Top 10 Reasons Your Long-Term Disability Claim Will Be Denied
If you insure your car or your home, you probably understand how insurance works. You purchase policies based on your needs. You pay your premium, and when a covered incident occurs, you expect the insurer to timely pay your claim. Sadly, insurers don’t always respond to claim submissions the way you expect. That’s often what happens when you make a long-term disability insurance claim.
Whether you purchase an individual policy or get an ERISA-governed disability plan at work, there’s a chance that your insurer will deny your claim. When you work with long-term group disability insurance lawyers, they help you take the appropriate steps to avoid undesirable claim outcomes and denials.
Why Insurers Deny Coverage
As you consider purchasing individual disability coverage, you learn policy basics from promotional materials and plan overviews. When a claim department handles your claim, they don’t look at marketing materials. They review the disability insurance contract (the policy) and they analyze the insuring agreements to confirm your coverage. Then they review policy limitations, scheduled benefits, waiting periods, exclusions, limitations, and conditions. These provisions often limit your available monthly benefits. In some cases, they eliminate your right to make a claim at all.
If the claim handler decides to deny your claim, they usually cite the same predictable reasons. Here are the top 10 reasons for denial:
1. You Didn’t Provide Timely Claim Notification and Documentation
Timeliness is a consistent issue when you file a disability insurance claim. Despite your physical or mental health, insurers expect you to provide immediate notice and timely follow-up. Claim handlers sometimes deny claims when you fail to comply with requests within the designated timeframe.
The Employee Retirement Income Security Act sets the standards for timely notification of ERISA-governed group disability claims. Commercial disability policy language mirrors ERISA timeliness guidelines.
When filing a disability insurance claim, timeliness is relevant at every claim-handling stage.
- Proof of disability
- Documentation submission
- Response to insurer inquiries
- Medical updates, testing, chart notes, pharmacy medications
- Other claim deadlines and requirements
Theoretically, insurers only deny your claim for timeliness issues when your tardiness jeopardizes their rights and claim-handling ability. Still, a missed deadline opens the door to denying or delaying your valid claim.
2. You Provided Insufficient Claim Documentation
Insurers make claim decisions based on written proof of your disability.
They require enough information to determine your long-term disability status.
- Medical records, chart notes, pharmacy prescriptions, objective testing
- Physician’s narrative reports
- Employment history and earnings
- Medical history
Insurance companies sometimes provide claim forms that assist your documentation process. Even if they don’t send forms, your policy conditions place the burden on you to provide the proper documentation they need. Insurers consider denying your claim if you or your physician fail to send in the required proof of loss for your disability.
3. Your Condition Isn’t Covered
Individual and employer-provided group long-term disability plans don’t cover all disabilities. Some only provide coverage for specified conditions listed in a schedule of benefits. Often, exclusions eliminate coverage for circumstances the insurer chooses not to cover, such as war, self-inflicted injury, and crime-related disabilities.
4. You Have A Pre-Existing Condition
Long-term disability policies usually won’t pay benefits for disabilities related to, caused by, or contributed to by a pre-existing condition. Policies define a condition as pre-existing if you previously had symptoms, took medication, sought treatment, underwent diagnostics, or consulted with a professional during the 3, 6, or 12 months preceding the date your insurance went into effect.
This pre-existing coverage limitation is not absolute. In some plans, the provision doesn’t apply if you had been actively and continuously on a job for a specified period before you became disabled. The certainty of a claim denial for a pre-existing condition becomes muddled when your condition involves multiple symptoms and more than one diagnosed condition.
5. Your Condition Doesn’t Meet The Policy’s “Disability” Guidelines
As ERISA contains no uniform definitions for disabled or totally disabled, each insurer defines the terms in their own way. Your policy’s Definitions section defines these terms and other words and phrases key to coverage interpretation.
When your insurer denies your claim due to failure to meet their disability guidelines, it means that they have made their decision based on your proof of disability and the policy’s terms. When you fail to meet disability guidelines, the insurer hasn’t necessarily concluded that you aren’t disabled. It sometimes means that you or your physician didn’t provide enough documentation to prove your disability.
6. An Independent Medical Examiner Disputed Your Disability
If your insurer has doubts about your disability extent or length, they may require that you visit a non-treating physician for a so-called Independent Medical Exam.
The IME is often a biased process.
- The insurer chooses a doctor from a list of professionals that have been favorable to their position in the past.
- They forward a medical file that may or may not include all of your relevant records.
- The chosen doctor may or may not have the specialization or training necessary to properly evaluate your condition.
- The response the insurer receives is often in line with their expectations.
To understand the IME’s potential ramifications, consider seeking legal counsel before and after your independent medical exam.
7. The Insurer Disputes Your Legitimate Condition or Severity
Even if you suffer from a disability, some conditions frequently trigger a claim denial or coverage limitation. Doctors often treat fibromyalgia, or migraines based on your subjective complaints. Insurers sometimes have difficulty paying benefits for these and other “self-reported” disabilities. When you have a disability that a physician can’t confirm objectively, you must submit strong, convincing documentation that supports your claim and inability to work.
8. The Insurer Uncovers Adverse Information During An Investigation
When an insurance company needs to confirm or disprove your disability, they do whatever it takes. That often includes investigative activities that you might think are an invasion of privacy. Because you’re seeking financial gain based on a policy they underwrite, you open up your life to intense scrutiny. In addition to reviewing your medical documentation and scheduling an IME, a claim representative or independent investigator often conducts an activities check.
Their investigation may include these and other actions:
- Park their car in front of or near your home
- Wait and watch for you to exit or enter
- Monitor and record your activities
- Talk to your friends and neighbors
- Run a credit check to confirm your financial status
Captured activity often affects your disability claim. Insurers sometimes deny your claim if your activities don’t correspond to your disability status.
9. Adverse Social Media Investigation
Even if an investigator can’t catch you on videotape, social media investigators often track you down on Facebook, Instagram, Snapchat, or TikTok. If you haven’t tightened your privacy settings, investigators easily access your photos, videos, and posts. They watch you dance, sing, cook, and every fun moment you post online. They sometimes see you doing things a disabled person shouldn’t be able to do. The information online investigators uncover sometimes prompts insurance companies to deny disability claims.
10. Insurer Error
When a claim representative denies your claim, you must insist on a comprehensive explanation. Insurance claim representatives have varying degrees of knowledge and experience. With so many complex policy provisions and medical issues, they sometimes make critical errors.
Group insurers must also comply with ERISA claim guidelines and individual policies with their state’s Unfair Claim Settlement Practices Act. The requirements sometimes force claim handlers to decide claims within a strict timeframe. This often pushes them to commit errors or make decisions before they have all the required information they need.
Do You Need A Personal or ERISA Group Disability Attorney?
When you believe you have a valid disability claim, you need legal assistance to help you throughout the process. Personal and ERISA disability lawyers handle complex disability cases every day. They assist clients at every stage of the disability claim process, and they help them overcome insurance company red tape and improper claim denials.
When you contact a disability claims insurance attorney, they schedule a complimentary consultation. A legal professional reviews and analyzes your coverage, discusses your claim, and determines if they can help you.