It’s difficult enough when you or a family member has to apply for long-term disability, especially if there is a terminal or progressive, degenerative illness, such as ALS, or an injury that will never heal. What’s even more difficult to think about is when the time comes that you or your loved one passes away.
But when the day comes, will you receive any death benefits from the LTD policy? This will depend on the terms of the policy, which should be reviewed completely before attempting to apply for LTD disability benefits.
What Is A Death Benefit?
This is a lump sum paid to an insured’s family when the individual dies, and is most commonly associated with life insurance. In fact, life insurance is just that—insurance on someone’s life, which pays out to whomever the insured assigns as a beneficiary.
But with long-term disability, there may or may not be a “death benefit.” Some policies do offer a “survivor benefit” that pays a lump sum of LTD death benefits to survivors for a specific time period, usually one to three months. But as a rule, if the individual has passed away, there is no more need for the insurer to make payments, so they will stop.
If your LTD policy comes through your employer, it may or may not include a death benefit—check your policy. You may have been offered a rider for an additional charge to have that would provide your family or other selected beneficiaries a death benefit.
You may have selected this option for your own LTD policy as well. Again, read and check your policy to be sure, or contact your agent to clarify. You may have the option of adding this type of LTD death benefits, even if you’ve had your policy for some time.
An Alternative LTD: Accelerated Death Benefit
If your LTD insurance is not sufficient, or you are terminally ill and need help immediately, one possibility would be to request an accelerated death benefit on your life insurance policy. There are restrictions on requesting this benefit, and it will reduce the death benefit (total sum of money) paid to your survivors after you die.
You may also use this coverage if you are confined to a nursing home, or are deemed terminally ill. Some policies automatically pay this in circumstances of an imminent death. To qualify, you will have to be certified by a doctor or other medical professional that you are terminally ill, and that death is expected in 12 to 24 months. Some providers set the threshold at six months.
Critical illnesses that can also trigger this benefit include:
- Stroke
- Cancer
- Heart attack
- Kidney failure
- Organ transplants
- ALS
Chronic illnesses are not the same as critical illnesses. To determine if your policy allows an accelerated death benefit for your illness, as always, review your policy and speak with your insurance agent to be sure.
Your Houston LTD Disability Attorney
Long term disability can be an annoying process before you begin receiving benefits. The Herren Law Firm can help you with your application, appeals and help you through the process, and give you and your family peace of mind. Contact us today at 713-682-8194 (or use our online contact form) to schedule your free consultation. There’s no obligation, and no up-front fees, because we will only collect if we win your case.
