When most of us think about “disability,” we define the term simply: you can’t work because of an illness, medical condition, or injury. However, when you apply for long-term disability insurance, you’ll discover that “disability” can mean many different things, depending on your policy.
Unfortunately, many disabled individuals don’t realize that their policy’s language can have a profound impact on their right to benefits. This lack of understanding can lead to a lot of frustration and denied benefits. In this blog article, our disability insurance lawyers break down the difference between “own occupation disability” and “any occupation disability.”
Read Your Long-Term Disability Plan Document
A long-term disability (LTD) policy is a contract. Either you or your employer agreed to the terms in the contract when they bought the coverage, even if you didn’t read them. When you apply for long-term disability benefits, these terms and conditions will affect when you apply, whether you’ll get monthly benefit payments, and how much you’ll receive.
If you apply for disability insurance benefits before reviewing your policy’s standards and processes, you’ll be at a serious disadvantage. To get started, you should request the following documents:
- Plan Document: Details every term, condition, and process that applies to your policy; Plan Documents are often dense and difficult to read
- Summary Plan Description (SPD): Outlines the key elements and procedures of your long-term disability plan in an easier to read format
While you may prefer reviewing the SPD, your disability lawyer will probably dig into the precise language of the Plan Document.
One of the most important issues outlined in your LTD policy is its definition of disability. If you don’t meet the definition, you cannot receive benefits. While every policy has unique quirks, most lawyers break disability definitions into two categories: own occupation disability and any occupation disability.
Own Occupation Disability Focuses on Your Actual Job
Own occupation and regular occupation policies will pay your long-term disability benefits if you can prove that you are unable to perform the primary duties of your current job because of an illness, injury, or chronic medical condition.
For example, a surgeon with severe nerve damage in their hands may be unable to perform surgery. Even if the surgeon could take on different, less hand-intensive work, they should get disability benefits under an own occupation disability insurance plan.
Compared to “any occupation” disability plans, it’s easier to get disability insurance benefits under an own occupation plan since you only have to show that you’re unable to perform the substantial duties of your specific occupation. You also may be able to perform simpler or lighter work and still get the benefits you need.
For this reason, insurance companies tend to avoid the “own occupation” definition of disability in long-term disability policies. (It is much more common in short-term disability plans.) However, if you have an individual disability insurance policy that you purchased, you may have an own occupation definition in your Plan Document.
- Related Article: What Does “Regular Occupation” Mean in an ERISA Plan?
What’s My Occupation?
If you have an own occupation disability policy, don’t be surprised if the insurance company tries to categorize your work in a way that’s inaccurate. Insurance adjusters often try to describe your job as broader and easier than your specific occupation. If this occurs during your disability claim, your disability lawyer will typically work with vocational experts, assessing your job description, essential duties, and employment records to determine how to categorize and define your occupation.
Insurance Companies Often Add Limitations to Own Occupation Policies
Because a true own occupation policy is relatively lenient, insurance companies often try to add qualifications and limitations to these definitions. When you review your Plan Document or Summary Plan Description, look out for these more restricted versions of an own occupation policy.
- Modified own occupation: You must show that you cannot perform your actual job and you are not working in any other occupation.
- Transitional own occupation: This definition of disability requires that you cannot perform your actual job and are not earning more than your pre-disability income.
Other times, you may receive a partial long-term disability benefit if you have returned to work.
- Related Article: Why Vocational Experts Can Make a Difference in LTD Claims
Any Occupation Disability Usually Requires Total Disability
Any occupation definitions of disability are common in long-term disability plans. Insurance companies prefer the any occupation definition because it makes it harder for individuals to receive benefits. If your policy contains “any occupation” language, you must prove that you’re unable to perform the substantial duties of any occupation, not just your own job.
For example, let’s revisit the surgeon with severe nerve damage in their hands. Suppose that the surgeon’s work restrictions limit repetitive use of their hands, gripping, and grasping, but they are otherwise healthy. While the doctor is unable to perform surgeries, the insurance company will argue that they have other options, like teaching at a medical school, telemedicine, or even simple jobs outside the medical profession.
Look for “Gainful Occupation” Language in Your Long-Term Disability Policy
Some long-term disability policies define disability as being unable to perform any gainful occupation. While this may sound identical to “any occupation,” the addition of the “gainful” can loosen your policy’s definition of disability.
- Any occupation: You must show that you are unable to perform any job, including the simplest, lowest-paying ones.
- Any gainful occupation: A gainful occupation is one that pays you a significant portion of your pre-disability wages, often between 60–80%.
For example, suppose our surgeon’s policy says they cannot perform any gainful occupation and defines a gainful occupation as one that earns them at least 60% of their pre-disability income. Before they stopped working, the surgeon earned $500,000 annually. The surgeon’s disability insurance lawyers collect evidence that shows the surgeon’s restrictions limit them to jobs that pay roughly $100,000, or 20% of their prior earnings. In this case, the surgeon may be eligible for long-term disability benefits.
Look Out for Hybrid Own Occupation and Any Occupation Language
Even if your long-term disability plan starts as an own occupation policy, don’t assume it will stay that way. Some disability insurance plans take a hybrid approach. For a specified period (typically two years), the insurance company will pay your disability benefits if you’re unable to do your own job. However, after that time, your policy will convert into an any occupation plan.
We’ve met with many people who felt blindsided when the insurance adjuster suddenly terminated their LTD benefits, even though their condition had not changed. We often discover that these denials are due to a changed disability definition.
However, remember that you have rights and options after you receive a denial. If you receive a letter ending your long-term disability benefits, you should always consult a disability insurance lawyer. The team at Bryant Legal Group can help you understand your legal options and work with you to get you the benefits you deserve.
Bryant Legal Group: Illinois’ Trusted Disability Insurance Team
If you’d like to learn more about your long-term disability plan’s terms and conditions, or if you need help filing a claim or appeal, contact Bryant Legal Group today.
Our respected disability lawyers take a practical, hands-on approach, and we’ve recovered millions for our clients. We also offer remote consultations if you would rather not meet in person due to concerns about your health.
To schedule your free initial consultation, call us at 312-667-2536 or complete our online contact form.