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Category: Disability Insurance

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Are Insurance Benefits Affected by Damages Recovered in a Lawsuit?

Fri Jun 15th, 2018 on     Disability Insurance,    

Oftentimes, insurance policyholders who are already receiving benefits (or who intend to submit an application for benefits) are concerned about how their qualification for such benefits will be influenced by their success in litigation.  This is a reasonable concern, of course — it seems sensible that one’s disability benefits may be affected by their receipt of hundreds of thousands of dollars, or even millions of dollars in damages from the liable defendant in a personal injury lawsuit. In reality, however, the effect of a settlement or verdict on one’s receipt of benefits is not necessarily straightforward.  Whether these concerns are valid is fundamentally dependent on the circumstances. Let’s take a brief look at the situation. Income-Based Benefits May Be Affected In Florida, as in other states, private insurance coverage — such as disability insurance, health insurance, and property insurance, among other policies — is generally not affected by the receipt of damages in a settlement or verdict.  It’s a rather simple calculus, in fact.  Private benefits are typically not awarded based on “financial need” or income, and so by securing substantial financial resources through a lawsuit, you do not influence the provision of benefits under your existing coverage. For example, suppose that you have entered into an agreement for private disability insurance coverage.  You subsequently are involved in a motor vehicle accident where you suffer injuries that give rise to a disabling condition.  In your lawsuit, however, you are awarded $1M in damages. Unless your policy includes some provision that […]

How Are Disability Benefits Calculated?

Fri Jun 8th, 2018 on     Disability Insurance,    

In Florida, and throughout the country, whether you receive disability benefits — and the benefits amount that you are awarded by your insurer — depends largely on the disabling condition at-issue and the provisions of insurance policy.  As policies can vary quite substantially, you and your attorney will have to closely evaluate the language of your insurance agreement in order to determine the benefits to which you’re entitled. Generally speaking, the disability benefits calculation begins with the insurer’s determination of your condition.  Some policies have stricter, more restrictive definitions of “disability,” which require that the policyholder demonstrate that they cannot work any job (not just their current job).  In any case, if you qualify as “disabled” under the plan, then you may receive disability benefits. Benefits are very likely to differ based on the structure of your disability insurance plan, however.  Let’s take a look. Percentage-Based Income Replacement In the private disability insurance context, the benefits you receive are often a critical issue in negotiations when initially signing onto an insurance plan.  Percentage-based benefits are desirable for knowledge workers and other white-collar workers with high monthly wages.  For example, if you are a medical professional earning $20,000 per month, then 50 percent of your monthly wages in benefits will be $10,000 — though it represents a substantial drop in total income, it is likely to be sufficient to cover your immediate financial needs. Benefits Capped Out Bear in mind that in many policies where the benefits are paid out based […]

What Makes Long-Term Disability Insurance Unique?

Fri May 25th, 2018 on     Disability Insurance,    

Generally speaking, in Florida and throughout the country, disability insurers will utilize whatever means necessary — whether you have short-term disability insurance coverage or long-term disability insurance coverage — to undervalue a policyholder’s claim, or to otherwise avoid having to payout the claim altogether.  Insurers rely on the fact that many policyholders are unwilling to challenge their decision, even if their decision is not justified by the evidence. If you’ve had a legitimate disability claim denied by your private insurer, you do not have to standby and accept their decision — if you appeal the decision or pursue traditional litigation thereafter, it may be possible to have it reversed. What is Long-Term Disability Insurance? Long-term disability (LTD) insurance is private disability insurance coverage that acts as an income replacement if you are rendered disabled and therefore incapable of working.  LTD insurance lasts for a year (at minimum), and up to a lifetime (at maximum) — depending on the policy that you have entered.  As such, it can function as a permanent income replacement in some cases. By contrast, short-term disability (STD) insurance is private disability insurance coverage that acts as a temporary income replacement, usually between three months and one year in duration. STD insurance and LTD insurance need not conflict.  In fact, comprehensive insurance coverage generally involves purchasing STD and LTD insurance policies that overlap.  Once the STD insurance benefits period has ended — assuming that you are still disabled — then the LTD benefits will kick in, ensuring […]

Be Careful What You Post to Social Media — Insurers May Be Investigating

Fri May 18th, 2018 on     Disability Insurance,    

In Florida (and throughout the country), disability insurance policyholders must take special care not to post potentially compromising text, photos, and videos to their various social media accounts.  Insurance companies are increasingly making use of evidence that their investigation teams dredge up on social media accounts to undermine policyholder claims and thereby justify a denial. Insurers Have Always Investigated Inconsistencies Disability insurers have a long history of using privacy-invasive tactics in order to investigate potential inconsistencies in policyholder claims.  In decades past, insurance companies would direct their internal investigation team (or hire out a third-party investigation team) to commit to surveillance activities — after some time, they might discover that the policyholder was not suffering from as severe a disability as was originally claimed. How Social Media Has Changed the Investigations Process With the advent of social media, insurance investigations teams have expanded their activities to include digital surveillance.  Posts that you make on social media will almost certainly be monitored by your disability insurer. How does it work? Remember, disability insurers only owe benefits if you are actually disabled — in other words, if you are suffering from a condition that renders you incapable of working, to the degree set out in the policy.  Insurers conduct surveillance so that they can “catch” you doing something that you should not be able to do given your claimed disability. For example, imagine that you suffer a back injury in a motor vehicle accident that causes you to experience severe pains and […]

Disabled Claimants Must Seek Treatment and Give Regular Updates

Fri Apr 20th, 2018 on     Disability Insurance,    

In Florida, as is the case in other states, recipients of disability benefits — whether through private disability insurance or through a public program like SSDI — must reasonably follow the treatment plans required by their physicians, and must regularly update their insurer as to their condition.  Failure to do so could result in a loss of benefits (through premature termination of benefits), or a reassessment of disability benefits that reduces the amount you receive on a monthly basis. Reasonable Efforts to Mitigate Generally speaking, insured policyholders in Florida (including disability insurance policyholders) have a duty to mitigate — in other words, they must make reasonable efforts to minimize their losses.  In the disability context, this means that disability claimants must attempt (to the degree possible) to “fix” their disabling condition, or at the very least, to minimize the impact of the condition on their life. Once your physicians recommend a treatment plan, it is important that you follow said treatment plan.  Failure to do so will likely constitute a violation of your duty to mitigate your losses — if you do not follow your physician’s recommended plan, your insurer may terminate benefits prematurely and will likely argue that your disability would have resolved had you followed the plan. If you failed to follow a given treatment plan, you may still be able to receive benefits, but you’ll have to introduce evidence that demonstrates that your disabling condition would not have improved or resolved even if you had followed the […]

Short-Term Disability Insurance in Florida — The Basics

Wed Feb 21st, 2018 on     Disability Insurance,    

Short term disability insurance benefits serve as a form of temporary wage replacement for those who are suffering from a serious disability (though it’s worth noting that not all plans require employment, or a history of employment, to qualify for disability benefits).  If you have been seriously injured in a car accident, for example, to such and extent that you can no longer work for a period of time following the accident, then your short term disability insurance will kick in and you will be entitled to receive benefits. Many people unfamiliar with disability insurance do not understand what short term disability insurance is, and whether they can actually receive benefits pursuant to their policy.  There is a real and unfortunate “knowledge gap” when it comes to short term disability, particularly in scenarios where the policyholder may be automatically covered under an employer-based group plan. In reality, short term disability insurance is fairly straightforward to understand.  Consider the basics. Short Term Disability Benefits Short term disability benefits payout when you have been injured, or are suffering from an illness or condition that is severe enough to disable you — in other words, enough to prevent you from fully and adequately handling your job/career duties for a specified time period (up to one year, usually).  Benefits vary depending on the insurance plan, and sometimes, on the nature of the work that you are involved in.  Some plans pay a percentage of your wages, while other plans pay a set amount of […]

When is an Injury Deemed a Disability for the Purpose of Insurance?

Fri Dec 29th, 2017 on     Disability Insurance,    

In Florida, as in other states, there are a variety of private insurance plans for disability coverage, each with their own respective terms and provisions relating to such disability coverage.  If you are suffering from an injury or other health condition that has rendered you disabled (partial or full), however, then you may find that your insurer — despite having provided you “comprehensive” coverage — has wrongfully denied benefits to you on the basis that your injuries/condition do not qualify as a disability under the plan. You have a number of different options: a) you can resubmit your original application if your documentation was inadequate, or if there was some other procedural issue; b) you can challenge the denial of your original claim through the appeal process; or c) after you have exhausted administrative remedies, you can bring a lawsuit against the insurer for wrongful denial of benefits (and perhaps for bad faith conduct). So, what counts as a disability, and what is defined as a non-disabling condition?  Let’s take a look. Each Plan Has Its Own Rules Your disability policy may differ from others, so it’s important that you have a qualified attorney assess the language of the contract.  Whereas one disability coverage plan may have a broader definition of “disability,” another may have a narrow definition — it’s critical that you understand the range of conditions that your plan covers. Typical Disability Factors Generally speaking, you will be entitled to receive disability benefits if you can show that […]

Insurance Benefits: Partial vs. Total Disability

Fri Dec 15th, 2017 on     Disability Insurance,    

Depending on your insurance coverage, you may be eligible to submit an insurance claim for either total or partial disability.  Too often, however, insurers wrongfully deny, delay, or undervalue disabled policyholders’ claims so as to minimize their liabilities.  In the disability insurance context, for example, an insurer might define your disability as merely partial, when in fact the disability is totally debilitating with respect to your ability to work and earn a living.  If your insurer defines your disability as “partial” when the disability is actually “total,” you will lose out on substantial benefits that are necessary when your income-earning potential has been so thoroughly damaged. Plans can vary quite a bit with regard to their provisions and definitions, so there are not necessarily one-size-fits-all truisms that apply to each and every disability insurance plan in Florida.  Generally speaking, however, there are certain ways in which insurers define total and partial disability that are worth keeping in mind as you begin the process of pursuing your rightful disability benefits. Total Disability Total disability can be defined differently between policies, but as a general rule, total disability tends to be linked to whether the policyholder can perform their material duties (with respect to their current occupation).  If the policyholder cannot perform the material duties of their occupation, then they may be entitled to receive total disability benefits. Some disability insurance plans offer total disability benefits only if the policyholder can show that they have been rendered incapable of performing the material […]

What Is An ERISA Insurance Claim?

Fri Nov 3rd, 2017 on     Disability Insurance,    

If you are covered by an employee benefit plan (life insurance, pension, health, retirement benefits, etc.), and you work for a private industry employer, then in all likelihood, your plan is governed by ERISA regulation.  ERISA can have important ramifications for your insurance claims and the process by which you can seek proper recourse in the event that your claims are wrongfully denied. What is ERISA? The Employee Retirement Income Security Act (ERISA) was enacted into federal law in 1974 to establish standards for private employee benefit plans.  ERISA does not mandate that employers sponsor private benefit plans for their employees, but it ensures that when employers do offer benefit plans, they abide by various regulations relating to accountability, reporting, fiduciary duty, conduct, disclosures, and more. Thanks to application of the interstate commerce doctrine, federal ERISA regulation applies to employee benefit plans whether or not the employer’s business crosses state lines.  For example, a small three-person firm in Miami will be governed by ERISA (with regard to benefit plans offered by the employer), even if the firm only works with Florida-based clientele. Your benefit plans will not be governed by ERISA regulation if you are a public employee or the employee of a qualified religious organization.  ERISA applies only to benefit plans offered by private employers. Consequences of ERISA for Claim Denial As an insurance claimant, ERISA affects the basis and process by which you obtain benefits when your claim has been denied. If your insurance provider denies your benefits […]

Common Justifications for Denial of Disability Benefits

Wed Oct 11th, 2017 on     Disability Insurance,    

In Florida, as is the case in other states, disability benefits may be denied for a number of different reasons.  Insurers often act wrongfully when denying benefits, however.  If you believe that you have legitimate reason to challenge the denial of your benefits, you may appeal the denial and — having exhausted the administrative process — you may even bring a lawsuit against your insurer for wrongful denial. On what basis do insurers justify the denial of disability benefits?  Consider the following non-exhaustive list. Disability Does Not Satisfy Plan Requirements The definition of a “disability” that qualifies for benefits can vary significantly depending on the policy.  Under some policies, specific illnesses, injuries, and conditions are outlined, with full/partial exclusions listed (for example, subjective conditions are often limited to temporary benefits). Most policies apply an occupational standard: either own occupation or any occupation.  If your disability benefits plan is an own occupation plan, then you will be considered disabled if your condition renders you incapable of working in your current occupation.  If your disability benefits plan is an any occupation plan, then you will be considered disabled if your condition renders you incapable of working in any reasonable alternative occupation — the condition must therefore be severe enough that it prevents you from seeking a different career path. Medical Record Evidence is Lacking Your insurer may deny disability benefits if certain aspects of your medical record relating to the disability at-issue are missing or inadequate.  For example, if you are attempting […]

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