Do I Have to Pay Back Long Term Disability Benefits if I Start Getting Social Security?

Posted on July 14th, 2016

The short answer is: Probably, yes.

Social security disability benefits may take longer to receive than long term disability (LTD) benefits from an insurance company. Once you start to receive social security disability back benefits, the insurance company will usually expect you to reimburse them for what they have already paid you, if your insurance policy offsets for social security benefits.

At Eric Buchanan & Associates, we have worked out a simple equation as an example:

If you receive a monthly long term disability benefit from the insurance company of say, $2,000 and you begin to receive a $1,200 per month from Social Security, the insurance company will only pay the difference between the two amounts, or $800 per month. From that point on, you would receive $800 per month from the LTD company and $1200 from Social Security.

Also for the catch-up payment from Social Security which gives you back benefits, you will be expected to reimburse the insurance company for the difference between what you should have received from the insurance company had Social Security been paying all along. However, you should get credit for the fees you pay your social security attorney, and normally the LTD company will not offset any increases in your Social Security due to increases each year due to the cost-of living. So, under the example above, if Social Security increases your benefits by a 2.5% cost-of-living increase to $1230, you would still get $800 from the LTD company.

Therefore, if you receive $6,000 of back benefits from Social Security, you pay your social security attorney a 25% fee, or $1500, and will be asked to pay the LTD company back the $4500 difference, but you will still get any future social security cost-of-living increases, get your Medicare, and will have a backup source of income.

Lastly, in some cases, the LTD policy will not have the correct language to allow the company to recover, or there may be other defenses you might have to avoid having to pay the company back. We help people with both social security and LTD claims, and if you have both, we can help you get the most benefits under both claims, and can advise you on your obligations on whether you have to pay back the LTD insurance company if you win both cases.

Getting Legal Help

The experienced disability team at Eric Buchanan & Associates has handled thousands of disability claims, and has many years of experience in disability insurance, ERISA long term disability and social security disability law. Give us a call today at 877-634-2506 or email us at to set up your appointment.