As we've discussed previously, the definition of disability is found in your long-term disability (“LTD”) insurance policy. While it can differ from policy to policy, the definition typically looks something like this: “Due to sickness or injury, the employee is unable to perform the material and substantial duties of his or her own occupation.” The term “own occupation” there is key.
Your “Own Occupation” Governs Initially
Typically, LTD policies will consider you disabled if you cannot perform your “own occupation” only for the first 24-48 months. This timeframe will vary from policy to policy but is often a period of two (2) years. After that, whether or not your insurance company considers you disabled will depend on whether you can perform “any occupation.” The two-year mark after you file a LTD claim is a critical point as your carrier will reevaluate your condition and determine whether you can perform “any occupation” considering your training, education, and skillset. If your LTD carrier finds you can perform “any occupation” at that point, your LTD benefits will terminate.
If you are disabled under an "own occupation" policy this means you are unable to carry out the duties of your own job. Consider a chemical plant foreman who is required to lift heavy (50+ pound) bags of chemicals, operate machinery that requires muscle and heft, climb onto silos, crawl into electrical spaces, etc. all while supervising a team of men. If this foreman falls and suffers a severe back injury that limits his ability to stand, walk, lift, crawl, etc. and puts him in constant pain (which would affect his ability to supervise and direct his employees), he will no longer be able to perform his job as a chemical plant foreman. He would be considered disabled under his policy under an “own occupation” definition even if he could perform lighter work for which he is trained and suited, e.g. managing the plant's purchases and order fulfillment.
Your Ability to Perform “Any Occupation”
The "any occupation" definition in LTD policies is usually far more strict. Most insurance carriers will take into account your education, training, and physical limitations to try to determine whether there is “any occupation” you can perform. In the example of our chemical plant foreman—who let's say obtained a two-year associate's degree and who (after the accident) is still able to sit for periods of time, lift up to 20 pounds, and perform all necessary cognitive skills—it is likely his LTD carrier can compile a long list of jobs he can perform ranging from office work, administrative jobs, oversight, management, clerk, teller, etc.
The Insurance Company Decides Whether You Are Disabled
It will be up to your LTD carrier to decide whether you are disabled or not, under an “own occupation” or “any occupation” definition depending on the timeline of your claim. Unfortunately, this gives your carrier a financial incentive to decide you are not disabled, as it will save them a lot of money in the LTD benefits they will not be paying you. This results in the denial of many legitimate claims. For this reason, it is important to follow all instructions your insurance company gives you and fulfill all reasonable requests they ask of you.
It is also in your best interest to hire an experienced LTD attorney to assist you with the process if you are thinking about filing a claim. There are many pitfalls and traps and most policyholders do not know the ins and outs of filing a claim for LTD benefits and, in particular, appealing a denial. If you believe you may meet your policy's definition of disability and are thinking about filing a claim, pick up the phone or send us an email to talk about it. It is much better to learn and understand your rights and the process before you begin.