How is ERISA Long Term Disability Relevant to You?
If you have a group long term disability plan, then ERISA is definitely relevant for you. The fact is that many people will end up with a disability at some point in their working life. The statistics are staggering. According to the Social Security Administration, about 25% of 20-year-olds will have a disability before they retire. Many people will need to miss work in order to try to recover from their injuries.
Federal Social Security Disability Insurance (SSDI)
Federal Social Security Disability Insurance (SSDI) provides benefits to those who are disabled before they reach retirement. However, the standards to qualify for government benefits are strict.
For one thing, you must have enough work credits to qualify. The amount of credits you need will depend on your age, income, and how long you have been working. Unfortunately, some people don’t have enough credits.
Second, SSDI requires that you have a condition that will leave you disabled for at least 12 consecutive months or will result in your death. This means that someone who suffers a terrible disability that lays them up for 9 months won’t get any disability benefits from the federal government.
Long-term Disability Insurance
For these reasons, workers should jump at the chance to purchase long-term disability insurance from their employer. If a group plan is offered, check how much it costs. Group plans can be surprisingly affordable because premiums are paid by large groups of people. Also check the terms of the plan, such as:
- The length of time you must be disabled before you can begin drawing benefits.
- How much you will get in a weekly benefit.
- Whether there are benefit caps, i.e., a maximum amount you can receive over your lifetime.
- The definition of what qualifies as a disability to warrant payment of benefits.
Group long-term disability can also help because SSDI payments are fairly modest. According to SSA, the average monthly disability benefit is only $1,234. This is barely enough to put someone over the poverty line, and it is wholly insufficient to allow a person to pay their bills in some of the more expensive parts of the country.
As mentioned above, ERISA does not offer long-term disability insurance (or any insurance or benefits). Instead, it is a body of law that will protect your right to benefits under the terms of your long-term disability plan. And chances are, you will need that protection at some point in the future—because insurance companies continue to engage in questionable tactics.
The sad truth is that many insurance companies deny perfectly valid claims because they don’t want to pay out benefits. Paying benefits can hurt their bottom line, and many insurance companies are now gigantic companies sold on the stock exchange. Insurers also know that a certain percentage of claimants will give up the fight for benefits, so some insurers have developed a “deny first, investigate later” approach to disability. It’s not fair, but it continues to happen.
Fortunately, ERISA will protect your right to a fair consideration of your claim and reasonable appeal rights if you are denied. But you need to stand up for yourself and demand that plan administrators follow the law and the terms of their plans.
Contact Us Today
If you need help with your ERISA claim, contact experienced ERISA attorney John Peace today.