On March 31, 2006, the commissioner of Social Security issued regulations revamping the Social Security disability benefit program.
The new rules will change the four-step administrative process that existed in most states since the program began. They also will set up a Quick Disability Determination procedure for claims that are likely to be awarded (see box).
Though the changes are procedural, they will impact disability insurance agents. That's because agents will have contact with the new system through their customers who become disabled. Some points to keep in mind follow.
The new rules are effective Aug. 1, 2006, initially only in the Boston region (Maine, New Hampshire, Vermont, Massachusetts, Connecticut and Rhode Island). The idea is to get feedback and fine-tune them before expanding to other regions, which the SSA says will not occur for at least one year.
Even if a customer has private disability insurance, such as an individual policy or a group policy, the private insurance may have exclusions and limits. For example, many group long-term disability benefits are limited to two years for mental/nervous claims. But such limitations do not exist for Social Security disability insurance benefits.
As one would expect, the medical and vocational requirements for Social Security disability benefits often are easier for people to meet than is the case with private disability policies.
In addition, some disability insurance policies, particularly group long-term disability, require the insured to apply for Social Security disability benefits. If these benefits are awarded, the LTD payment is then offset accordingly.
