The Two Definitions Explained
Disability insurance policies define "disability" in specific ways that determine whether you qualify for benefits. The two primary definitions are "own occupation" and "any occupation" - and the difference between them is enormous.
"Own Occupation" Definition
You are disabled if you cannot perform the material duties of your specific occupation.
Under this definition, you receive benefits if you cannot do the job you were actually doing when you became disabled. It does not matter if you could theoretically do some other job - what matters is whether you can perform YOUR job.
"Any Occupation" Definition
You are disabled only if you cannot perform the material duties of ANY occupation for which you are reasonably qualified by education, training, or experience.
Under this definition, you lose benefits if the insurer determines you could work in some other capacity - even if that job pays far less, has lower status, or is fundamentally different from your career.
Why This Matters: Real-World Examples
Example 1: The Surgeon
Dr. Smith is a cardiac surgeon earning $600,000 annually. A hand tremor makes it impossible for her to perform surgery safely.
Under Own Occupation: She receives full benefits because she cannot perform cardiac surgery.
Under Any Occupation: Benefits could be denied because she could theoretically teach medical students, consult, or work in administration - even at a fraction of her surgical income.
Example 2: The Construction Worker
Mike is a heavy equipment operator with severe back injuries preventing him from operating machinery or doing physical labor.
Under Own Occupation: He receives benefits because he cannot operate heavy equipment.
Under Any Occupation: Benefits could be denied if the insurer argues he could work as a dispatcher, estimator, or in another sedentary role - positions that may not actually exist or be available to him.
Example 3: The Attorney
Sarah is a litigation attorney who develops severe anxiety and cognitive issues that prevent her from appearing in court or managing complex cases.
Under Own Occupation: She receives benefits because she cannot perform trial work.
Under Any Occupation: Benefits could be denied because she might be able to do document review, legal research, or administrative legal work - even though her earning capacity is dramatically reduced.
The "Change of Definition" Trap
Most long-term disability policies start with an "own occupation" definition but switch to "any occupation" after a certain period - typically 24 months. This is when most benefit terminations occur.
| Time Period | Definition Applied | What This Means |
|---|---|---|
| First 24 Months | Own Occupation | You receive benefits if you cannot perform your specific job |
| After 24 Months | Any Occupation | You must prove you cannot perform ANY job you are qualified for |
As you approach the 24-month mark, expect your insurer to conduct an intensive review of your claim. They will often order new medical examinations, hire vocational experts, and conduct surveillance - all to build a case that you can perform "some" occupation and should lose benefits.
How Insurers Exploit the Definition Change
Insurance companies know that the transition to "any occupation" is their best opportunity to terminate benefits. Common tactics include:
- Paper-Only Vocational Reviews: Hiring vocational experts who never meet you but opine you could work in jobs that may not actually exist in your area or for which you are not truly qualified
- Ignoring Real-World Factors: Claiming you could work sedentary jobs while ignoring that your medications cause drowsiness, you need frequent breaks, or you have unreliable attendance due to your condition
- Defining "Occupation" Broadly: Arguing that general job categories (like "office worker") constitute occupations you could perform
- Undervaluing Your Experience: Suggesting you are qualified for entry-level positions in fields where your specific experience does not transfer
Types of Own Occupation Coverage
Not all "own occupation" coverage is created equal. Understanding these variations is crucial when reviewing your policy or buying coverage.
True Own Occupation
The most favorable definition. You receive full benefits if you cannot perform your occupation, even if you are working in another capacity and earning income. A surgeon who cannot operate but teaches medicine would still receive full disability benefits.
Transitional Own Occupation
You receive benefits if you cannot perform your occupation, but benefits are reduced dollar-for-dollar by any income you earn in another occupation. Working reduces your benefit, but does not eliminate eligibility.
Modified Own Occupation
You receive benefits if you cannot perform your occupation and you are not working in any other occupation. If you work at all (even part-time in a different field), you may lose all benefits.
Own Occupation, Not Engaged
Similar to modified: you must be unable to perform your own occupation AND must not be engaged in any gainful employment. This limits your ability to attempt rehabilitation or part-time work.
California courts interpret ambiguous policy language against the insurer under the doctrine of contra proferentem. If your policy's definition of "own occupation" is unclear, California law requires the interpretation most favorable to you as the policyholder.
Additionally, under California Insurance Code section 10110.6, insurers must clearly explain material policy provisions. Failure to adequately explain the "own occupation" to "any occupation" transition could support a bad faith claim if benefits are later denied.
How Courts Define "Own Occupation"
When disputes arise over whether you can perform your "own occupation," courts look at several factors:
The Material Duties Test
Courts examine the material and substantial duties of your specific job, not just a generic job title. For example:
- A "nurse" who works in the ER has different material duties than a nurse in a doctor's office
- A "sales representative" who travels constantly has different duties than one who works from an office
- An "attorney" who does trial work has different duties than one who drafts contracts
Your Specific Job, Not a Generic Version
The analysis focuses on how YOU actually performed your job, not how the job might theoretically be performed. If your specific position required physical demands, travel, or cognitive tasks that you can no longer do, you may be disabled from your "own occupation" even if others with the same job title work differently.
The National Economy Standard
Some policies define your occupation as it is "generally performed in the national economy" rather than how you specifically performed it. This is less favorable because it ignores the unique aspects of your actual job.
How Courts Define "Any Occupation"
The "any occupation" standard is more stringent, but it is not as broad as insurers sometimes claim. Key limitations include:
Reasonable Qualification Requirement
You must be "reasonably qualified" for the alternative occupation by education, training, or experience. Insurers cannot simply pick random jobs from a dictionary. If you have worked in finance your entire career, suggesting you could be a truck driver is not reasonable.
Gainful Employment Standard
Many policies require that the alternative occupation provide "gainful" employment, meaning it must provide a reasonable income. Some policies specify a percentage of your pre-disability earnings (often 60-80%). A job paying minimum wage may not qualify as gainful for a professional who previously earned six figures.
Real Jobs, Not Theoretical Ones
Courts increasingly require that alternative occupations actually exist in reasonable numbers in your geographic area or be reasonably available through remote work. A theoretical job that exists only in labor statistics but has no actual openings may not count.
California courts have been relatively favorable to claimants in interpreting "any occupation" provisions. In Hangarter v. Provident Life & Accident Ins. Co., the court emphasized that the insurer cannot rely on theoretical job availability and must consider real-world employment factors.
Furthermore, if your insurer's vocational analysis is unreasonable or ignores your actual limitations, this can support a bad faith claim under California law.
Protecting Yourself at the Definition Change
As you approach the 24-month transition, take proactive steps to protect your benefits:
1. Know Your Policy
Review your policy's exact language for the "any occupation" definition. Does it require gainful employment? A specific income percentage? Being qualified by education AND training AND experience, or just one of these?
2. Update Your Medical Evidence
Obtain current, detailed reports from your treating physicians that specifically address your functional limitations. Generic statements like "cannot work" are insufficient - you need specific restrictions (cannot sit more than 30 minutes, cannot concentrate for extended periods, etc.).
3. Consider a Vocational Evaluation
Retain your own vocational expert to analyze whether any realistic occupations exist that accommodate your limitations. This provides evidence to counter the insurer's likely conclusion that jobs exist.
4. Document Everything
Keep records of your symptoms, limitations, and how your condition affects daily life. A contemporaneous journal can be powerful evidence.
5. Prepare for Surveillance
Assume you may be watched. Do not exaggerate your limitations on claim forms - be accurate. But also do not push yourself on "good days" in ways that create misleading surveillance footage.
6. Consult an Attorney
If your benefits are significant, consider consulting a disability insurance attorney before the transition. It is easier to prevent a termination than to reverse one.
What to Do If Benefits Are Terminated
If your insurer terminates benefits at the "any occupation" transition:
- Request the Complete Claim File: Under ERISA or state law, you have a right to your file. Review exactly what evidence the insurer relied upon.
- Identify the Alleged Alternative Occupations: What jobs does the insurer claim you can perform? Research whether these jobs actually exist and whether you are truly qualified.
- Gather Counter-Evidence: Obtain updated medical opinions addressing why you cannot perform the identified occupations. Consider vocational expert testimony.
- File a Timely Appeal: Meet all deadlines. In ERISA cases, you typically have 180 days.
- Consider Legal Representation: The appeal in an ERISA case is often your only chance to build a complete record. An experienced attorney can maximize your chances.
For more on fighting LTD denials, see my guide on Long-Term Disability Denials.
Facing a Definition Change Review?
I help claimants prepare for the "any occupation" transition and fight wrongful terminations. Whether you need a demand letter, appeal assistance, or just want to understand your options, I can help.