Overpayments And Off-Set Issues

Our New York and New Jersey ERISA disability attorneys may be able to provide assistance if you are dealing with overpayments and off-set issues. If you have received back benefits from Social Security for disability, or Workers’ Compensation, or Veterans Benefits, your LTD insurer can and may have a claim to offset its benefits by the amount you receive from those other income sources. In such cases, you may be required to repay the back benefit award or face a potential lawsuit. A counter-claim may occur on the same basis if you have filed a lawsuit against your carrier for a denied benefit claim. Even if you file for bankruptcy while receiving benefits and discharge your obligation to repay an overpayment of back benefits, your plan may still withhold a portion of future payments to cover the overpayment.

What Is a Off-Set?

A off-set refers to the amount that can be deducted from your current or future monthly benefits according to policy. Off-sets may come from Social Security disability, dependent Social Security, severance pay, Workers’ Compensation payments, or personal injury settlements. It is important to disclose payments from any of these sources to your disability attorney upon receipt. Carriers reserve the right to reduce benefits if any of these off-sets are not reimbursed. The off-sets that qualify for reimbursement according to your policy should be provided by your carrier before enrolling in a plan. The policy itself will describe what constitutes an offset, and what does not.

Social Security Back-Benefits For Dependents And Disability Insurance

Whether Social Security disability payments made to your dependent children are reimbursable to your carrier depends on the language in your particular policy. While the reimbursement of such payments is a controversial matter since such payments actually belong to the dependents rather than the parent, most courts have upheld the right of carriers to demand reimbursement for benefits paid to minor children through the Social Security disability system. It all depends on what the LTD policy says.

Contact Our New York / New Jersey Disability Attorneys

If you fail to repay overpayments to your disability insurance company, your regular disability benefits may be reduced until you repay the excess amount. Your carrier has the right to withhold payments for months or even years if necessary until the amount of overpayment is reimbursed. The veteran disability attorneys at Uscher, Quiat, Uscher & Russo, P.C., in New York and New Jersey will help you sort out the complicated process of disability off-sets and overpayments, so call today at 201-342-7100 for your consultation.