Disability Insurance FAQs

These questions are provided by the Maine Bureau of Insurance as a general guidance. These questions and answers are not intended to give specific information relating to particular situations nor are they intended to provide legal advice.

For more information, visit our section on Disability Insurance.

I have filed a claim for disability income benefits. My insurance company makes telephone calls to me to discuss my claim and to ask me questions.  Am I required to discuss my claim with and to answer questions from my insurance company over the telephone?

No. You are not required to discuss your claim with nor to answer questions from your insurance company over the telephone. You may request that the insurance company not contact you by telephone and to only contact you in writing to discuss your claim and/or ask you questions. Conducting your business in a written form creates a clearer record of communications between parties than will doing so over the telephone.

How much time does the company have to pay my disability claim?

A claim for disability benefits is payable within 30 days after proof of loss is received by the insurer and approval of the claim is made in writing.  A claim that is not paid within 30 days is overdue, unless during the 30 days the insurer, in writing, notifies the insured that reasonable additional information is required.  In that case the claim is not overdue until 30 days following receipt by the insurer of the additional required information.

Is my disability insurance carrier allowed to reduce my disability benefits by my Social Security benefits?

It is common for Group disability insurance policies to stipulate that benefits are reduced by other sources of income, such as, Social Security Disability, Social Security Retirement, and, frequently, Dependent Social Security Disability benefits. To achieve the total income level specified in the Policy, the disability insurance carrier is allowed to reduce the disability benefit by the total amount of other income (offset) the claimant is entitled to receive as a result of the disability.

Though it’s true that the Group disability Insurance benefits are reduced by the initial amount awarded for Social Security benefits, the SS offset will not include future cost of living increases.

See what the Maine law says on this issue, Title 24-A M.R.S.A.  § 2717-A and  § 2829-A.

Is there a limit on the amount or percentage that my disability insurance carrier is allowed to reduce my disability benefits?

  1. For Individual disability income polices, the insurance company must make certain disclosure to policy applicants.  The insurer shall provide the applicant with a clear written notice that explains all types of income that may result in a reduction of the benefits payable under the policy.
  2. For Group disability income polices, the insurer shall include in any written enrollment material and certificate of coverage a clear notice that explains all types of income that may result in a reduction of the benefits payable under the policy or contract.

The process of any recovery of disability benefit overpayments generally functions like this:

For claims filed after January 1, 2006, an insurer that is entitled to reduce disability income benefit payments when the insured receives income from other sources and that is entitled to recover overpayments through offsets against current payments to the insured may not recover such overpayments at a rate greater than 20% of the net benefit per benefit payment period unless:

For policies applied for after September 13, 2003, the insurer has complied with the requirements of number 1 above for Individual disability income polices and 2 above for Group disability income polices .

The insurer effects the offset of benefits within 60 days of notice to the insurer, or such later date as the insurer begins paying benefits to the insured, that the insured is receiving or is entitled to receive income that may result in a reduction of benefits payable under the policy;

The overpayment did not result from the insurer's miscalculation of benefit reductions or the insurer's miscalculation of benefits payable under the policy and

The insurer provided the insured with clear and conspicuous written notice that accurately explains to the insured all types of other sources of income that may result in a reduction of the benefits payable under the policy within 30 days of the date a claim for disability benefits was filed.

What is an elimination period?

It is the number of days, from the start of disability to the date when benefits become payable. During the elimination period no benefits are paid. Generally, premium during the elimination period must still be paid.