When you qualify for long-term disability benefits due to your inability to work, you typically receive monthly benefits equivalent to a specific percentage of your salary. In some cases, after you have received long-term disability benefits for some time, the insurance company will offer you a one-time lump sum payment that buys out your claim. If you accept a buyout, you no longer will receive monthly disability benefits from your insurance policy. The lump-sum buyout amount will be the last benefit that you receive under the plan.

Choosing whether to accept a buyout is a big decision because it can impact your financial stability for years into the future. Getting legal advice when your insurance company offers you a buyout can be crucial to protecting your financial health.

Insurance companies worry only about their bottom line, which means that they continuously are trying to find ways to limit the amount of benefits that they are paying out to claimants. One way to do this is to buyout claims so that the insurance company is no longer paying monthly benefits. If the insurance company expects that it will continue to pay out monthly benefits for years into the future, it may offer a buyout so that it can pay out less in benefits than it otherwise would.

When considering whether to take a buyout, you should determine the maximum value of your disability claim. For instance, if you are entitled to benefits until age 65 or retirement age, you should multiply the amount of your monthly benefits by the remaining number of months for which you can collect benefits. The insurance company likely will not offer you a buyout that is equivalent to the total amount of benefits that you can obtain. Instead, the insurance company typically will provide you with a discounted rate based on various factors, including your expected mortality, the likelihood of you recovering from your disability, and inflation. Insurance companies use different formulas to calculate your buyout, but they all consider many of these same factors.

If you need to apply for long-term disability benefits, you may greatly benefit from calling us today and getting the advice that you need. Bonnici Law Group has the experience and knowledge that is invaluable when applying and qualifying for long-term disability benefits. When you need answers, contact Bonnici Law Group today at 858-261-5454. As we focus our efforts on long-term disability claims, we know how to protect your rights and build a strong demand for compensation in your case.