You have questions? We have answers.
ABOUT LUCENS GROUP & CONFIDENTIALITY
Who is Lucens Group?
Lucens Group is a privately owned company that offers settlement facilitation services. As an independent company, we have been engaged by your insurance company to present you with a settlement offer determined and provided by them. We present the settlement offer to you and allow you to explore your settlement offer in a secure and confidential place. We are always available to talk through questions or issues related to your settlement offer and keep what you tell us confidential and safe. We don't charge you for our time, expertise or help and we are just a phone call, online chat or email away. To learn more about Lucens Group, visit: www.lucensgrp.com.
How did Lucens Group obtain my information?
Your insurance company engaged with and provided your information to us, so that we can present you with their settlement offer in a secure and confidential place.
Who does Lucens Group work for?
Lucens Group is an independent settlement facilitation service that works with insurance companies so that individuals covered by insurance have a secure and confidential place to explore the possibility of a settlement.
How does Lucens Group get paid?
Lucens Group is paid by the insurance company to provide a confidential web-based forum to answer questions about the settlement offer, process, options and next steps. We do not receive a success fee for claims settled and we do not provide direct advice on which path to choose, but rather provide pre-settlement supportive services to assist you in understanding the settlement offer and terms.
Can Lucens Group provide me with specific information regarding my claim or policy?
No, Lucens Group is only provided with the information necessary to facilitate a settlement for your claim. If you have specific questions regarding your claim or policy, we recommend you contact your claims office directly. We can provide the team/office managing your claim if needed.
How do I learn more about Lucens Group?
To learn more about our company, visit www.lucensgrp.com.
What is a settlement offer?
A settlement offer is a proposal by your insurance company for a final payout made in one large payment. This type of settlement ends the insurance company's obligations to pay you benefits.
Can I counter/negotiate the settlement offer?
Lucens Group does not engage in settlement negotiations. Please create an account and login to find more information as it is relates to your specific long-term disability insurance carrier.
How was the settlement offer calculated?
In calculating the settlement offer the insurance company took into consideration the present day value of the claim, cost of living adjustments if applicable and the mortality rate. Please create an account and login to find more information as it is relates to your specific long-term disability insurance carrier.
What is the present day value?
The present day value is the current worth of a future sum of money or stream of cash flows given a specified rate of return. In suggesting a lump sum payment, the insurance company is offering to pay the present day value of all your future monthly disability benefits. This calculation provides the insurance company with a discount for paying you a lump sum payment today, as opposed to paying out monthly benefits over the course of time. If you were to receive payments over time, future payments of the same amount would be worth less due to inflation. Further, because you have access to this lump sum payment today, you potentially could invest it and earn interest on the money. By paying the money out now, the insurance company has lost the ability to earn interest on it. For these reasons, your settlement offer must be reduced to its "present day value." As such, the future stream of disability benefits must be reduced to "present day value." The interest rate used for this calculation is an important factor in determining the value of your settlement offer. This interest rate represents the interest you could potentially earn on the settlement amount. In today's financial climate, an interest rate between 3% and 5% is generally accepted as reasonable.
What is the mortality rate?
Another important factor used to determine the value of your settlement offer is your life expectancy. Long-term disability insurance benefits are typically paid until age 65 or your Social Security Normal Retirement Age. Depending on your age and health conditions, there is always a chance you may not survive for the full period of your benefit claim. In short, the mortality rate is the chance that you may die due to any cause, health, natural or accidental during the time period from now until payments are completed.
LONG TERM DISABILITY INSURANCE SETTLEMENT CONSIDERATIONS
What happens if I do not accept the settlement offer?
The insurance company will continue to pay your monthly benefits subject to the terms and conditions of your policy.
How is my medical/health insurance affected?
This depends on your policy and who is providing your health insurance. You must consider whether your employer provides health insurance for you and if applicable your family. Please contact your employer for further information regarding your medical/health insurance.
Will I get taxed on a lump sum payment?
Considering the tax implications of your lump sum payment is important. Whether you are required to pay taxes on your long term disability benefits is based largely on who paid for the insurance premium. If you paid for the premium with "after tax dollars" then the long term disability benefits are generally tax-free. If your employer paid for the insurance premium or you paid for it with "pre-tax dollars" then the benefits are generally taxable at regular income tax rates. If your benefits are taxable, receiving a lump sum payment may lead to negative tax consequences, as it would be taxed at a higher rate than if you received the benefit over time. Considering the tax consequences is very important. We strongly recommend that you consult with a licensed attorney, tax and/or financial professional for tax issues on the benefits and a settlement.
What happens to my Social Security Disability Insurance (SSDI) benefits?
Your receipt of a lump sum payment will not affect your Social Security Disability Insurance benefits. You will continue to receive your monthly Social Security Disability Insurance even if you settle your long term disability claim.
What are the advantages of accepting a settlement offer?
Individuals who have accepted the settlement tell us they are using the lump sum payment to help them improve their current financial situation and to plan for the future. A lump sum payment can provide several significant financial benefits, beyond what could be achieved with a monthly benefit. These financial benefits can include:
- The opportunity to make a decision to leverage current finances against future need
- More flexibility in exploring options that will put the benefits to maximum use
- The opportunity to resolve outstanding debts (especially those with high interest rates)
- The opportunity to finance other income-generating investments
- The opportunity to finance retraining, education or self-employment
What are the disadvantages of accepting a settlement offer?
Receiving a lump sum payment can in some instances have disadvantages, which you should carefully consider. For instance:
- If you are reliant on receiving your monthly benefit you need to carefully consider how not receiving it will impact you meeting your monthly financial obligations
- If your benefits are taxable, receiving a lump sum payment may lead to negative tax consequences, as it would be taxed at a higher rate than if you received the benefit over time. Structuring your settlement to consider the tax consequences is important.
HELP & RESOURCES
How do I find a licensed attorney, tax and/or financial professional to review everything?
We encourage you to consult with a professional in considering your settlement offer. If you do not have your own counselor(s), we encourage you to visit our resource page where you will be directed to independent legal, tax and financial resources.
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