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Dentists and Disability: Financial Records Disclosure Concerns

When dentists file total disability claims, insurance companies will often ask them for a complete financial disclosure. A complete financial disclosure contains more information than even the IRS is entitled to. In the case of total disability, this request may be improper. What follows are tips on how to get through this process as painlessly as possible.
Jason Newfield, Esq.
PUBLISHED: Wednesday, March 15, 2017
Except for an IRS audit, few requests for information are as unpleasant as a letter from the disability insurance company asking for complete financial disclosure. 
 
If the disability insurance payments are based on practice income, in the case of a claim for partial disability or residual disability benefits, the request for financial disclosure does not seem out of order. How else will the disability insurance company determine the correct payment amount? But this isn’t usually the case. Where a claim is for total disability, however, it may be that the request for such financial disclosure is both onerous and improper.
 
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Most disability insurance policies sold to dental professionals contain clear language about the amount of monthly benefits to be paid, with no reference to the financial statements of the dentist personally or professionally. So why are the insurance companies asking for documentation of your income, details of your expenses, and more information than the IRS is entitled to?  
 
Financial records are requested to evaluate income, assets and earnings. Expect them to be reviewed under a high-definition microscope. And for a partial or residual disability, expect to provide monthly financial support for your claim.
 
This is an intrusive process. It is also a strategic move to reveal how hard the dentist is willing to push back. The presence of an experienced disability attorney at this stage changes the dynamic. The representatives from the insurance company are now faced with a professional who is going to challenge requests that a dentist is not legally compelled to fulfill. That doesn’t mean the onerous requests disappear, but they become part of the negotiations for getting the claim resolved.
 
If you have filed a claim and the insurance company has requested a complete set of your financial records, here are steps you can take to protect yourself:
 
Find your original disability insurance contract and read it. Locate the section that discusses financial disclosure. This is often governed under a section of the policy called Proof of Loss. If there’s language in there you don’t understand or that doesn’t make sense to you, call an experienced disability insurance law attorney. You may have to provide some records – but it is unlikely that you have to provide everything.
 
Determine what information is truly appropriate and/or necessary for the insurer to consider your claim properly.  Do not permit an insurer to brow beat or intimidate you into disclosing more information than would be appropriate.
 
You can contact the insurance company directly and ask them to provide their request in writing, and ask them to show you specifically where that language appears in your contract. Don’t expect them to be accurate or comply with this request.

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