Learn About ERISA Plans With An Experienced ERISA Lawyer Columbus
How you choose to pursue your long-term disability claim and your odds of approval all depends on if you possess an individual long-term disability (LTD) policy or an group policy offered by an employer. An employer-offered group LTD policy is regulated by the Employee Retirement Income Security Act (ERISA), and as such, provides much more basic coverage than individual plans. Additionally, ERISA plans require claimants to follow very specific procedures when filing their claims and appeals, while individual policyholders are only subject to the rules of their insurance company and not to additional state and federal laws. It is important that if you are going to carry long-term disability insurance you understand the key differences between different types of plans.
Columbus, OH Long-Term Disability Attorney Explains Key Differences Between Employer-Sponsored and Individual LTD Plans
Unfortunately, there are times when an individual will come to us for help with a disability claim only to have us tell them that their unique condition is not covered by the basic policy of their employer-provided plan. It is always hard to inform clients of this, especially if they joined the policy because they anticipated the onset of their condition. To avoid such a devastating revelation, consult with a Columbus long-term disability attorney prior to signing on for coverage. At the Law Office of Mike Gertner, we can help you understand the key differences between your company’s ERISA plan and other individual policies, and thereby help you find a plan that meets your particular needs.
Some of the main differences in ERISA plans and individual policies to watch out for include:
- Cost: Because group plans are usually more basic than individual plans, they are less expensive. However, keep in mind that individual plans can be modified to your specific needs, while a group plan cannot.
- “Disability” Definition: Each policy’s definition of “disability” varies. Under some employer-provided ERISA plans, “disability” is typically defined as the inability to engage in any job. Under other ERISA plans, it is defined as the inability to engage in your own job, but after 24 months of disability, the definition switches to any occupation. This narrow definition often leads to the complete denial of a claim, or the termination of a disabled person’s benefits after just two years of disability. Individual policies, on the other hand, allow an individual to choose their preference when applying for coverage. For instance, they may pay a little more to have their policy read your own occupation, or pay less to have it read any occupation. Or they may choose a mix of the two, and allow the definition to switch to any occupation after five years of disability.
- Restrictions: Most long-term disability plans do not allow individuals to file disability claims for mental or nervous disorders or for alcohol or drug abuse. If they do allow it, they limit disability benefits to just 12 to 24 months.
- Benefits Amount: How much you will receive on an individual policy also greatly varies from how much you will receive on a group plan. With a group plan, you can anticipate to receive between 50 and 75 percent of your current income, with a cap of between $5,000 and $10,000 per month. Individual policies, on the other hand, allow you to receive a greater percentage of your current monthly income and grant you a greater maximum per month.
- Portability: An excellent trait of an individual policy is that you can bring it with you from one employer to the next. An employer-provided ERISA plan, on the other hand, is only good so long as you continue to work for that particular employer; your benefits are terminated once your position with the company is terminated.
There are other key differences in ERISA plans and individual policies, such as tax implications, and how you must go about filing a claim for disability and appealing a denial. For more information on the differences between employer-provided and individual long-term disability policies, contact the Law Office of Mike Gertner.
Consult a Long-Term Disability Lawyer
At the Law Office of Mike Gertner, our LTD attorneys have experience with both ERISA plans and individual long-term disability policies. Whether you are in the policy buying stage, about to file a claim, or would like to appeal a decision, we are here to come up with the best solution for you.