What Is Voluntary Long Term Disability Insurance?

Most people understand the importance of health insurance in covering medical expenses. But what happens if you suffer an injury or illness that prevents you from working? How will you pay your bills and support yourself and your family? This is where long-term disability insurance comes in.

Long-term disability (LTD) insurance provides income replacement if you cannot work for an extended period due to a covered disability. But what is voluntary long-term disability? Voluntary long-term disability insurance is a policy you purchase through your workplace. Although the policy is offered by your employer, it costs them very little or nothing at all.

The Basics of Voluntary LTD Insurance

With a voluntary long-term disability policy, you pay the premiums, usually through payroll deductions at work. If you experience a disability that keeps you out of work for an extended time, the policy pays you a portion of your salary, typically 50-70%. Benefits kick in after you have been disabled for the “elimination period,” a waiting period that commonly lasts 90  to 180 days. Payments continue until you recover and return to work, reach retirement age, or the benefit period stated in the policy ends.

To qualify for benefits, you must have a disability that meets the policy’s definition. Most LTD policies consider you disabled if you cannot perform the duties of your occupation for the first two years. After that, you must be unable to work in any suitable occupation based on your experience, education, and training. Medical evidence must also support your disability claim.

Why Consider Voluntary LTD?

Many people assume they will receive long-term disability coverage through their job. However, the Bureau of Labor Statistics reports that only 35% of private industry workers can access employer-provided LTD insurance. And even among those with the option, the employer may only pay part of the premium.

Without LTD insurance, an extended disability could drain your savings and put your assets at risk. Social Security Disability Insurance (SSDI) provides some protection, but qualifying is complex, and the average benefit of $1,358 per month may not be enough to maintain your standard of living. Voluntary LTD insurance can provide money you need if you can’t qualify for SSDI or have no other income sources.

Buying your policy also allows you to customize your coverage. You choose the monthly benefit amount, elimination period, and benefit period that fit your needs and budget. If you pay the premiums, you own the policy and can take it with you if you change jobs. With employer-paid LTD, you lose coverage if you leave the company.

The Underwriting Process

To purchase voluntary LTD insurance, you must go through underwriting. The insurance company evaluates your risk and decides whether to insure you and at what price. The insurer can refer to your medical history and pre-existing conditions when assessing your application. Expect to answer questions about your health, medications, and lifestyle.

In some cases, such as when first offered or when the benefit stays below a set amount, you may have a chance to enroll without underwriting, but those “guarantee issue” opportunities are not the norm. Typically, the insurer will decide to accept or reject your application or modify the requested coverage based on the information you provide.

Getting Legal Help

Even the best LTD policies involve complex terms and conditions. If your insurer denies your claim or cuts off your benefits, you may need legal representation to protect your rights. This especially applies if your policy is governed by the Employee Retirement Income Security Act (ERISA), a federal law that sets standards for employee benefit plans.

The experienced attorneys at Capitan Law help people navigate the long-term disability claims process. We handle appeals, lawsuits, and all aspects of ERISA-governed and individual LTD insurance policies. Our team is ready to analyze your policy, gather evidence to support your claim, and pursue the benefits you deserve and paid for.

Protect Yourself and Your Family

An accident or illness can upend your life at any time. While no one wants to think about becoming disabled, preparing for the possibility makes good financial sense. Voluntary long-term disability insurance provides a safety net when you cannot depend on your paycheck. When you purchase your policy, you are setting yourself up to remain financially stable in the event of extreme adversity.

If you have questions about long-term disability insurance claims, appeals, or legal actions, the skilled long-term disability lawyers at Capitan Law can help. Call (267) 419-7888 or contact us online today for a consultation and learn more about how we can assist you.