Question

Which of the following statements is correct when pertaining to coordination of benefits by a group long-term disability plan with Social Security?

A. Social Security benefits are always the primary source of disability income.
B. Group disability benefits are always the primary source of disability income.
C. Social Security benefits are offset by group disability benefits.
D. Group disability benefits are offset by Social Security benefits.

Answer 1

Group long-term disability benefits are reduced or offset by the amount an individual receives from Social Security disability benefits, ensuring that the income from both does not overly exceed the person's pre-disability earnings.

Step-by-step explanation:

In reference to the coordination of benefits between a group long-term disability plan and Social Security, the correct statement is that group disability benefits are offset by Social Security benefits. This means that if an individual receives Social Security disability benefits, the amount they receive from their group long-term disability plan may be reduced accordingly. This offset ensures that the total income from both sources does not exceed a certain percentage of the individual's pre-disability income, thereby preventing over-insurance.