I’ve been on LTD for 5+ years. My claim will end in the month I turn 65 which is coming up later this year. They have offered me a full 100% buyout as no change in my medical condition is expected. If I accept the buyout, am I free to dabble in a new part time business venture without them clawing back any portion of that buyout? By now, my employer is not expecting me to return to work but they continue to put in ‘time employed’ toward my pension plan, but no payments. Could the payout jeopardize the continued Time Employed going toward my pension? Also I have to pay for my own medical benefits through my employer. If I accept a buyout, will my access to that medical plan likely stop? I don’t have debt so that is not a motivator for me to accept a buyout. What would you recommend?
Usually the employer pension /benefits stuff depends on you continuing to be disabled, not on you receiving disability insurance. Check those items with HR to make sure though especially if you are in a unionized environment. Otherwise I don’t see any downside for you.
I repeat what Caro is saying, often employment benefits like membership in a group plan can depend on an an employee being on an “approved” LTD claim. Doing a buyout will take a person off of an approved LTD claim as usually contemplated by the employers. Some employers will allow a person to stay on the group plan even after buyouts, so there is no one answer here. It depends on your employer.
I can’t advise on the implications of your specific situation. What you can and can’t do will depend on the terms of the buyout agreement. Most buyout agreements will be a full and final release of all rights for both sides, sot that would mean an insurance company would lose any rights to reimbursement or offset after the agreement. However, these agreements can include implications for future events or actions take, like confidentiality clauses etc. so you have to read the fine print.
David Brannen
Disability Lawyer with Resolute Legal
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