Can You Collect Long-Term Disability Insurance While Living in Another Country?

Employees in Chicago and the rest of Illinois receiving long-term disability insurance benefits generally have less income than they did when they were working. Most long-term disability insurance policies pay 60% of pre-disability earnings, and most of the time the pre-disability earnings counted for the benefits considers only base salary and does not include bonuses. The result is a 40% or more loss of income while on long-term disability. Not surprisingly, many people receiving those long-term disability insurance benefits consider living in a lower cost of living area. Some even consider moving to another country. That raises the question of whether you can continue receiving the long-term disability benefits if you live in another country. Some policies are silent about this, while others have restrictions on your ability to move to another country. Not checking your policy before you move could be fatal, as one insured recently learned.

In Archer v. Unum Life Insurance Co. of America, No. 2:23-cv-1128-LK, 2025 WL 2107491 (W.D. Wash. Jul. 28, 2025), Archer used to work as a nurse. After a combination of ailments rendered her unable to continue working, she claimed long-term disability insurance benefits under her employer’s group long-term disability insurance policy, insured by Unum. Unum did not challenge that Archer was disabled. But about 8 years after commencing disability benefits, Archer moved to Mexico. A year later she disclosed her new address to Unum in annual updates. Unum notified Archer her eligibility for benefits ceased because she had been living in Mexico for over the last year, and the policy contained a clause stating benefit eligibility ends if you live in another country six months out of any given year. After Archer unsuccessfully appealed, she sued Unum under ERISA § 502(a). The United States District Court for the Western District of Washington granted Unum’s motion for judgment on the record and denied Archer’s motion. It held the plan language clearly required Archer live in the United States more than 6 months a year to remain eligible for benefits. Archer argued it was impossible for her to return to the United States after she relocated early in the Covid pandemic, but the court rejected this argument citing evidence American citizens were always allowed to return to their home country, even during the height of the pandemic. The court thus rejected Archer’s impossibility argument.

If you have a claim for long-term disability insurance and are considering moving to another country, don’t make the same mistake. Call an experienced ERISA long-term disability attorney to learn what rights and restrictions you have under your policy.