Our law firm often receives questions from clients who are receiving long-term disability benefits under a policy obtained from a private insurance carrier. If you have invested the time and effort to obtain the status of a licensed professional, such as physician or attorney, the desire to take advantage of your training and education is understandable. Professionals with long-term disability claims will forfeit their right to ongoing payments if they resume working in the same professional capacity and position as they performed prior to their disabling injury or illness because the need for disability benefits has been abated. Whether you are a doctor, accountant, lawyer, or other professional, you might well wish to engage in productive endeavors though you are unable to maintain the long hours and high stress of your prior occupation.
Many physicians actually recommend that patients remain as active as possible while recovering from an injury because of the physical rehabilitative and emotional benefits. Despite the therapeutic advantages of remaining active, policyholders must understand the specific terms of their coverage to prevent inadvertently impacting their benefits under a long-term disability (LTDI) policy. While the best approach is to seek legal advice from an experienced disability insurance attorney, the right of an insured to continue working in a limited capacity often depends on the specific terms of the policy.
Importance of Definition of Occupation under the LTDI Policy
Although the precise definition of occupation will vary based on the individual policy, the most important distinction will be rooted in whether the focus is “any occupation” or the insured’s “own occupation.” An example illustrates the vital importance of this distinction. If you have previously worked as a physician, your ability to work part-time at a bookstore will depend on which of these definitions of occupation are indicated in the policy. While the difference in the nature of the work will be important, the disparity in income for your pre-disability and post-disability jobs will also be a factor in determining whether the new job disqualifies you from receiving long-term disability benefits.
Impact of Return to Work Incentives
The vast majority of LTDI policies include a provision referred to as a “return to work incentive” clause. This type of provision permits an individual to move back into the workforce for a limited time period without any reduction or termination of benefits under the policy. This type of policy will authorize an insured to return to work for a trial period, such as one year, but the insurance carrier will start to decrease the benefits paid once this trial work period has expired. The amount of the reduction will vary from a dollar-for-dollar reduction under some policies to a calculation based on an offset formula under others.
Relevance of Social Security Disability Benefits
Many people with LTDI policies also apply for and receive social security disability insurance benefits. If you are already receiving disability benefits through social security, the impact of re-entering the workforce in some capacity will extend beyond the language of the LTDI coverage under your policy through a private insurance carrier. Policyholders in this situation need to carefully review Social Security Administration rules regarding returning to work as well as policy provisions under their private LTDI policy.
You can reach Miami Insurance Claims Lawyer J.P. Gonzalez-Sirgo by dialing his direct number at (786) 272-5841, calling the main office at (305) 461-1095, or Toll Free at 1 (866) 71-CLAIM or email Attorney Gonzalez-Sirgo directly at [email protected].