In our last post we discussed some of the problems that may arise from a Social Security Disability application and the fact that many people who have employer-provided disability insurance may still need to file for SSDI benefits because many employer-based plans only pay the percent of your income that SSDI does not. We also discussed the importance of finding an experienced Portland Social Security Disability attorney because of the high denial rate and the confusion that can arise out of the SSDI application process. An application may be under consideration for years, which is why the application process is too important to mess up.
The requirement that many workers file for SSDI before they collect employer-provided disability is ironic because the approval rate for group disability claims is very high whereas the approval rate for SSDI claims is equally low. Studies indicate that approximately 75 percent of SSDI applications are denied the first time around and that half are approved after appeals. This is a stark contrast to the 75 percent approval rate for group disability carriers.
Of the approved applications by the group disability carriers, about 23 percent of the applicants never receive any benefits because they recover before the insurance kicks in.
It is also important to understand your rights in regard to individual and group plans. Some states allow people who are wrongfully denied individual disability coverage to sue for emotional damages whereas the Employee Retirement Income Security Act of 1974 bars many of these suits for group policies. Whether a plan is governed under ERISA depends on its structure, which is why it is important to seek legal advice before filing any lawsuit.
Source: New York Daily News, “Getting the right disability insurance can be a painful process,” Nov. 1, 2011