Why Do Insurers Deny Long-Term Disability Claims?
Disability insurance companies often have a conflict of interest because if they decide that you are entitled to benefits, they also have to pay you your benefit. In many cases, every dollar the insurance company does not pay to you is a dollar the insurance company earns. This creates an incentive to deny you the benefits to which you are entitled. Many claim denials can be unreasonable depending on the circumstances. Here are some common reasons insurers give for denying a disability claim:
- “Own Occupation” vs. “Any Occupation”: Many policies will pay you benefits if you are unable to perform the material and substantial duties of your Own Occupation for the first 12 or 24 months of disability. However, after that, the definition of disability changes to Any Occupation. Insurers often terminate insureds at the end of the Own Occupation period, taking the position that they are able to work in another occupation.
- Own Occupation as performed in the national economy: Many policies provide that your Own Occupation will be defined as it is performed in the national economy. That means that if there was a duty of your job that made it particularly demanding, but other employers do not include that duty as part of that occupation, the insurance company might not consider that duty as part of your Own Occupation. Beyond job duties, insurers may use this reason to deny a claim where someone becomes disabled after experiencing abuse from a supervisor or co-worker. The insurance company may take the position that while the claimant may be disabled from working at the prior job site, the claimant could perform the same job elsewhere.
- Mistake on the application: Insurers may claim that you made a misrepresentation on your application for benefits. For example, failing to disclose pre-existing medical conditions or failing to provide accurate employment and/or income history.
- Policy exclusions: Some LTD policies will not pay benefits for certain conditions such as musculoskeletal injuries, chronic fatigue, fibromyalgia, or chronic pain.
- Policy limitations: Most policies pay benefits for a limited period of time for certain conditions. For example, most LTD policies pay a limited number of monthly benefits for disabilities caused by mental illness such as depression or anxiety. Policies also may limit the benefits payable for disability resulting from “subjective symptoms” such as pain or fatigue.
- Maximum benefit period: Insurers will terminate benefits when you reach the policy maximum benefit period. While some policies provide lifetime benefits, most policies limit the amount of benefits that are payable based on age. Depending on your age on your date of disability, many policies pay benefits to age 65 or your normal Social Security retirement age. If you are close to age 65 or retirement age on your date of disability, some policies provide a fixed maximum number of monthly benefits.
- Late claim forms: The insurance company may deny or terminated your benefits if you or your doctor fails to provide them with claim forms or requested information on time.
- Lack of documentation: In some cases, insurers will accuse disabled employees of not providing enough “objective evidence” of their medical condition. In other cases, the insurer may allege that the claimant’s symptoms were self-reported and not corroborated by medical evidence.
- Surveillance or IME evidence: Insurers will often conduct their own testing and observations in an effort to prove that you are not truly disabled. They will then claim that the results of their Independent Medical Examination (IME) support the denial. Once they have conducted their surveillance, they will claim that you are capable of working based on the activity they observed as they watched you.
These are only a few examples of reasons insurers give for denying benefits. The attorneys at Chisholm Chisholm & Kilpatrick are experienced at dealing with these excuses. CCK carefully scrutinizes the denial against the policy, the evidence, and the law. CCK makes an appeal plan for its clients, gathers the evidence needed to rebut the insurance company’s excuse, and writes and files the appeal. CCK is ready to file a lawsuit against the insurance company in state or federal court in appropriate cases.
What Do You Do If Your Benefits Have Been Wrongly Denied?
If your benefits have been wrongly denied, in whole or in part, you have the right to appeal to the insurance company. Most policies require that you appeal first to the insurance company before going to the court. You likely have a limited time to appeal. If you miss this appeal deadline, you may lose your rights.
You do not need a lawyer to file your appeal with the insurance company. You have the option of handling your own appeal. You must follow the rules of your own policy or plan. Depending on the circumstance of your claim, this may involve requesting a copy of the claim file from the insurance company; requesting a copy of the plan-governing documents in writing from the plan administrator; gathering information from your medical providers that evidences the impairments that keep you from working; analyzing all of the documents collected to determine what additional information is needed to prove your claim; communicate with experts and identify additional testing needed to measure your impairments; gather any material information that the insurance company told you was missing; analyze the insurance claim file to identify legal and factual errors made by the insurance company; analyze the claim file to identify procedural violations of ERISA committed by the insurance company; submit a personal statement explaining why you are disabled along with witness statements; draft an appeal letter explaining why you meet the terms for payment of benefits and why the insurance company’s decision was wrong.
As you can see, there is a lot of work to do to prepare your appeal properly, and a short time to do it. Therefore, we recommend that you consult an experienced ERISA LTD attorney as soon as possible after receiving your adverse benefit determination.
Call the Long-Term Disability Lawyers at Chisholm Chisholm & Kilpatrick
Do not let your insurer deprive you of the financial support you need to live. The ERISA attorneys at CCK understand the complexities of long-term disability cases and are able to take on the powerful insurance companies. They may be able to handle your case on a contingency basis, with no upfront cost to you. Call now for a free consultation to see if we can assist you: 401-331-6300.
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