LTD Buy-up?

[turkjey5]

Hello all,

New to DI and trying to understand what a LTD buy-up will cover. In the following example the existing LTD covers 60% and the LTD buy-up covers 80%. So, if someone is making $1000/mo. they would get $600 from the original LTD but what does the 80% cover? The remaining $400, i.e. the person will receive an additional $320?

Thanks!



Employer Profile

Regional bank with 80 Employees

• 25 officers and managers

• Female employees: 55%

• Average employee age: 46

• Average income: $60,000

• Occupation classes: 3A-5A

Situation

• Existing group Long-Term Disability (LTD)

benefits replacing 60%

• Requested: Voluntary Guaranteed Standard

Issue (GSI) LTD buy-up

Solution

We’ll offer Voluntary GSI LTD buy-up

• 80% replacement ratio up to $3,000/month

• 20% premium allowance

• 12/12 pre-existing condition limitation

 

[somarco]

I don't write much LTD any more, but have not seen a plan that pays a benefit in xs of 67% of gross pay.

In layering plans you need to consider SS offset and COB with other LTD plans.