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When you run a professional practice, you must manage your risks to remain financially viable. As many professionals do, you absorb the costs of some losses and purchase insurance policies to cover others. You buy property coverage to pay for building and personal property damage, health insurance to pay for medical expenses, and business overhead expense insurance (BOEI) to pay in the event you suffer a worst-case health scenario that could potentially destroy your business.
When you purchase a BOEI policy in good faith, you expect your insurer to pay your claims. If you’ve suffered a disabling injury or condition, you expect the money to arrive when you need it. If your insurance company declines your coverage or denies your claim, you shouldn’t simply walk away. Contact Gomez Trial Attorneys’ business overhead expense insurance lawyers to discuss your options.
A BOEI LAWYER PROTECTS YOUR INTERESTS
By the time your insurer denies your disability claim or declines your coverage, you may not be in a position to fight back. After you make a claim because your health prohibits you from working, you need all of your energy to heal. When you consult with a BOEI lawyer, he or she may intervene on your behalf. An attorney will analyze your policy, evaluate your claim, and discuss any issues with your insurance carrier.
BOEI coverage is a disability policy issued by a life and health insurance company. Some insurers write their own policies, but all insurers must follow basic industry guidelines and all applicable laws and regulations. It is impossible to cover every medical disability, so they commit to paying for the conditions and circumstances listed in their policies. BOEI attorneys understand how insurance principles and guidelines apply in light of potential coverage and claim issues. Attorneys also stay abreast of the California Unfair Claim Practices statutes, which mirror the National Association of Insurance Commissioner’s Model Law.
BEFORE YOU HAVE A CLAIM
A BOEI attorney can also help you minimize the potential for claim problems before they occur. An attorney can review your policy and discuss your coverage expectations to determine how closely they align. While coverage attorneys can’t assess every possible contingency, they can advise you of potential coverage issues that you might otherwise oversee.
BOEI POLICIES ARE COMPLICATED
As with all insurance policies, BOEI policies are contracts. Just like other contracts, the wording and intent are both important and complex. Even the simplest insurance contract includes language, definitions, and jargon that insurers don’t expect policyholders to understand. Even if you have the capacity and patience to digest the meaning of every clause, you probably just don’t have the time.
As an insurance consumer, you rely on insurance professionals to explain and interpret your coverage. They control every facet of the process, from procurement and termination to claims.
The following is an example of what you might expect from an insurance company:
- An insurance agent will recommend the appropriate policies and submit an accurate application.
- The insurance company underwriters will issue a policy based on your preferences and your agent’s representations.
- When you have a claim, you turn in a report and expect a timely response.
- When you hear from the claims department, you expect the representative to pay what the agent promised.
INSURANCE AGENTS MAKE BOEI COVERAGE SOUND SIMPLE
A BOEI policy covers costs that will continue if you become disabled and are unable to run your business. The coverage can pay for rent or mortgage payments, malpractice insurance premiums, employee salaries, utilities, and other overhead costs. Because it’s based on traditional disability coverage, it’s usually written by life and health insurers. BOEI policies are marketed to doctors, lawyers, accountants, architects, and other professionals whose disabilities would reduce their practices’ income-producing abilities.
Once you start reading the BOEI provisions, you may realize that they are very complicated. Insurance marketers mislead customers into believing that the policies are simple and easy to understand.
The insurance companies accomplish this by focusing on basic talking points, such as:
- Your disability could put your company at risk.
- Social Security Administration (SAA) data shows that one-in-four 20-year-olds becomes disabled.
- BOEI policies cover business expenses when you can’t work.
- The money helps you meet day-to-day business expenses.
- BOEI policy premiums are tax-deductible as a business expense.
- Policies are non-cancellable until your 65th birthday.
If you purchased a BOEI policy, most likely the selling agent spent time marketing the above benefit examples. They probably did not provide you a sample policy to read and evaluate, and you probably didn’t think to ask. As with most insurance consumers, you may have relied on promotional materials and the agent’s coverage descriptions and representations. Both the agent and promotional materials typically use the simplest language possible to explain a complex coverage option.
WHAT’S IN YOUR BOEI POLICY?
Insurance companies provide a copy of the policies that they issue, but usually only after they complete the underwriting process. Once an underwriter approves your application, the company issues a policy that includes a copy of your application, a coverage booklet, and other assorted documents.
Here is a basic list of the policy sections:
- Data page: Personal and business details that you provided during the application process;
- Definitions: Descriptions of key policy terms like “injury” and “loss,” that have definitions outside of those within the insurance policy;
- Benefits: What your insurance company promises to pay;
- Exclusions and limitations: Forms that change and describe limitations of coverage;
- Claims: Procedures for submitting a claim;
- Benefit limits: The maximum amount you can receive for a covered benefit;
- Termination, premium, and reinstatement provisions: Procedures for premiums due and past due;
- Conversion: Your options to convert your policy to a different plan;
- General provisions: Insured and insurer’s rights and duties;
- Riders: Added provisions that provide optional coverages (property and casualty policies use the term endorsement)
Insurance companies recommend that you read your insurance policy when you receive it. Later, if you question a coverage decision, the company will often explain that it provided a policy so that you would know what it does and does not insure.
If you don’t normally read your insurance policy, you’re not alone. An insurance policy is not an easy read, which is why most insured individuals skip this step and file their policies away. Some insurers only issue electronic copies of their policies. If you want to read it, you must view it on a computer or a digital device. Even if you do read it, you probably need a BOEI lawyer to help you understand your rights. Insurance claims adjusters will interpret your policy in ways that most benefit the insurance company, not you.
THE BOEI CLAIM PROCESS
When you have a claim, your insurance policy explains what you must do to initiate benefit payments. These provisions are similar to those in many other policies.
To receive a claim benefit, you must comply with your policy, including, but not limited to:
- Notice: Notify your insurer of any loss within 30 days after such loss occurs or as soon as reasonably possible.
- Written proof of loss: A formal document you must file with the insurer to initiate your claim.
- Proof of your loss: You must submit supporting documentation that evidences your loss.
You must cooperate with your insurer’s investigation and submit to a medical examination, if applicable. Also, as the claim continues you may need to submit further claim documentation as the insurer requires it. An insurer decides whether they are satisfied with the evidence of your loss or not, and still may choose to deny your claim anyway.
Call us. We can help you through that process.
REASONS WHY YOUR INSURER MIGHT DECLINE COVERAGE OR DENY YOUR CLAIM
Simple doesn’t apply when your insurer reviews your claim. Insurance companies consider policy language, documentation, and proof of loss, among other things to determine if they will cover your loss. If they discover a particularly thorny issue, they will conduct research on it and may obtain a coverage opinion from an attorney. As part of the insurer’s review to determine your true loss, they will conduct an investigation that may include surveillance of you and questioning of your neighbors.
Claim handlers may deny claims or decline coverage for the following reasons:
- Unpaid Premium: An insurer will cancel your policy if you fall too far behind on your premiums.
- Delayed Notice: If you fail to report your claim within the required time period or as soon as reasonably possible, your insurer may deny your claim. Reasonable insurers rarely deny a claim for notice unless a delayed reporting of the loss jeopardizes its right to conduct a timely investigation.
- No Coverage: BOEI policies contain several clauses that define what coverages are not provided under your policy. One excluded category includes disabilities caused by war, insurrection, or other types of government or military conflict.
- Pre-existing Condition: Policies only cover certain pre-existing conditions and deny coverage of others. An experienced lawyer, however, might find a workaround—for example, your policy might exclude diabetes but not the disabling heart condition that diabetes causes. Excluded conditions may depend on when and if you received treatment within a stated time period or if you should have received treatment during such time.
- Failure to Cooperate: Your claim may be denied for failure to provide documentation, cooperate with an investigation, report for a medical examination, etc.
- Application Statements: Fraudulent statements in your application for coverage may cause an insurer to deny your claim, and potentially cancel your policy.
- Failure to Provide Proof of Loss: The proof of loss requirement adds confusion to most insurance claims. Many insurers require that an insured submit an official proof of loss document. Insurers often send out a formal document requesting that the insured individual complete it and have it notarized. Insurers may also provide claim worksheets for you to fill out. If the form(s) are missing necessary documentation, an insurer can reject the claim for failure to provide sufficient proof of loss.
- Fraud: Insurers have the right and duty to defer payment of a claim if they suspect fraud. Oftentimes, however, their suspicion is unwarranted.
AGENTS SOMETIMES MAKE PROMISES THAT THE INSURER CAN’T KEEP
When you purchase a BOEI policy, you have certain expectations. Agents earn a commission by listening to your expectations and matching you to the appropriate insurance program. For each insurance policy the agent secures, they will receive a percentage of each policy renewal premium year after year. It’s in the agent’s best interest to make the sale, so they may make coverage promises that the insurance carrier can’t keep. Whether it’s intentional, a misunderstanding, or the agent simply doesn’t understand the policy, it often leads to future claim controversies.
The agency arrangement establishes a potential conflict when an agent puffs coverage details in order to sell a policy. In the hope of pushing a policy through the underwriting process, agents sometimes explain coverage in a way that makes it sound enticing. Over time, the agent usually forgets his promises, but the insured doesn’t. This can create a coverage dilemma when the insured turns in what he believes to be a covered claim.
When an agent is captive to a single insurer, it makes the potential for conflicts even more profound. An agent works for a single company and often has a single insurance product for each category. When an agent works directly for the insurer, the pressure to sell often increases. Insurance marketing “optimism” happens frequently enough that at least one BOEI insurer has the following clause in its policy: “No one, including our agents, has the right to waive or change any part of this policy.”
COVERAGE DECISIONS ARE OFTEN A JUDGMENT CALL
The insurance company decides whether it will cover your claim or not, regardless of whether you have the coverage expressly written in your policy. A refusal to pay may be reasonable when backed up by supporting facts and evidence. However, BOEI policy claim denials and coverage declinations are often a rush to judgment based on limited information.
Some common reasons for a claim denial include:
- Your application contained a material misrepresentation.
- The proof of loss doesn’t meet company standards.
- Your claim might be fraudulent.
- The insurance company’s doctor doesn’t agree with your doctor.
- You failed to cooperate.
- You have an excluded pre-existing condition.
When an insurer bases a declination or denial on a faulty judgment call, they often expect you to challenge its decision. Of course, some insured individuals accept denials without asking any questions and lose out on potentially covered benefits that they need to keep their practice going.
DO YOU NEED AN ATTORNEY IF YOU HAVE A BOEI CLAIM?
When you’re disabled, you need coverage to help pay your expenses as soon as possible. BOEI attorneys do everything within their power to make that happen. They help their clients comply with critical claim submission deadlines and all other insurance company requirements. They help their clients deal with insurance investigations, independent examinations, and the claims process.
BOEI attorneys can provide important policy analysis services long before a claim arises. These attorneys review their clients’ policies to make sure they are given the coverage they want, need, and pay for. If you file a claim that your insurance company refuses to pay, a BOEI attorney understands how to fight back.
CONTACT THE BOEI LAWYERS AT GOMEZ TRIAL ATTORNEYS
If you require assistance with your BOEI policy, contact the personal injury lawyers at Gomez Trial Attorneys to protect your legal and financial interests. You have too much to lose if you accept a decision from your insurance company without having us review it—in fact, you may want us to file the initial claim for you. When you pay for an insurance premium you deserve to be paid the policy benefits when you suffer a loss.
When you consult with us, you do not have to make an immediate commitment. You simply share your information, and we will listen and provide recommendations. If we feel you have a good case, we will offer to represent you, but you have the ultimate decision.
Our Process... Easy as 1. 2. 3!
We will determine your case and submit
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