You’ve made the difficult decision to give up practicing and file a claim. You’re not working and you need to collect the disability benefits you’ve likely paid years of high premiums for. So how long will you have to wait until your first benefit check arrives?
Unfortunately, the answer is not clear cut—it depends on the terms of your policy, your insurance company, the assigned benefits analyst, and the complexity of your claim, among other things.
Filing a Claim
Your policy should outline the requirements for filing a claim. Typically, you must give notice of your claim to your insurer within a certain time frame. If you miss this important deadline, the insurance company will typically claim that you have prejudiced its ability to investigate your claim, and use this as an excuse to delay making a decision on your claim. Significantly, if you don’t provide timely notice, it can also foreclose your ability to collect benefits (depending on the circumstances, and the reason for the delay).
Once you file your claim with your insurer, they will then send claim forms to be completed by you and your physician. Your policy should include a deadline for when your insurer must provide you with these forms (e.g. 15 days). If they don’t provide you with forms within this time frame, most policies allow you to submit a written statement documenting your proof of loss, in lieu of the forms. Again, there is a deadline to return these forms and failing to do so gives your insurer an excuse to prolong the decision-making process.
Elimination and Accumulation Periods
Your policy will also contain details about your elimination period. This is the period of time that must pass between your disability date and eligibility for payment on a claim. Generally, you must be disabled (as defined in your policy) and not working in your occupation during this time period.
Depending on the terms of your policy, this period does not necessarily have to be consecutive, but it does need to occur within the accumulation period also set out in your policy (for example, your policy might require a 90 day elimination period that must be met within a 7 month accumulation period). You will not be eligible for payment until the elimination period has been fulfilled. Typically, insurers won’t provide you with a claim decision until after this date has passed.
It is important to be aware of your elimination period, so that you can plan accordingly (and are not expecting a benefit payment to arrive right way when you are budgeting to meet living expenses, or debts like student loans). Also, it’s important to keep in mind that receiving a benefit payment immediately following the elimination period is the ideal scenario. In many claims, it takes much longer for a benefit to be issued. In our next post, we will address some of the most common reasons benefit payments are delayed.
Physicians filing a disability insurance claim often underestimate the complexity of the process. Unlike health insurance, which pays one-time reimbursements for services provided, disability insurance claims are ongoing and expensive. The insurer heavily scrutinizes each claim it receives, including looking at the records of treating physicians.
Insurers carefully examine every claim form and treating physician’s note for any information that can be used to deny the claim. It is important that these records are complete and descriptive in the insured’s diagnosis, symptoms, and functional limitations. Unfortunately the pressures of a modern medical practice mean that physicians spend less time treating patients and more time filling out paperwork. What should be detailed evaluations of a patient’s history and limitations often become abbreviated notes cobbled together from several doctors. As an article in the New York Times noted, “A doctor’s note turns into a cut-and-paste collage instead of an accurate and personalized narrative of illness; and documentation becomes an electronic and potentially dangerous version of the game ‘Telephone.’”
Insureds thus cannot rely upon merely being treated by their physician; they must take an active role in ensuring that their physician adequately documents their disability, its nature, and most importantly, the resulting functional limitations. Treating physicians’ notes often lack sufficient description of what the insured can and cannot do—and the insurer will be happy to fill in the missing information in its favor. Treating physicians need to use language such as “incapable of performing his occupation” as part of detailed narrative statements describing the insured’s condition. Insureds must work with their attorney and treating physician to properly present their claim, and the foundation begins with a detailed treatment narrative.