Deciphering Mental Disorders and Substance Abuse Exclusions – Part 1

In previous posts, we have discussed how many disability policies contain mental disorder and/or substance abuse exclusions that either prevent claimants from collecting under their policies, or severely limit claimants’ right to collect—usually to 24 months or less.

Sometimes, it can be hard to tell if your policy contains such an exclusion.  Policy language can be difficult to decipher, and it becomes even more difficult in cases where the terms of the exclusion are contained within multiple provisions of the policy.

In the next few posts, we are going to discuss mental disorder and substance abuse exclusions.  In Part 1, we will look at an example of how insurance companies define mental disorders and substance abuse.  In Part 2, we will look at an example of a mental disorder and substance abuse limitation provision.

How Do Insurance Company’s Define Mental Disorders and Substance Abuse?

Each policy’s definition varies, depending on the insurance company.  Here is a sample definition taken from an actual insurance policy:

mental disorders and/or substance abuse disorders mean any of the disorders classified in the most current edition of the Diagnostic and Statistical Manual of Mental Disorders published by the American Psychiatric Association (APA). Such disorders include, but are not limited to, psychotic, emotional, or behavioral disorders, or disorders relatable to stress or to substance abuse or dependency. If the Manual is discontinued, we will use the replacement chosen by the APA, or by an organization which succeeds it.

As you can see, this definition is quite broad and could potentially encompass quite a few disabling conditions.  Since the policy provision does not actually list out specific disorders, at best you would need to consult the APA manual, in addition to your policy, to find out what this provision actually means.  And if your particular disorder does not fit neatly within the APA’s framework, you will likely have to go to court to determine whether your disorder falls within the policy’s definition of mental disorders and/or substance abuse disorders.

Also, because the definition is based upon the “most current edition” of the Diagnostic and Statistical Manual of Mental Disorders published by the APA, the types of disorders covered by the limitation will change each time the APA publishes a new manual.

These are just a few of the reasons why claims involving mental disorders and substance abuse disorders can be particularly tricky.  In the next post, we will look at an example of what a mental disorder/substance abuse disorder limitation provision looks like.