Disability Policy Language

As in all insurance policies, the language used in the policy will be used in enforcing and interpreting the policy.

In the 2003, Texas Supreme Court opinion, Provident Life and Accident Insurance Co. v. Knott, the court read the policies in question  defining the term “total disability” to mean that the insured must, in order to be considered totally disabled under the policies, be unable to “perform all of the important daily duties of his occupation.”   The then held that the trial court’s granting of summary judgment in favor of the insurance company was appropriate given that the insured, a gynecologist seeking benefits for total disability under those policies was able to see patients, perform surgery, consult with other physicians and perform administrative duties.

A long term disability policy that defined disability in part as the inability to perform “each of the material duties” of the insured’s regular occupation required only that the insured be unable to perform any single material duty of her occupation in order to be considered disabled, not that she be unable to perform all duties of that occupation.  This was in the 2002, U.S. 5th Circuit opinion, Lain v. UNUM Life Insurance Co. of America.  No concrete evidence disability insurer’s determination of non-disability for insured who suffered recurring severe chest pains, while overwhelming evidence supported disability claim, warranting benefit award under ERISA civil enforcement provision:  the insured’s time at home doing research on her medical condition did not equate to ability to practice law, as insurer contended; insurer focused on certain “normal” test results to support its finding, but test results were primarily abnormal and also could not clinically measure insured’s pain; and insurer’s reliance on insured’s failure to seek psychiatric care prior to ceasing employment was misguided since her disability was physical.

For lawyers handling disability claims, it must be emphasized that these types of cases all involve the court’s interpreting the pertinent clause or clauses which define what “total disability” means under the particular policy in question.

The Texas Supreme Court has recently driven home that point when it indicated that, while in the past, certain decisions might be read as indicating that common-law definitions of disability were allowed to supersede definitions included in a policy, any such argument will fail today.