At this point in time you need to claim the income. The fact that the amount is in dispute does not change the reporting at present. If you do end up having to pay the amount back, there could be a tax treatment for that next year under a provision called a claim of right. But right now it is being reported as income. Therefore, unless you receive a corrected W-2 (particularly one that reports the amount in a box 12 with a code of J), the IRS (and your state, in all likelihood) is going to be expecting you to pay tax on that amount. Doing so will prevent greater potential difficulties later on.
Having said this, if your short-term disability premiums were paid for with after tax dollars (which is often the case), then it is likely that the insurance company is not only in dispute with the reason/amount they sent you, but also reporting the amount incorrectly. If your premiums were after-tax payments, your benefits are not taxable (dispute aside). In that case you most certainly will want to have a corrected W-2 sent to you, indicating the amount currently in box 1 to instead be reported in box 12 with a code of J indicating that it is a nontaxable benefit.
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