Jane Dotson
Disability Insurance Elective Coverage (DIEC) is an optional program for those who don't pay into State Disability Insurance (SDI) but want to be covered by Disability Insurance (DI) and Paid Family Leave (PFL). This includes small business owners, entrepreneurs, independent contractors, and self-employed people in California. To be eligible for DIEC, you must commit to two years of quarterly premium payments while self-employed. If you are unsure about your eligibility, you can contact the Taxpayer Assistance line for help with the application process.
How do I know if I have DIEC insurance?
| Characteristics | Values |
|---|---|
| Who is it for? | People who don't pay into State Disability Insurance (SDI) but want to be covered by Disability Insurance (DI) and Paid Family Leave (PFL). |
| Who does it protect? | Small business owners, entrepreneurs, independent contractors, or self-employed people. |
| Who is eligible? | People who recently lost their job as a federal employee, public school/agency employees, community college district employees, or members of an Indian tribe. |
| What does it offer? | DI offers benefits to those who can't work and lose income due to a non-work-related illness, injury, pregnancy, or childbirth. |
| What does PFL offer? | Benefits when you need time off to take care of a seriously ill family member or bond with a new child. It also covers participation in a qualifying event due to a family member's military deployment. |
| What are the requirements? | You need to commit to two years of quarterly premium payments as long as you remain self-employed. |
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What You'll Learn
Who is eligible for DIEC?
The Disability Insurance Elective Coverage (DIEC) program is offered to employers, independent contractors, and self-employed people who don't pay into State Disability Insurance (SDI) but want to be covered by Disability Insurance (DI) and Paid Family Leave (PFL). Small business owners, entrepreneurs, and general partners who meet the requirements can also apply for DIEC. However, limited partners and corporate officers are not eligible.
To be eligible for DIEC, you must not have a seasonal business, and you must stay in the program for two complete calendar years unless you discontinue your business or move out of California. You can apply for the DIEC program by completing the application and mailing it to the address on the form.
Usually, you are eligible for benefits after participating in the DIEC program for at least six months from the approved start date of your plan. However, if you worked as an employee in California and your employer previously deducted SDI contributions 5 to 18 months before your DIEC plan, you may have wage earnings in your base period, which could allow you to start your DI or PFL leave sooner. Benefits are based on the income credits during the four quarters of the base period of your claim, not on your actual earnings during those quarters. Income credits are based on net profit reported to the IRS on your tax forms up to four years prior, depending on the timing of your claim.
DIEC benefits are payable whether you are injured on or off the job, unless you carry workers' compensation coverage for yourself. You may continue to receive income or profits from your business and still be eligible for either DI or PFL benefits.
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What does DIEC cover?
The Disability Insurance Elective Coverage (DIEC) program is an optional coverage for individuals who don't pay into State Disability Insurance (SDI) but want to be covered by Disability Insurance (DI) and Paid Family Leave (PFL). DIEC is designed to protect small business owners, entrepreneurs, independent contractors, or self-employed people in California who don't qualify for SDI.
DIEC provides benefits to those who are unable to work and lose income due to a non-work-related illness, injury, pregnancy, or childbirth. This means that if you are unable to work due to a non-work-related issue, DIEC can provide financial support to help you get by. It's important to note that DIEC covers non-work-related issues, so any illness or injury that occurs at work or because of work would not be covered under this program.
Under the Paid Family Leave (PFL) component of DIEC, individuals are offered benefits when they need to take time off work for specific reasons. This includes taking care of a seriously ill or injured family member, such as a child, parent, grandparent, or spouse. PFL also covers time off for bonding with a new child, whether through birth, adoption, or foster care placement. Additionally, PFL allows individuals to participate in a qualifying event due to a family member's military deployment to a foreign country.
DIEC is an optional program, and individuals can choose to apply for coverage if they meet the eligibility criteria. The specific benefits and coverage details may vary, so it's important to review the program guidelines and regulations to fully understand what is covered and what is not. This information can typically be found on official government websites or by contacting the relevant government departments.
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What are the benefits of DIEC?
Disability Insurance Elective Coverage (DIEC) is an optional program for employers, independent contractors, and self-employed people who don't pay into State Disability Insurance (SDI) but want to be covered by Disability Insurance (DI) and Paid Family Leave (PFL). Here are the benefits of DIEC:
Coverage for Non-Work-Related Illnesses and Injuries
DIEC provides benefits when individuals cannot work and lose income due to non-work-related illnesses or injuries. This ensures financial support during periods of inability to work, providing peace of mind and security.
Paid Family Leave
DIEC offers Paid Family Leave (PFL) benefits, allowing individuals to take time off from work to care for seriously ill family members, bond with a new child, or deal with a family member's military deployment. This helps to alleviate the financial burden during these important moments.
Protection for Small Business Owners and Self-Employed Individuals
DIEC is specifically designed to protect small business owners, entrepreneurs, and self-employed people who may not be covered by traditional state disability insurance. This ensures that they have financial support and can maintain their income during periods of disability or family leave.
Flexibility in Income and Eligibility
Individuals enrolled in DIEC may continue to receive income or profits from their business while still being eligible for DI or PFL benefits. Additionally, eligibility for benefits is based on income credits during the four quarters of the base period of the claim, allowing for flexibility in income fluctuations.
Unemployment Benefits
If an individual with DIEC recently lost their job as a federal employee, they may be eligible for unemployment benefits. This provides an additional layer of financial support during periods of unemployment.
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How do I apply for DIEC?
The Disability Insurance Elective Coverage (DIEC) program is an optional coverage plan for people who don't pay into State Disability Insurance (SDI) but want to be covered by Disability Insurance (DI) and Paid Family Leave (PFL). DIEC is designed for self-employed individuals, independent contractors, and small business owners who don't have access to state disability insurance.
To apply for DIEC, you can follow these steps:
- Review the eligibility criteria: DIEC is offered to individuals who don't pay into SDI but want coverage for non-work-related illnesses, injuries, and PFL. Typically, this includes self-employed people, independent contractors, and small business owners.
- Download and complete the necessary forms: You can find the required forms on the EDD website or by calling 1-916-554-7104 to receive them by mail. The forms you need to fill out are:
- Application for Unemployment Insurance and State Disability Insurance Elective Coverage for Employees Exempted Under the California Unemployment Insurance Code (CUIC) (DE1378) (PDF).
- Application for Unemployment Insurance, State Disability Insurance, and Paid Family Leave Elective Coverage Under Section 708(a) of the Unemployment Insurance Code (DE 1378A) (PDF).
- Information Sheet: Elective Coverage for Employers and Self-Employed Individuals (DE 231EC) (PDF).
- Application for Disability Insurance Elective Coverage (DIEC) (DE 1278DI) (PDF).
- Submit your completed forms: You can submit your forms online through the EDD website or by mailing them to the provided address.
- Wait for a response: After submitting your application, you will typically receive a response regarding your eligibility for DIEC. If approved, your coverage will begin, and you will be responsible for paying premiums.
- Make timely premium payments: DIEC premiums are typically due by the last day of the month following the end of each quarter. Ensure you make your payments on time to maintain your coverage.
By following these steps, you can apply for DIEC and gain access to disability insurance and paid family leave benefits if you are a self-employed or independent contractor in California.
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Are there other options for independent contractors?
If you are an independent contractor, you can opt into Paid Family Leave (PFL) and State Disability Insurance (SDI) by applying for the Disability Insurance Elective Coverage (DIEC) program. This program is designed for individuals who don't contribute to State Disability Insurance but wish to be covered by Disability Insurance and Paid Family Leave. DIEC safeguards small business owners, entrepreneurs, independent contractors, and self-employed people who make up a large part of companies operating in California.
To be eligible for the DIEC program, you need to start paying into the program before you need to use it to establish a base period. The program also mandates that you commit to two years of quarterly premium payments as long as you remain self-employed. If you were previously employed and contributed to California State Disability Insurance (CA SDI) in the last 5-18 months, you may be eligible for DIEC based on that employment.
Additionally, as an independent contractor, you may also need to consider other types of insurance to protect yourself and your business. Here are some options to consider:
- General liability insurance: This type of insurance protects you from claims related to bodily injury or property damage that may occur while you are working. It can also help you comply with your clients' contractual requirements.
- Professional liability insurance: Also known as errors and omissions insurance, this coverage protects you if a client or customer accuses you of making a mistake or providing inadequate services.
- Endorsement to your homeowners' insurance: If you run a home-based business, you may be able to add an endorsement to your homeowners' insurance policy to obtain some commercial coverage.
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Frequently asked questions
DICE insurance is a type of production insurance for film and video production. It covers multiple projects within a year, so if you are working on several films or videos in a year and have insurance for all of them, you likely have DICE insurance.
DICE insurance covers a wide range of risks and liabilities associated with film and video production. This includes general liability, errors and omissions, and protection of recording media. It also provides workers' compensation, encompassing medical expenses, lost wages, and rehabilitation benefits for crew and staff members.
The cost of DICE insurance can vary depending on factors such as gross production costs and coverage options selected. Premiums can start at under $2,000 but can increase up to $35,500 or more for an annual policy.
