The Standard LTD Overpayment Case Study – How We Eliminated a $97,876 Debt
Our client, Ms. T, contacted Victor Peña Law (VPL) frustrated and desperate for help. Her long-term disability (LTD) carrier, The Standard, sent her an overpayment demand letter claiming she owed more than $97,000.
According to The Standard, the overpayment was due to work earnings Ms. T had received over several years while still on claim. Like many disability claimants, she felt overwhelmed and didn’t know what to do.
Before finding our firm, Ms. T had hired another ERISA long-term disability law firm to appeal The Standard’s original decision. Unfortunately, that appeal not only failed — it made things worse.
The Standard’s Overpayment Letter
On May 11, 2023, The Standard issued an overpayment notice to Ms. T. The letter stated:
She had been overpaid approximately $35,000 due to earnings she received between 2016 and 2022.
She was no longer considered disabled under her LTD policy.
She would receive no further long-term disability benefits going forward.
This left Ms. T in a difficult position: her benefits were terminated, and she was facing a large debt claim.
The Failed Appeal
With the help of another disability law firm, Ms. T appealed The Standard’s overpayment decision. But on August 21, 2024, The Standard upheld its denial and went further — recalculating the alleged overpayment at more than $97,000.
The law firm representing Ms. T at the time reviewed The Standard’s calculations and told her the numbers looked correct. Shortly after, they informed her they could not help her further.
Feeling abandoned and without hope, Ms. T began searching for another solution.
How Victor Peña Law Eliminated the $97,876 Standard LTD Overpayment
Just four days later, Ms. T found our office. Attorney Peña carefully reviewed her claim file and quickly developed a legal strategy to challenge the overpayment.
Within two weeks of being hired, our firm achieved the following outcome:
The Standard agreed the overpayment was not valid.
The entire $97,876.02 balance was waived.
Ms. T did not have to repay a single cent.
Despite the appeal process having already been exhausted, Attorney Peña demonstrated that the overpayment was caused by The Standard’s own mismanagement, not by Ms. T.
This case is proof that disability claimants may still have options even after an appeal is denied.
What Is an LTD Overpayment?
A long-term disability overpayment happens when your insurance company claims it paid you more than you were entitled to under your LTD policy. The company will then demand that you pay back the difference.
Common causes of LTD overpayments include:
SSDI approval: LTD carriers offset SSDI benefits against your monthly benefit. If your SSDI is approved retroactively, your LTD company may claim you were “overpaid.”
Work earnings: If you attempt to return to work, even part-time, insurers often reduce your LTD benefit. If they later recalculate, they may allege an overpayment.
Dependent benefits: SSDI dependent benefits are sometimes treated as offsets, leading to unexpected repayment demands.
Administrative errors: Insurance companies make mistakes. Poor claim handling can result in miscalculated benefits that are later blamed on you.
Why The Standard Issues Overpayments
The Standard is known for aggressively pursuing overpayments. Here are the most common scenarios we see:
SSDI Back Pay
Example: If you receive a lump sum of SSDI back pay covering months or years while also receiving LTD benefits, The Standard may claim you owe them the difference.
Work Earnings Miscalculations
Example: Like in Ms. T’s case, if you work part-time while on LTD, The Standard may later recalculate your benefits and demand repayment.
Retroactive Denial of Benefits
Example: The Standard may decide you were never entitled to benefits for a past period and issue a retroactive denial. When they do this, they often allege you must repay benefits already paid during that time.
What To Do If You Receive a Standard LTD Overpayment Letter
Receiving an overpayment demand can be frightening, but you have options. Here are steps you should take:
Don’t Panic
These letters are intimidating, but acting quickly and strategically is more important than rushing to pay.
Don’t Automatically Agree to Repayment
The Standard’s calculations are often flawed. Once you agree to a repayment plan, it can be much harder to challenge the debt.
Request Your Claim File
You have the right to review your claim file under ERISA. This may reveal errors or mismanagement.
Consult an LTD Overpayment Attorney
An experienced ERISA attorney can review your case, identify defenses, and negotiate reductions or waivers.
Can You Fight a Standard LTD Overpayment After Losing an Appeal?
Yes. Ms. T’s case is proof that you can challenge an overpayment even after an appeal has failed.
Insurers sometimes treat appeals as the “final word,” but the truth is:
Appeals can be handled poorly.
New evidence or legal arguments can emerge.
Insurance companies may waive or reduce debts if pressed with the right legal arguments.
FAQs About Standard LTD Overpayments
Q: Can The Standard waive an LTD overpayment?
Yes. As shown in Ms. T’s case, The Standard may waive all or part of an alleged overpayment when challenged.
Q: Does appealing an LTD overpayment ever work?
Yes, but not always. Appeals must be carefully prepared. In some cases, appeals worsen the situation, which is why legal representation is critical.
Q: Can The Standard send me to collections for an LTD overpayment?
Yes. If ignored, LTD insurers may try to collect. However, there are defenses that can reduce or eliminate what you owe.
Q: What if I can’t afford to repay The Standard?
You should not agree to a repayment plan without reviewing the claim first. Many alleged overpayments are negotiable or invalid.
Q: What if The Standard retroactively denies my LTD benefits?
Retroactive denials are one of the most common ways The Standard creates overpayments. In these cases, the company decides you were not entitled to benefits for a past period and demands repayment. These situations are often disputable, especially if the denial is based on incomplete or incorrect information.
Do You Have a Standard LTD Overpayment Letter?
If The Standard has demanded repayment of LTD benefits or denied your appeal, don’t assume you’re out of options. Even large overpayments may be reduced or eliminated with the right legal strategy.
📞 Contact Victor Peña Law today for a consultation. We help clients nationwide fight LTD overpayments and negotiate disability settlements with The Standard and other insurers.