Understand The Difference Between A Factual Disability And A Legal Disability

Posted on: 16 December 2015

If you're a doctor, teacher, pharmacist, or other professional who requires a license in order to do your job, are you able to claim disability insurance benefits if your license to practice is suspended or revoked? In some cases, yes. However, you'll probably have to prove that you have a factual disability, not just a legal one. Here's what you should know.

Understand the difference between a factual disability and a legal disability

A factual disability occurs when an individual has a mental or medical condition that physically prevents him or her from working, regardless of whether or not his or her professional license is in good standing. A legal disability, however, exists when someone has the physical capability to do the job but is legally prevented from doing so because his or her professional license has been suspended or revoked.

For example, imagine that a doctor begins to show signs of a severe bipolar disorder, complete with irrational mood swings and hallucinations. Medications help control the bipolar disorder, but they bring a number of new problems: memory loss, fatigue, and problems concentrating. The doctor has to quit working and go on long-term disability through his or her insurance. The doctor is factually disabled and unable to work.

A year later, the state's medical board reviews the situation and decides to indefinitely suspend the doctor's license to practice. At that point, even if the doctor gets the bipolar disorder under control and resolves any medications problems, he or she is still has a legal disability for however long his or her license remains suspended.

Causation is very important when it comes to a successful claim for disability insurance.

Predictably, it isn't usually as clear in real life when trying to determine if someone actually has a factual disability or merely a legal one. People frequently file their disability claims after they lose their licenses, instead of before. In those situations, causation has to be examined very carefully (and sometimes fought about in court) in order to decide whether or not there's any entitlement to benefits.

For example, suppose a doctor's bipolar disorder, complete with mood swings, impulsivity, and feelings of grandiosity, is undiagnosed for years. He or she eventually makes sexual advances on a patient. The patient reports the encounter and the doctor's license to practice is suspended. The doctor is forced to quit working and obliged to undergo counseling, during which time his or her bipolar disorder is discovered. 

The insurance company may very well declare the doctor's disability to be only legal -- the loss of his or her license to practice. The insurance company could say that the doctor was, obviously, physically able to work in spite of the bipolar disorder. The doctor, however, could contend that his or her behavior with the patient only happened because of the bipolar disorder, making it the result of a factual disorder.

A case like that would likely end up in court before it's resolved. Whenever you receive a denial of your disability insurance claim based on the idea that you only have a legal disability, not a factual one, consult with an attorney. He or she will help examine the situation and try to determine if there's a good chance to prove that your legal disability wouldn't have occurred without the underlying factual disability. Click here for more information on disability claims.