When You Have To Pay Back Long
Most long-term disability insurance policies contain a rule, called the offset provision, that requires you to apply for SSDI in addition to claiming LTDI benefits. If your LTDI policy has this provision and you receive SSDI payments, your LTDI benefits will be reduced by the amount you received in SSDI.
The Social Security Administrations definition of disability, which describes how disabled you have to be before youre eligible to receive benefits, is very strict, and most people get denied. In addition, it may take months or years to start receiving SSDI benefits. However, if youre granted benefits, youll receive a lump-sum catch-up payment for every month the SSA spent processing your eligibility.
During the time you spent waiting for SSDI benefits, your LTDI benefits may have already started paying out. If your LTDI policy has the offset provision, you may have to pay all or part of the catch-up payment to the insurance company to offset the amount the company was obliged to pay you during that time.
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Social Security Disability Benefits
The most common reason that claimants owe long-term disability benefits back to the insurance company is that they begin receiving Social Security Disability Income benefits. More often found in group policies, or a policy that you get through your employer, the long-term disability insurer is entitled to offset your monthly long-term disability benefits based on the disability compensation you receive from Social Security. Typically, the application process for SSDI benefits takes longer than the process of applying for long-term disability.
I Received My Notice Of Computation Why Havent I Received A Benefit Payment
This notice does not confirm that you are eligible to receive benefits.
We send you the Notice of Computation to let you know your potential weekly and maximum benefit amount based on the wages you earned in your base period. We may need more information before making a decision about your eligibility.
Get Your Doctors Approval To Work
Before considering any work or business opportunities that will require you to perform tasks of any nature, it is critical to seek the support and approval of your medical team. There are several reasons for this.
First, you want to be sure to review any of the types of tasks you will be undertaking while working, even if they are light ones or you will be sitting. It can help identify any modifications that you need to work without reinjuring your body.
Second, your doctor will be able to support your goals of returning to work so you can have the proper medical documentation to do so when you are ready.
We May Be Able Help If You:
- You had to stop working due to disability
- Were covered under an ERISA long term disability policy
- Were denied LTD benefits and received a denial letter
- Your Doctors agree that your disability caused you to have to leave your job
There are very strict time limits to appeal your disability claim and it is definitely not something that you should try to handle on your own . While our law firm does not handle social security cases, we can recommend a few very reputable attorneys to help you. This is a test.
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Many Ltd Policies Contain Social Security Offset Provisions
If you read your LTD policy or summary plan description , youll likely find several terms and conditions involving Social Security benefits. First, the plan might insist that you file for Social Security disability benefits once you become eligible for long-term disability. Second, it may claim an offset for any Social Security benefits you and your dependents receive.
Suppose your LTD policy pays you $2,000 per month in benefits. If the Social Security Administration approves your disability claim, and you receive $1,500 in disability benefits each month, the insurance company will reduce your LTD payments to $500. Many insurance companies aggressively enforce these provisions.
- RELATED ARTICLE: What Are the Advantages of Private Disability Insurance vs. Social Security Disability Income?
Individual Long Term Disability Insurance
When youre buying disability insurance for yourself either as a standalone policy or to supplement group coverage you have more freedom to tailor it to your needs. As its paid for with after-tax dollars, the replacement income it provides is also tax-exempt. Its most often bought through a financial advisor if you dont have one, or if that person doesnt have much experience with this type of coverage, a Guardian financial professional can give you a disability insurance quote. The cost of an individual LTD policy can vary greatly based on the waiting period and benefit period as well as benefit amount, age, gender, occupation and optional provisions added to your coverage. You can expect to pay between 1% to 3% of your annual salary.
When you discuss disability plans with your financial professional, be prepared to share as much as you can about your financial situation and goals, so that he or she can tailor your disability policy to your needs. Ask a lot of questions and make sure you get clear answers:
- How much coverage can I qualify for?
- How does the definition of disability work? Is it own-occupation or any-occupation? What conditions are covered?
- How long will benefits be payable, and when do they begin?
- Could my policy be changed or cancelled or could my premium increase?
- How do I make a claim if and when needed?
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Still Have Questions Call Our Kansas City Long Term Disability Attorney
The issues surrounding denials and appeals of long-term disability and the impact of an award of Social Security disability can be complicated, but an experienced long-term disability attorney can help. If you have a long-term disability denial, heres what you should do right now:
1. and get the information you need so you can be prepared to fight for your disability benefits. We will review your denial letter for free and give you a strategy to get back on claim.
2. Download our free guidebook for long-term disability appeals, Danger: Proceed at Your Own Risk, which is packed with helpful tips and concrete steps on how to file an appeal.
3. Call us at 816-203-0143 or fill out the form below. But don’t wait until after you file your appeal. If you already filed your appeal, we can only be able to help if your policy allows a second appeal. Most policies dont allow for that so don’t risk it — contact our Kansas City long-term disability insurance lawyer today.
Everything You Always Wanted To Know About Disability Offsets
Q: What are offsets?
A. Offsets are provisions in your disability coverage that allow your insurer to deduct from your regular benefit other types of income you receive or are eligible to receive from other sources due to your disability. Common types of offsets include, but are not limited to, Social Security disability benefits, workers compensation benefits, and benefits from state disability programs like those offered in California, New York, New Jersey, Rhode Island, and Hawaii. Other common offsets include employer-provided disability retirement benefits, and in some cases, income received from a third party who may have caused the injury that resulted in your disability.
Q. Where can I find offset wording in my disability policy?
A. Usually the section of the policy that explains your benefit amount will have language indicating that the insurer is allowed to deduct other benefits or other income benefits. The policy will then have a separate section shortly thereafter explaining what types of benefits constitute other benefits, and how the insurer will offset them from your regular benefit.
Q. I got my disability policy through my employer but I dont have my master policyjust an explanation of benefits. Is that enough to tell me what offsets are in my policy?
Q. Does ERISA say what kinds of offsets insurers can take and which they cant?
Q. Why are insurance companies allowed to offset my disability benefits?
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Overpayments Due To Calculation Mistakes
It is not uncommon to see a carrier allege that a mistake has been made in calculating the regular monthly benefit. Mistakes can occur due to an omission of information by the claimantâsuch as in the case of receipt SSDI Dependent/family benefits. Often, claimantâs do not realize that SSDI benefits paid for their children, as long as it was paid as a result of the claimantâs disability are considered an offset. Also, the failure to apply for dependent benefits may not excuse you from having your benefits reduced by your LTD carrier as long as those benefits are âpayableââyou may be required to apply for any additional benefits for which you may be eligible as a result of your disability. In these situations, there is normally no question that the carrier will want you to repay the money.
If the mistake resulted from an internal accounting error then many times the insurance company will waive the overpayment but will apply the correct amount going forward from the date the error is discovered. However, some carriers, such as Reliance Standard, have been known to include specific language in their policies stating they have the right to be reimbursed for an overpayment even if the miscalculation was entirely their fault!
What Is The Difference Between Ltd And Ssd
LTD and SSDI are separate and distinct types of disability benefits. Long-term disability is a type of private insurance that is most commonly offered to an employee through his or her employer . Typically, the employer or the employee will pay a monthly premium amount to an insurance company. In the event that the employee becomes disabled, regardless of whether or not the disability is related to work, LTD benefits will pay a percentage of the employees lost wages. Usually, this percentage is approximately 60 percent.
SSDI, on the other hand, is for people who have paid into the Social Security insurance fund and incur a disability that leaves them unable to be gainfully employed. SSDI benefits are awarded in a monthly amount, which is determined by how much the employee has earned on their Social Security record.
So you can see when comparing long term disability vs social security disability that each presents a separate and distinct type of benefit.
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Why Has My Long Term Disability Claim Been Denied Why Have My Long Term Disability Benefits Been Terminated
An insurance company may deny your long term disability claim or terminate your long term disability benefits for a variety of reasons. Some of these might have a simple solution, such as making sure that they have all the necessary forms and documentation, but in other cases it might require the assistance of a lawyer to help you in your claim against the insurer in order to get the benefits that you are entitled to.
Issues may arise if you are not examined by insurance company approved doctors, you exceeded the time limitation in submitting a claim, there was a misrepresentation on the application as you had a pre-existing condition that you did not mention, there is surveillance evidence that contradicts your claim, there was a failure to have your injury or condition properly documented by your physician, you have not mitigated your losses by maintaining your treatment regimen, or there was a failure of your employer to provide the necessary documentation.
Similarly, insurance companies may argue that you do not have a claim or that you are partially or residually disabled . Instead, you are able to work part-time or with modified tasks. It may also consider your loss of earnings as a result of the medical condition. However, the benefits you would receive would be less than if you were receiving long term disability benefits.
Watch these videos explaining the top 10 reasons why an insurance company might deny your long term disability claim :
Do I Have To Pay Back My Long
Victor PeÃ±aJan. 1, 2021
There are several reasons why you may be asked by your Long-Term Disability company to pay them back benefits they already paid you. The request is usually as a result of an overpayment claimed by the insurer. The overpayment can be due to your recent receipt of deductible income from a source considered offsetable under your policy. The overpayment can also result from a miscalculation due a mistake by you or your disability insurance company.
Going through the process of applying for and being granted disability benefits can be a long journey. Delays and requests for additional documents are not uncommon. You may even be asked to be examined by an unfamiliar doctor, further lengthening the process. All of this can result in more frustration when your insurance company asks you for much of the money back.
If you have been contacted by your long-term disability carrier about an overpayment, you may be wondering if you have to repay that money. Letâs take a look at how disability carriers treat overpayments and what you can do to ensure that you are complying with the rules surrounding long-term disability benefits.
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Can The Insurance Company Force Me To Apply For Cpp Disability
Yes, an insurer can force you to apply for CPP disability. Again, the policy gives them this right. Most policies do this, but not all. Technically, you can refuse to apply for it. If you do, then they will guess what CPP would pay you. Then, they can deduct it from their payment.
They can also force you to apply for other benefits, including:
- Workers compensation
- Other disability insurance policies
When I Sue The Insurance Company For Disability Benefits What Do I Actually Sue For
In long term disability actions you are suing for the payment of the disability benefits to which you are entitled. If you and your lawyer decide that the insurance company acted unfairly when they denied your claim you may also sue for bad faith. Your lawyer will also make a claim for pre- and post-judgment interest on the amounts claimed along with a financial contribution from the defendants which will go towards your legal fees.
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I Just Received A Letter From My Insurance Company Terminating My Benefits What Should I Do
It is important that you try to find out why your benefits have been terminated. Carefully reading over the letter that your insurance company sent you may provide this information. For example, if your benefits were terminated because you did not send the insurance company the proper documentation contact your insurance provider and arrange for the necessary forms and documentation to be sent to them as soon as possible.
However, if the reason for your termination is that the insurance company no longer finds that you are disabled enough as to require benefits even though your doctor maintains that you are still disabled, contact a disability insurance lawyer.
How Long Benefit Payments Should Last
People buy LTD policies to replace income for as long as theyre disabled, so benefit period length is among the most important decisions to make when applying for a policy. Standard choices include 2, 5, or 10 years to age 65 and to age 67. A few companies, including Guardian, offer coverage to age 70. While a longer benefit period is clearly desirable, it comes at a cost. How do you make right choice for your needs?
The average duration of a long term disability is 2.5 years2, but remember thats just an average. Some disabilities are shorter, but many are longer, so a 2-year benefit may not provide the reassurance youre looking for. Even though you have no way of knowing what form your disability will take , from statistical standpoint a 5-year benefit is much more likely to cover your needs. But there are good reasons to opt for an even longer period.
Consider getting benefits to retirement age. The premiums for a policy that provides benefits into or through your 60s may not be much higher than the premiums for a 5-year plan. Why? Insurance companies calculate the risks associated with each policy, and they know they may nothave to pay benefits for more than 5 years on most disability claims. So, they can offer a longer benefit period at a relatively low added cost.
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What Qualifies For Long
The qualifications for long-term disability are usually more stringent than those for short-term disability. With short-term disability, benefits can be awarded if the employee is unable to do their job. With long-term disability, benefits will typically only be awarded if the employee is unable to do any job. What constitutes a qualifying event will be specified in the policy, so it is important to understand when benefits may apply before accepting a long-term disability policy.
Qualifying events may include chronic pain, cancer treatments, or debilitating illness or injury lasting more than 26 weeks. If an employee could qualify for another form of income replacement, such as Social Security Disability Insurance, the long-term disability policy will no longer provide benefits.
What Policy Riders Can You Purchase With Long Term Disability Policies
A policy rider or endorsement provides extra coverage to your already existing long term disability policy. These riders are usually only offered with private disability policies and if not purchased at the time of the original application, will require that a medical form be completed before the rider can be added into the policy.
a) Cost of Living AdjustmentThis rider policy considers your salary and inflation yearly and adjusts your benefits accordingly.
b) Own Occupation to 65Professionals or people with specialized skills may find this rider policy beneficial as it eliminates the Any Occupation Test and provides the disabled individual with long term disability benefits as long as he/she is unable to perform the essential duties of their own occupation or until age 65, whichever is sooner.
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