VDI vs CASDI Calculator 2026: Compare California Disability Rates & Save

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2026 VDI vs CASDI Costs: Instant Comparison

See how VDI and CASDI compare across different income levels. These examples assume a VDI rate of 0.95% with a $1,727.10 cap (common for many employer plans). Your actual VDI rate and cap may differ — use the calculator above for your specific numbers.

*VDI costs assume a 0.95% rate with a $1,727.10 cap, based on typical employer plans like Pepperdine University's. VDI rates vary between 0.50%–1.00% and cannot legally exceed 1.30% — your savings may be higher or lower.

What These Numbers Mean for Your Paycheck

For a $100,000 salary, CASDI costs $1,300 per year — about $50 per biweekly paycheck. VDI at 0.95% costs $950 per year — about $36.50 per paycheck. That's a $13.50 savings per pay period, or $350 per year. For high earners above $200,000, the savings are even larger because VDI plans often have a cap while CASDI does not.

2026 California Disability Rates at a Glance

The 2026 CASDI rate is 1.3% with no wage cap. VDI rates vary by employer, typically ranging from 0.5% to 1.0%, and cannot exceed the state SDI rate of 1.3%. Both plans provide the same maximum weekly benefit: up to $1,765 per week, with lower-income workers receiving 90% wage replacement and higher-income workers receiving 70%.

CASDI (State Plan) Rate: 1.3% — No Wage Cap

The state CASDI rate increased from 1.2% in 2025 to 1.3% in 2026. This means every dollar of wages is subject to the deduction. There is no maximum wage base. For example, an employee earning $100,000 pays $1,300 in CASDI tax. An employee earning $250,000 pays $3,250.

VDI (Voluntary Plan) Rate: Varies by Employer — Cannot Exceed 1.3%

VDI rates are set by employers and their private insurers, subject to one firm legal limit: the employee contribution rate cannot exceed the state SDI rate (1.3% in 2026), as required by the California Unemployment Insurance Code. In practice, typical rates fall between 0.5% and 1.0%. Many employers also cap the annual VDI contribution. For instance, Pepperdine University's VDI rate is 0.95% with a $1,727.10 cap. Marvell Benefits offers a VDI rate of 0.50% with a different cap structure.

Maximum Weekly Benefit (Both Plans)

Both CASDI and VDI provide the same maximum weekly benefit of $1,765 in 2026. The benefit is calculated as 70% to 90% of wages depending on your income level: workers earning at or below approximately 70% of the State Average Weekly Wage ($1,789 in 2026, so roughly $63,000 per year) receive 90% wage replacement; workers earning above that threshold receive 70%, up to the $1,765 weekly cap. This tiered structure was established by SB 951 and SB 1090, effective January 2025. The benefit amount does not differ between the two plans — only the cost to employees differs.

What Is CASDI? (California State Disability Insurance)

CASDI is California's state-run disability insurance program. It provides short-term wage replacement for workers unable to work due to non-work-related illness, injury, or pregnancy. Every California employee pays into CASDI through payroll deduction. Use our California CASDI / SDI Tax Calculator to see exactly how much you'll pay.

How CASDI Is Funded

CASDI is 100% employee-funded. Employers do not contribute to the state disability insurance program. The current 2026 rate is 1.3% of gross wages, with no maximum wage cap. Your employer withholds this amount from each paycheck and remits it to the EDD (Employment Development Department).

CASDI Eligibility Requirements

• Have earned at least $300 in wages during a 12-month base period
• Be unable to work for at least 8 days
• Be under the care of a licensed physician or practitioner
• Have a valid claim filed with the EDD

CASDI Benefits: What You Get

CASDI pays 70% to 90% of your wages, up to a maximum of $1,765 per week in 2026. Workers earning at or below approximately 70% of the State Average Weekly Wage receive 90% wage replacement; higher-income workers receive 70%, up to the weekly cap. Benefits are available for up to 52 weeks. CASDI also covers Paid Family Leave (PFL) for bonding with a new child or caring for a seriously ill family member.

What Is VDI? (Voluntary Disability Insurance)

VDI is a private, employer-sponsored alternative to California's state disability insurance. Employers offer VDI plans through private insurers to replace or supplement the state CASDI program. VDI plans must provide benefits equal to or better than CASDI, and the employee contribution rate cannot exceed the state SDI rate of 1.3%.

How VDI Plans Work

Employers contract with private insurance carriers to offer VDI. Employees are automatically enrolled or given the option to enroll. The employer sets the contribution rate (up to the 1.3% legal maximum) and any wage cap. Contributions are deducted from each paycheck, similar to CASDI. When you need disability benefits, you file a claim with the private insurer, not the EDD.

VDI Requirements: Must Be Equal or Better Than CASDI

California law requires that any VDI plan offer benefits at least as generous as the state CASDI program. This includes:

• Weekly benefit amount (70% to 90% of wages, up to $1,765 per week in 2026)
• Benefit duration (up to 52 weeks)
• Eligibility criteria
• Appeal rights

Private plans may offer additional benefits, such as higher maximums or shorter waiting periods, but they cannot provide less than the state minimum. Additionally, the employee contribution rate for any VDI plan cannot exceed the current state SDI rate.

VDI Opt-Out Rights

Employers offering VDI must give employees the right to opt out and remain in (or revert to) the state CASDI plan. Your employer must provide clear opt-out instructions, usually during open enrollment or when you are first enrolled in VDI. You are never required to stay in VDI — you always have the option to switch to CASDI.

Key Differences: VDI vs CASDI

VDI and CASDI both provide disability insurance, but they differ in cost, administration, claim handling, and portability. Use the table below to compare the key dimensions side-by-side.

Comparison Table

Cost Difference

VDI is usually less expensive for employees because employers can subsidize premiums, and private insurers often offer lower rates than the state's 1.3%. California law also prohibits VDI employee rates from exceeding 1.3%, ensuring employees are never charged more than the state plan. At a $100,000 salary, CASDI costs $1,300 per year. A typical VDI plan at 0.95% costs $950 — a $350 annual savings. See how these deductions affect your net pay with our California Paycheck Calculator.

Benefit Difference

Both plans pay the same weekly benefit: 70% to 90% of wages, up to $1,765 in 2026. Lower-income workers (earning at or below approximately 70% of the State Average Weekly Wage, roughly $63,000 per year) receive 90% wage replacement; higher-income workers receive 70%. The benefit amount is identical by law — the difference is not in how much you get, but in how much you pay and how you file a claim.

Claim Process Difference

CASDI claims are filed with the EDD through an online portal. VDI claims are filed with your employer's private insurer. Processing times can differ. Some employees report faster payments from private insurers, while others express concerns about claim denial rates. VDI claims are regulated by the EDD, so you have appeal rights similar to CASDI.

Tax Treatment Difference

Both CASDI and VDI contributions are after-tax deductions from your paycheck. They are not deductible on your federal income tax return. Disability benefits received from either plan are generally taxable if your employer paid the premiums; if you paid the premiums with after-tax dollars, the benefits are tax-free. Most employees pay their own premiums, so benefits are typically tax-free.

Portability Difference

This is a critical factor. CASDI stays with you — you are covered by the state program regardless of where you work, as long as you are a California employee. VDI ends when you leave your employer. If you switch jobs, you revert to CASDI. This is a key consideration if you plan to change jobs frequently.

Why Are There Two Rates? (SB 951 Explained)

The split between VDI and CASDI rates traces back to California Senate Bill 951 (SB 951), enacted in 2022 with changes taking effect in 2024 and 2025. The legislation expanded Paid Family Leave (PFL) benefits, which required additional funding. The result was a separation of the disability insurance rate structure.

What SB 951 Changed

Before SB 951, California had a single SDI (State Disability Insurance) rate with a taxable wage ceiling. The 2022 legislation permanently eliminated the taxable wage ceiling (effective January 1, 2024) and began increasing benefits. A follow-on law, SB 1090 (signed September 2024, effective January 1, 2025), further increased the wage replacement rate to 70%–90% of wages — 90% for lower-income workers and 70% for higher-income workers — up from the previous 60%–70% range. These reforms also created a clearer framework for voluntary plans (VDI) to continue operating alongside the updated state program.

The CASDI Rate Increase

The CASDI rate increased from 1.2% in 2025 to 1.3% in 2026. This increase funds the expanded PFL benefits and the overall state disability insurance program. The rate applies to all wages with no cap, meaning every dollar earned is subject to the deduction.

How VDI Fits In

VDI plans predate SB 951 and are not directly affected by the rate increase — employers and insurers set their own rates, subject to the legal ceiling of 1.3%. However, VDI plans must still offer benefits at least as generous as the state program, including the 70%–90% wage replacement rate and $1,765 weekly maximum. This means VDI plans must match the increased benefit levels, but they can maintain lower contribution rates through employer subsidies and efficient private insurance operations.

VDI vs CASDI: Which Should You Choose?

The answer depends on your income, job stability, employer plan quality, and personal preferences. Use this decision framework to guide your choice.

Decision Matrix

When VDI Makes Sense

• Your employer offers a rate below 0.95% (many do)
• You earn over $150,000 and the cap creates significant savings
• You plan to stay with your employer for 3+ years
• Your employer's VDI plan has a good reputation for claims processing

When CASDI Makes Sense

• Your employer's VDI rate is 1.0% or higher (minimal savings)
• You earn under $75,000 (savings are less than $200/year)
• You frequently change jobs and value portability
• You want the security of a state-run program

Real-World Example

"I earn $100,000 and my employer's VDI rate is 0.70% with a $2,500 cap. CASDI would cost me $1,300. VDI would cost me $700 (0.70% × $100,000, well below the cap). I save $600 per year — a clear decision to choose VDI. But I plan to change jobs in 12 months, which would end my VDI coverage. That's $600 in savings but I lose coverage when I leave."

What About Claim Denial Risk?

This is a common concern, especially in forum discussions like Bogleheads. VDI claims are regulated by the EDD and must follow state standards. Appeal rights exist for both CASDI and VDI. If you're concerned, research your employer's specific VDI insurer and claims reputation before opting in.

How to Opt Out of VDI (Step-by-Step)

If you decide VDI isn't right for you, you have the right to opt out and revert to CASDI. The process varies by employer, but these are the typical steps.

Step 1: Check Your Paystub

Look at your paystub for a deduction labeled "VDI," "VPDI," "Voluntary DI," or similar. This confirms you are enrolled in VDI. Also check the deduction amount and rate — this is your baseline for comparison.

Step 2: Review Your Employer's VDI Plan Documents

Your employer is required to provide a Summary Plan Description (SPD) or similar document explaining the VDI plan. This document will include:

• The VDI contribution rate and any cap
• The claims process and contact information for the insurer
• Instructions on how to opt out
• The deadline for opt-out requests

Step 3: Submit an Opt-Out Notice

Your employer will have a specific process for opting out. This could be:

• A form you fill out and submit to HR
• An online enrollment portal with an opt-out option
• A written request sent to your benefits administrator

Submit your opt-out notice before the deadline. Deadlines vary but are often tied to open enrollment or your initial VDI enrollment date.

Step 4: Confirm Your Enrollment in CASDI

After you opt out of VDI, you will be automatically enrolled in CASDI. Confirm this on your next paystub — the deduction should now be labeled "CASDI" or "SDI" at the state rate of 1.3%. Keep a copy of your opt-out confirmation for your records.

2026 Rate Updates — What's Changing

The 2026 tax year brings important changes to California disability insurance rates. Here's what's new and how it affects you.

CASDI Rate Increased from 1.2% to 1.3%

The most significant change is the CASDI rate increase. In 2025, the rate was 1.2%. In 2026, it rose to 1.3%. This 0.1 percentage point increase adds $100 to the annual cost for every $100,000 of wages. For example — calculate your own numbers with our California CASDI / SDI Tax Calculator:

• At $50,000: 2025 cost was $600; 2026 cost is $650 (+$50)
• At $100,000: 2025 cost was $1,200; 2026 cost is $1,300 (+$100)
• At $200,000: 2025 cost was $2,400; 2026 cost is $2,600 (+$200)

No Wage Cap Remains

Unlike previous years when a wage cap existed (e.g., $153,164 in 2023, the last capped year), there is no wage cap for CASDI in 2026. Every dollar of wages is subject to the 1.3% deduction. High-income earners pay the full rate on all wages.

Maximum Weekly Benefit Increased to $1,765

The maximum weekly benefit increased from $1,681 in 2025 to $1,765 in 2026. Benefits are calculated as 70% to 90% of wages depending on your income level, up to the weekly cap. The benefit increase helps California workers maintain more of their income during disability or family leave.

VDI Rates Remain Employer-Specific

VDI rates are not directly affected by the state rate increase. Your employer's VDI rate is set by their contract with the private insurer, subject to the legal ceiling of 1.3% (the state SDI rate). Some employers may adjust their VDI rates, but many maintain stable rates that remain well below the state's 1.3%.

Why Did the Rate Increase?

The rate increase funds the expanded Paid Family Leave (PFL) benefits enacted by SB 951 and further expanded by SB 1090. The PFL benefit increased from 60%–70% to 70%–90% of wages, and eligibility expanded. The additional funding ensures the program remains solvent while providing higher benefits to California workers.

Methodology & Data Sources

All rates, benefit amounts, and calculations on this page are based on official 2026 data from the California Employment Development Department (EDD) and publicly available employer benefit plans. Rates are verified against multiple sources including university benefit pages, payroll software documentation, and legislative updates.

Data Sources

• California Employment Development Department (EDD) — Official SDI contribution rates and benefit schedules
• California Senate Bill 951 (SB 951) — Legislative framework for disability insurance rates and wage cap elimination
• California Senate Bill 1090 (SB 1090) — Expanded wage replacement to 70%–90%, effective January 2025
• Publicly available employer VDI plan documents (Pepperdine University, Marvell Benefits)
• California State Disability Insurance program guidelines
• California Unemployment Insurance Code (CUIC) — VDI employee rate ceiling requirements

Calculation Methodology

• CASDI Cost = Gross Annual Wages × 0.013 (1.3%)
• VDI Cost = Gross Annual Wages × (Employer VDI Rate ÷ 100), capped at the employer's specified annual maximum if applicable. Enter 0 in the cap field if your plan has no contribution cap.
• Annual Savings = CASDI Cost − VDI Cost
• Paycheck Impact = Annual Savings ÷ 26 (bi-weekly pay periods)
• Effective Rate = Total Annual Cost ÷ Gross Annual Wages

This calculator provides estimates based on 2026 rates and typical employer VDI plan structures. Your actual deductions and savings may differ based on your employer's specific VDI plan, wage structure, and payroll frequency. Always verify your payroll deductions with your employer and consult the official EDD website for the most current rates and regulations.

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