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Disability Insurance Claims

WylieLaw specializes in own-occupation, private disability policy claims and settlements.  Ordinarily, individuals that have these policies are professionals such as doctors, dentists, accountants, lawyers, chiropractors, etc.  Much of the information provided in this section may provide assistance to claimants with a variety of disability claims, yet the information is focused on total disability and own-occupation claims for private insurance disability policies.

Private Insurance Disability Policy Definitions
Understanding the Policy Distinctions                       
If You Miss a Policy Payment             
Why Insurance Companies Don’t Pay
Insurance Company Practices Exposed      
How a NYC Lawyer Can Help You                                                              

Private Insurance Disability Policy Definitions

A private insurance disability policy is an independently purchased insurance policy to protect you in case you are unable to work due to injury or illness.

There are ordinarily three different levels of protection offered by private total disability policies and these levels depend upon the type of policy purchased.  It is the definition of disability in each policy that distinguishes the protection provided:

  • Own-Occupation (Own-Occ):  This policy provides the most protection and usually defines disability as the inability to perform the substantial and material duties of your own occupation—the job you were doing before the onset of the disability or illness.
  • Middle Level:  This type of policy defines disability in terms of your inability to perform any occupation for which you are suited by education and experience.
  • Least Protection:  This level of policy defines disability as the inability to perform any occupation.

Understanding the Policy Distinctions

The distinctions between these definitions are critically important.  For example, if a surgeon loses a hand, she may not be able to perform surgery, but depending on the type of policy she has, her insurance benefits would vary as follows:

  • Own-Occupation (Own-Occ):  With this policy, the surgeon would be able to recover benefits, even though she was able to work as a doctor in a non-surgical field.
  • Middle Level:  With this type of coverage, she would only recover benefits if she was no longer able to work in any medically–related field.
  • Least Protection:  With this kind of coverage, she would most likely only receive benefits if she became so disabled as to be totally incapacitated and unable to leave her home.

If You Miss a Policy Payment

  • Grace Period:  Many states have laws requiring insurers to allow a grace period of as long as 30 days after a premium payment is due before coverage can be terminated.
  • Cancellation:  If payment is not made within the grace period, disability coverage will usually terminate retroactively to the date the premium payment was due without any further cancellation notice from the company.
  • Reinstatement:  Certain policies contain missed premium payment, grace period and reinstatement language.  If your coverage terminates or is cancelled because of a missed or late premium payment, some insurance companies may agree to reinstate your coverage if you make all past due payments and certify that you are not aware of any losses or changes in health that have occurred since the policy was issued or the recent cancellation date.  If there has been an unreported health change, any subsequent claim made after reinstatement will automatically be denied.   Some policies allow reinstatement but limit the protection to new injuries or sickness (meaning after the reinstatement) that result in a disability. 

History of Disability Policies (Why the Insurance Companies Don’t Want to Pay Benefits)

In the 1970s, insurance companies sold a lot of disability policies and have been collecting premiums ever since.  However, during the last ten years, a large number of individuals who owned these policies started to make claims.  It is believed that the insurance companies did not properly evaluate the underwriting risks involved in these policies and opened themselves to a larger amount of liability than they had calculated.  Therefore, the insurance companies could pay all of these claims and lose large amounts of money or they could deny many claims and keep large amounts of money.

Today, only a few insurance companies sell own-occupation disability policies.  It is very difficult, if not impossible, to get the same coverage today that was being offered 20 years ago.  In order to avoid liability, many insurance companies have changed definitions and terms in the new policies that they sell.  Some companies have even tried to retroactively change the language in old policies by sending out “new and improved” definitions and terms along with an explanation that the change is a benefit for the policyholder and unless the policyholder opts out, this change will take effect.

Insurance Company Practices Exposed

Dateline NBC aired a special report on wrongful denials of private disability claims related to one company, UnumProvident.  This report alleged that in 1993, the company was losing millions of dollars.  But after a new management team took over the company and changed the claims process, the company managed a complete reversal and began making millions.  The new claims process included targeting goals for claim denials, employing medical doctors and pressure to deny claims.  Dateline NBC also reported that the Attorney General of Georgia was completing an investigation that would most likely result in some disciplinary action.  UnumProvident issued a statement denying the veracity of the report.

How a New York Lawyer Can Help With a Claim in Your State

The most important factor to consider when retaining an attorney for assistance in filing a disability claim is experience.  A qualified attorney with experience in disability insurance law can file papers, letters and correspondence with an insurance company regardless of where the claimant is located.  Due to the extensive experience WylieLaw has in this area, claims may often be resolved without the filing of a lawsuit.  However, if a lawsuit becomes necessary, one can be filed in Federal Court, rather than State Court.  The attorneys at WylieLaw are admitted in the State of New York and also in Federal Court.  Even for cases arising in New York, WylieLaw files lawsuits in Federal Court.  As a Federal Court attorney, WylieLaw may file a lawsuit and represent clients in any and all Federal Courts in the United States.