Long Term Disability Insurance Policy Booklet
Describes eligibility requirements, coverages, premium/price tag information, benefits summary.
Long Term Disability Overview
The long term disability insurance plan (LTD), which is underwritten by Unum, provides monthly benefits if you become ill or injured and are unable to work. This income replacement is designed to restore part of the work earnings lost during a period of disability.
Benefits begin after completion of the elimination (waiting) period and are equal to a percentage of your base annual salary, up to a maximum of $10,000 per month. Benefit amounts may be reduced by other income benefits such as, but not limited to, pay for sick leave, workers compensation, university retirement, Social Security disability/retirement payable by the United States Social Security Act, etc.
To qualify for LTD benefits, you must be unable to perform each of the significant duties of your regular occupation during the first 24 months of disability. Disability will continue thereafter if you cannot perform each of the significant duties of any gainful occupation for which you are reasonably fitted by training, education or experience.
Long term disability benefits will be paid to a disabled employee based on the following payment schedule:
|Age at Disability||Maximum Period of Payment|
|Less than age 62||To age 67|
|Age 62||60 months|
|Age 63||48 months|
|Age 64||42 months|
|Age 65||36 months|
|Age 66||30 months|
|Age 67||24 months|
|Age 68||18 months|
|Age 69 and over||12 months|
Summary of LTD Options
|Option||Income Replacement||Elimination Period|
|3||66 2/3%||180 days|
|5||66 2/3%||90 days|
Issues to Consider
- LTD benefits are subject to a "3-12 month pre-existing condition" exclusion, which precludes income replacement benefits for any disability that (a) is caused by, contributed to by, or results from a preexisting condition, and (b) begins in the first 12 months after an insured's effective date of coverage.
- You may enroll for coverage, increase your income replacement benefit percentage and/or reduce your elimination period from 180 to 90 days at a later date. Benefits are, however, subject to a pre-existing condition exclusion.
- LTD benefits are offset by pay for sick leave. If you have a sick leave balance of 90 days or more, it may be desirable for you to enroll for Option 2 or 3, which pay benefits after a 180-day elimination period.
- Premiums are withheld on a pre-tax basis; therefore, disability benefit payments will be taxable.
- Due to cost-of-living increases (COLA), your monthly disability benefit may be increased annually by an amount equal to the previous year's CPI, not to exceed 3 percent of your monthly benefit.
- Totally disabled employees who qualify will receive a monthly retirement plan contribution based on a percentage of their pre-disability earnings, not to exceed the maximum allowable by law.