Long term disability (LTD) is a protective measure that provides a portion of the claimant’s income in the event of an extended illness or injury. This benefit is typically employer-based, with varying rules and restrictions depending on the company, area, and unique situation.
The variances create significant confusion for people who need this benefit for financial support as they recover. Here are five common misconceptions and truths about LTD.
Long Term Disability Insurance Covers All Illnesses and Injuries
Long term disability insurance policies may have specific terms and conditions that must be met to receive benefits. For example, some policies may require a certain timeframe before benefits kick in or may only cover specific types of disabilities.
In some situations, a short term disability claim must be made before making a claim for long term disability benefits. According to The Maddox Firm, “Short-term disability benefits may replace 50% to 100% of your income for 3 to 6 months.”
It’s also common for applications to be denied based on pre-existing conditions, self-inflicted injuries (such as a non-work related sports injury), or mental health conditions.
It is important to review your workplace LTD policy’s specific terms and conditions to understand what is and isn’t covered. Additionally, consulting with an experienced long term disability attorney can provide valuable insight into an individual’s rights and options in the event of a disability.
Application Denials Are Final
Another common misconception about LTD is that if an application is denied, that’s the end of the road. In reality, everything is up for negotiation and a form like Coffman Law can manage that for you
Individuals reserve the right to appeal a claim denial. This can be a long, convoluted process and is best handled with support from a knowledgeable attorney.
The appeal process typically includes gathering records, securing an independent examination, and ultimately building a case that proves you meet the requirements of your LTD policy.
As you navigate the process, keep detailed records of all communication points with your employer, insurance provider, care providers, and other relevant parties. Working with an attorney will help improve your chances of success.
Long Term Disability Lasts Forever
Long-term disability typically has an end date, depending on the situation and the policy in place. You may be required to provide continuous proof that you cannot work to continue to get LTD.
It’s important to note that continuing to secure LTD under the guise of an inability to work is insurance fraud. Many companies use private investigators to monitor claimants to disprove their claims. It’s crucial to work with an attorney if you’ll be on LTD for an extended period and ensure your claim is entirely truthful.
LTD Is Non-taxable
LTD is not taxed as income in some specific situations. However, different policies, timelines, jurisdictions, and disabilities have unique rules.
If you’re collecting LTD, you must discuss the taxation specific to your situation with a tax specialist to avoid costly fines and additional financial hardship.
LTD Attorneys Aren’t Worth It
Don’t make the mistake of overlooking the services of an LTD attorney. There’s a common misconception that the expense of an attorney isn’t worth it. Most of these attorneys work on a contingency basis, only charging a percentage of your winnings — which you might not secure otherwise.
Regarding LTD, it’s important to understand the specific terms and conditions of a long term disability insurance policy and your rights.
