Commonly Asked Questions About Long Term Disability
In general, its best to have enough disability coverage to replace 60% of your after-tax income. However, this number can vary on a number of factors, such as recurrent debt payments and monthly living expenses.
Use our Disability Insurance Coverage Calculator to find out how much coverage is right for you.
The length of time you can receive benefits depends on your policys Maximum Benefit Period, which is determined by your employer. Once the elimination period is satisfied and you continue to meet the definition of disability, your Long Term Disability Insurance benefits can extend through the Maximum Benefit Period.
The disability benefit may be reduced if you are receiving income from other insurance policies, retirement or government programs.
Is There A Social Security Offset For Metlife Disability
Most disability policies obtained through an employer have a deduction for social security disability benefits. You can write Metlife and ask them to clarify in writing their right to a social security offset. There is no guarantee that your wife will receive long term disability benefits the rest of her life.
How Long Will Social Security Disability Benefits Last
Many people are under the mistaken assumption that Social Security Disability benefits last forever. This isn’t necessarily the case. While many people will receive Social Security Disability benefits until they reach the retirement age of 65, not everyone will. For those who do receive Social Security Disability benefits until age 65, Social Security benefits will not just stop altogether. They will simply change from Social Security Disability benefits to Social Security Retirement benefits. There are, however, some instances in which a Social Security Disability beneficiary will have their disability benefits stopped prior to reaching the age of 65.
Why Social Security Disability Benefits End
There are a number of reasons why Social Security Disability benefits would be revoked after being instated. The most common reasons for a stop in Social Security Disability benefits are improvement of one’s disabling condition, incarceration, or a return to work. How long you receive Social Security Disability benefits will be determined by whether or not these factors come into play and, if so, when. For example, someone could begin receiving Social Security Disability benefits in 2010 and those benefits could go under review in 2013. If the Social Security Administration decides that the person is no longer disabled, the benefits could stop.
How to Keep Your Social Security Disability Benefits in Effect
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After Approval For Long
You still have to deal with the insurance company after they approve you for long-term disability. They will monitor your condition and treatment. They may ask you to see a doctor. Or, they might enroll you in a treatment program. But ultimately, its your responsibility to follow the rules of your plan.
So, to keep your benefits, you must carefully manage your relationship with the insurance company. You will need to do what they ask, even if you disagree with it. The following are common issues that happen after claim approval.
Returning To Work With Changes To Your Schedule
You should immediately notify your manager if your physician has certified that you are able to return to work, but that you are:
- no longer able to carry out the duties of the position
- in a rehabilitation program
- recommended for a reintegration process
- not able to return to work on a full time basis
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What Does Long Term Disability Insurance Cover
Here are the top five reasons for filing long term disability claims:
As you can see, the scope of disabling events is wide. That’s why perhaps the most important factor when considering long term disability insurance is a policy’s definition of disability.
How a policy defines disability will determine how much, and even if, you collect benefits following an injury or illness. Some policies will pay out a monthly benefit if an injury prevents you from working at your normal job, but allows you to do other types of work that will nonetheless reduce your income. Other policies will not pay benefits if you are able to work in another type of profession, even if you earn less money.
A policyâs definition of disability is based on your capacity to work. Maybe youâre unable to work in your chosen profession, but can do other work. A disability may allow you to work in a reduced capacity. Serious ailments can prevent you from working in any job.
To collect on a claim, you must meet the policyâs definition of disability. This can vary greatly by company and policy. The broader the definition, the more it will cost.
Long Term Vs Short Term Disability Insurance
Created by FindLaw’s team of legal writers and editors
Disability insurance is an insurance policy that covers some of an individual’s lost income while that individual is unable to work due to an illness or injury. Some disability insurance policies cover workers for a short period of a matter of months, while others provide stable benefits for decades. Deciding whether to get short term, long term, or both types of disability insurance depends on the individual worker’s needs, expectations, and budget.
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Need Help Filing A Disability Claim Get Legal Help Today
With so many different types of disability insurance, options, and various involved parties, the process can get overwhelming for anyone without a law degree. Have additional questions? Learn more on our disability law legal answers page or contact a disability lawyer to learn more about private disability insurance, and an ERISA lawyer for questions regarding employer-sponsored disability benefits.
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How Much Is My Long
With a private or individual LTD insurance policy, you get to choose your income benefit amount, up to a maximum allowed by the insurer. Your income benefit maximum caps out around 50-60% of your current income.
You can also get a cost of living adjustment rider, which increases your monthly income benefit amount to keep up with inflation.
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Women Pay More Than Men
Even with all other factors being equal, women can pay up to 40 percent more in premiums than men for disability insurance. Thatâs because women suffer disabilities that impact their careers, such as breast cancer, autoimmune disorders, and depression, more than men. Disability claims for women also typically last longer than those for men.
- A 40-year-old male applying a $3,300 monthly benefit will pay $61 a month.
- A 40-year-old woman getting the same coverage will pay $80 a month.
For what it’s worth, the gender price gap for disability insurance is the opposite of life insurance. Women consistently live longer than men, which means they get the same preferential treatment you see men getting here.
Best For Customization: Guardian Life
With four policy types offered and a slew of riders and coverage options, Guardian Life is our preferred choice for customization of your disability insurance. Options include group policies and supplemental insurance coverage. To help you further customize your policy, you can choose between riders like a future benefits increase, guaranteed renewability, and student loan protection, allowing you to completely customize a policy according to your needs.
Variety of riders and policy options to choose from
Quotes are available online for some applicants
Discounts available for preferred occupations such as a 10% discount for physicians
Many applicants will need to speak with a representative to get a quote and/or purchase coverage
Elimination periods can last up to 720 days
Policies are not geared toward group plans and professional workers
Medical exam likely required
Founded in 1860 and backed by Berkshire Life Insurance Company of America, Guardian Life offers a number of disability insurance options including long-term coverage. The company holds an A++ rating from AM Best.
Long-term policies can replace up to 60% of your income, with benefits lasting five years, 10 years, 20 years, or until you reach retirement. Some policies will allow you to renew your coverage beyond age 65 if you are still employed and not disabled. Every policy is different, but a typical elimination period is usually 3 months long.
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Disability Statistics For New Jersey
The initial approval rate for Social Security Disability benefits is slighlty higher in New Jersey than the national average approval rate, as is the approval rate after a disability hearing. Your chances of getting approved after your hearing are even higher if you are represented by a disability lawyer or nonattorney representative at the hearing.
The wait time for disability hearings is four months shorter, on average, than the national average wait time. Below is a comparison of the approval rates and hearing wait times for New Jersey and the national averages.
Telephone: 964-5769Fax: 317-3421
Services the following field offices: Brick, Bridgeton, Cherry Hill, Egg Harbor Township, Glassboro, Mount Holly, Neptune, Rio Grande, Toms River, and Trenton
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Options To Make It Through A Long Elimination Period
The longer the elimination period, the longer youâll need to find other ways to replace your lost income. Without a paycheck or long-term disability insurance benefits, youâll need to turn to sources like credit cards, loans and other debt, the charity of friends and family, short-term disability insurance , and more severe budget cuts than you were planning. What compromises youâre willing to make in order to make payments in your life will contribute to your decision about the elimination period.
One way to at least somewhat circumvent this dilemma is with an emergency fund. There isnât a set amount of emergency funds that you should have set aside â personal finance experts typically recommend anywhere from 3 monthsâ worth of expenses to a full year â and the size of your emergency fund can dictate how long to make your elimination period. Youâll have to rebuild your fund at some point afterward, but you wonât have to worry about things like racking up credit card bills, defaulting on payments, or paying others back. Itâs the perfect use case for an emergency fund: money whose explicit purpose is covering your expenses while you donât have income.
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How To Choose The Right Waiting Period
Choosing a waiting period should be considered carefully. If you have enough savings to last a few months, you can go for a more extended elimination period. But, if you have many expenses and dont have much savings, you should choose a shorter waiting period. The standard waiting period is 90 days. However, you can cut it down to as short as 30 days or increase it to one year.
If you have STD insurance, then you can choose a more extended waiting period. STD benefits will cover your living expenses while you wait for LTD to kick in. Having both STD and LTD insurance will help you cope financially with a disability.
While a longer elimination period will help you save on premiums, you will need to ensure you have enough cash to get you through this time. Thats why you should check your financial situation to decide the best period for you.
If You Run Out Of Paid Leave
Depending on your circumstances, you may request that sick leave credits be advanced to you to cover the period of your absence. This type of leave request is covered to the limit prescribed in your collective agreement or terms and conditions of employment.
You may also request leave without pay for illness or injury. Refer to Appendix B of the Directive on Leave and Special Working Arrangements for additional information.
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How Long Do Long
Unlike with life insurance, auto insurance, and most other insurance products, long-term disability insurance does not pay out in a lump suminstead, after the claim is filed, the benefits are paid out gradually over a long period of time.
How long you can stay on long-term disability depends on which plan you have. Some benefit periods last two years, some last five or ten, and some even last until retirement age. Longer benefit period plans cost more money, but could be more cost-effective depending on when a person becomes disabled and how long it lasts.
Usually, a five-year benefit period is enough to cover peoples disabilities, since the average disability claim lasts for just under three years, according to the Council for Disability Awareness.
The average worker drastically underestimates the likelihood of becoming disabled at some point in their career. Indeed, 64 percent of those earning a wage believe their risk of becoming disabled for three or more months is two percent or less. However, they actually face about a 25 percent chance, according to the Council for Disability Awareness.
In the case of Unum, one of the largest insurance providers in the US, receiving the claim may be the challenge. Unum has been accused of bad faith insurance practices, denying claims on a regular basis.
Cost Of Living Adjustment
If you’ve been approved for benefits, you can expect your benefits to increase 1% to 3% each year if your policy contains a cost-of-living adjustment . The COLA may be part of your basic coverage or offered as an optional rider, and it is usually indexed to a well-known measure of inflation, such as the Consumer Price Index .
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Long Term Disability Insurance
Available through the workplace, this coverage helps maintain your standard of living if you’re unable to earn a paycheck due to an accident or illness
Covers essential living expenses: can help pay for food, clothing, utilities, your mortgage, car payments and more
Direct monthly payments: receive a portion of your salary paid directly to you each month if youre unable to work
Rehab incentives: coverage may include financial incentives designed to help you transition back to work
Easy claims filing: report claims online or by phone
Competitive rates: this group coverage is offered only through your employer
For complete plan details, talk to your companys benefits administrator.
A Guide To Claiming Long Term Disability
Long-term disability may be the result of an injury sustained on the job or in an automobile accident it may occur following a sporting mishap or because of a chronic illness. Recovery from surgery that requires ongoing rehabilitation or continuing medical treatment can limit the ability to perform normal duties at work, resulting in loss of earning power and a claim for long term. No one is totally protected against such loss, and even employees of companies with quality insurance programs would be wise to check on the benefits of private long term disability insurance.
Long term disability coverage is anyones best protection against serious financial difficulties that result from loss of income, no matter what your age or income level may be. Despite the reputation that surrounds some insurance, and the perceived difficulties involved in filing claims and receiving benefits, there are valid reasons to consider such insurance.
This guide is designed to answer some of the common questions you may have about disability insurance, filing a disability claim, and assuring that your long term disability claim is honoured. It should be used to broaden your understanding of the terms, limitations, benefits and types of various long term disability plans, including the various policies and claims procedures of different insurance companies. There are also differences in specific legal policies and procedures from one province to another.
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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?
Can They Force Me To Apply For Canada Pension Plan 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. 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
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