Offsets to Disability Benefits

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Offset statutes put brakes to insurer’s effort to half disability benefits

All group disability insurance policies coordinate benefits with other sources of disability income to preclude potential double recoveries. Social Security disability benefits and workers’ compensation benefits are universally identified as offsets against long-term disability insurance payments. A more controversial offset, though, are payments that result from personal-injury claims which compensate claimants for categories of damages […]

Court looks at calculating credit and taxes in disability benefits case

Although death and taxes are both viewed as inevitabilities, when it comes to disability insurance benefits, taxes may be avoidable. According to Revenue Ruling 2004-55 (June 28, 2004), long-term disability insurance premiums paid on an after-tax basis result in a non-taxable benefit. Hence, many employers structure their group long-term disability benefit plans in that manner […]

Should veterans’ benefit payments reduce private long-term disability?

A recently issued unpublished ruling from the 10th U.S. Circuit Court of Appeals, Holbrooks v. Sun Life Assurance Company of Canada, 2014 U.S.App.LEXIS 12741 (10th Cir. July 7, 2014)(unpublished), departed from two contrary appellate rulings in determining that veterans’ benefits are offset table from long-term disability payments as “other income benefits.” Typically, in order to […]

Two points of view on offset for veteran and disability benefits

After more than 10 years of war in Iraq and Afghanistan, many veterans are returning home with disabilities, some of which are latent and do not manifest themselves until years later. If a veteran who later qualifies for veteran benefits also receives disability benefits under their private-sector employer’s group long-term disability insurance plans, the question […]