Insurance Company Tactics:
The Dual Occupation Defense

Dentists and physicians facing a disabling condition often look for other jobs to supplement income. Depending on the terms of the underlying policy, this can prompt insurers to raise a “dual occupation” defense.

One such example is the case of Lemons v. Principal[1]. Dr. Lemons was an OB/GYN who had also worked as a claims consultant for a health insurance company and as an addictions counselor. Dr. Lemons claimed disability based on a hand tremor, claiming that the tremor prevented him from safely practicing as an OB/GYN.

Principal denied Dr. Lemons’ claim, claiming his occupation under the terms of his policy encompassed all of the jobs he had been engaged in. Principal asserted that Dr. Lemons was not totally disabled because the tremor did not impact the ability to act as a consultant or work as a counselor. For his part, Lemons argued that his regular occupation was solely that of an OB/GYN.

The court determined that, under Alabama law, words must be given their common, everyday meaning and interpreted as a reasonable person in the insured’s position would interpret them.  Based on this, the court determined that the most natural reading of regular occupation was that “the term refers to an insured’s primary job or discipline.” The court further explained that it read the “regular occupation rider’s use of the singular ‘your regular occupation’ to mean that the policy contemplates that the insured has only one primary job.”

Lemons was successful, in part, because his regular occupation rider used the singular “your occupation.”  However, insurers have updated and changed their policies to make the definition of occupation more robust. Many companies have now replaced “occupation” with “occupation(s)” in an effort to preserve their ability to use a “dual occupation” defense to avoid payment.

Every claim is unique and the discussion above is only a limited summary of the court’s ruling in this case. If you are concerned that your claim has not received a full and fair review, an experienced disability insurance attorney can evaluate your claim and help you determine what options are available.

[1] Lemons v. Principal Life Ins. Co., Case No. 2:18-CV-01040-CLM, 2020 WL 6273741 (N.A. Ala. Oct. 26, 2020).


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