Top 3 Reasons Why Disability Claims are Denied: Avoid These Common Mistakes

Andrew: Today we're talking about an interesting topic on disability claims, and we're going to explore what we consider to be the top three reasons why people's disability claims are denied.
#1 Understanding Disability Definitions
Andrew: Let's just take this one by one here, Colton. What do you see as the top reason? What do you think is the top reason why disability claims are denied? 
Colton: So the top reason, in my opinion, is the definition of being disabled isn't met, as per the policy. 
Andrew: That would be my opinion as well. 
We have to keep in mind, disability contracts are contracts. And the insurance company is the one that wrote the contract. And so they've come up with a definition, a legal binding term in their contract of what it means to be disabled. 
Typically these disability contracts have some sort of language that the person must be totally disabled from engaging in their work.
Change in Definition After Two Years
Andrew: What about those contracts that then have a change in definition? So what if somebody was initially approved for long term disability? Or short term or long term. One day the insurance company is saying, well, you no longer meet this, but they phrase change in definition. Explain what that means. 
Colton: Most policies after two years, the tests for disability changes from being unable to return back to your previous form of employment, at the time you're considered disabled, to unable to return back to any form of employment for which you are suitable by way of training, occupation, education, experience.
The definition is a lot more broad. So instead of not being able to return back to your previous form of employment, now the term disabled is more general, to not being able to return to Any form of employment, not just your previous employment. 
Andrew: Right. And so it gives the insurance company, even though they've approved somebody at the outset, a new opportunity to now look at it and say, okay, well, we don't think you meet this test and deny you, or they could have deny to you at the first test where the insurance company considers that you can work in your own occupation despite your injury or your illness.
Colton: In most insurance companies the tendency is most individuals' disability benefits would stop at the two year mark because of this change in definition, unfortunately. 
#2 Lack of Medical Documentation
Andrew: What would you consider the second biggest reason why we, what we see where an insurance company has denied somebody's disability claim?
Colton: Lack of medical documentation confirming that they are in fact disabled. 
Andrew: This ties into all injury claims, medical records, medical treatment, support from healthcare providers is your best tool for proving your claim. Disability claim is no exception because at the end of the day, the insurance company is reviewing medical records and the opinions of your doctors.
So even if someone has symptoms that in their view disable them from going to work every day, doing the essential duties of their job. The insurance company is going to look at that and say, well, we have nothing to support that other than you saying it. We don't see you ever attending a doctor's office. We don't see your doctor diagnosing you with these things. We don't see your doctor treating you for these things. We don't see specialists or whatever it might be. 
For me That kind of also ties into the number one reason if you have a strong medical foundation Then you have a better ability I think to meet the definition as well. 
Colton: And more often than not the medical records are the strongest evidence to support your claim for being disabled.
What To Do If Your Disability Claim Is Denied
Andrew: So what do you say, so if someone called you today, like let's say someone called you now, you reviewed their file and explained to you that they had this injury or illness and they can't work, the disability insurer has denied their claim. Right. And you read the records and you find that there are very limited records for treatment supporting the claim.
Is that a case that you can take on? Or what's the client's option or what's the person's option in that circumstance? 
Colton: It's still a possibility that there is a valid claim. Of course, each claim is very different. It's very important that the individual does go seek medical attention from their family doctor. Specialists get treatment on an ongoing basis because that would prove that they are disabled, unable to return back to their work. 
Andrew: So just to be clear, even though an insurance company has denied it and there might not be great support in the medical records, there are still options to this person because they can still go and treat and get support from their treating doctor to try to persuade the insurance company that in fact they mean the Incorrect decision in denying the claim.
Colton: Correct. 
Andrew: And there's a reverse.
Colton: Correct, because, you know, as a case progresses, it's always evolving. There's always new medical records that come to light. There's always new diagnosis, new prognosis that maybe the individual or the doctor wasn't aware of until recently. All of the factors that come into play not only include your medical records from the past, but also the medical records into the future as well.
#3 Inconsistencies in Claims
Colton: Andrew what do you think is the third highest reason for an insurer to deny a disability claim? 
Andrew: From what I see, if I had to describe a third, it kind of ties into the first two. I would say just generally inconsistencies. You know, where they're claiming they have this disabling symptom or features of an illness that disable them from working, but yet they're telling their doctor they're much improved or they just went skiing or jet skiing. And that's been brought to the attention of the insurance company. 
So the insurance company is looking at this, Hmm, it's convenient to say you're really, really hurt in connection with the claim that you're making to us, but it's not consistent with what we're seeing in your reports to either your medical providers or other information that's come to their attention, like activities that you're doing, other recreation that you're doing, things like that, that are inconsistent with the claim you're making. 
And so I think that boils down to number one and number two, kind of co-mingling, they have an argument to say you don't meet the definition. Those are probably the three main reasons why we see people get denied for long term disability. 
Insurance Companies' Bias In Disability Claims
Andrew: I would also say, I think these long term disability insurance companies are not always looking at the information in the light that's favorable to the person who's making the claim. Very often, they will emphasize and focus on any information that supports the denial and largely ignore information that's compelling and supports the acceptance of the claim. And that's where you get into whether an insurance company is actually adjudicating that claim or deciding that claim. In good faith or not, or if they're trying through the process to find a reason to deny. 
No matter which situation it is, one, two, or three, for me, the over reaching factor that I see very often in disability claims, when you look at it objectively, all of the information available to the insurance company, that they're very good at pointing out what doesn't support the claim, and largely ignoring factors that do support the claim, and that could give rise to punitive damages in a lawsuit. 
It's not just these factors, it's also who's adjudicating it and how they're looking at the facts. 
Colton: How the insurance company adjusts the file. Reasons that they used to deny the claim, is there a valid reason? 
Legal Recourse and Punitive Damages
Andrew: So sometimes the insurance company will claim you don't meet the definition. Your medical records don't support it. There's a lack of medical foundation. They'll claim inconsistencies. Yes, all three tend to be separate reasons, but really they can make those claims because they're, they're, that insurance company is choosing what to put emphasis on within your claim materials and what to ignore.
And that's where a lawyer can really help expose that, explain your rights, and where necessary, file a lawsuit on your behalf to enforce your rights under the contract and ask the court for declaratory relief to enforce that contract. And force the insurance company to honour the terms. 
Colton: Then your lawyer can also explain to you whether or not you do have a valid claim for punitive damages, whether or not the reasons that the insurance companies are providing are valid, and if they aren't valid and they are, you know, looking for reasons to deny you, even though they're not valid reasons, then perhaps you would be entitled to punitive damages on top of what you're entitled to under your contract.
What Are Punitive Damages?
Andrew: Okay, and I know a question is going to come up in the comments, so let's just tackle it right now. It'll probably be a topic for another video, but just briefly, what are punitive damages? 
Colton: Punitive damages, essentially in simple terms, are damages that are used to punish the insurance company for not adjusting the claim fairly.
Andrew: To punish the conduct in this case, but also to act as a deterrence. 
Colton: Prevent the insurance companies from denying other people's insurance claims. That are valid. Correct. 
Recap and Final Advice
Colton: Just a recap of the top three reasons why insurance companies deny disability claims. The first reason is that you do not meet the definition of disability under the terms of the contract. The second one is there is a lack of medical support for your disability. And the third one is inconsistencies that are found that again do not support the definition of meeting disability. 
Andrew: And those are just the top three. There could be other reasons. And certainly we've encountered claims where denials were done for other reasons, but those are some of the common ones we see. It's important to speak to a lawyer. Find out your rights. Better to take corrective action sooner than later to preserve your rights to make that claim. 
Have Questions? Contact Us Today!
Andrew: Disability contracts are extremely important because they're designed to protect you at a very vulnerable stage in your life, to give you peace of mind in the event that you're unable to work and support yourself.
By denying a claim like that, they put you at a significant financial hardship. Act quickly to try to get a remedy as soon as possible. 
Colton: So if you have any questions, you know, please don't hesitate to reach out to us. Contact details are listed in the notes below.