Integration of Benefits – Offset for other Income

I frequently get calls from long term disability claimants wanting to know if their disability insurance company can get all their social security back benefits. Often they recall some discussion with the insurance carrier about coordination of benefits, but fail to fully appreciate what it meant.

In a nutshell, most group disability policies have a provision that allows the insurance company to offset other income benefits. This means they take credit for the income the disabled individual received from other sources of income such as social security disability, pension, retirement, worker’s compensation, or even settlement from an accident that resulted in the disability benefits. In some cases they can take credit for the social security income that their children receive as a result of the disability.

If you have or are entitled to receive benefits from other sources, you need to seek legal advice. If your worker’s compensation attorney or personal injury attorney is not familiar with all the intricacies of ERISA law, they should consult with an ERISA lawyer to discuss how the settlement of your claim could affect your disability benefits.

I tell clients faced with a request for reimbursement from their disability policy to do the following:

• Get a complete copy of their policy.
• Verify the information provided by the company. Sometimes the carrier may take credit for a child’s benefit when the policy doesn’t allow offset for a dependent’s benefit.
• Get a copy of the calculation worksheet to determine how they arrived at the overpayment.
• Seek legal advice before agreeing to repayment.

Most ERISA disability lawyers offer a free initial consultation. There is no reason that you should not fully understand your rights under ERISA.