Why the insurer cannot refer to just any profession, when another activity is truly comparable, and how you can defend your most recently practiced profession.
Can my disability insurance really refer me to another job? Not just any job: Referral is only permissible if your contract allows it and the other job is truly comparable in terms of training, experience, income, and social standing. Rogert & Ulbrich review the referral clause and defend your most recently held occupation.
What referral means in disability insurance
Referral means that the insurer acknowledges you can no longer perform your previous job, but considers you capable of performing another occupation. Based on this argument, they refuse or terminate your disability pension. Referral is therefore one of the insurer's most effective tools, precisely because the disability itself is often not disputed.
There are two forms of reference. In the case of abstract reference, the insurer is satisfied with a theoretically viable comparable occupation. In the case of concrete reference, they refer to an activity that you have actually taken up. Both forms are subject to strict requirements.
From a client's perspective, the crucial question is: Can my disability insurance really require me to take on a different job? The answer is clear: not just any job. The insurer cannot arbitrarily assign you to another occupation simply because you might theoretically be capable of performing it.
Two conditions must be met. First, your contract must actually permit a referral; what matters is not what the insurer claims, but what is stated in your insurance terms and conditions. Second, the alternative occupation must be genuinely comparable to your previous one in terms of education, experience, income, and social standing.
Is your insurer trying to refer you to another profession? First, check what kind of referral your contract actually allows.
Which pre-existing conditions must actually be reported – and which do not.
In the case of an abstract reference, the insurer considers you capable of performing another, comparable activity, without you actually having to perform it. A theoretical reference to another job profile that corresponds to your knowledge and skills is sufficient.
This form of reference is particularly disadvantageous for policyholders because it hinges on a mere possibility. Many current disability insurance policies therefore explicitly waive the abstract reference clause. Its practical significance today lies primarily in older contracts and in review procedures. Whether it is included in your contract can only be determined by examining the policy terms and conditions.
From his previous work on the insurance side, lawyer Dario Kovac knows how insurers construct a suitable comparable occupation. Often, a profession is chosen that appears comparable on paper, but does not reflect the actual standard of living.
Is the insurer invoking an abstract reference clause? Check whether your policy even contains this clause.
Specific reference: if you are actually taking up a new profession
In the case of a concrete reference, the insurer links the claim to an activity you have actually taken up, for example, after retraining or because you have returned to work due to financial hardship. This is also possible in policies that do not include the abstract reference clause.
But here, too, a clear limit applies: The new job must be commensurate with your previous standard of living. The decisive factor is not merely the job title, but the specific nature of the new job, i.e., tasks, requirements, working hours, and salary. You are permitted to take on a significantly lower-paid or socially lower-valued job without losing your entitlement. Accepting a less prestigious job due to financial hardship does not automatically mean giving up your disability pension.
The insurer bears the burden of proof to demonstrate that the new job is comparable. The mere fact that you are working again is not sufficient.
Are you working again despite being unable to work? Have your new job assessed to ensure it's appropriate for your social standing before your insurer cuts off your pension.
When another activity is truly comparable
Whether abstract or concrete: A referral is only permissible if the comparable occupation corresponds to your previous standard of living. The insurer may therefore not refer you to just any job, but only to one that is truly comparable according to several criteria:
- Education and qualificationsThe comparable occupation must not require skills you do not possess and must not be significantly below your level of education.
- Professional experienceWhat matters is your existing knowledge and actual professional experience, not a profession you are yet to learn.
- incomeThe comparable job must provide an income that is noticeably not lower than your current one. You do not have to accept a significant loss of income.
- Social positionThe prestige and appreciation of the work also play a role. A transfer from a qualified position to a significantly lower-valued one regularly fails.
In addition, the specific nature of the new job is crucial. It's not enough for a job to simply look like a good fit on paper; what matters is what it actually entails – the tasks, responsibilities, and working hours. The benchmark is always your specific previous job, not an abstract job description. Insurers often exploit this by presenting a simplified version of your most recent job to make the comparison seem more appropriate. Therefore, a precise description of your previous daily work routine is the most important element of your defense.
Is the offered comparable job lower-paid or less qualified? You don't have to accept such a referral – have it reviewed.
Reference in the review procedure
Referral to other occupations is particularly common in review proceedings. Once the insurer has acknowledged and paid out occupational disability benefits, it later checks whether the conditions for continued coverage still exist. Strict rules apply if the insurer intends to discontinue benefits (§ 174 VVG).
The insurer may only discontinue payments if your health has demonstrably improved or you have taken up a new, comparable occupation. The burden of proof for this change rests solely with the insurer. Furthermore, a discontinuation of benefits only becomes effective upon formal, verifiable notification and with a specified deadline. A mere assertion that you are able to work again is insufficient.
For self-employed individuals, another point of contention arises: The insurer often argues that the business can be reasonably reorganized, thus negating any occupational disability. However, such a reorganization must be economically viable and actually feasible, not merely theoretically conceivable.
Is your insurer planning to stop your current pension payments? Demand a specific explanation – the burden of proof for any change lies with them.
How to defend your most recent occupation
In disputes over referrals, the job description is decisive. These steps will help you secure your position:
- Document the activity preciselyDescribe your previous daily work routine in detail, including tasks, responsibilities, physical and mental demands, and time commitments.
- Check conditionsDetermine whether your policy allows or waives the abstract reference.
- Question the comparable occupationCheck whether the offered job truly corresponds to your social standing in terms of income and appreciation.
- Demanding proofIn the review process, the insurer must prove a change. Demand a specific, comprehensible explanation.
- Don't confirm anything too hastily.Do not make any statement regarding a new activity until its impact on your entitlement has been clarified.
Do not confirm any referral before you know whether it is even permissible.
This article is part of our overview of the five most common reasons for rejection in disability insurance. We will discuss in more detail how insurers handle the duty of disclosure and the claims process in separate articles. You can find an overview of our work on our insurance law page.
The sooner the referral clause is reviewed, the better your case can be defended. Have your case assessed while the deadlines are still open.
Rogert & Ulbrich – Your lawyers in insurance law
Rogert & Ulbrich represent policyholders nationwide in disputes concerning referrals in disability insurance. Attorney Dario Kovac, who is familiar with insurers' review and referral strategies from his previous work on the insurers' side, serves as the contact person for insurance law. We combine this insider knowledge with the firm's consumer protection experience from major cases in banking, capital markets, and automotive law. This allows us to engage with insurers on equal footing.
We review your insurance policy terms and the referral clause, assess the offered alternative occupation in light of your current circumstances, and verify through a review process whether the insurer has actually demonstrated the necessary change in your circumstances. We pursue your claims against the insurer out of court. If they maintain their referral, we will represent you in court. We involve any existing legal expenses insurance early on and obtain coverage approval for you.
Is your disability insurance company trying to force you to take up a different profession or stop your current pension payments? Get in touch and protect your rights.
