MUTUAL OF OMAHA
Mutual of Omaha Lump Sum Settlements
Mutual of Omaha was founded in 1909 as a Mutual Benefit Health & Accident Association. In additional to other financial products, the company provides insurance including life insurance, Medicare supplement insurance, long-term care insurance, health, accident and special coverages, long term disability (LTD) insurance and dental insurance.
Mutual of Omaha has multiple subsidiaries including United of Omaha Life Insurance Company, United World Life Insurance Company, Mutual of Omaha Investor Services, Inc., Omaha Financial Holdings, Inc. and East Campus Realty, LLC.
Does Mutual of Omaha Offer Lump Sum Buyouts?
Mutual of Omaha is known to, on occasion, extend settlement offers to their disability claimants. To qualify, you must meet their specific criteria which usually includes a thorough review of the claim file and most recent medical records. The most recent medical and financial information available in your claim file will be crucial in evaluating not only your eligibility for a buyout but also the amount to be offered.
In calculating an offer amount, Mutual of Omaha’s actuaries will consider the following factors:
Present value of future monthly benefits
Most recent medical and financial information available
Uncertainties of the future—this includes interest rate fluctuations and unforeseen accidents
Morbidity and mortality risks—this is why your most recent medical information is important
Possibility of future medical advances
A buyout offer will always be a fraction of the total calculated value of the claim. All the factors listed above will be used to “discount” the present value of anticipated future monthly benefits. If Mutual of Omaha concludes that a reasonable offer can be made, then they will offer to buy out your policy.
Mutual of Omaha Offered Me a Buyout, Now What?
It is important to fully understand your rights before agreeing to settle your claim with Mutual of Omaha. In exchange for the lump sum payout, you will be required to sign a broad release waiving all rights under the policy and discharge Mutual of Omaha and any affiliates and subsidiaries from any and all payments, claims and obligations whatsoever. You will have to surrender all rights under your disability policy meaning you will not have any future coverage even if you suffer a future disability from a new, unrelated medical condition.
Before signing any release, you should always consult with an experienced disability buyout attorney. Experienced attorneys can guide you in determining whether a settlement amount is reasonable and help you fully understand how a settlement will affect you.
Having the right team is crucial and this often includes not only an experienced lawyer but also an accountant, financial advisor and, in some cases, a settlement annuity specialist.
Does Mutual of Omaha Negotiate?
Every case is unique, and every offer should be carefully reviewed with experienced professionals. Experienced attorneys know if an offer can and should be negotiated and you should not simply accept the first offer on the table. Some carriers extend only “take-it or leave-it” offers without negotiating. Since your disability policy will not give you the right to a settlement or buy-out, the insurance company does not necessarily have an incentive to negotiate.
However, there are steps that can be taken to maximize your payout if you have decided that you want a buyout. If you have not received a buyout offer from Mutual of Omaha but you are interested in a lump sum settlement, then it is best to contact an attorney as soon as possible.
A comprehensive review of your claim and the most recent medical and financial information is necessary to determine the next best steps.
How Does Mutual of Omaha Calculate a Buyout Offer?
Every case is unique, but the same basic criteria is used by all disability carriers to determine the value of a claim. This includes the present value of anticipated future benefits remaining on the policy. This is not a matter of multiplying the monthly benefit by the number of months remaining on the claim until the policy expires. Disability policies often pay benefits until age 65 or a claimant’s normal retirement age but calculating the value of a claim for purposes of a buyout requires determining the present value of all those future monthly benefits. A financial expert can explain how the time value of money has to be factored into determining that amount. This calculation can be explained, simply, by considering the interest that can be earned on a specific lump sum of money over the period of time that covers the time remaining on your claim.
Once the present value is calculated, the value is discounted even more depending on your current medical conditions, the time remaining on the claim, and uncertainties that Mutual of Omaha has calculated considering their own history of past disability claims.
The calculations can get complicated, which is why Mutual of Omaha has their own actuaries work the numbers. Victor Peña Law PLLC has relationships with experienced actuaries who can review the numbers and ensure you are getting the best possible offer.
Why Should I Retain an Attorney for A Buyout with Mutual of Omaha?
You should never sign a settlement release before having it reviewed by an attorney experienced in the area. Mutual of Omaha has been around a long time and has extensive experience handling and settling claims. Given their long history, they are well-versed in how to draft release agreements. The release will protect them and is very difficult to escape once it is signed. If you sign a release and then later change your mind, you will have a difficult time finding an attorney who will be willing to challenge the release on your behalf. It is therefore crucial to fully understand what you are signing before you sign your rights away.
Questions to Ask Yourself Before Deciding to Approach Mutual of Omaha for A Buyout
There are many questions you should ask before deciding whether to approach Mutual of Omaha with a request for a buyout or before considering accepting an open offer. Also, just because you have been on claim for years does not mean that Mutual of Omaha will even consider offering you a buyout. Before approaching them to request a buyout you should ask yourself the following questions:
When was the last time they performed a medical review?
Is my doctor available and willing to fill out medical paperwork if Mutual of Omaha requests an update now?
How long will my primary doctor be able to complete future claim forms?
How long have I been on claim?
Are there any policy limitations that apply to my claim?
How much longer do I have left before I reach the maximum benefit period?
What is the likelihood I will reach my maximum benefit period?
Am I willing to give up a portion of my future benefits just to receive a lump sum?
Am I willing to undergo an independent medical evaluation?
Do I have any employer sponsored benefits that require me to stay on claim with Mutual of Omaha in order to continue receiving them?
Will my health insurance end if I settle my claim with Mutual of Omaha?
Do I fully understand my disability policy?
When Is the Best Time to Ask Mutual of Omaha for A Settlement?
The best time to ask depends on your circumstances. It is possible for a request to be too early as well as too late. You do not want to approach Mutual of Omaha with a request for a buyout too early and risk making them suspicious of your reasons for asking. You also do not want to ask too late and give up a huge portion of your benefits unnecessarily when your policy expires in a year or two.
Whether or not it is a good time for a buyout will depend on not only the particular facts of your case—which includes medical and financial aspects—but also your unique circumstances and needs.
Ultimately, only you can determine if a buyout is right, but it is best to make the decision after a thorough review by the right team of experienced professionals.