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Disability Insurance

Why Disability Claims are Denied and What to Do About It

When you’re injured and unable to work, obligations can pile up quickly. Fortunately, British Columbia has a strong system of employment disability insurance that supports claimants during periods of short- or long-term disability. But insurance companies deny claims every day for a variety of reasons. If your claim has been denied, consider appealing with the help of a lawyer who can assist in strengthening your claim. Start this process by better understanding what short- and long-term disability claims are, why benefits are granted, and why disability claims are denied.

Short-Term Disability Basics

In British Columbia, some employment benefits like disability are administered by third-party insurance companies. Employers purchase disability plans for their employees through these companies. Not all employers offer such benefits but many do.

Insurance companies are in charge of evaluating whether your injury or condition is serious enough to warrant benefits. Insurance companies are known to make mistakes and act in bad faith to deny benefits. If your claim is denied, you can appeal the disability insurance company’s decision. The appeals process is similar to making an initial claim, with a few key differences.

If You’re Denied Short-Term Disability

If you expect that an injury, illness, or condition will keep you out of work for up to six months, you can file a short-term disability claim. If your claim is denied, there are a few steps you’ll want to take when deciding what to do next.

1. Review your denial letter.

Insurance companies are required to give specific reasons for denying a claim. In the case of short-term disability, reasons for denial often include the insurance company’s assessment that the claimant’s illness or injuries do not render them “totally disabled” and unable to work.

There are several other common reasons for short-term disability claim denial. These include:

  • Your symptoms are not serious enough to qualify.
  • Your diagnosis is not serious enough to qualify.
  • You have not sought or accepted treatment.
  • Treatment does not indicate a serious illness or injury.

Another reason for denial includes an incomplete application. Claims documentation must include:

  1. Attending Physician’s Statement
  2. Employer Statement
  3. Employee Statement

2. Notify the insurance company of an appeal.

If you decide to appeal, the first step is to inform the insurance company of your intent to do so. You have 30 days from the date of your denial letter to notify them. You then have 90 days to formally file your appeal. Do not wait to collect more evidence or records before taking this step.

3. File an appeal.

Successful appeals address the reasons for denial provided by the insurance company. They will often provide additional evidence in the areas listed above, including information relevant to your diagnosis, your symptoms, and your treatment. If your condition has changed or worsened you can also ask your doctor to include this information in an updated statement.

It is important to note that employers are notified of a disability decision. If you are denied, you’ll want to provide your employer with additional information as to why you cannot return to work. If you are denied and have exhausted your short-term disability appeals, there are other options.

Alternatives to Short-Term Disability

As an alternative to short-term disability, you may also consider federal EI sickness benefits.

Long-Term Disability Basics

Long-term disability occurs when an injury, disease, or disorder prevents an individual from completing the duties of their current job. It can include physical, mental, and emotional conditions affecting your ability to work in the long term, which could be up to several months or even years. You can receive long-term disability for up to two years on this basis before being reevaluated.

It’s customary to apply for short-term disability benefits before applying for long-term disability. While on short-term disability, you’ll want to begin preparing your long-term disability claim, especially if you and your doctor feel that your condition isn’t improving. Short-term disability is not a prerequisite to receiving long-term disability, especially if short-term disability is wrongfully denied.

Common Reasons for Long-Term Disability Denial

Understanding why your long-term disability claim was wrongfully denied can be complex. However, there are some common reasons why a claim was denied.

Lack of sufficient evidence or medical justification. This is among the most common reasons for denial. Lack of evidence could include missing documentation, medical information that is improperly or inaccurately worded, or items missing from a medical report.

Cases lacking medical justification could mean that the symptoms of the condition are not severe enough to satisfy the insurance company’s definition of “total disability.” This is particularly true in cases involving mental and emotional health. “Total disability” is a phrase insurance companies often use when judging the severity of a health condition but this is not the legal definition of disability. Determining whether or not you are disabled is subjective and can often depend on who is reviewing your case.

You were late filing your claim. There are deadlines when challenging insurance company findings. Missed deadlines are not necessarily the end of your claim. You may still have options if you believe too much time has passed.

Evidence that contradicts claims. Insurance companies may take actions to contradict the details of your medical report if they believe you are being dishonest. It is vitally important that you follow all advice of your doctor and avoid activities that could be used as evidence to refute honest medical claims.

Denying medical advice. Refusal to accept prescribed treatments and failing to attend medical appointments could prompt the insurance company to reject your claim. It is best to follow your doctor’s guidance but it is possible to seek an outside medical opinion.

You have a “pre-existing” condition. Eligibility for long-term disability requires that your health condition has developed while working on your current or most recent job. But having a pre-existing health condition that’s contributed to an inability to work does not automatically make you ineligible for disability benefits. In fact, a pre-existing condition may make you more likely to need benefits. Not all disability insurance policies have an exclusion for pre-existing conditions. Even if your policy contains this exclusion, it may not prevent you from receiving compensation.

Your long-term disability benefits ended after two years. Claimants who were previously eligible for disability may eventually lose benefits. “Own occupation” disability means that a current health issue prevents you from working in your most recent job. However, insurance companies will reexamine your case after two years to determine if you are still eligible using what is called an “any occupation” standard. “Any occupation” requires that your injury or illness be serious enough to prevent you from working any job before receiving benefits. It is common for insurance companies to deny claims based on the “any occupation” standard.

If You’re Denied Long-Term Disability

Insurance companies are required to provide specific reasons for claim denial but this does not mean your claim is otherwise perfect. There may be other problems with your claim that aren’t listed in the rejection letter.

The disability lawyers at Stephens and Holman can help you understand the insurance company’s decision and build a successful appeal. This can include refuting the stated reasons for rejection as well as addressing other weaknesses in your claim. These steps outline the basic process of appealing a long-term disability denial.

  1. Declare your intent to appeal.
  2. Communicate with your doctor about your most recent symptoms.
  3. Compile important documentation like medical records.
  4. Be mindful of deadlines.
  5. Keep a health journal.

Alternatives to Appealing a Long-Term Disability Denial

Seeking an appeal is not the only path forward. Seeking an internal case review, an external case review, and a long-term disability settlement are all options the team at Stephens & Holman can discuss with you. You can also take the insurance company to court to fight for benefits and hold them accountable for mistreatment.