Law

9 Must-know facts about LTD in the United States

Jean R. Proffitt

Long Term Disability (LTD) can be used in conjunction with Short Term Disability (STD) policies. Long-term disability insurance replaces 50-70 percent of your earnings before you could not work due to an injury that was not related to your job. If your workplace offers an LTD plan, it’s critical to enroll within the initial enrollment period, when you can’t be rejected coverage due to a pre-existing condition. Read the summary of your plan for definitions of what is covered, conditions that qualify for LTD in the United States and precise details required by your plan.

  1. Before you can start collecting LTD benefits, most LTD plans include a waiting period that lasts from 3-26 weeks, which corresponds to the amount of time you can be paid for STD payments.
  2. To maintain eligibility for benefits, precise medical information must be supplied to the LTD carrier at the start of the claim and then as needed during the duration of the claim. If you do not comply, your benefit will be terminated. Most policies do not require you to continue paying premiums if you are disabled for more than 90 days.
  3. The majority of LTD insurance includes two types of disability definitions: “Own Occupation” and “Any Occupation.”
  4. Benefits are due if an employee cannot perform their normal job or a similar job during the ‘Own Occupation’ period. This time frame can be as long as two years.
  5. The employee is only entitled to benefits if they are unable to do Any Occupation for which they are or become fairly qualified through education, training, or experience.
  6. Most LTD firms need you to apply for Social Security Disability Insurance (SSDI) benefits, and they may help you with the procedure. Your LTD policy includes an offset, which means that any SSDI benefits you receive will be deducted from the LTD benefit.
  7. If you are eligible for SSDI and receive a retroactive payment check, you will typically be compelled to repay the LTD company the amount received when SSDI is paying you.
  8. In addition to STD and LTD, you may be eligible for Social Security Disability Insurance and Supplemental Security Income, which are also federal disability programs (SSI).
  9. You must have a medical condition that fits the Social Security Act (SSA) criteria of disability, which is defined as “having a sickness or injury that is projected to continue at least 12 months or if your condition may be considered terminal.”