If you receive long term disability benefits and have been approved for SSDI, you likely have questions. You may wonder if your insurance company can sue to recover the overpayment. The answer is it depends.
What Happens If I Don’t Pay Back Long Term Disability?
Under certain circumstances, disability insurance companies may be able to take legal action against you to recover SSDI or SSI overpayments. This is particularly true if the company provides you with an advance on your SSDI benefits. For example, if the insurance company pays you your entire “gross” LTD benefit amount without any reductions for Social Security disability and you later win your Social Security disability claim. If this is the situation, the company may have a legal right to overpayment recovery.
If you are facing legal action over an SSDI overpayment, there are a few things you can do to protect yourself. First, you should consult with an attorney who specializes in disability law. They can review your case and help you understand your legal rights and options.
In some cases, it may be possible to negotiate a settlement with the disability company, including a waiver of overpayment. Negotiating a settlement with a request for a waiver can be an attractive option for both parties. It can help to avoid the time, expense, and uncertainty of a trial.
However, it’s essential to know that an attorney should review any settlement agreement before signing it. This will ensure that it is fair and in your best interests.
Finally, it’s worth noting that there are some legal protections in place to help protect SSDI recipients from overpayment-related lawsuits. The statute of limitations for these claims may be limited. The insurance company may also have trouble making a proper legal claim if the Social Security funds are mixed with other assets or if the Social Security funds have been “dissipated.”
In conclusion, a disability company may be able to sue you to recover an SSDI overpayment under certain circumstances. It is not always a clear-cut situation. If you cannot afford to pay and face legal action over an SSDI overpayment, seek professional help.
Consulting with long term disability attorneys specializing in disability law can help you understand your legal rights and options. With the proper guidance and support, you can protect yourself and ensure you’re treated fairly.