{3:20 minutes to read} When filing an insurance claim due to an injury or sickness, it can be challenging to determine the date of disability—i.e. when coverage was triggered.
Clients, typically professionals, who experience injury or sickness which affects their ability to perform their job don’t always stop working. Many times, they will perform less of, or cease to perform one particular activity—even though that activity is an essential duty of their occupation.
This can make it complicated to determine a date of disability.
Trigger of Coverage
Often, you have to go back in time to discover when that person may have triggered coverage under their long-term disability policy.
As an analogy, if your house burned down on April 1st, that is when you suffered your loss. It doesn’t matter what happens after that. Whether you told anyone about it, did anything about it, or collected money, April 1st will always be the date of the loss when coverage was triggered under your policy.
In disability policies, the “trigger of coverage” happens from the moment injury or sickness prevents you from performing the duties of your occupation, regardless of whether you’ve filed a claim. There can be some digging involved, however, to determine the date when that total disability started.
Activity Levels
The first part of digging is to look at the activity levels of your client. For example, if your client is a surgeon:
• Did the surgeon perform a great deal of surgery and cut back over the years?
• Did the surgeon stop performing more complicated procedures?
• Did the surgeon take much longer to do surgeries than before?
Income Levels
After looking at those types of activity levels, you then have to look at the income levels to tie to when the activities change. A drop in income may qualify your client for benefits under their policy or policies, assuming that their policy(ies) contained a partial or residual disability benefit provision. If the policy(ies) contain only an own-occupation provision, then a cessation of the client’s own-occupation will be necessary in order for the client to obtain benefits, regardless of income level.
The Specifics
Finally, you have to dig into the specifics to verify what your client said they were doing less of at the time. For doctors and surgeons, that typically includes examinations of their Current Procedural Terminology (CPT) codes. For lawyers, it may be trial schedules, diaries, billing records, etc. When you put all of those together, you can identify whether someone met the definition of disability in their policies months, a year, or even many years earlier.
Evan S. Schwartz
Founder of Schwartz, Conroy & Hack
833-824-5350
[email protected]
