What the “change of definition” means in Alberta long-term disability claims
Long-term disability (LTD) insurance policies offer benefits that are paid out in the event you are unable to work. If you collect long-term disability benefits for long enough, the “change of definition” will likely be a major factor in whether your insurer decides to keep paying you or to terminate the benefits.
The insurance policy that includes LTD coverage may be a group plan paid for by your employer, though they can also be purchased privately by individuals. Long-term disability benefits replace a portion of your income, usually ranging from 40% to about 70% of how much you earned immediately before your claim began. Typically, they come into effect after other sources of coverage, such as short-term disability, have already been exhausted.
You are eligible to submit a long-term disability claim when medical problems stop you from performing the duties of a job. The specific health conditions that prevent you from working can vary greatly. They may be the result of either injuries or illnesses, such as broken limbs following a recent car crash, chronic back pain from a past work injury, or the aftermath of a heart attack. Generally speaking, either mental or physical challenges may be covered under your insurance, although this will depend on the specific terms of your policy.
It is not necessary to have a distinct diagnosis from a doctor for your symptoms to qualify for long-term disability, only that those symptoms have removed your ability to work and you are therefore “totally” disabled. What kind of work? That’s where the change of definition comes in.
Insurers apply “own occupation” and then “any occupation” tests
Insurance policies in Alberta can vary widely from company to company as well as among a particular insurer’s products. Not all policies include a change of definition clause, but most do.
The “own occupation test”, which insurers apply when initially considering a long-term disability claim, asks whether you can perform the duties of your own job. As part of your LTD benefits application, you most likely submitted paperwork from your employer setting out your duties.
The insurance company may investigate whether you meet this “own occupation” test, by requesting updated medical records and/or a medical questionnaire from your treating doctor(s), send the medical records for review by an in-house medical consultant, or order an independent medical examination (IME). The IME is usually performed by a third-party doctor, who will provide an opinion on your medical condition and its effect on your ability to return to work.
The insurer may demand medical records or for you to attend a medical or vocational assessment. It is recommended to always act in good faith and comply with reasonable requests. Every disability policy outlines the obligations of the insured person, and most require you to provide relevant medical information and attend medical assessments.
The “change of definition” occurs when insurance companies switch from the “own occupation test” to the “any occupation test”. This will usually be about 2 years after the date on which you become disabled.
The “any occupation test” is a harder test to meet since you now have to prove that you cannot do any type of job that is reasonable for someone with your experience, training, skills, and so on. Many policies require other occupations you may be able to do be reasonably similar in compensation. For example, a heavy machine operator should not be denied if the insurance company believes they can do any minimum-wage job.
Your current (post-disability) capacity to upgrade your qualifications for other types of work through additional training or education, based on factors such as your physical fitness, may be weighed as well.
Your insurer may order an IME and other assessments again to test your ability under the “any occupation” definition.
Alberta residents currently receiving long-term disability benefits should be mindful of their change of definition date as it approaches. Switching to the “any occupation test” greatly broadens the scope of why an insurance company can determine you to be “able”. As such, the change of definition is a common time for insurers to terminate clients’ benefits.
What can I do if my insurer wants to stop my benefits?
Hang on to any correspondence from your insurance company. The company will have to notify you if it intends to change your benefits, namely by reducing or eliminating them.
If you have not received a detailed written explanation of its decision, the company is required to provide one upon request, so we encourage you to call your insurer.
The insurance company must also offer a process to dispute or appeal its findings. This process is organized internally, meaning rules such as how many times you can appeal, accepted grounds for an appeal, and ultimately whether to reverse its previous denial are largely in the insurer’s control.
Unless there is new and important medical evidence, the appeal process does not usually change an insurance company’s denial. Remember, the appeal does not go to a third party, it simply goes back to the insurance company to reconsider their denial.
Hiring a lawyer and filing a lawsuit against the insurance company is a more effective approach, since it brings the denial to the eyes of a court. There is a 2-year window to start a lawsuit under Alberta’s statute of limitations. If you do not submit a claim within that time, you will likely be barred from taking legal action.
Your insurer cannot end your coverage without reasoning or evidence to back up its decision. Legal advice from a capable professional experienced with long-term disability claims may be useful to find weak points in your insurer’s argument and ways to bolster your own case.
Our team regularly wins LTD claims and can advise you of your legal options if desired. We can attend to all legal matters like communicating with your insurer and gathering evidence to prove you are disabled from work, while you focus on your health.
We can answer your questions about long-term disability
Our firm, Preszler Injury Lawyers, proudly serves Albertans wherever they are in the province. If your long-term disability change in definition is approaching, your benefits were denied, or you have questions about any other aspect of your insurance policy, we encourage you to take advantage of our free initial consultation.
You can phone us at 1-888-494-7191 or contact us online to set up an appointment. There is no cost to you unless we win, either by way of settlement or at court.
