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Long-term disability (LTD) insurance should provide financial assistance if an injury or illness substantially limits your ability to work. If you are self-employed, you can purchase an LTD policy from a broker or agent. However, most employees are covered under group policies provided by their employers.
The Definition of Disability
One of the most important things to know is how disability is defined in your policy. Whether you have an employer-provided group policy or an individual policy, there are significant differences in the definitions of disability.
Understanding these differences is crucial for filing successful long-term disability claims. In this article, we will focus on the distinctions between “own occupation” and “any occupation” definitions of disability.
“Any Occupation” Disability Insurance
Under an “any occupation” policy, the focus shifts to gainful employment suited to your work experience and education level. The insurance company evaluates whether you can work in any capacity. It may argue that you can still work in a different occupation even if it is not suitable. This definition broadens the possibilities for the insurance company to deny benefits for a person with a disability.
Insurance companies often use vocational experts to identify potential alternative occupations. Vocational experts rely on labor market data and surveys, which can be subjective. The claims administrator at the insurance company ultimately decides whether a claim meets the “any occupation” criteria.
For example, let’s consider a CPA who suffers a brain aneurysm that affects his or her ability to calculate figures and think critically. The insurance company might claim he or she can work as a receptionist. However, the income of a CPA far exceeds that of a receptionist. In such cases, consulting an attorney and appealing the denial is crucial.
“Own Occupation” Disability Insurance
Under an “own occupation” or “regular occupation” definition, the policy considers your specific occupation and the essential duties associated with it. The focus is on the ability to perform the substantial duties of your specific occupation.
For example, let’s consider a heart surgeon who develops a hand tremor. He or she are unable to perform delicate heart surgeries, but they can still conduct general consultations with heart patients. With an own occupation policy, he or she may be deemed totally disabled and qualify for disability benefits.
Modified “Own Occupation” Disability Insurance
Under this definition, you are considered disabled if a physical or mental impairment prevents you from performing your “own occupation”. However, the insurance company will not continue paying monthly benefits if you begin working in another occupation.
Transitional “Own Occupation” Disability Insurance
A transitional “own occupation” policy allows you to work in a new occupation and receive monthly disability benefits. However, the insurance company will not continue paying monthly benefits if your income exceeds a certain amount. The combination of your two income sources must not exceed your pre-disability earnings.
True Own Occupation Disability Insurance
Certain specialized professions, like surgeons and attorneys, often have “true own occupation” disability insurance coverage. If a claimant is disabled and cannot perform a specific duty in which they specialize, he or she may qualify for disability insurance benefits. This is true even if the claimant is able to perform another occupation.
For example, a surgeon who cannot perform an operation such as a lung biopsy may qualify for benefits. It is advisable for professionals in highly specialized fields to ensure their policy includes “true own occupation” in the coverage outline. This type of coverage provides a higher chance of successful claims for major disabilities.
What If the Definition of Disability Changes After Two Years?
Under most policies, the “any occupation” definition does not kick in until after benefits have been paid for a certain period. This type of modified occupation language after a set period is called a Change in Definition feature (“CID”). Most policies have a 24 month period, but others may have a 12, 36, or 48 months period before the change
When transitioning from “own occupation” to “any occupation”, the insurer will review your claim to determine if benefits are still payable. The insurance company will hire a vocational expert to review your file and prepare a vocational assessment. A vocational expert is a neutral person who has experience in job placement, earnings histories, employment history, and opportunities.
It’s important to note that most claims are dismissed at the 24-month mark based on the vocational expert’s report. Vocational experts have an incentive to find that you are able to work. The insurance company will not continue to hire them if they find a large number of claimants unable to work. An experienced disability attorney can strengthen your appeal by disputing the insurer’s vocational expert opinion.
What If the SSA Found That I Cannot Perform Any Occupation?
If you have been receiving LTD benefits for two years, you have probably applied for Social Security Disability benefits as well. If the claim was approved, you probably expect that your insurance carrier will also continue to find you disabled. So why is the insurance company saying that you can perform another occupation?
The rules used by the SSA to evaluate claims for people with disabilities differ from those used by your insurer. This means that the long-term disability insurance company does not have to agree with the decision made by the SSA.
A Disability Attorney Can Help Prove That You Meet the Definition of Disability
The differences between “own occupation” and “any occupation” policies can be complex. Seeking assistance from a disability attorney who specializes in these matters can increase your chances of receiving the benefits you deserve. At the Ortiz Law Firm, disability attorney Nick Ortiz and his experienced legal team work on a contingency basis, meaning they only get compensated if you do. For a free case evaluation and answers to your questions, contact us at (888) 321-8131.
