This is an issue primarily for those with IDI policies such as doctors, dentists, surgeons and highly paid executives. There seems to be a misconception among these insureds that they can decrease their hours, stop doing certain procedures, sell their businesses, and even not work at all on their own say-so. This is really a very bad idea.
IDI policies most often contain a provision requiring insureds to be in treatment “with a physician who has a specialty treating the claimed disability”. Disability physicians cannot just stop working on their own volition and expect insurance companies to pay claims. Only a qualified physician other than him or herself can validate disability by documenting in the patient notes a recommendation for cutting back occupational duties, or not working at all.
This situation can result in some very complex issues for insured IDI claims. For example, let’s suppose doctor X decides we wants to file a disability claim because in 2017 he had an accident resulting in a TBI. As a result of the accident he stopped performing surgery and decreased his workday to part-time. In 2019, after finding it more and more difficult to manage his patients, he decides to file for disability back to 2017 when he had the accident.
This is a classical case of not understanding the disability claims process. Ideally, for IDI insureds they would have already developed a treatment history with physicians who managed the injury at the time of the accident. Can the insured produce patient notes and physican recommendations to cut-back work activities dated in 2017? No? Can the insured produce any type of verification dated in 2017 from any physcian recommending part-time only? No? Doctor X simply cut back his hours and stopped performing surgery on his own without the buy in and recommendation of treating physicians.
If we completely ignore “prejudice and late filing” issues, without written documented support for cessation or limitation of work activity, there is no proof of claim dating back to 2017 and insurers are not likely to pay for the period 2017-2019. The insured must submit written proof of claim from a qualified physician before any benefits can be paid. This means that while the insured may have a much later date of disability in 2019, retroactive benefits back to 2017 aren’t payable without substantial proof that a physican took the insured out of work or recommended that he cut back.
I get quite a few calls from professional insureds such as doctors, lawyers, dentists, chiropractors, and executives with situations very similar to the above. When asked what “proof” in 2017 from qualified doctors can be submitted, there usually isn’t any because physicians did not officially “take the insured out of work”, nor did any of the physicans of record document decreased work. Therefore, doctor X will have to opt for a more recent date of disability once treatment is established with his physicians who then document he can no longer work.
Along with this issue is the fact that IDI professionals often reduce work loads, stop sugical procedures, but continue to pay themselves the same amount of money. Most IDI policies require at least a 20% earnings loss, so in addition to not getting paid for earlier dates of disability, a 20% loss of pre-disability earnings didn’t happen.
From what I can tell, many physicians and executives do not file immediately for disability thinking they will eventually get back up to speed and continue work as usual. One year goes by, then two years and finally it becomes apparent that performing one’s own occupation is no longer possible. It is imperative that insureds file for disability at the time of the accident or injury and not wait to file.
This is an issue I’m seeing more and more of. IDI insureds must realize that only another physican can “take them out of work” in order for a disability claim to be credible. This is not something IDI professionals can do on their own without “proof of medical disability” from their own physiciains.