Should I apply for Social Security Disability benefits even though I was just approved for LTD by Unum?

Answer

I generally recommend that my clients wait until they have been out of work for at least six months before applying for Social Security Disability Insurance (SSDI) benefits. There are both financial and strategic reasons for this approach.

However, in your situation, because you have already been out of work for six months and your Unum policy apparently contains a 24-month mental health limitation, I would generally recommend moving forward with an SSDI application now rather than waiting until your Unum benefits are about to expire.

Why I Don’t Usually Recommend Applying for SSDI Immediately

One of the most important things to understand is that most group long-term disability insurance policies allow the insurance company to reduce monthly LTD payments by the amount of SSDI benefits a claimant receives. For example, assume Unum is paying you $5,000 per month in LTD benefits. If Social Security approves you for $2,000 per month, Unum may reduce its monthly payment to $3,000. Your total monthly disability income would remain $5,000.

In other words, an SSDI approval does not necessarily put additional money in your pocket while Unum is paying your full LTD benefit. Instead, it often reduces the amount Unum is responsible for paying. This is why I do not believe every claimant should rush to apply for SSDI immediately after stopping work. There are exceptions, including situations involving minimum LTD benefits, dependent SSDI benefits, Medicare eligibility, and policy provisions requiring an SSDI application.

An Early Social Security Disability Denial Can Create Problems

Another consideration is the potential impact of an SSDI denial on your private disability insurance claim. Social Security generally applies a more demanding disability standard than many LTD policies apply during their initial own-occupation benefit period. For example, your Unum policy may initially require you to establish that you cannot perform the material duties of your regular occupation. Social Security generally evaluates whether you can perform substantial gainful work, considering your medical conditions and vocational circumstances.

If you apply for SSDI too early, before your medical records adequately document your ongoing restrictions and limitations, you could receive a denial. Although an SSDI denial does not legally establish that you are capable of performing your occupation under your Unum policy, an insurance company may attempt to reference that denial when evaluating your LTD claim.

In my experience, it is preferable to submit a well-supported SSDI application with sufficient medical evidence rather than rush to apply before the medical documentation is developed. This is especially important for mental health disability claims involving bipolar disorder, depression, and anxiety.

The medical records should document not only the diagnoses but also how symptoms interfere with concentration, reliability, attendance, social interaction, and the ability to sustain full-time employment. Importantly, waiting six months is not an SSA requirement. It is a general strategy that must be considered in light of the claimant’s individual circumstances and policy obligations.

Why Applying Now Makes Sense in Your Situation

You have already been out of work for approximately six months, and Unum has approved your LTD benefits. At this point, the analysis changes.

First, Social Security Disability claims take considerable time to process. The Social Security Administration generally estimates six to eight months for an initial disability decision. If your application is denied, the reconsideration and hearing process can extend the time significantly.

Second, your Unum policy apparently limits benefits for mental health conditions to 24 months. Social Security does not impose the same 24-month limitation on disabilities caused by bipolar disorder, depression, or anxiety. If Unum stops paying your benefits after 24 months, an approved SSDI claim could provide an important continuing source of income.

Third, you may already have satisfied Social Security’s five-full-calendar-month waiting period, depending on your established disability onset date.

For these reasons, I would not recommend waiting until the end of Unum’s 24-month mental health limitation to begin the SSDI process.

What Happens If Social Security Approves Me?

If Social Security approves your claim while Unum is paying LTD benefits, Unum will likely reduce its monthly payments by the SSDI amount, assuming your policy contains the typical offset provision.

You may also receive retroactive SSDI benefits. If those benefits overlap with months Unum already paid, Unum may be entitled to reimbursement under the policy. However, SSDI can provide significant long-term advantages. Unlike Unum’s mental health limitation, Social Security does not automatically terminate benefits after 24 months solely because the disability involves a psychiatric condition.

Additionally, SSDI entitlement can eventually lead to Medicare eligibility, generally after 24 months of SSDI entitlement. There is another reason not to wait too long. Social Security generally limits retroactive SSDI benefits to 12 months before the application date, subject to eligibility requirements. Delaying an application for two years could result in losing benefits that otherwise might have been payable.

My Recommendation

Based on the facts you provided, I would generally recommend applying for SSDI now, but I would not have recommended rushing to apply when you initially stopped working six months ago. You have already completed six months of short-term disability, Unum has approved your long-term disability claim, and you face a potential 24-month limitation on your benefits. The goal is to have your SSDI claim approved before your Unum benefits potentially expire.

You should review your Unum long-term disability policy to determine whether you are required to apply for SSDI, whether the 24-month mental health limitation contains any exceptions, and how Unum calculates offsets for Social Security benefits. The fact that Unum asked you to sign a document agreeing to notify the company if you receive SSDI does not, by itself, establish that you are required to apply immediately.

The bottom line: Timing an SSDI application is a strategic decision. Applying too early may provide little immediate financial benefit and can create unnecessary complications. Waiting too long, however, can expose you to a significant gap in income if your LTD benefits end before Social Security approves your claim.

Supporting Social Security Administration Resources

• SSDI application processing times: SSA Disability Application FAQ - Social Security generally estimates six to eight months for an initial disability decision.


• Five-month waiting period: SSA Disability Benefits Approval - Explains when SSDI payments can begin.


• Mental health disability eligibility: SSA Mental Disorders Listings - Includes depressive disorders, bipolar disorders, and anxiety disorders.


• Disability qualification requirements: SSA Disability Eligibility - Explains the requirements for qualifying for SSDI.