What is State Disability?
State Disability Insurance (SDI) is a California insurance program run by the Employment Development Department. Insurance programs work by having a large group of people pay a monthly fee, called a premium, to receive a benefit when certain events happen. If you have fire insurance, for example, you pay a monthly premium that goes into a fund along with the premiums of everyone else on the policy. If your house burns down, the insurance company will take money from that fund and give you a check. The system works because most of the people paying premiums dont ever have a fire, but they want to be protected in case they do. See below for a list of the events that SDI covers. Paying into SDI Most California employees have to pay into the SDI system and are therefore covered by SDI. If youre covered, you automatically pay the SDI premium through a payroll tax. This means that every time you get a paycheck, part of it goes to the SDI program. In 2007, this amount is 0.6% of your paycheck
