Your lawyers are likely paying for duplicate coverage
Almost every group long term disability plan includes “direct offset” wording. This means that if a lawyer has an individual disability plan through the Canadian Bar Insurance Association, your group long term disability plan will reduce the long term disability plan benefit that could be paid by the same amount as the lawyers individual disability plan. This means the lawyer is paying for both plans but can only collect one. This is a common problem that we have solved for many lawyers and law firms in Alberta.
The most common questions we get asked are “Am I paying for duplicate coverage”, “Can I collect both plans’ disability benefit amounts?”, “Can I stack the benefit amounts, or do they overlap?”, ” I pay my Professional Corp income, is that income covered?”
The answer is generally “Yes” that the lawyer is paying for duplicate coverage and “Yes – we can make the necessary changes in the contracts to allow for stacking of coverage to avoid the overlapping of a duplicate benefit.” Talk with a qualified employee benefits specialist and they may be able to assist you with this – we do it for all of our clients.
Other important details to keep in mind and know the answer for regarding your group long term disability plan include:
- Does it have a direct offset against the Canadian Bar Insurance Association plans (the most common individual disability coverage for lawyers)?
- Does it have an all source maximum clause that could mean the lawyers at your firm are over paying for a benefit level they cannot collect?
- Is it own occupation to age 65 or does the definition change to any occupation which is considerably less favorable for lawyers
- Does it cover T4 salary income only, and are the lawyers at your firm only taking T4 income, or do they also take dividends, use income splitting or receive compensation into their Professional Corps? Deliberate steps need to be taken to insure all income types besides T4 income are covered.
- What are the lawyers expectations about their coverage level or what they would collect if they suffered a disability at some point down the road, and are their expectations correct?
We can help you answer the above questions and ensure your group plan and the lawyers disability plans are structured correctly to avoid duplication and overpayment and that their expectations are accurate.
Silverberg Group is the exclusive representative in Alberta for The Canadian Bar Insurance Association’s proprietary product arrangements. We work with all of the insurance providers and are the only Employee benefit firm that is able to provide a clear, complete and unbiased recommendation on what is best for your firm. So far, over 120 Alberta Law Firms have put their trust in us.
Interested in hearing more about how Silverberg Group can save you time & money?