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Calculate Your Monthly Long Term Disability Insurance Benefits

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If you’ve recently been affected by an illness or injury that has left you unable to continue working, you need to understand how to calculate your monthly long term disability insurance benefits. Knowing the impact of salary, historical salary, bonuses, offsets and other factors is essential in helping you wrap your head around this often overwhelming process. That's why we have created this comprehensive guide for those who are looking to better understand their monthly long term disability insurance benefits and how they figure into these life-altering decisions. Here’s everything you need to know about calculating your long term disability insurance benefits today!




1. Calculate Your "Prior Income" or "Predisability Income": This is the number one factor when it comes to calculating your monthly long term disability insurance benefits. Prior income/predisability income is calculated by determining either your current salary, or your average salary over the past few years.  The definition of prior income in your policy may be limited to the salary you earned as of your date of disability, or it may be limited to your salary in the last calendar year.  Other policies take into account the highest 2 of the previous 3 years of salary or the highest 2 or 3 of the previous 5 years of salary.  Review your policy in detail to determine which portion of your salary history is taken into account to determine your prior income. Prior income/predisability income will be factored in with other factors like bonuses, offsets, etc., to determine your monthly benefit amount.

2. Bonuses: Some policies take into account bonuses or other incentive pay.  Some policies do not.  Review your policy in detail to determine whether your policy counts certain types of bonuses or a portion of bonuses towards prior income.

​3. Benefit Percentage:  This is the percentage  of prior income that is used to calculate your monthly benefit amount.  This percentage will depend on the policy and its provisions, but benefit percentage typically ranges from 50-70 percent of prior income.

​4. Know Your Offsets: Depending on your policy, offsets may be taken out of your long term disability insurance benefits. Make sure to look up the specifics of your plan to understand exactly how these will affect your monthly benefit amount. Typical offsets include Social Security Disability Benefits, Workers' Compensation Benefits, and any other income paid to you on account of your disability.

​5. Understand Different Types of Policies: Not all policies are created equal. Make sure you understand the specifics of your policy so that you can accurately calculate your monthly long term disability insurance benefits.  For example, many individually purchased policies do not take into account prior income or predisability income at all. Some policies instead pay a fixed sum each month regardless of your salary history.



Calculating your monthly long-term disability insurance benefits can be a complex process. It is important to understand the key factors that will affect your disabled income such as average salary, offsets and bonuses, non-salary income, and different types of policies so that you can accurately estimate what you will be receiving for your monthly long term disability insurance benefits. By taking the time to understand the different components of your policy and their impact on your benefit amount, you can make informed decisions and ensure that you are getting the protection you need.  With this knowledge in hand, you can confidently navigate through the process of understanding and managing your long term disability insurance benefits.




How the Maddox Firm Can Help


The Maddox Firm examines your policy.  As discussed earlier, your disability insurance policy outlines how your monthly long term disability insurance benefit is calculated.  The policy language is often complex, confusing, and easily misunderstood. The Maddox Firm will study your policy and explain the terms to you so you understand the definition of prior income, whether bonuses are taken into account, and if any offsets will apply to your benefits.  We will also make sure that you understand all of the other important provisions of your policy.

The Maddox Firm handles all communications with your insurance company.  Once retained, The Maddox Firm will take over all communications with your insurance company immediately.  This prevents your insurance company from blindsiding you with any attempts to undermine your disability claim with misleading questions. We ensure all claim forms are received in a timely manner and that your insurance company does not drag its feet with your claim.  If your insurance company tries to request an interview with you, we will push back on your behalf.  Should an interview proceed, we attend the interview with you to make sure your insurance company doesn’t overstep and your rights are protected.

The Maddox Firm gathers and evaluates your evidence.  The Maddox Firm will request and obtain your medical records from your treating doctors.  We review the records for any “red flags” to get ahead of your insurance company’s questions.  If your disability claim has already been denied or your benefits are terminated, The Maddox Firm can handle your appeal or litigation with your insurance company. 

We always recommend speaking with a trusted attorney before filing or appealing a short or long term disability claim.  Whether you are looking for assistance in navigating the claims process, appealing a claim denial, or litigating a final adverse decision, The Maddox Firm can help.  The team at The Maddox Firm will look over your insurance policy, paystubs, correspondence from your employer, correspondence from your insurance company, medical records, and any other relevant documentation in order to give you personalized guidance on how we can help you win your short and/or long term disability claim.



Contact us to help you file your claim, appeal, or litigation the right way.

Predisability income definition

Benefit Percentage


Pre-Disability Salary on Last Day Worked


Yearly Salary Last Year


Yearly Salary Two Years Ago


Yearly Salary Three Years Ago


Yearly Salary Four Years Ago


Yearly Salary Five Years Ago


Bonus Last Year


Bonus Two Years Ago


Bonus Three Years Ago


Bonus Four Years Ago


Bonus Five Years Ago


Minimum Benefit Payment


Maximum Benefit Payment


Any offsets such as Social Security, Worker's Compensation, Other disability income? Total monthly amount of offsets:



Monthly Benefit


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