Based on our extensive experience handling long-term disability (LTD) claims, we know that about one third of Social Security disability clients are also either receiving or applying for LTD benefits. Indeed, we have helped many of our Social Security disability clients get their LTD! Many insurance policies require that an LTD claimant also apply for Social Security disability (almost always when the LTD insurance is part of a benefit received from your employer; private LTD policies usually do not include this requirement). Please understand: The only reason they want this is that most LTD policies allow the insurance company to offset Social Security disability benefits from the amount they owe to the claimant. And, on top of that, another experience we have frequently is when the LTD insurance company is insisting that the claimant use the services of a private legal representation company they work with to handle their Social Security disability claim.
LTD companies will make many claims to try to convince you that you are better off with their representative than with one you can choose on your own. Sometimes, they will even imply that you are required to work with their representative, trying to emphasize this point by saying that their representative will not “cost you anything.” Or, they will tell you that their representative “wins 99% of the cases they handle” or similar claims. Finally, sometimes they will tell you that if you hire a private attorney you will end up paying the private attorney’s fees. All these claims are false. You are, of course, free to pick anyone you would like to represent you, including the insurance company’s representative. But consider this before you do.
There is nothing at all wrong with the LTD insurance company requiring repayment from Social Security disability benefits. This is usually a term in the insurance contract. However, consider why they would be so insistent that you hire their representative and even make false claims about how successful their representative is.
First, their representative, unlike an attorney you choose on your own, has “two masters”: they are of course representing you, but they also have responsibilities to the LTD insurance company, in particular to share information they have received about your case with the insurance company. Your private attorney would not be under any obligation to share such information unless it was helpful to your LTD claim.
Second, their insurance company is paid a flat fee to handle your case, whether they win or not. On the other hand, a private attorney who will not charge you a fee unless they win — which, of course, motivates that attorney to be successful on your behalf.
Third, the claim that LTD insurance companies win most of their cases contains a significant deception. They can only say that is because they drop numerous cases shortly before the hearing when they start to think that they are going to lose. In short, that loss “doesn’t count.” Keep in mind that a claimant does not always lose their Social Security case because they did not have good medical proof, etc. Sometimes the LTD insurance company’s representative can find out that the Social Security judge the case is assigned to turns down a very high percentage of cases, and they will drop the case for that reason alone, even if the claimant has submitted evidence showing that they are disabled. Again, this limits the number of cases they have “lost.”
Finally, LTD insurance companies will sometimes say that you will end up paying both the offset you are required to pay to them if you win your Social Security disability case, AND ALSO will have to pay your attorney on top of that. Again, this is simply not true.
In short, “You get what you pay for.” To be clear, not all LTD insurance companies make these false claims or pressure you into accepting a representative who does not necessarily have only your best interests in mind. And, again, it is of course your choice who represents you — we just want you to be aware of all the information.
We should also point out that sometimes a claimant has tried to obtain a private Social Security attorney, or possibly has seen several attorneys, all of whom have indicated that you have a low chance of winning your Social Security disability claim, but the LTD insurance company is requiring you to apply and get representation anyway. Refusal to file the claim can be a basis to stop or reduce your benefits and, in such cases you may just have to use their representative.
However, to eliminate all doubt, don’t hire your LTD insurance company’s representative, and instead hire someone who is 100% on your side, who has pledged to work with you until you win your case (or not be paid any fee), and who will not make false claims about the strength or weakness of your case. This will put you in the best position to receive the most benefits you can receive between Social Security disability, and LTD. Our recommendation is that you first seek an independent evaluation of your specific case. You can contact our Jacksonville FL and/or Pittsburgh PA disability attorneys at Osterhout Berger Disability Law for a fresh, unbiased opinion regarding your LTD or Social Security disability case at no cost.