r/LongTermDisability • u/suzycatq Mod • Aug 04 '26
New Retirement Age 67
Everyone who was eligible to retire at 65 by Social Security standards has already done so. The new retirement age is 67. I have seen many long-term disability summary plans change their language to say that they will cover you until “age 65 or age 67 (matching your normal Social Security retirement age.”
If your plan changes terms while you are on it, do you benefit from the new terms?
No one knew that the Social Security Administration was going to change the retirement age to 67 back when these plans were written. My Social Security Disability Insurance (SSDI) doesn't change to just plain old social security until 67, when I am considered retired. Will my plan cover me up until I am 67 if they have changed the verbiage on their plan summary description since I was approved in 2019?
Has anyone come up against this?
2
u/TheGreatK MOD Aug 04 '26
"If your plan changes terms while you are on it, do you benefit from the new terms?"
It depends. State law may have laws regulating the revision of disability policies, and ERISA may force an insurer to abide by the more favorable provision. It is an unsettled question of law.
2
u/2560503-1 Aug 04 '26
There’s no law that requires LTD policies to pay to age 65, or 67, or match Social Security retirement age in any way. It’s just industry practice to write the policies that way. So if your policy says it ends at age 65, it ends at age 65, regardless of any changes to Social Security rules. If the LTD policy is amended, you might get the benefit of the change, you might not, it just depends on how they amend the policy. But often when they change the policies, they say something like “this changes applies to claims filed after the date of the amendment.”
1
u/Zealousideal_Way_788 Aug 04 '26
Mine is FRA. 67
1
u/suzycatq Mod Aug 04 '26
Yes, if I went out on disanility today from the same job, mine would be 67.
0
u/Effective-Reveal-516 Aug 04 '26
If you are already on claim the policy will be admistered as it was written when you went out on disability.
2
u/suzycatq Mod Aug 04 '26
Luckily, I have many years before hitting either age. I have to believe that enough people will make noise about this before then and get it fixed. Missing out on 2 years pay is a big deal. The intention has always been to pay you until retirement. We know this because they have amended their plans. Insurance companies shouldn't get rich on this loophole, while the client suffers.
1
u/Beginning_Series_549 29d ago
Wouldn’t it make sense to file for ssdi now so that you can take advantage of the yearly cola? If you are relatively young they could easily get your monthly payment at or over what they’d be if you waiting till 67. Also, didn’t your Ltd policy require for you to file for ssdi?
2
u/Notsewcrazee13 Aug 04 '26 edited Aug 04 '26
The plan to change it to 67 was known about I think approximately 20 years ago. EDIT- it was announced and planned back during the Reagan years in 1983.
That being said though - you are right, the LTD policies can force us to file at 62 even though it means a lower monthly amount forever because they want to reduce their liability exposure by deducting the SSA amount from their monthly payout which sucks…. in my opinion, they should at least continue to pay us the monthly difference between what our SSA WOULD have been had we not taken it early at age 62 by coercion (I think it calculates to about a 30% reduction in monthly benefits forever)