On Long Term Disability what is meant by the four types of social security integration Ex Primary Full Family Backdoor?

Answer 1

In general:

Primary - means that the disabled person's Social Security benefit reduces the amount of LTD paid. Typically, the reduction is dollar for dollar - every dollar of SS benefit reduces the LTD benefit by one dollar.

Full - means that both the disabled person's Social Security benefit and any spouse/child Social Security benefits reduce the amount of LTD paid. Typically the reduction is dollar for dollar.

Family - usually means the same as Full above.

Backdoor - means that the LTD plan looks at three different calculations and pays the lesser of the three:

1. the benefit percentage (often 60%) of the disabled person's earnings, reduced by all of the reductions allowed by the plan EXCEPT for Family SS benefits; or

2. a higher benefit percentage (often 70%) of the disabled person's earnings, reduced by all of the reductions allowed by the plan, INCLUDING Family SS benefits; or

3. the maximum monthly benefit (whatever dollar limit or cap that is set by the plan).

Please keep in mind that these are general definitions. Your plan could use different definitions or have unusual features that modify any of the above statements.