I Have A Private Long Term Disability Policy, Should I Also Apply for Social Security Disability?

Do you have a long term disability policy with a private insurance carrier or through your employer? If you have one of these policies and become disabled you may have questions about Social Security disability. Chances are if you have questions it's because you have filed for disability benefits through the long term disability policy and now the LTD carrier is telling you that you have to file for Social Security Disability.

I always recommend that anyone who plans on applying for Long Term Disability through their private carrier consults with an attorney that is experienced in this area of the law. This is a tricky area of law and the overwhelming majority of lawyers have no idea how LTD policies are governed and administered. This is not a Long Term Disability blog, but as a Social Security Disability attorney there are times when the two overlap.

Most LTD policies require that if an individual is going to receive benefits under their policy they must apply for Social Security Disability. The majority of these policies will offset the Social Security benefits from your monthly LTD benefits. Basically, if your LTD policy's monthly benefit is $5,000 and your Social Security benefits each month are $1,500 you will only receive $3,500 from your LTD carrier if the LTD policy offsets for Social Security benefits. You would not receive any less money overall, but the sources of the benefits would alter.

Often the LTD carriers will recommend a firm that can assist you with your application for Social Security Disability benefits. It is my advice to stay clear of the company that your LTD carrier has recommended you to. There are literally thousands of firms and attorneys who can assist you, avoid conflicts of interest whenever possible.

Some LTD carriers will even lead you to believe that the company is going to assist you free of charge. The reality is that most of these recommended companies have the same contingency agreement that almost every single Social Security Disability attorney or representative has, which will only pay them a percentage of your retroactive benefits if you are awarded. However, the way the LTD carrier phrases it, they make it sound like it is more beneficial for you to use the company they are recommending.

Even if the company is willing to waive their fee of any portion of the retroactive benefits they would be entitled to, as you will see below, often there are much worse consequences

Why do I advise staying away from these Social Security advocacy firms recommended by your LTD carrier? The main reason is because the majority of these firms hire non-attorney representatives. While there are certainly good non-attorney representatives out there, the main concern that I have is that since these representatives are not attorneys they do not have attorney-client confidentiality and therefore the conversations you have with them do not have to remain confidential.

I was recently told by one of my clients that he was recommended by his LTD carrier to use one of these advocacy groups (I won't disclose the name of either the carrier or the company) and they employed these tactics which I consider to be very sneaky. First, the LTD carrier made the individual feel like the advocacy group was going to represent them and advocate for them. In one regard this was true, the advocacy group assisted the individual in applying for SSD benefits. However, since the advocacy group were not attorneys, they did not have an obligation  to keep the information confidential. Throughout the process the advocacy group was informing the LTD carrier of the client's medical information which was eventually used as the basis for the LTD carrier to deny the individual LTD benefits.

Once the LTD carrier denied the individual his benefits the advocacy group informed the individual that they would not be assisting him in filing a request for hearing in his application for Social Security Disability benefits. Shortly thereafter, this person came to our firm and retained us to assist him in his application for Social Security disability benefits. Thankfully, at the Administrative Law Hearing I was successful in advocating for my client and he received a "fully favorable" decision.

Despite a happy ending from the Social Security viewpoint, he is still in the middle of appealing the LTD carrier's decision. I do not know if the LTD carrier would have denied his claim had he not retained the advocacy group, but there is no doubt in my mind that they did not fulfill their duty to advocate for him. Additionally, the advocacy group blatantly told him that since there was no attorney-client privilege, they were able to discuss the details of his case and medical issues with the LTD carrier.

If you have a LTD policy and are applying for Social Security Disability benefits, make sure that you are aware what the repercussions are on your LTD policy if you are awarded or denied SSD. Also, always make sure that the representative that you hire, whether it's an attorney or a non-attorney representative, is looking out for YOUR best interests, not the best interests of an insurance carrier.