Disability Buyout Settlements with The Standard, Long Term Disability Insurance Company

The Standard agrees to buyout long-term disability claim for $442,000.

After being on claim for several years, a former Credit and Collections Manager contacted our firm for help exploring her options with her future disability benefits. She was unable to work due to severe peripheral vision loss known as Retinitis Pigmentosa, a condition that rendered her legally blind. After applying for disability benefits with The Standard, her claim was approved without any problems. While the Standard did have her undergo an Independent Medical Evaluation (IME) during the claims process she had a relatively positive experience with the Standard while on claim.

Due to her limited vision, our client had trouble maintaining independence around her home without assistive devices or another person. Since she was renting, she wanted money to buy a home and customize it to support her independence.

She contacted our office to discuss her options and attorney Victor Peña reviewed her claim history, medical history and discussed her financial situation with her. After several conversations, Attorney Peña proposed a buyout or settlement as an option. Given the client’s medical condition and likelihood of continued disability as well as the fact that the client was also approved for SSDI benefits, it was decided that a settlement was worth looking into without posing any major risks to the continued claim.

After developing and discussing a strategy with the client for approaching the Standard in the safest possible way, Attorney Peña reached out to a familiar settlement specialist with The Standard and started the processing of securing a settlement of the claim.

After multiple discussions, a buyout settlement was reached in an amount that the client was excited about.

The Standard offers $610,000 to buyout long term disability claim for former attorney.

This amount represented less than 55% of the present value of anticipated future benefits and was too low to consider. The amount of the offer was due in large part to the claim having more than 25 years remaining. Typically, the longer the period of time remaining on a claim, the lower a buyout settlement offer will be. If there is too much time remaining on a claim, The Standard may decline to make an offer all together. This is due to a number of factors, including but not limited to, the possibility of something changing in the claim that could limit the life of the claim in some way.

Claimant seeks buyout with the Standard before reaching 24-months on disability claim.

It is not normally advisable to seek a buyout before reaching the 24-month mark. With certain exceptions, a long-term disability carrier will not even consider a buyout before a claimant has received benefits for 2 years and until after getting beyond any applicable policy limitations. A disability carrier is typically unable to determine its exposure until after a disability determination has been made beyond the change in definition in the policy. There may also be other limitations such as musculoskeletal or mental-nervous limitations in the policy which often limit benefits payable to 24 months for any disabilities caused by such conditions as defined in the policy.

Due to such limitations, disability insurance companies like The Standard often stay away from settling claims under long term disability, employer sponsored disability plans since it is more common for such plans to contain these types of limitations. Also, The Standard is one of the few disability carriers that offers group disability plans through employers as well as individual plans through insurance agents. The Standard is more likely to settle a disability claim in the form of a buyout on claims made on individually purchased policies and not necessarily on group policies. 

The Standard offers buyout at 73% of total future payments.

A 51-year-old former employee of a water and power company is offered a buyout of her long-term disability claim by the Standard.  As part of the buyout process, The Standard will provide present value calculations and require the claimant to sign and notarize an Acknowledgement & Attestation of Present Value Calculation before accepting a buyout offer. The Stannard’s calculations can often be confusing, which is why this client contact our office for help understanding her options