First Unum: Read the Fine Print

Baltimore, MDImagine her dismay when Deborah Hamlet got a bill from First Unum, stating that she has to repay $64,000 of her long-term disability benefits because she collected social security benefits. "I read in my policy that once I received social security benefits, my Unum benefit would be reduced, not cut off," she says.

Hamlet has repeatedly asked First Unum for a copy of her policy: she doesn't remember ever reading that she could not receive social security—her entitlement after 40 years of work.

"I received First Unum's long term disability (LTD) insurance through my work and when I became ill and unable to work I received benefits from the insurance company," says Hamlet. "That was fine until I received social security disability insurance; Unum discontinued all of my benefits--which I should be receiving until the age of 67. I am 54 now.

Unum sent me a letter in November. Ohmigod, I almost had a heart attack when I read it. First of all, I already have heart failure, which is why I am on LTD, along with pulmonary hypertension. Unum wants me to repay every dime of $64,000!

They told me that when I received social security, I had to reimburse them with it. Had I known that I had to pay back to Unum every dime that social security gave me, in a lump sum, benefits that I am entitled to from the date I filed until the date it was approved, I would have never paid into this insurance policy.

I never read my policy word for word but this is what I did read: once I received my social security benefits, my Unum benefit would be offset to equal the monthly payment that I received from Unum—which is a reduction from Unum plus what I receive from social security.

In other words, I was led to believe that I would get full benefits from social security (which started in February, 2006) and a reduced amount of LTD benefits from Unum. I am entitled to social security but Unum stopped my LTD payments in November, 2007 to absolutely nothing. In that same month, I received a letter from Unum. It said that because I received social security and Unum, I was no longer entitled to any benefits from Unum and social security. They were going to keep the monthly benefits that I was supposed to receive from Unum until 2015. Unum said that is what I owed them and they wanted the payment in full or they would just keep my monthly benefits until that year--when the overpayment will be settled.

Now, I am only getting $1,339 per month from social security. I was getting $2,811 per month from Unum, which started in June of 2005.

As you can imagine, I am really struggling. I will never be able to go back to work and I am in a terrible situation. The money I get from social security is barely enough to pay my living expenses and I have had to humble myself and apply for programs to help me, such as welfare and food stamps.

I was supposed to receive $1,379 in reduced benefits from Unum for the rest of my life. Instead I got about eight checks for this amount until I got cut off; they left me high and dry just before Christmas. I have one daughter and I can't even make her tuition payment. I even had to give up my car insurance so I can buy food for us.

I phoned Unum and talked to my insurance agent. She said when I signed the contract for the policy, it clearly stated that I could not receive social security and Unum together. But when I told Unum that I started to receive social security benefits, I knew that my LTD from Unum would be reduced.

Back in November, I asked her to send a copy of my policy. My old employer had the policy and I also spoke with them around the same time. They contacted Unum and called me back. My employer said that, according to Unum, it is their policy to recoup any overpayment due to benefits received from social security. But they still haven't sent me a copy of this policy that I requested.

Had I known that I would owe Unum every cent I received from social security, I would never have accepted LTD from Unum. I consider Unum a loan: they owe me. And I also paid into social security for 40 years, all the years that I worked. I am entitled to both benefits.

I am waiting for legal help before I do anything. Unum also told me that if I got a job, they would garnish my wages. They put me in the worst depression. Luckily I was able to keep a roof over my head. Sorry to sound profane but I have to say it: they are spineless, money-grubbing, sons of bitches."