Under California law, a disabled dentist’s return to work does not necessarily preclude recovery on his disability insurance benefits.  This was held in Zambito v. Northwestern Mut. Life Ins. Co.

In Zambito, a dentist suffering from mental illness filed suit against his disability insurance company, Northwestern Mutual, after it denied his claim for disability benefits.  The disabled dentist first started showing symptoms of bipolar disorder in 1989, which gradually began to interfere with his ability to practice dentistry.  Despite his deteriorating mental condition, the dentist continued working until 1991 when his doctor finally convinced him to stop practicing.  The disabled dentist then filed for disability benefits with Northwestern Mutual, asserting that in 1989 he became totally disabled, as defined by the California law.  Despite the evidence the disabled dentist presented, which demonstrated that the mental disorder substantially interfered with his ability to practice competently and effectively from 1989 onward, Northwestern Mutual denied the dentist’s disability claim.  The dentist sued to recover benefits.

The California district court below held that, because the dentist continued working and earned money after his alleged disability, he could not be “disabled” as defined by Northwestern Mutual’s disability insurance policy.  Therefore, it concluded that Northwestern Mutual did not wrongfully withhold disability benefits.

The decision was overruled on appeal, however.  The Ninth Circuit held that a disabled dentist is not automatically barred from recovery on his disability insurance plan in California simply because he returned to work despite his disability.  According to the court, the disabled dentist presented sufficient evidence of mental illness symptoms, starting in 1989, for the issue of total disability to go to a jury.  Therefore, because there was a genuine issue of material fact regarding whether or not the dentist could practice dentistry in the customary way because of his mental illness, the case was remanded for trial.

Disability insurance companies, like Northwestern Mutual, sometimes attempt to deny disability benefits by ascribing an inappropriate definition of total disability to your policy.  They do so despite state prohibitions. Here, for example, Northwestern Mutual tried to say that the dentist was not totally disabled because he continued working after he became ill.  But as the case demonstrates, total disability “does not signify an absolute state of helplessness but means such a disability as renders the insured unable to perform the substantial and material acts necessary to the . . . occupation in the usual or customary way.”  Erreca v. Western States Life Ins. Co., 121 P.2d 689, 695 (1942).  Therefore, contrary to Northwestern Mutual’s assertions, it is quite possible for someone with a deteriorating condition to continue working albeit errantly and less effectively after becoming totally disabled under California Law.

Even so, some courts still struggle to get the law right in disability insurance litigation.  For this reason it is important to have an experienced disability insurance lawyer who knows the law and who can ensure the courts apply it correctly to your claim.