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If your employer provides you with a group disability insurance plan, buying private coverage might feel redundant. 

But if you do become disabled, you don’t want to lose the lifestyle you’ve worked so hard to achieve. 

So collecting both seems like a great way to ensure you and your family miss nothing. In this episode, you’ll find out all about collecting disability insurance from two policies.

Listen now to discover how to maximize your payouts if you become disabled!

Show highlights include: 

  • Why your private policy lets you collect benefits on disabilities group insurance doesn’t even cover (1:41)
  • How private coverage always adds to your employer’s policy (2:37)
  • Why your employer’s group policy might not pay out (even if it specifies 60% of your salary) (4:17)
  • The sneaky way your employer’s policy might be a false sense of security (4:38)

To ask questions on insurance coverage or to get a quote, please don’t hesitate to call us anytime at 704-270-2376, and I’d be glad to discuss your specific situation with you.

Read Full Transcript

Hi, I'm Billy Gwaltney and this is the CYA podcast. This show is for the physician who understands the importance of protecting everything you've worked so hard to achieve. Each week I'll bring you tips and advice to help you cut through the clutter and misinformation and show you exactly what you need to preserve your income and way of life. If you're ready to achieve the peace of mind that only financial security can bring let's get started.

(00:29): Welcome to today's episode of the cover, your assets podcast. This is Billy, Gwaltney your host, and I'm happy to be with you today. Today's question that we're going to cover is can I collect from my private specialty disability policy and also my employer group LTD policy. At the same time, I get asked this quite a bit by physicians I work with around the country. And I'm going to read a question from a client who asked me this recently, and then we can talk about what the answer is.

(01:04): An excellent question. I just loved the way she worded it. And so I want to just read it verbatim. Hey, Billy wanted to ask you a couple follow-up questions first, which long-term disability insurance kicks in. Once I become disabled, the one the hospital gives me or my personal portable one, and also does the personal portable insurance supplement with the hospital gives me, and that's again, an excellent question. The bottom line answer to that is that you can collect from both. If you meet the definition of disability with both insurance policies, which can be a big if, because a group policy definitions are a good bit more restrictive, but if you did meet the definition of disability, you would collect from both at the same time. In other words, your private disability policy does not offset the group LTD long-term disability and vice versa. The group long-term disability does not offset the private policy, your private coverage and the group policy through an employer would have their own separate claims process that they go through.

(02:13): So at time of claim, you would have two claims processes going on at the same time, again, as mentioned, the group policy definitions are almost always a lot more restrictive. And so collecting from a group policy can require more hoops. You have to jump through in order for it to occur. And the private policy tends to be more straight forward in a lot of cases, but yes, the private specialty coverage would supplement anything that an employer gives you. Okay? So again, if you have that policy and you have both policies in effect at the time of claim, they both would be in play. So to speak that you could collect from them. If you meet the definition of disability, again, you go through the claims forms or fill those out and make sure they get submitted appropriately to the, to the correct company in the correct department.

(03:04): Hopefully your broker can advocate for you on this and be a part of that. That is part of the role we play. Just making sure those details are followed through on and things get where they need to go. And some hear that and say, wow, that's awesome. I could get the 60% from my employer up to what, whatever the cap is. And then I can have my private policy. And yes, that could be the case. If the math works to where the combined total of those is higher than what you were making, then that's, it is what it is. Again, the group policy is a percentage of your salary prior to the, at the time of claim. And generally there's, there's a capital mat say 60% to 10,000 per month or 15,000 a month, or whatever it is that benefit is often taxable. If the employer gives this to you, then it's, then it would be taxable.

(03:53): If they gross you up through your paycheck to cover the expense of that, so that you pay tax on the premium, then the benefit could be non taxed. But most of the time it is taxable. And then again, that would function independent of your private specialty coverage. We, unfortunately we do have clients on claim. We've had a number of situations where clients collect. They go through the process, they collect from their private coverage as they expect, and they never see any money from their employer policy. And so that's why it's always wise to strongly consider maximizing whatever private coverage you can purchase. Make sure you're at that maximum. Even if you have an employer policy, don't get lulled into thinking that, oh, I've got this 60% of 20,000 a month from my employer or 15,000 a month because it's very hit or miss as to whether or not that's gonna gonna follow through at the time of claim.

(04:53): And so you would not want to find that out too late. It is. I'm not just saying this because I'm an insurance guy. Yes, I'm an insurance guy, but whoever your broker is, just make sure you maximize the private coverage because that's what you're going to ultimately lean on. I hope you found this helpful. I wanted to cover this quickly because I do get this question a lot about how, what happens at the time of claim and would an employer policy impact the private that's usually what clients are most concerned about. Is there going to be any offset to their private policy if they have an employer policy and the answer is no. And the vice-versa answer is no as well, no offsets. If structured properly, please feel free to text me anytime to arrange a conversation or to ask questions. We'd be happy to answer those. My number is 7 0 4 2 7 0 2 3 7 6. Again, that's 7 0 4 2 7 0 2 3 7 6. Happy to talk with you until next time. This is Billy Gwaltney. Thank you. As always for tuning in

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