We see it all the time: long term disability claims that are denied based on the pre-existing exclusion clause.
It is important to understand the implications of whether a pre-existing condition clause may impact any potential entitlement to your disability benefits at your current or future jobs. Why is this so important to know? If the exclusion clause does apply to your claim, you will not be entitled to receive any long term disability benefits.
What counts as a pre-existing condition?
This depends on the specific wording of the pre-existing clause in your particular disability insurance policy. In many group policies, the following type of clause may appear: “We do not pay benefits if your disability results directly or indirectly from a condition which existed on or before the date your coverage began. However, this limitation will not apply to you if: you have been covered for long term disability with your employer for at least 13 weeks during which you have been actively working continuously (up to 3 days of absence does not count) and you have not been treated by a doctor, or any medical personnel under the direction of a doctor, for the condition, or you became totally disabled more than 12 months after your coverage began.”[i]
This wording is fairly typical of pre-existing clauses in many insurance companies' policies. It contains a rather broad definition of what constitutes a pre-existing condition. In this example, it includes disabilities that result directly or indirectly from a condition which existed before coverage begins. This means that undiagnosed conditions may still be caught by this clause if they can be seen as being either directly or indirectly related to symptoms that were occurring in the applicable period. Particular attention must be focused on the time frames noted in the clause. In this case, 13 weeks of actively working continuously will knock out the clause, even if you had a pre-existing condition.
When an insurance company is reviewing this aspect of your claim they will scrutinize your attendance record and medical treatments carefully to see if coverage and benefit payment can be avoided.
How would a pre-existing condition impact my claim?
A pre-existing condition will only matter if the claim arises within the period during which the pre-existing exclusion clause applies, so in most cases, if the disability arises more than one year from when coverage was put into place, the pre-existing exclusion will not apply. There are some policies where the pre-existing exclusion applies for a longer period of time – for instance, two years – but that is more the exception than the rule. The policy wording must be checked to determine the specific clause in each case.
Can I avoid a pre-existing exclusion clause when starting a new job with new benefits?
Changing your place of employment usually means that you will be subject to whatever pre-existing exclusion clause applies to the group benefits at the new employer. If you have been struggling with your health and are dealing with a chronic illness, even though able to work, you should consider the potential impact of changing employers should a disability occur within the initial period (described earlier). In some cases, you might be able to get your employer to request that the pre-existing exclusion be waived, however, that would require a prospective employee to advise his new employer that they have a chronic illness, which could pose a barrier in the hiring process.
The bottom line is that while one cannot necessarily anticipate and plan for every single contingency, it’s important to be aware of this issue if and when you consider making a career move. Our long term disability lawyers at Share Lawyers review cases that have been denied based on a pre-existing exclusion. In some cases, it is possible to avoid the applicability of the exclusion clause, but this is an added challenge to a disability case that can be insurmountable in some cases.
If you’re unsure about how this may apply to you, it should be reviewed by an experienced disability lawyer who can assess the chances of success. At Share Lawyers, our disability lawyers offer a free consultation and can give you a clear answer as to whether your disability insurance policy will support you should you need to stop working due to a disabling condition.
If you have had your claim for long term disability denied, contact the long term disability insurance lawyers at Share Lawyers. Our 35+ years of experience in long term disability (LTD) law can help you win your case against Canada Life, Desjardins, Manulife, RBC Insurance, Sun Life, and other insurance companies. We offer free consultations and there are no fees unless you win your case. Join us on Facebook and become a Top Fan for a chance to win each month.