Many people who have been on claim for long-term disability (LTD) benefits for a long time will start receiving letters from their insurance company saying that they are approaching the “change of definition”. This begs the question – what is the “change of definition” and what does it mean for my claim?
In order for a claimant to qualify for disability benefits, they will have to satisfy the definition of “disability” in their LTD policy. Most disability insurance policies have two definitions of “disability” – the “own occupation” definition and the “any occupation” definition. The point in time where the policy switches from “own occupation” to “any occupation” is the “change of definition”. Under most insurance policies, the change of definition occurs twenty-four months after the date the claimant became disabled.
The “Own Occupation” Definition
Most LTD insurance policies contain a definition of disability which requires the claimant to be unable to perform the duties of their own occupation. “Own occupation” is the occupation that the claimant was engaged in when they stopped working. The own occupation definition of disability usually lasts for a specific time period, with most insurance policies specifying a twenty-four month (i.e. two year) time period. After the own occupation time period elapses, the policy switches to the “any occupation” definition described below.
Each policy of insurance will have it’s own specific wording of the definition of disability for the own occupation period. However, the case law has established some general principles in assessing disability from own occupation. The claimant does not need to show that they are unable to perform each and every job duty to satisfy the definition of disability for own occupation. The courts will generally take a holistic interpretation in determining if the insured person is able to perform their own occupation based on which duties they are unable to perform and how important those duties are to the person’s occupation.
Sometimes there may be several reasons why a person stops working. In order to satisfy the definition of disability for own occupation, the claimant must show that her medical condition was the driving force behind her stopping work.
The “Any Occupation” Definition
After a period of time (typically two years), the policy definition of disability changes to “any occupation.” This definition is a harder definition to satisfy because the claimant must prove to the insurance company that they are unable to perform the essential duties of any occupation.
The policy generally stipulates that the claimant must be disabled from not simply “any occupation, but rather from any occupation for which the insured would be reasonably suited by means of his or her “education, training and experience.”
When assessing a claim for any occupation, the insurance company should consider the specific characteristics of each claimant. While all policies are drafted slightly differently, typically they will all require an investigation into the claimant’s background. The assessment should take into consideration the claimant’s age, level of education, and their training and experience in their occupation at the time they stopped working as well as prior job experience. They must also demonstrate that the claimant’s limitations and restrictions do not preclude her from performing the duties of any occupation.
When proposing alternative occupations that a claimant may be able to perform, it is important to compare the prospective occupation to the claimant’s pre-disability occupation with regards to the nature, remuneration, and status. For example, the insurance company would have a hard time making the argument that a marketing executive should now work as a fast food server, as the proposed occupation would not be similar in nature, compensation, or status to the pre-disability occupation. Many policies will specify the amount of compensation that would make a proposed occupation “commensurate” or “gainful.” This figure varies from policy to policy, but often it is around 60% of pre-disability income.
What the Definition Change mean to my ongoing claim?
When the change of definition date approaches, your insurance company will start assessing your claim based on your ability to return to work at “any occupation”. Often, the change of definition investigation will include a questionnaire or interview asking you about your education, training, and experience. The insurance company may conduct a “Transferable Skills Analysis” (TSA) in order to determine alternative occupations that you may be able to perform. They may write to your treating physicians requesting updated medical information and asking their opinion as to whether you can return to work in another occupation. They may also send you for an Insurer’s Examination to have you assessed by an independent doctor.
Essentially, the insurance company will be seeking evidence to support your ability to work at any occupation, as defined in their policy. If they succeed, they will terminate your disability benefits.
Most group LTD policies contain two definitions of disability – “own occupation” and “any occupation”. The point in time when the definition changes from own occupation to any occupation is the “change of definition.” At the change of definition, the insurance company will no longer be evaluating whether or not you can perform the duties of your own occupation, but whether or not you can perform the duties of any occupation given your education, training and experience. This is the time when many insurance companies terminate disability benefits.
Of course, when proving that a claimant is disabled, it will always depend on the specific wording in the policy as to the definition of disability and whether or not the facts and medical evidence support the policy definition. The description of “own occupation” and “any occupation” above are general principles from the case law to date.
If your claim has been denied at the change of definition or if you suspect that the insurance company is preparing to terminate your disability benefits, it is critical that you contact a lawyer specializing in disability litigation.
MK Disability Lawyers has over 20 years experience between its two partners, litigating long-term disability claims. We are provide expert, personalized legal representation to disabled clients whose claims were denied for any number of reasons at any stage in the claim, including at the Change of Definition. Please contact us at info@MKDisabilityLaweyers.com if you have any questions or to request a free consultation.
The preceding is not intended to be legal advice. This blog is made available for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog, you understand that there is no solicitor-client relationship between you and the blog publisher. This blog should not be used as a substitute for competent legal advice from a licensed lawyer in your jurisdiction. If your disability claim has been denied or terminated and you require legal advice, please contact a lawyer specializing in disability law.