Individual Disability Policies, Long Term Disability Plans, and Social Security all define disability differently; make sure you understand the difference.
According to the Centers for Disease Control and Prevention, one out of every five adults in the United States has a disability. As of 2015, that was 53 million people.
What happens when you become disabled?
For many people, suffering a disabling injury or sickness means they must stop working. Or, for those fortunate to be able to continue working, it often means changing what they do or reducing the amount of time they work. Unfortunately, this often causes financial hardship for many people.
When a person can no longer work, he often looks to his own disability insurance and to Social Security Disability Insurance for assistance. For many people, their employee benefits are the first place to look for disability insurance. According to the Department of Labor’s most recent statistics, as of March 2016 33% of workers in the United States took part in their employer’s long-term disability plans. That includes 51% of workers in management, professional, and related occupations and 55% of workers in the top 25% of wage earners. Further, many people have bought their own disability insurance policies. And even more than that expect Social Security will be there for them should something ever happen.
Does your disability entitle you to disability benefits?
Unfortunately, what many people do not realize is just because you have suffered an injury or became sick, does not mean you are automatically entitled to disability insurance benefits. If you have a long-term disability plan (LTD) or individual disability insurance (IDI), your policy will have a very specific definition of disability. And, if you expect to receive Social Security Disability Insurance (SSDI), recognize they also have a very strict definition of disability.
Long-Term Disability Insurance
Generally, LTD plans define disability as the inability to perform the “substantial and material” duties of your “own occupation” or “any occupation.” When the definition relates to your own occupation, it usually changes after two years of disability to the inability to perform “any occupation”. Some LTD plans will also provide partial disability benefits if you are still able to work in some capacity, but your earnings are reduced because of your disabling condition.
Individual Disability Insurance
Generally, IDI policies define disability as the inability to perform the substantial and material or important duties of your regular occupation. Most IDI policies will also provide partial disability benefits when you continue to work at a reduced capacity.
What does this mean for you? What are the “substantial and material” duties of your own occupation? What is your “own occupation”? What is “any occupation”?
For a healthcare professional, these questions only raise further questions. What is the specific definition of disability in your policy. What was the actual nature of the work you were doing at the time you became disabled and how do you prove your condition now prevents you from doing that work or any other work. Remember, insurance companies will always be more than happy to accept your premium payments while you are healthy, but once you become sick, they will dissect your claim from every angle to make sure they are only paying you disability benefits if every single provision of the disability policy has been perfectly met.
Social Security Disability Insurance
So if I do not qualify for LTD or IDI benefits, will Social Security still be there for me?
Social Security does not provide benefits for short-term or partial disability. Social Security’s definition of disability is a very strict definition as set out by law. To be considered disabled by Social Security, you must be (1) unable to do work that you did before, (2) unable to adjust to other work because of your medical condition, and (3) your disability lasts for at least one year or will result in death. The Social Security definition of disability is often the strictest disability definition a person will encounter; therefore, it is important to recognize the disability coverage you have through your LTD and IDI policies.
Where does this leave you?
Once you suffer an injury or sickness, it will be very important to properly explain what is happening and how this will affect your ability to work to your insurance company. The company will look for every possible opportunity to avoid paying you disability benefits. However, if you really are disabled and have met all the provisions of your disability policy, you are entitled to your disability benefits. It is important to have an advocate on your side who can assist you in navigating through the claims process. Often times, a person filing a disability claim is rightly focused on their medical treatment and getting better; therefore, it is very important to have an advocate who understands the disability claim process assist you.