Should You Do a Lump Sum Payout on a Long-Term Disability Claim?
Long term disability insurance can be a lifesaver for the American worker. When they find themselves too ill or injured to work, they can rely on monthly payments to replace their income so they can continue to take care of their family. These monthly payments may be scheduled to last for a certain period of time or for the rest of their lives, depending on the policy. Sometimes, though, instead of a monthly payment the worker may be offered a lump sum payout on their settlement or they may ask for a buyout directly from the insurance company. In some cases, a buyout can make sense for the worker. In other cases, it could be a bad move that ends up hurting the injured or ill worker more than it helps them. Our disability lawyer in Mississippi has seen both the good and the bad in these situations. Make sure you are more informed about your options when it comes to your long term disability before you make those decisions.
What is a lump sum payout?
Instead of paying you monthly on your insurance claim, the insurance company buys out your policy. You get one large sum of money and the insurance company has no more financial responsibility for you on that policy. Your relationship with the insurance company is over.
How much do they pay?
It depends on a number of factors, including your age, your policy, and the insurance company itself. Keep in mind, too, that the insurance company isn’t going to pay you a lump sum unless it makes sense for them to do so financially. That means you’ll be getting less money in the lump sum than you would through the monthly payments. However, for some families that is worth it, but it’s something to keep in mind. Talking to a disability lawyer in Mississippi can give you a better idea about how much you may be able to expect when it comes to the buyout amount.
What are the benefits to staying on monthly payments?
There are a number of reasons that this could be the best option. First of all, it gives you a stable monthly income while you are unable to work. It’s much easier to budget a monthly check than it is making sure one large lump sum is enough to last you while you need it. If you have a history of making poor choices with your money, it’s best to protect yourself with a monthly payment instead of a buyout.
What are the benefits of a buyout?
When you take the lump sum buyout, your relationship with the insurance company comes to an end. That means you won’t have to deal with providing proof of your disability any longer and you can move forward with your life in the way that you see fit. A lump sum payout can also give you money to secure housing for your family or even to start a business that’s more suitable for your current health.
Why do I need a disability lawyer for this?
It’s true that you can approach the insurance company yourself about the topic of a buyout. However, it’s not something that our disability lawyer in Mississippi would recommend. That’s because insurance companies are going to be looking for reasons to not only not pay you the lump sum, but to find reasons to cut your benefits anyway. They may become suspicious that you are able to work and just want the buyout so you can get as much money as possible before returning to work. When you allow an experienced disability lawyer to handle your case, you can avoid making mistakes that could cost you your disability benefits.
Do you think a buyout could be the right option for your long-term disability payments? Want to learn more about your options? You can make an appointment with our disability lawyer in Mississippi today for a free consultation. Just give us a call or use the contact form on this website to get in touch with us. We’ll help you determine the best course of action for your long term disability claim and help you get the best resolution possible for your case.