Policy Settlement vs. Long Term Disability Benefits

When an injury causes long-term disability, you have to worry about a lot of things. Not only do you have to learn to live with the physical pain and discomfort of the disability but also the financial implications of being unable to work at your old job again. While medical advances hold hope of alleviating the pain and discomfort, long-term disability benefits are the key to meeting both your day-to-day living expenses and your medical bills. Some insurance companies offer a one-time policy settlement if you are willing to waive your entitlements for long-term disability benefits.

Policy Settlement

The amount you are offered as a one-time policy settlement will matter in conditions such as your expected mortality, morbidity, your age, gender, health status, and so on. If you have a long time to go to reach retirement age and will need continuing healthcare for your disability, you are probably better off choosing long-term disability benefits over a one-time settlement. This is because once you accept your one-time settlement, you will lose any healthcare benefits and health insurance you were eligible for as part of your company’s policy.

However, a policy settlement might be apt for those who fear that their disability benefits might be terminated before they fully recover. There are instances where this happens and you have to reapply for benefits and prove your disability all over again. This might be difficult to establish, especially in the case of mental illnesses. This is because different psychiatrists evaluate a patient in slightly different ways. Moreover, if you are competent enough to argue your case, many evaluators feel that you are competent enough to hold a job. However, your illness might be such that you are unable to put in long hours of work regularly.

Long Term Disability Benefits

Long term disability benefits can be terminated if the administrator of your benefits is of the opinion that you have now recovered and can hold a job. This leads to disputes, which you have to get resolved. Moreover, if you are nearing retirement age, a lump sum settlement might come in handy for your retirement plans. You can use the money to purchase a home or pay off the mortgage. Those who have a viable investment opportunity for an alternative employment too might prefer to cash-in on a one-time settlement offer.

Consult a Lawyer

As the decision to choose between a one-time settlement and long-term benefits depends on individual circumstances, you need to consult a lawyer. A lawyer will be able to advice you on the basis of your particular circumstances. Be sure to provide the lawyer will all relevant information in order to benefit from their counsel.