Long-term disability insurance (LTD) is meant to provide a fallback plan for individuals who become disabled during the course of their careers. There are a number of reasons why long-term disability gets denied, but most LTD denial causes and solutions center on the adequacy and appropriateness of evidence submitted in support of a claim. Recognizing some of the most common reasons LTD claims are denied can help individuals preparing to submit their initial claims for LTD benefits to avoid some of the most common LTD application mistakes. The same awareness also provides a starting point from which to address long-term disability claims denied due to misunderstandings.
Why Is It So Hard To Get Long-Term Disability?
Long-term disability insurance may be difficult to obtain on two main fronts. First, the initial application to enroll in a policy is often subject to significant scrutiny by the insurance company, in much the same way that many people may be more familiar with from life insurance models. The reasons why long-term disability gets denied at this juncture are also in many cases similar to those that might lead to being turned down for a life insurance policy, and in a similar fashion may sometimes be substituted for an increased premium based on the insurance company’s actuarial assessment of the applicant’s individual risk.
Individual vs. Group Plan Enrollment
Individuals looking for LTD denial causes and solutions may also find it helpful to know that this type of denial, preventing initial enrollment, tends to be more common with LTD policies purchased individually than with coverage obtained through an employer-sponsored group plan. These employer-sponsored plans can sometimes have fairly tight enrollment windows for joining, so be sure to check with your company’s human resources (HR) team if you think this type of coverage may be an option you wish to pursue.
Filing a Long-Term Disability Claim
The second point at which it often becomes difficult to access LTD comes when it is time to file a claim for long-term disability benefits. At this stage, rather than the avoidance of risk that can lead insurance companies to deny enrollment, the motive is usually a desire to keep the business expense of benefit payments as low as possible. You will likely see how these two stages are related: The initial denial of enrollment prevents someone who is likely to need benefits from enrolling in a policy, and the denial of a claim prevents someone who has enrolled and who files a claim from receiving benefits.
Both tactics are designed to minimize the insurance company’s risk exposure. However, while insurance companies generally have considerable incentive to accommodate potentially risky policyholders as long as those individuals are willing to pay higher premium rates than their lower-risk peers, accept policy terms that exclude certain conditions for which they have elevated personal risk, or both, the same type of incentive does not apply to approving and paying long-term disability benefits for submitted claims. As a result, it is far more common to see long-term disability claims denied than it is to see rejections of applications for enrollment.
Why Would a Long-Term Disability Claim Be Denied?
Even though long-term disability insurance providers have a strong economic incentive to deny LTD benefit claims, they cannot simply reject claims at will. The reason why long-term disability gets denied in a particular situation must meet whatever legal requirements apply in the state where the policyholder resides. Because an insurance policy constitutes a type of contractual agreement between the insured and the insurer, any long-term disability claims denied must be denied for reasons outlined in the terms of the policy.
Those terms vary from one policy to another, so individuals looking for LTD denial causes and solutions will want to carefully examine the terms of their own policies. However, reviewing some common reasons LTD claims are denied can put you in a stronger position to evaluate your options for appealing a denied long-term disability claim.
Why Long-Term Disability Gets Denied: Pre-Existing Conditions
Most long-term disability policies will have a clause excluding pre-existing conditions from coverage. Individuals who have grown accustomed to the requirements for employer-sponsored health insurance plans may sometimes find this reality to be something of a shock, but it is important to keep in mind that the minimum standards for employer-sponsored or federal Healthcare Marketplace health insurance plans do not apply to policies that offer disability coverage only. Unless your state has regulations requiring coverage for pre-existing conditions, disability caused by a pre-existing condition may not be eligible for benefits.
Lookback Period
That said, the “lookback” period that insurance providers use to look for evidence of pre-existing conditions is another feature that can show substantial variation between plans. Employer-sponsored plans in particular may have relatively short lookback periods, so always check the terms of your specific policy. Furthermore, the “lookback” period is only applicable if an individual ceases working within a specified time after their enrollment for coverage began, typically twelve months.
Medical Evidence
Collecting the additional evidence that may be needed to contest long-term disability claims denied on the grounds of a pre-existing condition can be time-consuming, frustrating, and in many cases expensive, but typically the presentation of additional evidence will be your first step in appealing a denial of this type. In most instances you will already have submitted at least some medical records as part of your initial claim submission, so depending on the circumstances you may or may not need to present additional evidence documenting the history of your symptoms and the steps taken by your medical team to reach a diagnosis and establish a treatment plan.
You will likely need to submit a new statement by your attending physician, or request that the physician submit one in your case. Depending on the situation, statements from other individuals, such as your work colleagues, who may have been in a position to witness the changes in your health and when symptoms began affecting your daily life, may also be appropriate.
LTD Denial Causes and Solutions: Excluded Conditions
Getting coverage for conditions excluded under the terms of a long-term disability policy may not be feasible. However, if the reason long-term disability gets denied in your case is given as exclusion of your condition under the terms of the policy, then you may want to review the specifics of the policy’s language regarding exclusions with the assistance of a disability law attorney.
Long-Term Disability Claims Denied: Definition of Disability
Sometimes an LTD claim may be denied on the grounds that the individual’s condition does not meet the policy’s definition of disability. There is an important distinction between long-term disability claims denied because a condition is “not disabling” or because the individual filing the claim is “not disabled” and those that are denied because the condition is excluded. A condition that is excluded under the terms of the policy is usually one which is not eligible for coverage, regardless of how severely disabling it may be in any particular case. A condition that is considered not disabling may still be eligible for coverage if the policyholder can provide sufficient evidence to show that they are indeed unable to work due to the condition, or sometimes a combination of conditions.
Policy Definition of Disability
With a denial based on the insurer’s determination that the policyholder is not actually disabled, because their condition is not considered disabling, there are two essential portions of the policy the disabled person will want to examine carefully:
- Definition of “disabled” or “disability”
- Procedure for appealing a denied claim
An effective appeal will need not just careful adherence to policy guidelines, but also a close understanding of what the medical documentation submitted in support of the appeal will need to prove.
Own Occupation vs. Any Occupation Disability Insurance
Some policies offer long-term disability when the policyholder is unable to continue working in his or her chosen profession and role. These are known as “own occupation” policies, because they base an individual’s eligibility for benefits on his or her disability to continue in their own job role and industry. Other policies only consider a claimant disabled if he or she is unable to return to work in any role, regardless of position of industry.
Policies that fit the second model are known as “any occupation” policies, and for the most part they will require the person filing the LTD claim to meet a stricter standard for proving their disability than will own occupation policies. However, any occupation policies may also be more likely to specify limited exceptions or thresholds for part-time work. Understanding the terms of your policy is crucial to understanding what you must prove in order to be approved for benefits, as well as the kinds of evidence you may need to submit.
Surveillance Evidence
There is an unfortunately widespread perception that disability insurance fraud is common, despite the fact that in most cases a successful claim for disability benefits would mean a substantial drop in income for the person filing. Thanks to this concern, many long-term disability insurance companies will hire private investigators to conduct surveillance on individuals who have recently submitted claims, and in some cases even on those who have already been approved but may be coming up for renewal of disability benefits. These investigators will often collect video evidence of their subjects going about day-to-day activities, and in many cases will examine and save evidence from these subjects’ social media profiles as part of their investigation.
The Role of Investigators
The issue is not that private investigators are anything less than responsible and professional in their collection of evidence, but rather that isolated moments can paint a distorted picture of an individual’s capabilities. By the nature of their business, private investigators can only record what disabled individuals do when they come outside their homes, and as a result in many cases they may be getting glimpses of short-lived activity from which the disabled person may need several days to recover.
Strategies for Protecting Benefits
The first step to protecting yourself against the possibility of surveillance evidence is to be honest in all of your statements to the insurance company. Avoid exaggerating your symptoms or limitations, as overstating the impact of any symptom can lead insurance adjusters to doubt the legitimacy of an entire case.
The next step is to be cautious and comprehensive: Cautious in what you post online and how you present yourself and your activities, and comprehensive in the notes you take regarding day-to-day symptoms. If an activity costs you days in recovery, include that in your log. If you are able to walk for fifteen minutes but find yourself suddenly doubled over in pain during the sixteenth minute, note that as well. Consider emailing the updated notes to yourself on a regular basis. Even if you prefer to keep the symptom journal in a handwritten notebook, sending a scanned version via email creates a timestamp that can help to show what happened, and when. By maintaining personal documentation in this way, you are creating a time-specific record that can provide needed context in the event that your self-reportage is ever called into question.
Planning Ahead to Avoid and Address Possible LTD Denials
Understanding some of the most common reasons LTD claims are denied puts individuals filing their claims for long-term disability benefits in a position to anticipate LTD denial causes and solutions. Thinking ahead about why long-term disability gets denied can make it easier for you to present the information you might need to counter a denial in your initial application, and also sets you up to appeal long-term disability claims denied out of hand. Keep comprehensive notes, make sure you have thorough, detailed medical evidence prior to submitting your claim, and be prepared to work closely with your healthcare providers to document the true nature of your condition.
