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EFFECT OF THE ECONOMIC DOWNTURN ON LONG TERM DISABILITY CLAIMS

← Back to Articles By Scott B. Elkind, Esq.


There have many news reports concerning the increased filing of Social Security Disability claims as a result of the economic downturn. This reporting, though, has not addressed any effect that the economic downturn has had on long term disability claim filings.

The Council for Disability Awareness undertook an extensive data analysis concerning long term disability claims review for the years 2007 - 2011 and made the following findings:

  • $9.3B was paid in disability claims in 2011, a 2% increase from 2010

  • 43% of companies reported an increased in claims from 2010 - 11 which casts doubt on the influence of the economic downturn in this area

  • For the first time since 2008, more employers provided group long term disability benefits which, again, underscores that the economic downturn has not had any real effect

  • The only possible effect of the economic downturn was a 0.5% decline in insured employees

  • The number of disability claims has increased in each of past four years as anticipated due to the aging population

  • 3.3% more claimants were approved a compared to 2010 despite the three year decline in overall number of insureds

  • Diseases of the musculoskeletal system and connective tissues are the leading causes of new disability

  • Cancer claims decreased as compared to the past year

  • This marked the second year in a row demonstrating an increase in disability claims caused by mental illness

So, all in all, there has been little in the way of changes in the numbers of long term disability claims made and paid. This, of course, is belied by the facts experienced by long term disability attorneys who continue to see a marked increase in claim denials which require litigation. The lesson learned is that once your claim hits a cycle of denial, it is harder to make the long term disability insurers change their minds and approve a denied claim.

For these reasons, more than ever, proactive hiring of legal counsel at the time of application is always recommended so as to keep your claim out of such a detrimental cycle of denial.


Scott Elkind is an attorney in Silver Spring, MD whose practice focuses on disability issues. He can reached at 301-495-6665.

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