New to Disability Insurance (Retired Military, now 20 yr Civilian)

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Topic Author
Clairvoyant
Posts: 5
Joined: Sun Apr 30, 2023 4:51 pm

New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by Clairvoyant »

Hi team,

My husband, in his early 60s, has a difficult diagnosis and we are ready to start filing for disability insurance.

He has military retirement pay, and has been a civilian for 20 years. He is employed by a private company.

The company’s disability policy is with Mutual of Omaha. We are concerned to read that it appears that his disability benefit will be reduced by his military retirement pay.

Does anyone have experience with this? We are trying to figure out how to budget for this occurrence. We can communicate with his employer tomorrow.

**I can see this happening when someone has two publicly funded jobs, such as military plus fed. It seems odd that military retired pay reduces disability from a policy held through a private employer.

Thanks in advance for your ideas or knowledge of similar situations.
BruDude
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Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by BruDude »

This is common with group LTD policies. The benefit is offset by "other income sources" as defined in the policy. If one of those sources is a pension/retirement income, there isn't really anything you can do unfortunately. Ask for a copy of the policy and check the definition of other income sources.
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pfrank
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Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by pfrank »

Is your husband’s diagnosis related to his military service? If so, he can also apply for VA disability compensation. The process takes about a year (or more) from application to decision. Payment will vary based upon the severity of the disability and other factors (spouse, children under 18). Payments are based upon the date of application. The VA payments are not taxable or reportable. If the VA approves his disability, his treatments will be covered by the VA. Based upon your post, he probably has TRICARE. You can use both medical benefits.
Fpdesignco
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Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by Fpdesignco »

pfrank wrote: Mon May 01, 2023 6:49 am Is your husband’s diagnosis related to his military service? If so, he can also apply for VA disability compensation. The process takes about a year (or more) from application to decision. Payment will vary based upon the severity of the disability and other factors (spouse, children under 18). Payments are based upon the date of application. The VA payments are not taxable or reportable. If the VA approves his disability, his treatments will be covered by the VA. Based upon your post, he probably has TRICARE. You can use both medical benefits.

Just as a note, as there has been several court cases about it, LTD cannot use veteran disability in their calculations.
Topic Author
Clairvoyant
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Joined: Sun Apr 30, 2023 4:51 pm

Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by Clairvoyant »

We appreciate these insights.

He left the service without a VA disability (as a matter of pride — he had some ailments). If there’s a connection to his diagnosis now, it would be to the Fire Fighting Foam (for which there are cases). Not sure if we will go down that road.

I also wonder if there would be a similar offset to if disability insurance had been purchased privately/directly.

If no offset on private purchase, I’ll do my best to spread the word to other military retirees we know.
BruDude
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Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by BruDude »

Clairvoyant wrote: Mon May 01, 2023 10:18 am We appreciate these insights.

He left the service without a VA disability (as a matter of pride — he had some ailments). If there’s a connection to his diagnosis now, it would be to the Fire Fighting Foam (for which there are cases). Not sure if we will go down that road.

I also wonder if there would be a similar offset to if disability insurance had been purchased privately/directly.

If no offset on private purchase, I’ll do my best to spread the word to other military retirees we know.
Individual policies do not offset income from other sources, at least for the “top tier” companies.
Fpdesignco
Posts: 302
Joined: Fri Jan 14, 2022 9:30 pm

Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by Fpdesignco »

BruDude wrote: Mon May 01, 2023 12:29 pm
Clairvoyant wrote: Mon May 01, 2023 10:18 am We appreciate these insights.

He left the service without a VA disability (as a matter of pride — he had some ailments). If there’s a connection to his diagnosis now, it would be to the Fire Fighting Foam (for which there are cases). Not sure if we will go down that road.

I also wonder if there would be a similar offset to if disability insurance had been purchased privately/directly.

If no offset on private purchase, I’ll do my best to spread the word to other military retirees we know.
Individual policies do not offset income from other sources, at least for the “top tier” companies.
I’d be careful here. Many group policies and marketplace policies have a habit of doing this.
BruDude
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Location: Las Vegas

Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by BruDude »

Fpdesignco wrote: Mon May 01, 2023 12:30 pm
BruDude wrote: Mon May 01, 2023 12:29 pm
Clairvoyant wrote: Mon May 01, 2023 10:18 am We appreciate these insights.

He left the service without a VA disability (as a matter of pride — he had some ailments). If there’s a connection to his diagnosis now, it would be to the Fire Fighting Foam (for which there are cases). Not sure if we will go down that road.

I also wonder if there would be a similar offset to if disability insurance had been purchased privately/directly.

If no offset on private purchase, I’ll do my best to spread the word to other military retirees we know.
Individual policies do not offset income from other sources, at least for the “top tier” companies.
I’d be careful here. Many group policies and marketplace policies have a habit of doing this.
I’m not sure what you mean. I specifically said individual policies, and in the first reply to this post I stated that this is common with group LTD policies.

The policy is a legal contract. If it’s not in the contract, they can’t do it. None of the “top tier” DI companies offset income from other sources unless you choose the Social Insurance Substitute rider from the few companies that offer it, and I’d have to check the definition but I believe that only applies to SSDI and workers comp payments.
Fpdesignco
Posts: 302
Joined: Fri Jan 14, 2022 9:30 pm

Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by Fpdesignco »

BruDude wrote: Mon May 01, 2023 12:50 pm
Fpdesignco wrote: Mon May 01, 2023 12:30 pm
BruDude wrote: Mon May 01, 2023 12:29 pm
Clairvoyant wrote: Mon May 01, 2023 10:18 am We appreciate these insights.

He left the service without a VA disability (as a matter of pride — he had some ailments). If there’s a connection to his diagnosis now, it would be to the Fire Fighting Foam (for which there are cases). Not sure if we will go down that road.

I also wonder if there would be a similar offset to if disability insurance had been purchased privately/directly.

If no offset on private purchase, I’ll do my best to spread the word to other military retirees we know.
Individual policies do not offset income from other sources, at least for the “top tier” companies.
I’d be careful here. Many group policies and marketplace policies have a habit of doing this.
I’m not sure what you mean. I specifically said individual policies, and in the first reply to this post I stated that this is common with group LTD policies.

The policy is a legal contract. If it’s not in the contract, they can’t do it. None of the “top tier” DI companies offset income from other sources unless you choose the Social Insurance Substitute rider from the few companies that offer it, and I’d have to check the definition but I believe that only applies to SSDI and workers comp payments.
Making a assumption and categorizing “all” subjectively top tier companies was my caution for individual or group policies. I have recently seen examples of this in the past 6 months from mega corp insurance individual offerings.
BruDude
Posts: 4211
Joined: Wed Dec 29, 2010 11:28 pm
Location: Las Vegas

Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by BruDude »

Fpdesignco wrote: Mon May 01, 2023 1:09 pm
BruDude wrote: Mon May 01, 2023 12:50 pm
Fpdesignco wrote: Mon May 01, 2023 12:30 pm
BruDude wrote: Mon May 01, 2023 12:29 pm
Clairvoyant wrote: Mon May 01, 2023 10:18 am We appreciate these insights.

He left the service without a VA disability (as a matter of pride — he had some ailments). If there’s a connection to his diagnosis now, it would be to the Fire Fighting Foam (for which there are cases). Not sure if we will go down that road.

I also wonder if there would be a similar offset to if disability insurance had been purchased privately/directly.

If no offset on private purchase, I’ll do my best to spread the word to other military retirees we know.
Individual policies do not offset income from other sources, at least for the “top tier” companies.
I’d be careful here. Many group policies and marketplace policies have a habit of doing this.
I’m not sure what you mean. I specifically said individual policies, and in the first reply to this post I stated that this is common with group LTD policies.

The policy is a legal contract. If it’s not in the contract, they can’t do it. None of the “top tier” DI companies offset income from other sources unless you choose the Social Insurance Substitute rider from the few companies that offer it, and I’d have to check the definition but I believe that only applies to SSDI and workers comp payments.
Making a assumption and categorizing “all” subjectively top tier companies was my caution for individual or group policies. I have recently seen examples of this in the past 6 months from mega corp insurance individual offerings.
Mega corp individual offerings are not the same thing as buying an individual policy yourself. The policy benefits are completely different and more limited. It is also very rare to see a mega corp even offer an individually-owned policy option, it’s almost always a group policy that may have a buy-up option. If it’s truly an individually-owned policy available through the employer on a group basis, it probably also does not offset other income sources.

The “top tier” of individual DI companies is pretty clearly defined. There aren’t that many companies selling individual DI in the first place. As always, read your policy.
Fpdesignco
Posts: 302
Joined: Fri Jan 14, 2022 9:30 pm

Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by Fpdesignco »

BruDude wrote: Mon May 01, 2023 1:15 pm
Fpdesignco wrote: Mon May 01, 2023 1:09 pm
BruDude wrote: Mon May 01, 2023 12:50 pm
Fpdesignco wrote: Mon May 01, 2023 12:30 pm
BruDude wrote: Mon May 01, 2023 12:29 pm

Individual policies do not offset income from other sources, at least for the “top tier” companies.
I’d be careful here. Many group policies and marketplace policies have a habit of doing this.
I’m not sure what you mean. I specifically said individual policies, and in the first reply to this post I stated that this is common with group LTD policies.

The policy is a legal contract. If it’s not in the contract, they can’t do it. None of the “top tier” DI companies offset income from other sources unless you choose the Social Insurance Substitute rider from the few companies that offer it, and I’d have to check the definition but I believe that only applies to SSDI and workers comp payments.
Making a assumption and categorizing “all” subjectively top tier companies was my caution for individual or group policies. I have recently seen examples of this in the past 6 months from mega corp insurance individual offerings.
Mega corp individual offerings are not the same thing as buying an individual policy yourself. The policy benefits are completely different and more limited. It is also very rare to see a mega corp even offer an individually-owned policy option, it’s almost always a group policy that may have a buy-up option.

The “top tier” of individual DI companies is pretty clearly defined. There aren’t that many companies selling individual DI in the first place. As always, read your policy.
The word individual is typically a give away I’m not talking about a group policy…. Yes, again, for any offering - read your policy and don’t make assumptions that even if they are “top tier” there are not offsetting conditions.
123
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Joined: Fri Oct 12, 2012 3:55 pm

Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by 123 »

Many disability income policies adjust for other income (typically Social Security Disability but there are others). A primary reason is to lower premiums to make the policy more attractive to purchase. Another reason is discourage individuals from being financially better off by receiving policy benefits than working.
The closest helping hand is at the end of your own arm.
BruDude
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Joined: Wed Dec 29, 2010 11:28 pm
Location: Las Vegas

Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by BruDude »

Fpdesignco wrote: Mon May 01, 2023 1:18 pm
BruDude wrote: Mon May 01, 2023 1:15 pm
Fpdesignco wrote: Mon May 01, 2023 1:09 pm
BruDude wrote: Mon May 01, 2023 12:50 pm
Fpdesignco wrote: Mon May 01, 2023 12:30 pm

I’d be careful here. Many group policies and marketplace policies have a habit of doing this.
I’m not sure what you mean. I specifically said individual policies, and in the first reply to this post I stated that this is common with group LTD policies.

The policy is a legal contract. If it’s not in the contract, they can’t do it. None of the “top tier” DI companies offset income from other sources unless you choose the Social Insurance Substitute rider from the few companies that offer it, and I’d have to check the definition but I believe that only applies to SSDI and workers comp payments.
Making a assumption and categorizing “all” subjectively top tier companies was my caution for individual or group policies. I have recently seen examples of this in the past 6 months from mega corp insurance individual offerings.
Mega corp individual offerings are not the same thing as buying an individual policy yourself. The policy benefits are completely different and more limited. It is also very rare to see a mega corp even offer an individually-owned policy option, it’s almost always a group policy that may have a buy-up option.

The “top tier” of individual DI companies is pretty clearly defined. There aren’t that many companies selling individual DI in the first place. As always, read your policy.
The word individual is typically a give away I’m not talking about a group policy…. Yes, again, for any offering - read your policy and don’t make assumptions that even if they are “top tier” there are not offsetting conditions.
Mega corps can’t offer individual disability insurance though. They can offer policies that the individual employee would own, but that is purchased as part of a group. Those are not the same thing. The policies are different and more limited than an individually-purchased policy bought privately would be.

What you are referring to is called a Guaranteed Standard Issue policy. Those don’t offset for other income sources either, at least none of the ones I’ve ever seen or quoted have. If it does, it’s probably a group LTD buy-up option that isn’t owned by the individual employee. Once again, as with anything, read your policy to be sure.
Topic Author
Clairvoyant
Posts: 5
Joined: Sun Apr 30, 2023 4:51 pm

Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by Clairvoyant »

I just wanted to come back to say, thank you for all of the insights.

We should see the first disability check within the month. We shall adjust!
Topic Author
Clairvoyant
Posts: 5
Joined: Sun Apr 30, 2023 4:51 pm

Re: New to Disability Insurance (Retired Military, now 20 yr Civilian)

Post by Clairvoyant »

I’m back with an update. We have now seen two direct deposits — they payments are larger than expected and the employer has confirmed they are not offset by the military retirement.

I hope this update is helpful.
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