Filed Under:Health Insurance, Disability

Researchers Measure Disability Plan Elimination Period Effects

Researchers say long exclusion periods boost the odds that LTD claimants will return to work. (AP Photo/Matt York)
Researchers say long exclusion periods boost the odds that LTD claimants will return to work. (AP Photo/Matt York)

Doubling a private long-term disability (LTD) insurance plan's elimination period to 180 days, from 90 days, might cut the likelihood that workers will file claims in half, but it could the average duration of the claims that do come in.

Three economists have published those conclusions in in a working paper posted by the National Bureau of Economic Research.

The researchers looked at questions such as how changing the percentage of income that an LTD policy replaces correlates with the likelihood that insured workers will file claims.

The researchers found that a 10% increase in the income replacement ratio might correlate with a 6% increase in the likelihood that a covered worker will file an LTD claim.

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Nichole Morford

Nichole Morford
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