How the Basis of Your Social Security Claim Affects Long-Term Disability Claims

Employees in Chicago with employer sponsored group long-term disability insurance coverage frequently ask why the long-term disability insurer pressures them to apply for Social Security Disability benefits. Nearly all group long-term disability insurance policies offset forms of other income, most notably income you receive or are eligible to receive for being disabled by the Social Security Administration. This offset means for every dollar in Social Security disability benefits you receive, the long-term disability insurer pays you a dollar less, leaving your total disability income at the insured level. Aside from the benefits to the insurer, receiving the same amount of benefits from two sources instead of one provides you diversification, so that in the event there is a dispute with one source, you still have income from the other source. But be careful before throwing the kitchen sink at the Social Security Administration, as a recent case demonstrated how the basis for seeking Social Security Disability benefits can hurt your long-term disability insurance claim.

In Abi-Aad v. Unum Group, No. 21-cv-11862, 2023 WL 2838357 (D. Mass. Apr. 7, 2023), Abi-Aad claimed disability due to mental health conditions. He concurrently applied for Social Security Disability benefits on the same basis. Unum approved his claim under the own occupation definition of disability, and Abi-Aad was subsequently approved for Social Security Disability benefits. The long-term disability insurance policy contained a 24-month limitation on benefits payable for disabilities caused by mental illness. When Unum terminated benefits, Abi-Aad appealed, and asserted he is also disabled due to chronic pain. After Unum upheld the benefit termination on appeal, Abi-Aad sued under ERISA § 502(a).

The United States District Court for the District of Massachusetts ruled in favor of Unum and against Abi-Aad. While Abi-Aad was awarded Social Security Disability benefits, the Social Security Administration awarded them based on Abi-Aad’s mental health conditions, and not his chronic pain. Additionally, the court explained Unum had at least four medical consultants review Abi-Aad’s file and all concluded of chronic pain rising to a level to completely disable Abi-Aad from performing any gainful occupation, since the definition of disability changed to a gainful occupation standard after 24 months.

If your long-term disability claim has been denied or terminated, contact a skilled ERISA long-term disability lawyer today.