In a recent post, Private Disability Insurance – Definition of Disability and Common Terms, I outlined some common terms in private disability policies. The own occupation definition of disability may seem simple but the interpretation of one’s occupation can be a matter of debate between insureds and their insurers. This post explores the definition in greater detail – looking at the occupations of Large Animal Veterinarian, Steadicam Operator and International Tax Lawyer.

What is your own occupation?

When you purchase a private disability policy with an own occupation definition of disability, you may believe that it’s clear that if you cannot perform your profession (as you know it) due to disability, you will be paid benefits. The inquiry is a little more nuanced than that. While your policy may say that you satisfy the definition of disability if you cannot complete the main duties of the occupation that you performed just before you became disabled. Alternatively, your occupation may be listed in the policy as “lawyer” or “veterinarian”. Although it may be clear to you that you cannot perform your profession, the insurer may take a different view based on their misconceptions of your occupation.

Some Examples:

As is often the case, fact situations illustrate the problems more clearly.

The Large Animal Veterinarian – John

John is 58 years old. He trained as a large animal veterinarian and developed a successful, busy practice treating cattle and horses in particular. He has built his practice through close relationships with local farmers, horse owners and trainers in his community. Having focused his practice in this way, John has not worked with small animals for many years. His policy describes his occupation as “veterinarian”.

John develops multiple sclerosis and makes a claim under his private disability policy. John’s condition is variable with his greatest symptoms being fatigue, difficulty walking, numbness and weakness. His symptoms come and go but he has found that, overall, he cannot handle the heavy physical work involved in his veterinary practice.

The insurer pays John for a period of several years. John’s partners take over his practice. John’s neurologist describes his condition as stable and in remission. The claims adjuster asks John why he cannot practice in a small animal veterinary practice with fewer physical demands. John does not know whether he would have the physical ability to practice in a different area, and he has not practiced in the small animal field for many years. John would need to build a new client base and learn a new area.

The problem is that the adjudicator does not understand the business, John’s daily work, nor the training involved in his profession. John knows that he cannot perform his own occupation and should continue to receive benefits. However, the insurer terminates his claim, taking the position that he can work in a less heavy physical practice as a general veterinarian.

The problem:

John has a successful and specialized practice as a large animal veterinarian. His education and training were devoted to his area of practice, and he built a successful practice through years of building relationships with his clients and the community. The insurer takes the position that he will not require the same physical strength to practice in a different context with smaller animals. John knows that he is ill-equipped to treat such patients and would need to retrain and start a new practice which would take years to develop and significant energy.

The Steadicam Cameraman – Fred

Fred is a cameraman, specializing in operating a Steadicam – a camera stabilizing system used to film certain shots in the movie industry. The Steadicam is heavy and the operator requires significant strength and specific training. The policy Fred purchased is specific and states that his occupation is “Steadicam Operator”.

Fred is injured skiing and fractures several bones including his hip and shoulder. He has multiple surgeries and is compliant with the recommendations of his treatment providers.

Fred tries to return to work. He quickly finds that he can no longer operate the Steadicam. It is too heavy and causes him significant pain. He can perform some camera work with a conventional camera and gets some work in the film industry. He earns a fraction of his former income and discloses his income to the insurer. The insurer takes the position that Fred has retrained and is no longer disabled.

The problem:

The nature of the film business is that Fred’s income has fluctuated over the years. The insurer does not understand that Fred’s ability to earn income has been seriously impacted by the fact that he can no longer operate the Steadicam. The insurer is not aware that Fred always worked in other areas of the film industry in addition to operating the Steadicam. He satisfies the definition of disability, but he needs to dispute the insurer’s decision and provide more information about his occupation and work history.

The International Tax Lawyer – Catherine

Catherine has been practicing law for 25 years at a large Canadian law firm. Catherine has developed a particular interest and become one of the country’s foremost experts on the tax implications of cross border transactions. Her work involves long hours and tight deadlines with significant travel. Catherine has a private disability policy which says that she is totally disabled if she cannot perform the essential duties of her own occupation.

Catherine is injured in a motor vehicle accident and suffers a head injury. She has a concussion and develops chronic migraines. Catherine is off work following the accident and returns to work at a reduced capacity, providing support on uncomplicated transactions. Whereas Catherine worked 55 hours/week in quiet periods and 70+ hours per week during transactions, she can now work at most 40 hours per week due to her recurrent headaches.

The policy says that as long as she has suffered a loss of income of more than 20% of her prior monthly earnings, her disability benefit is paid. The insurer pays Catherine her disability income benefit for several years without incident. She provides the insurer with proof of her loss of income and advising of her hours of work. The problem arises when Catherine’s case is assigned a new case manager.

Catherine’s case manager sees that she is working 40 hours per week. While he understands that she is suffering a loss of income, he concludes that she could work as a full-time lawyer on a different type of practice and is no longer disabled. He asks her for medical evidence supporting her inability to increase her hours.  Catherine explains that she is no longer involved in the same types of work because of her unpredictable migraines and the requirement to pace herself and avoid a lack of sleep. Her family physician supports Catherine but it is clear that the doctor’s opinion is based on Catherine’s self-reporting of symptoms.

The case manager terminates Catherine’s claim for benefits, saying that she is not totally disabled within the meaning of the policy because she can work 40 hours per week as a lawyer. The insurer says she can choose to increase her hours at her current workplace as there is no medical proof of her need to limit her hours. Alternatively, the insurer suggests that she could practice law elsewhere, suggesting she could practice corporate law as a sole practitioner.

The problem:

Catherine has always practiced at a large firm in a specialized practice. She has provided support to her partners on their transactions. She has never built a client base. Catherine has never drafted a will or worked on a residential real estate transaction. The insurer’s position ignores Catherine’s occupation at the time of disability and her specialized skills. This position does not reflect the spirit of the policy nor the basis on which it was sold to Catherine.

The Takeaway:

You studied for years and worked hard build the expertise necessary to practice your occupation. Therefore, you chose a private disability policy with own occupation coverage in order to provide income replacement if you became disabled from working in your specialized field. It is important to provide the insurer with detailed information about the skills and capacity required to perform your occupation appropriately and to dispute any misconceptions they may have developed because they haven’t had the information necessary to adequately assess your claim.

We know how to approach own occupation cases and can assist you in challenging the insurer’s decision to deny or terminate your private disability income claim. For advice, please text 613-777-0992 or contact us through our website to schedule a meeting with one of our lawyers.  We will provide a free consultation, in French or English, to ensure that your rights are protected.   In most cases, we can offer to represent you on a contingency fee basis.  This means that you do not pay legal fees unless you win or achieve a settlement on your case.

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