Long Term Disability

Helpful information about Long Term Disability (LTD) insurance

Very often employers provide or individual workers obtain additional insurance policies known as Long Term Disability, aka LTD.  These types of insurance plans provide indemnity benefits to those individuals who are disabled under the terms of the LTD policy. Most of these plans require those persons entitled to benefits to also apply for Federal Social Security Benefits since the provider of the benefits would then be permitted (in most plans) to limit or reduce it’s obligation by the amount of the Federal Social Security Benefit as well as be reimbursed by the beneficiary for retroactive Social Security Benefits.  It is therefore important to know the requirements of your LTD policy as well as whether there is a set off for Workers’ Compensation Benefits. Most LTD policies are not used to reduce their payouts by the amount of any Workers’ Compensation benefit but, this does not mean they can not be written to provide such a credit to the benefit provider. Most LDT policies begin after the expiration of six months of being totally disabled. You should also be aware that each LTD plan has definitions of “total disability” both as to degree of disability and duration. It is usual for LTD policies to define compensability as being totally disabled for your past job as described in the policy  for a period of time but, a new definition may occur in most plans after a two year benefit year passes. It is therefore significant that not only do you read and understand the terms of your policy but that you review same with a professional so you understand your benefits. As discussed throughout this blog, no attorney client relationship exists and the information contained throughout this blog is for informative purposes or educational only. A proper retainer and face to face discussion is necessary to protect your rights since specific policies and facts as well as locations may effect the rights contained in such arrangements.

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