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Long-term disability provides one of the most valuable coverages for working adults under the age of 65. Imagine how your life would change if you were unable to work or work in your own occupation for years or for the rest of your life. You probably made plans based on working until retirement. You may have a mortgage, credit card debt, and car payments. Plans to start a family or support your children are suddenly in jeopardy.
This scenario plays out across the United States every day. Working-age adults are three times more likely to become disabled before retirement than to die. Most everyone knows its important to have life insurance, but many people underestimate the importance of disability insurance.
If you purchased a long-term disability policy or signed up for one through an employer benefits plan, you have made one of the wisest financial decisions. Should a long-term injury or illness preclude you from working or force you out of your profession, your disability policy insures that you will not lose your house, be unable to support your family, or go bankrupt as a result.
What you may not have known when you took out your disability policy is that many insurance companies resist good disability claims. The resistance results from the fact that a long-term disability claim can easily cost insurance companies hundreds of thousands or millions of dollars. As a result, insurance companies deny these claims at a very high rate, even in cases when the person’s ability to continue working has clearly been destroyed by an illness of injury.
How does a disability claim work
After the diagnosis of an illness or injury, a claimant usually finds out whether their medical status will be disabling in the long term. Once this medical determination is made, the claimant will file a claim for long-term disability.
Long-term disability policies pay about 2/3 of an insured’s former income. The amount is 2/3 because disability income is tax exempt. The insurance company will examine the claimant’s income to determine the benefit amount. It will also require extensive documentation of the disabling condition.
Most private long-term disability policies start benefit payments after a 90-day elimination period. Many employer-based plans provide 6 months of short-term disability and a long-term disability plan that starts afterwards. Most claimants hope that their claim will be approved before the elimination period ends. Unfortunately, many claims remain bogged down in the approval process long after the elimination period and are ultimately denied.
What can go wrong
Disability insurance adjusters are trained to scrutinize every detail of a claim. They look for technical reasons to deny a claim. If they can find one, they may be able to deny a claim despite the fact that a claimant’s disability is obvious. They may also try to argue, often speciously, that a claimant’s illness or injury doesn’t qualify, even if the claimant obviously can’t work.
One of their most common reasons for insurance company denial is to claim that the disability doesn’t exist. To establish their position, they may dispute medical evidence with “experts” of their own. In some cases, they may send private investigators to gather photographic and other types of evidence that they can use to refute a claim.
For the claimant who has lost his or her livelihood, this process becomes a painful struggle. Often, the illness makes it very difficult to manage treatment and fighting the insurance company at the same time. Insurance company lawyers often try to exhaust the claimants.
What to do if your claim is denied
First, don’t panic. When you have financial obligations and cannot work, it can feel like you have the world on your shoulders. Accept support from your loved ones and focus on your health. To deal with the insurance company, contact a disability claim attorney.
Your attorney can evaluate your claim and give you an idea of what to expect, something that will put your mind at ease. An experienced disability claims lawyer knows all of the insurance company tricks. He or she can deal with the insurance company’s lawyers.
Often, once your attorney gets involved, the insurance company realizes that it has no case for denial and approves the claim. If not, your attorney can take the insurance company to court and force it to pay your claim, plus additional damages.
Disability insurance provides vital protection for American workers and families. Over the course of a career, many disabling conditions can strike, jeopardizing a family’s future and even leaving the breadwinner unable to make a bare-minimum living.
When you are healthy, it’s hard to imagine becoming disabled. Whenever illness or injury strike, even the highest income earners can find themselves broke. The purpose of disability insurance is to prevent a disability from leading to extreme financial hardship. When this benefits is unfairly denied, a tough disability insurance litigator can force the insurance company to pay your legitimate claim.