Monthly vs. lump sums

Generally, disability benefits are paid monthly as a percentage of the person's former salary for as long as the person continues to be disabled. Sometimes, the benefits can be paid, instead, in one lump-sum payment. This type of payment may be preferred by the insurance company and will not be to the benefit of the disabled person. One does not know how long s/he may be disabled with ME/CFS, FM or other chronic illness. Benefits may be needed for many years.

A lump-sum payment is a one-time payment and as a total benefit might only cover an equivalent of 5 years of monthly payments. A person should be very cautious in deciding to take a lump-sum payment. However, sometimes one is forced to decide whether to take a lump sum or possibly face an insurance company's threat to limit or terminate monthly benefits.

In other types of lump-sum payment cases (such as auto insurance cases), a lawyer will take the case on a contingency basis. This is perfectly possible in a disability lump-sum case. Different lawyers will charge different percentages—often from 25% to 40%. One should determine the average rate and not pay a higher fee than what most lawyers charge.

Again, however, be careful of a lawyer pressuring you to take a lump sum as a way of collecting his fee if you would be better served by collecting monthly payments for as long as you are disabled.