Page 132 - Group Insurance and Retirement Benefit IC 83 E- Book

employer provides salary continuation through a STD policy that has no elimination

period for disability from accidents. At the end of the 90-day elimination period, the STD
benefits stop and, since the individual is still disabled, LTD benefits begin.

This is just one way STD or salary continuation benefits and long--term disability

benefits might be combined to provide significant income replacement under a group
disability plan. As usual, you must be fully aware of the types and duration of benefits

available from the insurers you represent in order to offer options that will meet the needs

and desires of different group sponsors.

Benefit Period

By definition, the benefit periods for LTD are longer as compared to short-term disability
plans, but some LTD plans pay benefits for no more than two or five years. Of the longer

periods available, two of the most popular are benefits paid to age 65 and lifetime

benefits.

Lifetime Restrictions

When a long-term disability plan pays benefits for a lifetime, insurers usually impose

additional restrictions. Some policies stipulate an upper age before which the coverage

must be purchased. As an example, if an individual is covered by the LTD plan before
age 45, the lifetime benefit period applies. For those age 45 and older when the plan

becomes effective, the benefit period is restricted to age 65.

Other LTD plans specify an age before which disability must begin in order for lifetime

benefits to be paid. For example, a person age 50 or younger when disability begins
receives lifetime benefits, while a disability that begins at a person 5 age 51 or older pays

benefits only to age 65.