Disability Insurance Policies
More people buy life insurance than health insurance even though they’re much more likely to become disabled than die before 65. In fact, a 30 year old has about a one in three chance of having a long term disability (“LTD”) before age 65. People whose employers do not provide any or adequate benefits, or people who are self-employed, can purchase disability insurance that provides a monthly benefit if you become unable to work. Ideally, you want a policy that will replace the amount of your after-tax income; otherwise, your retirement savings may become depleted. Disability insurance benefits will be tax free if you pay for the policy with after tax money. The concept is similar to group coverage that are provided by employers, but your individual policy is not subject to the constraints of ERISA, which preclude trial, punitive damages for example. Just as importantly, unlike many policies governed by ERISA, your individual claim will not be subject to an arbitrary standard of review in which the insurer can win even if the court believes the insurer made the wrong decision. Many LTD Plans let you convert your group coverage into an individual disability policy if you leave the company, which you should almost always do.
The terms of your individual policy vary considerably depending upon a variety of factors, including the underwriter’s standards, your occupation, where you live, the amount of benefit sought, your age, and your health. It is better to have an “own occupation” policy, which pays you money if you cannot do the job that you used to do, as opposed to an “any occupation” one, which only pays if you cannot do any type of work at all. In general, premiums are higher for policies that provide more monthly benefits, offer benefits for longer periods of time, and start payments of benefits more quickly following a disability claim. Premiums also tend to be higher for policies that define disability in broader terms, meaning the policy would pay benefits in a wider variety of circumstances. We will help you understand and evaluate the potential terms and conditions if you are considering purchasing a disability policy. We will also put you in contact with a financial planner if you want assistance determining how much disability coverage you need.
If you did not use an attorney to file your disability claim, you should immediately contact an attorney when you receive a decision that is not an approval. Insurers frequently create an impossible moving target, and keep requesting for additional supporting information in ambiguous terms. They may not state that your claim was denied, but will delay approving your claim until you give up out of frustration or lack of resources to prosecute your claim.
Our appeals are very similar to the complaint and legal briefs that would be submitted in state court, which includes a thorough explanation of the medical and vocational evidence, errors the insurer made in reviewing your claim, and citations to case law that supports your entitlement to disability benefits under your policy. This shows the insurance that you are serious and will sue them, which gives them greater incentive for targeting somebody else’s claim to deny or terminate. If you believe that you are being stonewalled, you can sue without providing additional information, which you can produce during the litigation.
If your claim is denied, you should ask for a copy of your claim file. If the insurance company refuses, you can argue that its decision reflects the unfair manner in which they handled your claim. We ask for a copy of the policy, the entire claim file, anything the insurer relied on to deny or terminate your claim, any guidelines the insurer used, the reports of all medical and vocational reviewers and outside consultants with their invoices, any surveillance materials, and notes of any telephone conversations in connection with your claim.
We ask the insurer to provide a specific description of the reasons for denial, as a failure to do so can show that the insurer was not acting in good faith or violated consumer protection laws. The denial or termination letter may only state that there was insufficient “objective” evidence in support of your claim, and the insurance company interprets “objective” in an impermissibly narrow manner. We demand that the insurer specify why the objective information supplied was deemed inadequate, and what objective information is purportedly missing that they would find sufficient.
After reviewing the claim file, we will discuss with you what additional medical evidence we need from them, which could be narrative reports, treatment records, diagnostic test data, or functional assessments. We may also advise you on how to improve your claim by seeking second opinions and tests from your other treating doctors, or another doctor from a different specialty to see if they corroborate your treating doctors’ opinions. We might suggest your own FCE or IME or peer review, and will provide the insurance with medical literature that helps explain why your medical condition prevents you from being able to work. It is also may be just as necessary to secure additional vocational evidence, which can take the form of a comprehensive evaluation by a vocational expert.
Because the insurance company wants to make a profit, its default position is to deny or terminate your claim. Insurers assume that you are not telling the truth or are exaggerating your symptoms. That is why insurers conduct surveillance and field interviews so they can gather evidence to prove that you are being dishonest. We will help you establish your credibility by preparing affidavits for you and your witnesses that describe how your physical or mental limitations render you disabled. Your family, friends, neighbors, co-workers, boss, religious leader, or anybody who observes you on a regular basis can be a credible witness to corroborate your subjective complaints.
Our appeals are thorough, take time, and there are out of pocket costs when we handle your appeal. While some say we “gild the lily,” we believe that our results speak for themselves.
We are not afraid to litigate your disability claim, and the insurance companies know it. However, many claimants want the insurance company to settle their claim either because they are afraid that the constant barrage of information demands will make their doctors stop treating them, they are tired of surveillance, filling out updated information requests, and the threat of future litigation, or want their future benefits now. The courts do not usually award future benefits when you win your case. The insurance company may consider settlement even before litigation has commenced.
If settlement is considered, the starting point is calculating the present value of your case. The insurance company’s present value is always too low because they use inflated interest rates; that is, they use a rate that is higher than you could safely invest the lump sum that they use. We will explain to you in detail whether a settlement offer is reasonable, whether you should insist on reinstatement of your claim, and risks involved in accepting or rejecting any settlement offer.