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January 2012 Archives

Your Disability Insurance Company May Be Stalking You On Facebook

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.

Pre-existing Condition Exclusions Are Often Misused by Companies to Deny Disability Insurance Claims

Most every group long-term disability policy will include a complete exclusion for any disabilities caused by a pre-existing condition. Private long-term disability insurance policies purchased by individuals normally also exclude coverage for a pre-existing condition unless higher premiums are paid for special coverage that does not include the exclusion. Exclusions such as the pre-existing condition exclusion are often misused by companies to avoid paying disability insurance claims in effort to save a company billions of dollars, and is another common tactic used by companies to delay or deny payment of legitimate claims.  Whether a condition is legitimately "pre-existing" (and thus excluded from coverage) or not depends upon the provisions in the policy applicable to disabilities caused by a pre-existing condition. The disability policy language related to pre-existing condition exclusions can vary greatly, and even the slightest distinction could mean the difference between your disability being covered or entirely excluded from coverage under the policy. Given that the disability income benefits at issue under these policies are customarily paid through age 65 or even lifetime, whether the disability is actually excluded under the policy according to the law governing these matters is hugely significant.

Disability Insurance Policy Coverage and Denials

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.

Does It Matter Whether You Are Considered Totally or Partially Disabled Under Your Disability Insurance Policy If You Are Receiving Benefits? Yes.

Does it matter whether you are considered Totally or Partially Disabled under your disability insurance policy if you are receiving benefits? Yes. This is because under many disability insurance policies, an individual with a Partial Disability will be paid only through the age of 65, while under the same policy, a Total Disability will allow the individual to collect benefits for the duration of their life. Moreover, Partial Disability benefits are based on the percentage of earned income lost. Thus, unlike Total Disability benefits, if the individual does not suffer a loss of earned income, benefits are not paid and in many cases, the contract ends after a few months. Moreover, in the event of a buy-out of the policy by the disability insurance carrier, resulting in the lump-sum settlement in lieu of periodic payments, an individual would be more apt to surrender the contract for less money than if the individual was deemed Partially rather than Totally Disabled. Insurance companies save themselves hundreds of millions of dollars each year by paying out Partial rather than Total Disability Benefits to their claimants.

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