Florida and Nationwide Insurance Law Blog

Signing a severance agreement with your employer can hugely affect your disability benefits claim.  In fact, by signing a severance agreement you can entirely waive your right to pursue your disability benefits claim. Most severance agreements drafted by your employer's lawyers include broad reaching language that requires that you agree to release your employer from any and all claims that you may have against your employer in exchange for, and in "consideration" of, the amount of money to be paid you under the severance agreement. The wording of severance agreements vary greatly, but no matter how broad or specific the language is within the severance agreement presented to you by your employer, the danger exists that in signing the severance agreement you are waiving your rights to your disability benefits claim under a group disability benefit plan provided to you by your employer as a benefit of your employment.

By way of example, the language in the severance agreement that would raise concern may be similar to: "By signing this agreement, you, your agents, assigns, heirs, executors, and administrators, agrees to forever release employer, employer's parents, affiliates, subsidiaries, predecessors, successors, assigns, attorneys, and any director, officer, agent, trustee, employee, representative, insurer, employee benefit or welfare program or plan, from any and all claims, demands, actions, causes of action, liabilities, damages, known or unknown, which you now have, or claim to have, which arose at any time prior to the date you execute this agreement, including, but not limited to, under any federal, state, local or foreign law dealing with or regulating employment, The Age Discrimination in Employment Act ("ADEA"), The Americans with Disabilities Act, The Rehabilitation Act, The Family and Medical Leave Act, The Civil Rights Act, Employee Retirement Income Security Act ("ERISA"), Equal Pay Act, breach of contract, claims for unlawful discharge, any law related to emotional distress, mental anguish, benefits, wages, hours, discrimination, harassment, or retaliation." Such a provision may extend for a much shorter sentence than the above, or a more extensive paragraph, or even an entire page or two of the agreement. There may be additional definitions or provisions contained within the severance agreement, or included as an addendum or attachment to the agreement, which could further impact the question of whether you are waiving your rights to pursue your disability benefits claim by signing the agreement. The language is likely extremely complicated, and the true meaning of the provisions or potential application of the provisions in court may be convoluted and ambiguous. The language may not make clear whether you are specifically waiving your rights to any disability claim under an employee benefit plan, or it may make it very clear that you are waiving your rights. Either way, it is critical to have a skilled attorney review the terms of your severance agreement before you sign the severance agreement. A skilled attorney can provide you with advice on how to ensure that you do not waive your rights to pursue your disability claim while still proceeding with the severance agreement which will provide you with severance pay that may be a necessity. Once the severance agreement is signed, there is no going back on the language contained therein. We have had occasions where we've had to reject handling potential clients' disability benefits claims because the clients signed a severance agreement with their employer which had the effect of waiving their rights to pursuing their disability benefits claim. However, at DI law Group, we are also regularly involved in advising clients in regard to necessary revisions to a severance agreement before they sign to avoid a waiver of their rights related to their disability claim, and we work with our client, our client's employer and attorneys to get this done.

It is critical to point out that there are customarily other standard provisions within the severance agreement which serve to protect the employer from claims by employees who sign a severance agreement but later allege that they did not understand that they were waiving certain rights when the signed the agreement and accepted the severance pay, and thus, that because they did not knowingly waive those rights, the rights should not be waived under the law. An example might be an employee who signs a severance agreement out of desperation to receive needed severance pay, or who signs the severance agreement without fully reading or understanding the terms because they "just want to be done with it". By way of example, many times above the signature lines to the agreement is a provision that reads something similar to: "By signing this release, I state that: I have read it; I understand it and know that I am giving up important rights; I agree to all the terms contained within the agreement, I am aware of my right to consult with an attorney before signing it and have had the opportunity to do so; I have consulted with my attorney before singing it; I have signed it knowingly and voluntarily." When an employer advises you to consult with an attorney, and further requires that by way of your signature to your agreement that you are attesting that you've read and understand the agreement, consulted with an attorney, and are knowingly and voluntarily signing the agreement, the effect is to protect the employer from employees later alleging that they did not knowingly waive certain rights or they didn't understand what they were signing.

Of further significance is that a severance agreement will likely also have a completeness of agreement provision, which includes that the severance agreement sets forth the complete agreement between the parties, and that by signing the agreement, the employee has not relied upon any representations or statements not written into the agreement that were made by the employer with regard to the agreement. In other words, if something is not written into the agreement, it essentially does not exist in the legal world. It cannot be overemphasized that one word can change the entire meaning of an agreement, and any language included in a severance agreement should be reviewed and drafted by a skilled attorney who understands the language necessary to be included, and who can accurately and adequately advise you of the impact of you signing a severance agreement. The words written into the severance agreement are what govern the agreement at issue and determine what the agreement means under the law.

Although an employer may tell you that no revisions will be made to the severance agreement, and that it is a "take it or leave it" offer of severance pay, it may be possible to negotiate terms (and we've regularly negotiated terms of severance agreements for our clients at DI Law Group). If handled properly, it is possible for you to proceed with the severance agreement and still retain you right to pursue your disability claim under your group disability benefit plan offered to you as a benefit of your employment by your employer (who you are now releasing from any and every claim under the severance agreement). It is particularly compelling when an employer includes the language that requires you to attest that you have consulted with an attorney in order to enter into the severance agreement, but then turns around and alleges that the terms of the severance agreement are non-negotiable. A knowledgeable attorney is best equipped to advise you and your employer as to the significance of the inclusion of such language, and the significance of your ability to be involved in the negotiation process surrounding the terms of the severance agreement where such a provision (and other legally significant provisions) are required by the employer in the severance agreement.

It is important to note that this is not the only provision in the severance agreement, and a severance agreement contains many provisions of concern. Nor is the only impact of the provision discussed in this bog a potential waiver of your rights to your disability benefit claim. The focus of this blog entry is a narrow discussion regarding the potential impact of a severance agreement on your disability benefit claim under your employer's disability benefit plan offered to you as a benefit of your employment.

If your employer has offered you a severance package or agreement, and you are uncertain whether you will be waiving your rights to pursue your disability claim, please contact one of our skilled attorneys for a free consultation at www.dilawgroup.com before you sign anything in regard to the severance agreement presented to you.

Your disability insurance company could be stalking you on Facebook. Be careful who you Friend or what you post on the internet. Insurance companies have become extremely savvy in how to use social media to "investigate" and ultimately deny insurance claims. Facebook, on-line dating sites, and other social media sites are now the norm in our culture. However, often internet personas and profiles create a skewed image of an individual's abilities and activities. Accordingly, insurance companies scour the internet to find any glimpse of a claimant in order to create the illusion that they are more active than they and their doctor's have indicated. This is one of the most common insurance company tactics, which often results in truly disabled individuals losing their insurance benefits.

Typically, people do not post pictures of themselves on Facebook fatigued or resting in bed due to pain. A picture cannot capture the fogginess caused by medication, a person's pain level, or a person's inability to perform activities with reasonable continuity and consistency. A picture is a mere snapshot in time and when someone pulls out a camera, we typically put on a smile and try to look our best for that 5 second flash. Because of this, the pictures you post on Facebook and other sites can be misleading and the persona you create with all smiling pictures at various locations can unknowingly infer more activity than you are actually capable of performing. Remember, a picture cannot show that you had to leave a birthday party early due to pain. A picture will never be able to show just how many events you were unable to attend because of your disability. Likewise, the words you post can be taken out of context. Even simple phrases such as "I had a great day" or "feeling better today" can be misused by your insurance company to create the illusion that you are no longer or were never disabled. Dating sites can be even more problematic. Often, individuals will be weary of telling potential suitors about their limitations in their profile. People often highlight activities they enjoy, but rarely discuss their restrictions or medical condition. This suggests more functionality than most claimants have.

Insurance companies often take information they find on sites like Facebook out of context to support a denial of an insurance claim. Insurance companies have entire departments dedicated to investigating your insurance claim and often hire outside private investigators to track your activities on-line and in person. Often, they create a fictitious persona and send a claimant a "Friend Request" on Facebook. Many claimants simply accept, assuming they know them or a friend of theirs unknowingly accepted a similar request previously. Likewise. insurance investigators often create fictitious profiles on dating sites to gather information about claimants. However, even if you do not accept a Friend Request or engage in a conversation with an investigator posing as a potential suitor, insurance investigators can typically obtain the information through other means on the internet. Often what an insurance investigator finds on these social media sights can be used in conjunction with even more invasive surveillance of you. These sites explain what activities you engage in, where you like to go, and who your friends are. A private investigator can use this to obtain footage of you when you are out of your home. Often claimants can only engage in activity on their infrequent "good days." However, if an insurance investigator is able to know exactly when a claimant is having a good day and where they are going, it is easy to place a claimant under surveillance, creating the illusion that the claimant can do more than they have claimed.

For this reason, at Disability Insurance Law Group, we always counsel our clients to take down their Facebook pages and other social media profiles or at the very least severely limit the content they place on their pages. Likewise, it is important to remember that what others post about you can be equally dangerous. If your spouse, children, friends, or significant other are posting pictures of you or writing comments about your activities, this can also be damaging to your claim and create a misleading image of your functional abilities.

Recently, more and more disability insurance companies are denying claims on the basis that the individual or employee is not covered under the policy. More specifically, insurance companies are asserting that at the time the individual became disabled the policy at issue did not cover them because the person was not part of a covered class; became disabled just before or after their company changed policies and was therefore precluded from coverage due to a pre-existing condition or because the new coverage had not yet taken effect; because they were not Actively Employed; and/or for a myriad of other coverage related reasons.

In order to determine whether or not an individual is covered under a Disability Insurance policy or plan at the time he or she became disabled, it is necessary to look at the provisions defining the terms of coverage. If the individual appears to be covered the next step is to look at any policy exclusions or limitations on that coverage - for example, pre-existing limitations, active work requirements, temporary vs. permanent employees, whether the disability was self-inflicted. Under most state laws, exclusions are generally construed narrowly while exceptions to exclusions are construed more broadly in order to find coverage.

DI Law Group has received numerous calls from individuals whose insurance carriers are mistakenly denying benefits based on lack of coverage. In one case, our client's employer was sold while he was out on short term disability. The new employer canceled the previous short term and long term disability policies and procured new ones with a different carrier that offered lower benefits. When our client exhausted his short term benefits and became eligible for long term disability benefits (LTD) with the same insurance company, he was advised by his employer that LTD benefits were not payable under the old policy as it was no longer in effect and that because his disability occurred just prior to the new policy taking effect he was not eligible for LTD benefits under that policy either, as his disability was considered a pre-existing condition. In this particular client's case, our review of the prior LTD policy and the new LTD policy led us to the conclusion that the policy in place at the time of disability was the governing policy and thus benefits were payable (and ultimately paid) under the terms of the prior policy. In other cases, the policies, when read in conjunction with each other, require the new insurance company to pay benefits.

In a similar case, another client became disabled 6 months after her company was bought out by a new company. Thus, she had a new employer and was considered a "new" employee. At the time of the buyout, the old company's disability policies were canceled and coverage under the new company's policies became effective immediately. When our client applied for disability benefits with the new carrier she was advised that because she had been a covered employee for less than 1 year and had treated for her disabling condition within the 3 month period prior to the date the new employer's policy became effective, her disability fell under the pre-existing limitation and benefits were denied. Again, the employer and the insurance company's narrow reading of the policy were incorrect. Because our client had no gap in coverage between the end of her coverage under her prior policy and the effective date of coverage under the new policy, her disabling condition was exempt from the pre-existing limitation. Thus, we were able to help her procure short term and long term disability benefits under her employer's new and more generous disability policies.

As noted above, there are numerous coverage related explanations an insurance company will put forth when denying benefits. Another common issue involves the Actively at Work provision and how it is applied to full time employees with varied hours or full time employees who reduced their hours just prior to going out on disability. Under many employer sponsored disability plans a "covered class" includes all active full time wage, hourly and salary employees; Active Employment is defined as a specific number of hours worked per week. Thus, when either a full time employee with varied work hours or a full time employee who reduced her hours just prior to going out on disability becomes disabled, insurance companies will often wrongly deny benefits asserting that the employee was not "actively at work" at the time of disability and thus not covered under the disability plan. This also occurs when an employee quits due to his or her disability and is thus accused by the carrier of not being an employee on the date of disability and therefore not covered under the disability plan.

Over the years DI Law Group has resolved countless coverage disputes in our clients' favor, as insurance companies seem to have a habit of narrowly, and erroneously, interpreting coverage provisions in a way that precludes coverage. As indicated previously, it is important for any insured to have a clear understanding of their policy's terms so that coverage is secured and the benefits due and owing under that policy are paid.

Under many disability insurance policies the definition of disability that you must satisfy in order to receive continued disability income benefits changes after as little as 12 months of your claim being paid. Most disability insurance policies begin with what is called an "own occupation" definition of disability, and then change to an "any occupation" definition of disability. This is a very significant occurrence in your disability insurance claim and another common tactic used by disability insuarnce companies to scrutinize your claim. We regularly see disability insurance companies utilizing this change in definition as an opportunity to terminate payment of benefits. In fact, this is one of the most common reasons that we are contacted by claimants seeking representation against their insurance company by a knowledgeable attorney.

An any occupation definition of disability generally requires that a claimant be unable to perform the substantial and material duties of his or her regular occupation due to injury or illness. There are variations in how this is specifically defined under each policy. For example, the definition may reference the main or essential duties as opposed to substantial and material, etc. Most commonly this own occupation definition of disability governs your insurance claim for the first 24 months, but it may be as short as 12 months or as long as 5 years or more. This definition of disability only requires that claimants provide evidence that supports that they are unable to perform the duties of the occupation that they worked in prior to becoming disabled from that particular occupation. However, the "any occupation" definition of disability is a much more difficult standard of disability to prove in order to continue to qualify for benefits. Generally, an any occupation definition of disability requires that a claimant be unable to perform the substantial and material duties of any occupation for which he or she is or can reasonably become qualified to perform by training, education or experience, due to injury or illness.

For example, if Dr. Jones is a Dentist, then under the own occupation definition of disability he is required to prove that he cannot perform the duties of his regular occupation as a dentist in order to qualify for disability benefits. If Dr. Jones was performing the normal procedures that a dentist would perform, and he developed a tremor in his dominant hand that caused him to no longer be able to perform fillings, extractions, root canals, crowns, dentures, implants, or anything requiring a drill, then Dr. Jones would likely be disabled from his regular occupation as a dentist even if he were capable of performing an occasional cleaning or consultation with a patient. However, if Dr. Jones had a disability insurance policy where the definition of disability changed to the any occupation definition of disability after a certain period of time, then he would not only be required to prove that he is unable to perform the duties of his regular occupation as a dentist but he would also be required to prove that he is disabled from any occupation in light of his training, education and experience. Thus, if Dr. Jones who was disabled from practicing clinical dentistry also taught dentistry at a local college, and was still able to perform the duties required of a college professor of dentistry, he would not usually be considered disabled under this type of any occupation definition of disability.

There is no dispute that the any occupation definition of disability is a much more difficult standard of disability to prove under your disability insurance policy. This is similar to the very stringent standard required to qualify for Social Security Disability Insurance benefits with the Social Security Administration. However, your disability insurance company knows this and often unfairly uses this change in definition of disability as an opportunity to stop paying your disability benefits, which saves the company a considerable amount of money. Countless times our firm is retained to represent claimants whose benefits have been terminated by the insurance company based upon an unjustified allegation that the claimants are not disabled from any occupation, after the company found the claimants to be disabled and entitled to benefits under the own occupation definition of disability.

Suppose that Dr. Jones, the dentist, also had medical problems involving his feet and back, in addition to the tremor in his dominant hand. If Dr. Jones had difficulty with sitting, standing and walking, in addition to problems performing tasks with his dominant hand, then Dr. Jones would much more likely be unable to perform the duties required of a college professor as well as unable to perform the duties of a dentist. However, the insurance company will likely still use this as an opportunity to cease paying benefits arguing that the occupation of a dentist is a more physically demanding occupation than that of a college professor, and that although Dr. Jones is disabled from dentistry, he is not disabled from any occupation given his training, education and experience. Even if Dr. Jones' treating doctors advise the insurance company that the dentist has restrictions due to his medical condition that prevent him from being able to perform the duties of a college professor, the insurance company will still use this as an opportunity to terminate benefits, likely based upon the company's own hired doctor disputing the restrictions advised by Dr. Jones' treating doctors and finding that the dentist can work in any occupation, including as a college professor. This is despite the insurance company's doctor likely never examining or even speaking to Dr. Jones about his medical condition or restrictions.

The insurance companies are also notorious for putting forth other occupations that it alleges the claimants are able to perform to deny benefits under the any occupation definition of disability, but in reality the claimants do not have the education, experience or training to perform the occupations suggested by the company, and it is not reasonable to expect that they could be re-trained in the occupations. Or, the company may set forth other occupations that it alleges the claimants can perform that are not gainful occupations under the law. In order to be gainful, the person must be able to make a comparable wage to what they previously made, among other factors.

When the definition of disability changes or is about to change from own occupation to any occupation in your claim, your disability insurance company may require you to undergo an independent medical examination, or a functional capacity evaluation. Or, the company may require that you participate in a field or telephone interview with a representative from your insurance company. Your insurance company may insist that you participate in vocational rehabilitation so that you can attempt to return to work in a different occupation. Or, your carrier may only require you to complete extensive claim forms in regard to your past training, education and experience, and for you and your doctors to provide updated medical information and current restrictions. Contrarily, your insurance carrier may never provide you notice of their investigation into the change in definition of disability or request any information from you, and may simply advise you that your benefits have been terminated as the insurance company has determined that you no longer meet the definition of disability under the policy because it determined that you are capable of performing some theoretical gainful occupation. The process of your insurance company re-evaluating your claim to determine whether it believes you meet the any occupation definition of disability in addition to the own occupation definition of disability is a significant occurrence in your disability claim and how it is handled will make the difference as to whether benefits are continued or terminated.

Insurance companies regularly discontinue paying disability benefits based upon the change in definition of disability from own occupation to any occupation.  Disability Insurance Law Group has been very successful in fighting these denials where a person's medical condition disables them from working in any gainful occupation on a full-time basis with reasonable continuity. The earlier that a knowledgeable attorney is retained to prove to the insurance company that the claimant is totally disabled from any occupation the better - in fact, many denials of benefits by disability insurance companies can be prevented if handled correctly during this critical transition period. However, if a termination of benefits has already occured, it is not too late.  If an administrative appeal with the insurance company after a termination of benefits at the time of the change in definition of disability is handled properly, a denial can be overturned.  If you are facing a change in your definition of disability, or your benefits have been terminated by your disability insurance company, contact one of our attorneys at Disability Insurance Law Group.