it is legal for ltd insurance co to use an offset of my social security wages?

Though I'm not licensed to practice in your state, I can provide some general information for you. This practice is usually legal. You should check your insurance policy to see if there is an "offset clause." An offset clause means that the company can reduce the benefits it pays you if you collect SSD. Many insurance policies, especially those that are employer- or group-sponsored, have this type of clause. If there is such a clause in your policy, you are probably out of luck on this issue. If you are still in doubt about your insurance company's actions, it would be best to talk to a NJ insurance law attorney.

Unfortunately, this is very common. I am a Texas attorney so I cannot give advice regarding NJ law either; however, it is very likely that if your LTD plan was sponsored by your employer, it falls under federal ERISA law which is the same across the country. The LTD policy is at its base level a contract, and the offset of social security disability benefits is part of what we call the bargained for exchange. As you probably already know, the LTD likely not only contains the offset, but it also required that you seek and obtain Social Security disability benefits to qualify for LTD benefits. It is rare that the insurance carrier pursues an action seeking to collect on the overpayment though.