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What You Should Know About Accepting a Lump Sum Settlement From New York Life

Once a claimant has an established claim, there may be a time when New York Life offers a lump sum settlement to buy out the claim upfront. In a typical ERISA claim, this happens when:

  • A person has been approved beyond any occupation definition of disability, and
  • Is receiving SSDI

If you have an established claim with NYL, the company may send you a letter offering a lump sum amount in exchange for a signed release. The release typically states that you will no longer be entitled to benefits, your coverage under the disability insurance policy ends, and you cannot bring a claim for benefits under this policy again. Essentially, the release confirms that you and NYL are forever divorcing and will never reunite.

The offer letter also should include NYL’s present value calculation of your claim — what NYL calculates your claim to be worth today. This number will be smaller than if you just calculated your benefit by the number of months left on your claim. This is because NYL includes a discount rate to account for things like interest, and mortality/morbidity rates.

When considering a lump sum settlement from NYL, you should think about things like:

  • Can you live off the amount they are offering?
  • Whether you have to pay taxes on the lump sum payment
  • Whether you receive benefits from your employer because you are found disabled by NYL (for example, health insurance)

If you have received an offer for a lump sum settlement from NYL while you are on claim and being paid, contact one of our experienced disability insurance attorneys. We can help guide you through the process, determine if it is an offer worth considering, and discuss the pros and cons of a settlement. It is also possible we can negotiate a higher settlement amount for you.

Lawyers Specializing in Disability Insurance Claims

Because disability insurance law is complicated, it is important to get legal help from a lawyer who focuses on disability law.

As a law firm built to focus on disability insurance, our lawyers specialize in disability insurance. We spend every day working to get our clients long term disability benefits approved.

Because federal law applies to most disability insurance claims, we do not have to be located in your state to help.

If your claim for long term disability benefits was denied or delayed by an insurance company, call us to speak with a disability insurance attorney.

Call us at (800) 969-0488 to get experienced disability lawyers on your side with:

Contact us online for a free consultation with a disability attorney.