The Coma Clause

What it means when your insurance company asks if you cannot perform each and every job function."We Only Pay if You Cannot Perform 'Each and Every' Material Duty of Your Occupation." This clause shows up in a startling number of policies issued by Reliance, although it is used by many other companies, as well. Insurance companies love when they are able to slip this clause past purchasers because it means they can deny almost any claim submitted. Really, this clause should be dubbed “The Coma Clause.” Why? Because courts have allowed insurance companies to push the meaning of “each and every material duty” to its limits. Under this clause the only claimants who are consistently able to get benefits are those who are in a coma. 

 

Basically, this clause means that for the insurance company to pay benefits you have to be so completely disabled (i.e., in a coma) that you are disabled from performing every single duty of your job. For example, if you were a journalist and became disabled from traveling, typing, holding a pencil, sitting for an extended period of time, and even talking with people BUT you could still read, under the “each and every” clause you would NOT be eligible for benefits because you were still able to perform at least one of the substantial duties of your occupation. 

 

Under the federal law of ERISA, there is no oversight of what can be written in a disability insurance plan. Because there is no requirement that benefits be provided at all, there are no rules against providing scanty or illusory benefits. The government will not regulate employer-offered plans, which means that companies like Reliance are free to sell plans that offer no practical coverage. This is ridiculous!

 

The following is a frustratingly common example of the Coma Clause in use:

 

The claimant had been the assistant manager of computer information systems for his company before he became disabled. In the course of his daily activities, including using a computer, talking on the phone, and attending meetings, he was required to be able to sit for an extended period of time, almost always more than six hours per day. Once he was disabled, his physicians, employer, and even the insurance company agreed that his disability limited him to a maximum of three hours of sedentary work per day. 

 

It was clear to his employer, the court, and even the insurance company that he was disabled from performing his job; his limitations were far below what was required for him to work his eight-hour day, 40-hour week job. That should be it!

 

But, unfortunately, Reliance Insurance Company argued that because his disability insurance policy contains an “each and every” clause and he is still able to perform one “material duty” (in this case, the three hours of sedentary work per day), he did not meet the definition of disability set by the policy and, therefore, was not entitled to benefits. 

 

The court agreed with Reliance Insurance Company and the clearly disabled claimant—though not under the “coma clause” standard set by Reliance—received no benefits. The court explained that because of ERISA, even though “such a definition of total disability is extremely restrictive and not a disability policy that a prudent consumer would be expected to purchase, the plain language of the disability plan commands this result.”

 

The court even put the blame back on the claimant and the employer who purchased the policy, saying that while it might seem unfair that this policy paid nothing, the plaintiff had been “free to purchase on his own, a less restricted disability policy but he did not do so.” The court added that, as the purchaser of the LTD policy, if the plaintiff’s employer had wished to ensure its employees against anything but the most serious and debilitating of disabilities, the plaintiff’s employer could have elected to pay a higher premium for more inclusive coverage. The plaintiff’s employer elected not to do so and the plaintiff is bound by the terms of the policy which his employer paid for. Tippitt v. Reliance Standard Life Ins. Co., No. CIV.A.1:02-CV1140JEC, 2007 WL 4054664 (N.D. Ga. Nov. 7, 2007), aff'd, 276 F. App'x 912 (11th Cir. 2008)

Ben Glass
Ben Glass is a nationally recognized Virginia injury, medical malpractice, and long-term disability attorney