What Is a Long-Term Disability Lump Sum Payment?
If you are fighting a denied disability claim, you might be considering the option of receiving a lump sum payment instead of ongoing monthly payments.
Receiving a lump sum payment means the insurance company will provide you with a negotiated amount of money to cover you for all your disability benefits at once. This payment encompasses the current and future payments you're entitled to, calculated for the present value of that amount. There will also be a discount applied to the calculation for agreeing to pay the claim out early.
In this article, we’ll answer some common questions about long-term disability lump sum payments so you can better understand this option.
Are you considering a long-term disability lump sum payment over monthly payments? Share Lawyers’ experienced long-term disability lawyers can help you understand your options.
What Do I Need to Know About A Long-Term Disability Lump Sum Payment?
With a lump sum, you receive a negotiated one time payment rather than collecting a small sum each month. Does this make sense for you? Consider all your options.
Can I Ask for a Lump Sum if I’m Already Getting Monthly Payments?
You can try, but convincing insurance companies to consider a lump sum payment can be tricky if you’re already receiving payments. Even if they agree, their offer might fall below your expectations. It's a decision that requires careful consideration, as opting for a lump sum payment could mean that you take home significantly less money overall. Pushing for a lump sum could lead the insurance company to reassess whether they should continue your payments at all and could result in your being cut off or terminated from your benefits.
When Should I Take a Lump Sum Payment?
Opting for a long-term disability lump sum payment depends on your individual circumstances. Consult with the seasoned disability lawyers at Share Lawyers to ensure you're making the best financial decision.
Is a Long-Term Disability Lump Sum Payment Tax-Free?
Every situation is different. Here’s what you need to know:
If you earn more from the lump sum (such as from interest), you can expect that additional income to be taxed.
If your monthly disability payments weren't taxed, chances are your long-term disability lump sum likely won't be either.
Conversely, if taxes were deducted from your monthly payments, you'd probably owe taxes on a portion of your lump sum.
The tax treatment also depends on who footed the bill for your disability insurance. If your employer paid it, taxes are typically applied.
How Much Can I Get?
The amount you might get from a long-term disability lump sum payment varies based on multiple factors, such as:
How much you earn
What medical condition you have
Support from different doctors
How much you get every month for your disability
How long you're likely to live
How much money you’d get over time
What the present value of your claim is worth
What Can You Expect as a Share Lawyers Client?
When you partner with Share Lawyers, you're not just another case number. You're treated with utmost respect and empathy as we navigate the complexities of challenging your insurance provider, helping you understand when a lump sum payment might be in your best interests.
Our tailored approach ensures that each client receives personalized attention and support, regardless of location. At Share Lawyers, we're committed to standing by your side every step of the way. We’ll guide you through the decision-making process regarding lump sum disability payments and advocate for your best interests.
Share Lawyers Helps You Get The Benefits You Deserve
There is a lot to consider when choosing how best to receive your disability benefits. When you’re unable to work, these important decisions can further exacerbate your stress.
You don’t have to do this alone. Our experienced long-term disability lawyers can provide the legal guidance and support that you need. Let us help you safeguard your future.
For over 35 years, Share Lawyers has been dedicated to advocating for clients, successfully securing benefits for thousands of individuals. Our unwavering commitment lies in assisting Canadians like yourself in obtaining the essential benefits they deserve. It all begins with a free consultation, and you won't owe us anything until your benefits are secured.
Still wondering if you should accept a long-term disability lump sum payment? We can help guide you.
Contact Share Lawyers today and put our experience to work for you. Our 35+ years of experience can help you win your case against your employer. Our legal team offers a free consultation and works on a contingency basis—there are no fees unless you win your case.
