Understanding the Crucial Role of Occupation Assessments in Disability

When someone files a disability insurance claim, his or her ability to continue working is the crux of the matter. Disability insurance provides financial support when illness or injury prevents someone from performing his or her job. One of the key elements disability insurers scrutinize when evaluating a claim is the claimant’s occupation, as it directly impacts eligibility and benefits. The nature of the job plays a crucial role in determining whether a person is eligible for benefits, what type of benefits they receive, and how long those benefits may last. This analysis is complex and varies based on several factors, including policy terms, the physical and cognitive demands of the job, and how the occupation is defined.  In this article, we will explore how disability insurers analyze a claimant’s occupation and why this matters significantly for individuals making disability benefits claims.

Defining the Claimant’s Occupation: “Own Occupation” vs. “Any Occupation”

The definition of a claimant’s occupation is the starting point in the disability claims process. Typically, disability insurance policies fall into one of two categories: “own occupation” and “any occupation.” These terms determine whether a claimant qualifies for benefits based on their ability to perform either their specific job or any job for which they are reasonably suited.

1. Own Occupation Policies:

Under an “own occupation” policy, the insurer evaluates whether the claimant can perform the duties of their specific occupation at the time they became disabled. For example, a surgeon who develops a hand tremor may not be able to perform surgery, even though they could technically perform other types of work, like teaching or consulting. In this case, the insurance company would look at whether the surgeon can perform surgery (their “own occupation”) to determine eligibility for benefits.

“Own occupation” policies tend to offer broader protection because they focus on the specific job the individual was performing before the disability. If the claimant is unable to perform that job, they may be entitled to benefits even if they can still work in another capacity.

Group long-term disability policies often define disability for the first 24 months as the inability to perform one’s “own occupation,” followed by a more generic “any occupation” definition of disability.

2. Any Occupation Policies:

An “any occupation” policy, on the other hand, is stricter. It requires that the claimant be unable to perform the duties of “any occupation” for which they are reasonably suited by education, training, or experience. For instance, if a software developer is unable to continue programming due to a cognitive impairment, but could still perform a different, less demanding desk job, they may not qualify for benefits under an any occupation policy.

The insurer’s analysis in this scenario is more rigorous, as they will assess whether the claimant could work in any capacity, even if that role is different or less prestigious than their original occupation.

Although many group LTD policies define “disability” after the first 24 months as the inability to perform “any occupation,” those same policies typically contain a gainful threshold of 60% or more of the claimant’s pre-disability earnings. Thus, in the example of the software developer above, the insurer cannot deny benefits based on the former developer’s ability to perform a minimum wage job; rather, it must identify other occupations the claimant can perform that pay a percentage (usually 60%) of his or her pre-disability income.

What Are the Key Components of an Occupation Assessment?

Once the insurer establishes the type of policy, their representatives delve into the specific demands of the claimant’s occupation. This is crucial because every job has a unique combination of physical, mental, and cognitive requirements.

1. Physical Demands:

The insurer will examine jobs that require heavy lifting, manual dexterity, or prolonged standing or sitting closely. For example, a construction worker’s claim may focus on whether they can safely operate machinery or lift heavy objects, while a teacher’s claim may focus on whether they can stand for long periods in the classroom.

The insurer typically classifies the occupation as “sedentary,” “light,” “medium,” “heavy,” or “very heavy” in nature. You can find definitions for each of the forgoing exertional categories Appendix C of the U.S. Department of Labor’s Dictionary of Occupational Titles.

The insurer may request medical records, job descriptions, and even consult with occupational experts to determine whether the claimant can meet the physical demands of their job with their medical condition.

2. Mental and Cognitive Demands:

Cognitive impairments and mental health disabilities, such as depression, anxiety, or traumatic brain injuries, also play a significant role. For example, a financial analyst with cognitive impairments may not be able to perform complex calculations or concentrate for extended periods, even though their job does not require physical exertion.

The Dictionary of Occupational Titles and other vocational resources specify the “general educational development” and “aptitudes” required of each occupation. These resources provide a useful guide to assess the mental and cognitive demands of a job. For example, a surgeon must have a “reasoning level” of 6 on a scale of 1 to 6, with 6 being the highest.  They also possess a ‘general learning ability’ in the top 10 percent of the population.

Insurers may evaluate the extent to which the claimant’s condition affects their ability to focus, remember tasks, or make decisions. Medical records from psychologists or neurologists, along with functional capacity evaluations, help determine whether the claimant can handle the cognitive demands of their job.

3. Job Descriptions and Daily Duties:

Insurers will also look at the claimant’s job description and compare it with their actual day-to-day duties. There can often be discrepancies between what is written in the job description and what the claimant actually does. For instance, a manager may have a job description that emphasizes leadership and planning, but their daily tasks might involve physically demanding activities that their condition prevents them from performing.

The insurer might request documentation from the claimant’s employer or conduct interviews to get a clearer picture of the claimant’s actual responsibilities. Inaccurate or outdated job descriptions can create complications in the claims process. So, it’s essential for claimants to provide clear and detailed information about their role.

4. Specific Employer vs. National Economy:

Many group LTD policies define “own occupation” according to a national standard. Utilizing a national standard, insurers are not concerned with how an occupation is performed for a specific employer but rather with how it is performed in the national economy. To determine how a job is performed in the national economy, insurers consult vocational resources like the U.S. Department of Labor’s Dictionary of Occupational Titles, O*NET, and labor market surveys.

Using a national standard instead of a subjective one can sometimes disadvantage claimants. For example, even if your specific employer requires you to lift up to 50 lbs occasionally (consistent with “medium” work), insurers may still classify your job as “sedentary” or “light” based on the national standard. On the other hand, this can also work in a claimant’s favor. A nurse who has a sedentary role might benefit because nursing is generally classified as a “light” occupation in the national economy.

How Insurers Conduct Occupation Assessments in Disability Claims?

In many cases, insurers consult vocational experts during the occupation analysis. These professionals assess the claimant’s ability to return to their previous job or transition to another role. They review the claimant’s education, work history, skills, and medical restrictions to determine whether they can work in their current occupation or another suitable role.

Vocational assessments often play a decisive role in the insurer’s decision. If the vocational expert determines that the claimant cannot return to their previous job or find employment in a comparable role, the claimant’s chances of receiving benefits increase.

Please review our article on ‘The Vocational Aspects of Disability Insurance Claims’ for more in depth discussion on the context of vocations and the claim process.

How Does an Occupation Assessment Impact Disability Claims?

Understanding how disability insurers analyze occupations is crucial for claimants because it affects their likelihood of receiving benefits. Claimants need to provide detailed information about their job duties, medical condition, and limitations to ensure the insurer has a clear understanding of their situation.

Here are some key reasons why occupation analysis matters:

1. Accurate Job Descriptions: Claimants should ensure their job description is up-to-date and accurately reflects their daily responsibilities. This can prevent discrepancies that might lead to a denial of benefits.
2. Medical Evidence: Claimants must provide comprehensive medical evidence that directly ties their limitations to their job demands. Medical records, functional capacity evaluations, and expert opinions can strengthen the claim.
3. Choosing the Right Policy: When purchasing disability insurance, claimants should carefully consider whether an “own occupation” or “any occupation” policy better suits their needs. An own occupation policy typically provides more comprehensive coverage but may come at a higher premium. Participants in group LTD policies should request their plan documents to determine which type of coverage their employer provides.
4. Appealing Denials: If a disability claim is denied based on the insurer’s occupation analysis, claimants may need to appeal the decision. Working with vocational experts or legal professionals who understand how insurers analyze occupations can increase the chances of success, particularly if the insurer misunderstood or mischaracterized an important aspect of the claimant’s job.

Conclusion: Why Occupation Assessments Are Essential in Disability Claims

The way disability insurers analyze a claimant’s occupation is a crucial factor in determining the outcome of a disability claim. By carefully assessing the physical, mental, and cognitive demands of a claimant’s job, along with policy definitions like “own occupation” and “any occupation,” insurers can determine whether a claimant qualifies for benefits. For disability claimants, understanding this process and providing accurate and thorough information is key to securing the benefits they need.

At DeBofsky Law, we’ve helped countless individuals navigate the complexities of disability claims, with occupation assessments often being a decisive factor. Contact us for legal assistance or presentation with your claim.