Have you applied and told you were not disabled?
Has your claim been approved, benefits paid for a period, then suddenly terminated?
Are you receiving benefits, but contemplating settling your claim, sometimes referred to as a buyout?
The manner in which Long Term Disability laws are applied can be very complex and how they impact you is unique to every situation.While we provide an overview of some basic information on this topic below, we are ALWAYS best able to help you when we can talk to you directly.
Many of the leading disability insurance companies engage in systematic strategies to deny claims. Aided by an ERISA law that gives them procedural advantages, these companies have many means at their disposal to intimidate or outwit legitimate claimants. It is our job to level the playing field for an individual who wants to use his or her energy to recover from their illness, rather than using that energy to fight with an insurance company.
Disability insurance, like life insurance, is used to protect future earnings. Disability insurance will replace your income in the event that you become physically unable to work. Although it gets less attention than life insurance, experts agree that disability coverage is equally important. While most people are prepared for the medical costs (through health insurance), without disability insurance, they are not prepared for the loss of wages that accompanies such a tragedy.
In general, if you count on your job to pay the rent and buy food, you should seriously consider disability coverage. Many employers offer disability insurance for their employees – however, the plans vary greatly, and some may not offer adequate coverage. And, all disability payouts from an employer’s policy are subject to taxes, while payouts from individual policies are not. Individual disability coverage is generally much more expensive than employer disability coverage; nevertheless, you should review any policies your employer has taken out, and consider purchasing individual coverage if the policy is insufficient.
Disability insurance comes in two types: short-term and long-term.
This coverage replaces a portion of lost income in the event the policy owner misses six months or less of work. The coverage typically begins after all sick leave is exhausted, and replaces close to 100% of wages for the first payouts. If the policy owner remains unable to work, however, the payments will eventually drop, often to 60% of wages. The length of coverage and payment percentage varies from plan to plan, but these percentages are most common.
Some experts contend that long-term disability insurance is the most important insurance you can purchase. This can be partially attributed to advances in medical care given that some diseases and injuries are now disabling rather than deadly (meaning that the incapacitation can be lengthy).
Typically, long-term disability insurance can be purchased to replace 50-70% of salary. Some employers allow employees to purchase extra insurance from the same company, sometimes raising the total to 80%. Note, however, that some policies have monthly maximum payouts, which may reduce the actual percentage of salary the policy owner receives. The “salary” is set at the time the policy is purchased, and you will likely want to increase the value of the plan as your compensation increases. Some plans only allow increases with a physical, some allow increases without a physical for the first few years of the plan, and some have other rules. It is important to check the plan for its particulars. Long-term disability policies vary in the length of payout: some policies will only pay out for 5 or 10 years, some will pay out until age 65. Experts recommend the latter. Policies also vary.
As a long term disability attorney, know that we have experience in Michigan courts throughout the state. We can evaluate your long term disability denial, and inform you of what steps should be taken. Consultations are free; we never get paid until you get paid.
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