A major injury or severe health condition can prevent you from going to work, and it does not prevent bills from showing up in your mail. That is why people buy long-term disability insurance policies. Your coverage plan can be a group LTD plan through your employer and is governed by the Employee Retirement Income Security Act, or an individual plan that you pay for yourself. Please read this blog to learn more about the LTD disability policy.
How LTD Policy Defines a Disability
Your definition of disability significantly affects whether you are eligible for benefits. There are two types of LTD policies: any occupation and own occupation.
Own occupation means if you have a disability because of accident-related injuries, you cannot perform the duties and materials of your occupation for profit or wages. In other words, you cannot execute job-related duties. For instance, if you are a firefighter with your own occupation policy and have sustained back injuries that prevent you from carrying heavy objects, you qualify for disability benefits even when you can work a different job. You can perform different work duties under your LTD policy, but the insurance provider will reduce your benefits.
An any occupation policy has a narrower definition of disability. You should prove that you cannot perform any job (including your normal work) for which you qualify, depending on your experience, training, and education. Referring to the example above, you are not disabled per any occupation policy if you can complete desk work but cannot carry heavy substances as your current work requires.
Most LTD policies change from own occupation to any occupation after a specific duration. Your insurance provider can terminate your benefits because of any of the following:
- The policy's definition is now more stringent.
- Your insurance provider believes your medical condition has improved regarding your capacity to work.
Group and Individual LTD Plans
Individual insurance and group insurance are two classes of disability insurance. Each has pros and cons; knowing this will help you decide wisely when purchasing your long-term disability insurance.
Typically, the federal Employee Retirement Income Security Act governs employer-offered group plans. ERISA highlights processes you should abide by when filing appeals and applying for disability benefits. On the other hand, individual policies are agreements between an individual policyholder and the insurer, and state insurance laws govern them.
Here are other key differences between them:
Costs Involved
Generally, employers offer LTD policies by paying monthly premiums. You can buy the individual policy if you are covered through your employer or want to boost your employer-offered plan.
An individual LTD policy is expensive but designed to suit your needs and offers better coverage, while a group policy is more pocket-friendly but offers basic coverage.
Almost every individual and ERISA plan has limitations on claims depending on substance abuse and mental disease, restricting payment to one or two years. When buying an individual LTD policy with coverage for ailments like anxiety or depression, your insurer might require you to pay a higher premium.
The monthly benefits amount is another difference between individual and ERISA policies. ERISA policies offer benefits equivalent to fifty to seventy percent of the predisability income, with a monthly cap. On the contrary, an individual policy allows you to receive a higher amount of your salary with a bigger monthly maximum.
Your Coverage’s Portability
One advantage of an individual policy is its portability (its ability to accompany you when switching jobs and endure during unemployment). On the contrary, group LTD coverage is terminated once you stop working for your current employer.
The Consolidated Omnibus Budget Reconciliation Act, which permits your medical insurance to remain for a limited duration after your employer fires you, is not applicable to long-term disability insurance. If you are contemplating filing an LTD claim and want to resign, you should consider this fact.
Taxability Aspect
All benefits in an individual coverage are nontaxable, and you can keep all the benefit amounts.
If your employer pays for your group LTD insurance policy, you will owe tax on the benefits that the company paid.
Residual Coverage
Residual disability is the ability to receive benefits based on your inability to work full-time or only perform some of the tasks in your job.
Many group plans do not cover residual disability, which can be discouraging since it is a common phenomenon. On the other hand, individual LTD plans provide residual coverage. If your insurance provider has not written it in the policy, it should be a rider (however, it is an option).
Filing an Initial Long-term Disability Claim
Since every LTD policy has unique terms on how the insurer will pay benefits, review your policy paperwork to increase the chance of accessing benefits. Your human resources manager can help you find the relevant documents if you have a group policy. If you have an individual policy, you can request your insurer to provide any details you do not have.
When completing your application form, provide as many details about your health condition as possible and remain truthful. You can use medical proof to support your LTD benefits. Inform your medical experts that you want to apply for LTD benefits and request them to write a letter describing how your impairment affects your ability to work.
After submitting your application, a claim adjuster will contact you requesting more information.
Mistakes to Avoid Making on Your LTD Application
You should avoid errors that include the following:
Depending Entirely on Your HR Department for Advice
Although your company’s HR personnel may have good intentions as they offer you advice, they are not well-equipped to interpret insurance policy terms and do not influence the insurance firm. Remember, the employer and the LTD insurance firm are separate entities, and the insurance firm does not have to act on guarantees from your employer.
Thinking Your Evidence is Sufficient
The LTD insurance firm pays your LTD benefits, not the employer. Therefore, you should not assume that the employer’s opinion about your capacity to keep working is adequate to qualify you for disability benefits. The insurance firm will determine when your medical condition qualifies as a disability per its policy’s terms.
Engaging in Tasks Your Physician Warned You Against
An insurance firm can monitor your undertakings. If you perform tasks that your physician advised you against, it may appear that you are attempting to swindle the insurance firm.
Whenever the insurance firm sends an activity form for you to fill out, that confirms you are under surveillance. You are better off obeying your physician’s instructions.
Relying Only on the Insurance Company’s Forms to Document Your Disability Claim
Your physician must only answer some questions on the insurance provider’s forms. However, you need detailed information to prevail in your disability claim. You should explain your disability policy’s terms to your medical practitioner before asking them to write a full report detailing how your medical condition hinders you from fulfilling substantial duties related to your work.
Relying on the Insurance Firm’s Attorneys to File Your Social Security Benefits Claim
If the insurance firm approves your LTD benefits, you must file for Social Security benefits. Under certain circumstances, the insurance provider can offer to help you with your disability application process.
Refrain from accepting this legal assistance because it may pose complications at some point.
Be Careful What You Do and Say
Be skeptical of every interaction with a plan administrator or insurer; they can use even an innocent remark against you. For instance, avoid calling your insurer from anywhere other than your home. If the insurer hears noise from the background, they can argue that you can work.
Reasons Insurance Companies Deny LTD Applications
Insurance providers deny claims due to reasons that include the following:
Irregular Treatment History
It is challenging to win an LTD claim if you have not been making your regular medical appointments. The insurer expects you to visit your physician and the specialists at different intervals. For instance, if you have a psychiatric issue, like anxiety or depression, you must visit a psychologist or psychiatrist once a month. If your condition involves a physical disability, your doctor must be attending to you after one to three months. Your doctor should provide you with objective medical tests, like CT scans or MRIs, when possible.
Supportive Physician Statement
Your doctor’s written opinion plays a significant role in proving a disability claim. Your lawyer should present a comprehensive opinion relating to your medical limitations. You should avoid letting your physician complete the insurance firm’s forms because your insurer has designed them to evoke responses.
Missing Medical Documentation
Disability claims can be denied because of inadequate medical proof, because the LTD insurance firm has not obtained all your medical documents. If there are missing documents, ensure your insurance company asks the disability carrier for them. However, you may have to exercise some patience.
Failure to Satisfy the Policy’s Meaning of Disability
Review your policy’s summary description to know how your insurer defines the term disability to chec your eligibility. Per your own occupation long-term disability policy, you cannot perform the obligations of your specific occupation, and you are disabled. Any occupation LTD policy defines disability as the incapability to do any job duties. Certain LTD plans transition from using an own occupation policy to any occupation regulations after a specific period, typically 24 months.
You should also inspect your policy for all excluded diseases. Pre-existing conditions or medical conditions related to substance abuse-related medical conditions are not covered. People whose medical conditions rely on subjective complaints instead of objective testing, like chronic fatigue, fibromyalgia, or depression, may only be allowed two years of benefits.
Missed Deadlines
You should note all deadlines when bringing or appealing your long-term disability claim. Many group plans regulated by ERISA and individual plans grant 180 days for appeal on your initial denial. Therefore, your legal counsel can assist you in collecting medical documents and other favorable evidence that supports your claim.
If you do not meet the deadline, you will not be permitted to sue the insurer in any federal court due to your failure to exhaust your administrative appeals. Check the filing deadline and timeframes on your denial notice received from the insurance firm and file the appeal promptly.
Also, ensure that you submit all your medical proof on time during the appeals process. Per ERISA, federal courts should only review the evidence in the administrative record or what you file with your insurance firm. Therefore, you should not wait until you reach the federal court to submit medical documentation, third-party statements, and your physician’s reports, among any other favorable proof. If you have not submitted the proof to the insurance firm, the federal court will not allow it.
Video Surveillance That is Inconsistent With Disability
If you intend to file for an LTD claim or are currently receiving LTD benefits, know that your insurance firm might request investigators to trace you and take video surveillance. If the investigators record you performing activities inconsistent with your disability claims, your insurer might deny your claim or terminate your previously awarded benefits.
Sometimes, insurance firms use video recordings to justify a denial of disability, even if the video does not completely prove you are not disabled.
The best approach for dealing with the threat of video surveillance is to conduct yourself in accordance with your physician’s limitations.
Find a Tenacious LTD Attorney Near Me
Suppose you have developed a health condition or been injured and cannot work in your own occupation or any occupation. In that case, your LTD policy will provide compensation for the benefits. Unfortunately, that is not always true. LTD insurance firms are not always impartial since their focus is on continued profitability for their companies by reducing the number of claims they approve. The most effective way to level out the playing field is to hire a seasoned California-based lawyer. Lelad Law can ensure your application paperwork is accurate and does not include information your insurer might use against you. If your insurer wrongfully terminated or denied your benefits, we can aggressively fight to reinstate the benefits you deserve. Please call us at 866-449-6476 for all LTD policy matters.
