A Successful California Disability Insurance Claim Does Not Require “Absolute Helplessness”

One of the most hotly disputed areas among California disability lawyers focuses on the definition of “total disability” in private long-term disability insurance policies. An insurance company will routinely deny coverage, relying on policy language that, in its view, requires that the employee not only suffer from a disability but also that the disability prevents any type of work at all.

These wrongful denials usually result in a dispute between residual disability and total disability. The difference in dispute is often several hundred thousand or millions of dollars. Disabled employees have successfully challenged these denials of coverage by convincing courts that the definition of totally disabled is not as strict as the insurance companies would like.

California Law Regarding Total Disability is Well Settled and Pro-Claimant

A California appellate court addressed this issue in Joyce v. United Insurance Company of America. The plaintiff in that case worked as a toolmaker at the Stanford University Electronics Laboratory. In 1957, he bought a disability insurance policy from United Insurance that would pay him $100 a month if he were totally disabled. In late 1957, he injured his shoulder while moving equipment. A month later, he hurt himself again. This time, he injured his right arm while moving a heavy-duty vise. He tried to return to work six months later but could not work more than a few minutes at a time. As a result, his employer fired him because he could not perform his job duties.

United Insurance denied benefits, claimed the employee’s total disability ended the moment he returned to work. But in California, “total disability” does not mean an “absolute state of helplessness.” Instead, it requires only that the insured cannot perform the “substantial and material acts” necessary to work in the “usual or customary way.” The employee argued that he couldn’t make tools in the usual or customary way because his injured arm would not allow him to move machinery or use his arm for more than a few minutes at a time.

California Disability Insurance Claimant Wins

The California appellate court held that the employee was totally disabled under California law. Even though the employee returned to work twice, the court pointed to the fact that the employee could not perform “substantial and material acts” to work in the “usual or customary way.” And, under California law, a “totally disabled” claimant does not lose this status simply because he can perform sporadic tasks. As the claimant’s attempts to resume work were short-lived, the court properly found the employee should receive disability benefits. If you have been denied disability benefits, contact our California disability attorney for a free consultation.

Joyce v. United Ins. Co., 202 Cal. App. 2d 654 (1962).

Comments (4)

  • Mark,

    What long term disability carrier would your claim be through?

    Stephen Jessup Mar 17, 2015  #4

  • This is my problem. In 1979 I was struck by an automobile (veh. vs ped.) and lost my right arm. I did receive compensation, but elected to luckily return to the same occupation. I continued in the Land Surveying field until 2010, I took my retirement and took on another occupation. My sister in law hired me as a supervisor/purchasing agent/truck driver, I do wear allot of hats. At this time, I live in allot of pain now a days and my accident is now taking its toll on the rest of my body. My symptoms are major arthritis in my hand, elbow and shoulder, I also have back pain from my compensating for so many years. My original Attorney is now retired and is unavailable, at the time of settlement, he told me in the future, I should be able to make a new claim, if I where to have any other physical problem. Can you help, or do I have to keep struggling?

    Mark Steven Rombal Mar 16, 2015  #3

  • Andrew,

    If your policy is governed by ERISA it would be wise to comply with the request to obtain the records. If the hospitalisation occurred 18 months ago (which would presumably mean the after effects would have been present in 2012) then those records would logically appear to be pertinent to your claim as is stands today. As I am unsure as to the facts surrounding your claim I do not know if Standard is also reviewing the claim for a pre-existing condition limitation. Additionally, if you have signed authorisations at the inception of your claim allowing Standard to gather medical information, they would have the right to do so, unless the authorisation is revoked. If you would like to discuss your claim further you may contact us directly to consult with one of our disability attorney.

    Stephen Jessup Jun 7, 2013  #2

  • I was hospitalised for life threatening bacterial meningitis about 18 months ago. Cognitive impairment worsened over 13 months leading to a medical leave which is in it’s 90th day. I am a professional with an ethical obligation to acknowledge and address my cognitive issues or risk malpractice and losing my license.

    Treatment and testing for “post meningitis syndrome” with objective neuro-psychological testing showing noticeable impairment. Although I have had worsening symptoms over 18 months, formal evaluation and treatment did not begin until March 2013.

    Standard Insurance initially accepted my STD and paid 10 days of benefits, then stopped payment claiming that they have not received my doctor’s records from 2012, but she does not have them since I started treating with her in March of 2013. My doctor placed me on leave for 90 days.

    Standard now wants obtain records from all of my doctors in 2012 to present. Can I refuse absent a showing of good cause as to the issue those records could address? This seems like a fishing expedition. Please help.

    Andrew Jun 6, 2013  #1

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