March 2009 Archives

By Kirk Sloane B.A.(Hon), LL.B.

There are several investigative tools used by insurers when assessing disability claims, including IME's (Independent Medical Examinations), FCE's (Functional Capacity Evaluations), referrals to medical consultants, home visits and surveillance.   The insurer has a contractual right to compel a claimant to undergo an IME, and in most circumstances, a claimant has the obligation to attend an examination. 

An FCE may, however, be an entirely different matter.  In contrast to an IME, an FCE is not generally contractually required and is not necessarily a "medical examination" as provided for by the policy.  A FCE is a collection of tests utilized by insurers to test a claimant's maximal physical effort. The information from the FCE is then used by the insurance company to make inferences with respect to whether or not an individual can work full time on a sustained basis. There may be legitimate grounds upon which to refuse to attend an FCE, and claimants should be vigilant about asserting rights to refuse such testing.

Insurers often use in house medical consultants to contact a claimant's treating physician to discuss the claimant's condition, restrictions and limitations.  In essence, the insurer's medical staff seeks to develop evidence from the physician to demonstrate that the claimant is not disabled.  Often, the insurer sends a letter to the physician "confirming" the conversation and requesting a signed acknowledgment from the treating physician that he or she agrees with the statements in the letter.  The letter, however, may either distort the facts, or cast the claimant in an unfavorable light.   A claimant should instruct a treating physician to not respond to such a letter without first reviewing the contents of the letter with them in detail.

Insurers also utilize medical consultants to reviews claims, relying upon a non-examining physician to address functional abilities.  This has inherent problems, because it precludes the claimant from receiving an appropriate evaluation of the claim.  It is vitally important therefore that claimants ensure that their treating physicians provide well developed, organized office notes and/or narrative reports to support the claim.

Home visits are common techniques employed by insures when assessing disability claims.  An insurance company representative, often identified as a rehabilitation consultant, will stop by either unannounced or at a prearranged time to speak to the claimant.  This individual will seek to ascertain the claimant's activity level, determine whether the claimant is working on another interest, or to develop other information to be used by the insurer.  Caution should always be used when speaking to the insurer or its representative.  Such interviews should be done on the claimant's terms, whether recorded with witnesses, or by having a confirmation of interview prepared - all to avoid anyone distorting the information provided. 

Surveillance is another technique frequently used in high benefit cases, or where claimants allege disability based upon either subjective type conditions or where the objective support is not indicative of the restrictions or limitations.  In high benefit claims, the insurer is willing to invest significant money to terminate or deny a potentially expensive claim.  Claimants must be wary not only of their activity levels while on claim, but of any statements made to the insurer about their daily activities.  Inconsistencies can be fatal to a claim: the expression "a picture is worth a thousand words" holds very true with regard to surveillance.

By Steven Muller LL.B, J.D, LL.M.,

What does Heath Ledger and Britney Spears have in common? Their life and disability insurance companies delayed payment of legitimate claims worth millions of dollars. Competent specialised lawyers were retained to fight their entitlements.

ReliaStar Life Insurance Company, owned by ING America, refused to pay Heath Ledger's death benefit of $10 million dollars to his 3 year old daughter, Matilda Rose. The 28 year old star of Brokeback Mountain and The Dark Knight is now the winner of the Golden Globe and Oscar posthumously. Ledger was found dead in his New York apartment in January 2008 some seven months after taking out the policy where his daughter Matilda is the beneficiary. The New York medical examiner ruled an accidental prescription drug overdose of painkillers and other medicine: alprazolam, diazepam, doxylamine, hydocodone, oxycodene and temazepam. Despite the ruling, ReliaStar suggested Ledger committed suicide or lied on his insurance application when he said he never used illegal drugs showing bad faith in applying to the policy. ReliaStar refused to pay claiming the policy was voided.

Prior to approving the application, Reliastar didn't ask for Ledger's physicians' records. Post claim the insurance company asked for names of doctors, psychiatrists and all kinds of records. The estate hired a lawyer on behalf of Matilda and sued ReliaStar claiming punitive damages and contending that the insurer acted in bad faith in its refusal to pay the Ledger policy. ReliaStar in January 2009 agreed to a confidential settlement rumoured to be around $10 million. The insurer appears to have attempted to engage in post claims underwriting in order to delay payment to Matilda.  

Britney Spears hasn't been as fortunate with her insurance dispute. In 2005, Spears sued eight international insurance companies including Liberty, AXA and QBE to recover $9.8 million in damages for their refusal to pay her for losses she sustained when her European concert tour in 2004 was cancelled because of a knee injury. Spears paid more than $1.3 million in insurance premiums on contingency insurance, a form of accident and illness insurance for celebrities, to cover abandonment, postponement and cancellation of performances for her 2004 Onyx Hotel Tour through the United States, Canada and Europe. 

Spears underwent a medical examination for her insurers on February 5, 2004 and Dr. Drazin concluded that she was "in sound health and free from disease" and "in fit condition" for the Tour. Unfortunately for Spears, she failed to note on the questionnaire that five years earlier she had an orthopaedic surgery on her left knee and had fully recovered subsequently performing hundreds of times since the surgery. In March 2004 Spears injured her left knee during a performance and cancelled two shows. Spears was examined the by the insurers doctor and cleared to perform further shows. In April 2004 Spears provided an explanation at the request of the insurers for the omission in the 2004 questionnaire. After April 2004 the insurers extended the policy from August 10, 2004 to August 15, 2004 and accepted premiums despite Spears acknowledging that she made a mistake on the 2004 questionnaire. On June 11, 2004 Spears had surgery for her injury that took place on June 8, 2004 while shooting her music video "Outrageous". Ultimately Spears was diagnosed with a floating cartilage and cancelled her summer tour of 2004. Despite Spears insistence that many of the insurers knew of her pre existing problems because they insured her for the Tour 2000 with disclosure at that time, Spears insurers are dragging their feet in paying this legitimate claim. 

Whether you're a celebrity or not, being denied your claim is stressful for you and your family. Insurers delay as a matter of course. Able counsel may reduce the delay and help resolve your life insurance claim and disability insurance claim.

The obvious answer to this question is that you need a source of income.  But what happens when you are medically unable to work and the insurance company refuses to pay you benefits on the long-term disability policy?  The long range solution is to retain David Share Associates to fight the insurance company decision and win a settlement payment.  There are, however, a number of short-term options, besides accumulating debt or high credit card balances.

First, be sure you have made all possible claims: employment insurance sickness benefits, short-term disability plan payments, Ontario Disability Support Program, Canada Pension Plan for disability, insurance taken on loans (including mortgages) and other debts (especially credit cards) or life insurance premiums coverage.

Timing of the application can be crucial.  Obtain all necessary forms immediately so you can take the time needed.  Once submitted, follow-up with a call or visit the local office to ensure the file is in process.  And always keep copies of the documents and reports submitted.

Secondly, do you have non-core assets that can be sold?  An investment property, unworn jewellery, sports equipment you can no longer use?  What about a recreational vehicle?  Further, can you downsize to reduce or even eliminate some monthly costs? 

We realize that these are often painful actions.  And they take a toll on your scarce energy.  Just keep repeating that being proactive and facing the monetary issues is much less stressful than having to react to an immediate crisis.

There is also the possibility that you may qualify for social assistance payments. 

None of these scenes is pleasant nor fun. Try to remember that the financial problems are secondary to the real concern- that you are medically unable to work.  The reasons for your lack of funds are beyond your immediate control.  There is a resolution at the end of the tunnel- the hardest part can be making it through. 

Embarking on the long term disability claims process with your group insurance company can be an arduous and emotionally trying process. Endless requests for medical documentation and updated information can be difficult to deal with when you are trying to cope with physical or psychological impairments.

Even after you have provided all the necessary documentation that the insurance company has requested, they may still deny your claim on the basis that there is insufficient medical information to support your disability. A denial of this nature can be extremely confusing, when a family physician or specialist has provided a letter to the insurer in which a clear diagnosis of one or more medical conditions is indicated.

In some cases however, a diagnosis alone may not be sufficient to determine whether an individual meets the test for disability contained in the applicable insurance policy or plan. Given the idiosyncratic nature of the human body, different individuals may respond differently to the same disease process. The nature and severity of the symptoms of the illness may differ for a multitude of reasons. There may be pre-existing medical issues that predispose an individual to more severe symptoms or psychological issues that exacerbate a medical condition.

So while two people may be diagnosed with the same illness, one may respond well to treatment, the other may not. One may have mild symptoms and be able to function in the workplace, the other may not. It is crucial therefore to ensure that you accurately describe for the physician or specialist who may be preparing your disability claim forms the nature and extent of your symptoms and how they impair your ability to function in the workforce and at home.

In an Attending Physician's Statement (the document that an insurance company usually requires from your physician and/or specialist to commence your application for benefits) and the medical reports that are prepared pursuant to a request for further information from the insurance company, it is important for your physicians and specialists to consider all of your symptoms, physical and psychological, and more importantly, how these symptoms affect your ability to function. Functional ability is an essential component in analysing whether an individual meets the test for disability contained in the applicable insurance policy or plan.

It is, however, important to bear in mind that every disability insurance policy is unique and an assessment of disability must take place in the context of the definition contained within the applicable insurance policy or plan. Most disability insurance policies contain more than one definition of disability that an applicant must meet before they can be entitled to ongoing benefits.

The foregoing does not constitute legal advice. If you have unsuccessfully appealed your claim for disability benefits or your benefits have been terminated at the "change of definition", you may want to consider whether you require legal assistance to further advance your claim.