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What Happens If I Turn Down a Lump Sum Buy-Out From My Disability Insurance Company?

If you have been on claim and paid long term disability benefits for a while (usually more than 2 years), it is possible your disability insurance company may offer you a lump sum buy-out on your claim. That is, they may offer you a one-time payout on your LTD claim that would end your claim entirely.

This type of offer is a recognition that you are not expected to improve so the insurer will pay you a big chunk of money upfront, as opposed to paying monthly benefits for many years to come.

In theory, if you decide taking the lump sum payout is not right for you and reject the offer, nothing should change. In other words, your claim should go on as it normally would, assuming continue to qualify for benefits under the terms of the policy. But that is not always the case.

We have seen in the past, and are seeing more often now, a situation where the disability insurance company offers a lump sum buy-out, it is rejected, and then the company builds up a case against the claimant leading to a termination of benefits.

What to do when you receive a lump sum buy-out offer from your disability insurance company

Read the offer carefully and consider whether taking a lump sum payment is right for you and your situation. But before you choose to reject or accept, you should speak with a disability insurance attorney about the offer.

As experts in disability insurance law, we have negotiated hundreds of lump sum buyout offers and have guided claimants through the process of accepting or rejecting it. It is important to understand that the offer itself does not mean that they will pay you through the maximum benefit period. If you remain on claim, they will continue to review your case and could terminate your claim at some point in the future.

If you were offered a lump sum settlement in the past and are now facing a termination of benefits, you should contact us to speak with one of our disability insurance lawyers. We have represented numerous clients in this situation and know how to handle the claim and appeal.

Lawyers with Expertise in Disability Insurance Claims

This law firm has always focused only on disability insurance law.

Because we specialize in long term disability, our clients get the benefit of:

  1. Having an attorney who is an expert in long term disability claims;
  2. Having an attorney who has experience with every major disability insurance company;
  3. Being backed by a law firm that has a proven track record of winning tough disability lawsuits.

Call Dabdoub Law Firm to get experienced disability lawyers on your side.

We can help with:

The firm represents clients nationwide with disability claims governed by federal law, even if we are not located in your state.

Call to speak with an experienced disability attorney. Pay no fees or costs unless you get paid.