AIG Benefit Solutions introduced the Income PLUS rider benefit to its Group Long-Term Disability Insurance that provides a one-time, lump-sum payment in the event of a disabling condition.
The Income PLUS benefit is unique in the industry as a lump-sum benefit that is not offset or negated by any other sources of income, and is paid in addition to the monthly benefits offered under the long-term disability product. The Income PLUS benefit can be used by employees as they see fit to help pay debt or medical bills or to provide a financial cushion during a period of disability.
The Income PLUS rider benefit is payable immediately after the 180-day elimination period is satisfied. It offers what amounts to 12 months' worth of benefit at 10 to 40 percent of income, paid as a lump sum in addition to the monthly LTD payments. The percentage paid under the Income PLUS rider varies according to the rider option selected by the employer.
The total income replacement maximum available to employees is 80 percent, including the underlying LTD plan and the Income PLUS rider benefit. For example, if the underlying long-term disability plan offers 60 percent income replacement, then the Income PLUS Rider options are 10 or 20 percent.
According to the Council For Disability Awareness, the average long-term disability claim duration is 31.2 months, and one in eight workers will be disabled for five years or more during their working careers. Sixty-five percent of working Americans say they could not cover normal living expenses even for a year if their employment income was lost; 38 percent could not pay their bills for more than three months.