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group LTD


GA Medicare Expert
5000 Post Club
I was reading a post on another forum and an agent posted the following caveat about group LTD. I dont do a lot in LTD and it has been years since I wrote (or even reviewed) a group LTD plan so I can't comment one way or the other on the following.

Most group coverages have offsets:

1. Social Security- your benefit will be reduced by any SS benefit you receive

2. Legal Settlement- Example, you are hit by a drunk driver, rendered disabled, so you sue drunk driver's insurance company for 2 million dollars. You're group coverage provider will not pay a claim until you have exhausted the funds from that settlement.

3. Any other business activities- Rental property, partnerships, or any thing that generates revenue with or without you being there

#1 is no contest. All LTD plans I have seen have SS offsets. Some offset against primary only while others factor in dependent benefits as well.

2 & 3 is where I take issue, especially #3.

LTD (and health plans) do have subrogation offsets, but I have never seen one worded where your benefit is held up pending litigation against an at fault party.

I have never seen an LTD plan with an offset against unearned income.

Is this guy blowing smoke or does he know his stuff?