Q: What is LTD?
A: LTD usually means Long Term Disability benefits provided by a public sector or private sector employer. Some employers pay the benefits out of their general assets, but more payments are made by an insurance company. Typically LTD benefits replace a portion of your income if you become disabled for a least 13 weeks or 26 weeks depending on your company plan. Many plans pay 60% of your pre-disability earnings. Generally to qualify you are unable to do the material and substantial duties of your occupation due to injury or illness.
Q: Who is eligible for LTD coverage?
A: Depends on the terms of your employer’s plan. Usually you have to be employed for at least one year before you are eligible for benefit.
Q: Am I guaranteed coverage?
A: Generally, Yes. The trade-off is that you are not covered that arises from a pre-existing condition for at least the first year. Sometimes the pre-existing condition
Q: How long do my LTC payments continue?
A: You can continue to receive your LTC benefits for as long as your plan considers you disabled, or until you have reached your maximum period of payment, whichever comes first. Many plans provide coverage until your normal social security retirement age or age 65.
Q: Can I file for LTD if I was injured at work?
A: You can file, however, the disability benefit may be reduced in you receive income from other sources such as disability retirement programs, other insurance policies, or government program, such as Social Security Disability Income benefits or worker’s compensation or all of these.
Q: Are my benefit payments subject to taxation?
A: Most of the time employer pays the premiums for coverage. As a result, the benefits you receive are taxable as income. Unless you pay the premiums with post-tax dollars, presume the benefit payments are taxable.
Q: Can I return to work and still be eligible for benefits?
A: Often times you can work part time and still qualify for LTD benefits.
Q: Can I keep my coverage if I leave my job?
A: Sometimes you can keep your LTD coverage by “porteing” it or “converting” if you leave your job. Ask your employer for details.