If you filed for disability benefits from various sources, you might notice a particular deduction from your private long-term disability insurance payments. You might think this is a mistake by your insurer, but it might not be the case if it is an offset.
If you took part in multiple private and public disability benefits plans, the total amount could receive from them might be more than your pre-disability income. Insurers deduct specific amounts from your benefits to prevent this from happening.
They could implement offsets if you have other sources, including Social Security disability, worker’s compensation and other state disability benefits.
Terms regarding offsets should be in your policy’s summary plan description. It should also describe what benefits qualify for offsetting and how they calculate it.
Can I stop offset deductions?
For private policies, you cannot stop them from deducting offsets. Private long-term disability plans usually have set terms negotiated with your employer. However, they should have provided you with all the pre-determined agreements when you signed on.
If they failed to let you know about these arrangements and they were not in your policy information, you could report it as an ERISA violation.
Can insurers offset benefits received by my immediate family?
Insurance providers cannot apply offsets to benefits received by your dependents. These deductions often apply only to payments you receive directly. However, limitations can vary from one plan to another.
Some policies might indicate offsets for your dependents’ social security benefits based on the circumstances. You can easily miss these details in your policy, so you should always keep a copy and read it thoroughly.
Additionally, you should take note of the language used in your policy. These statements could help determine how much you should receive for your disability.