BUZ Insurance Doesn't Pay: Understanding Causes and Taking Successful Action
30 Apr 2025
8
Minutes
Katrin Straub
CEO at nextsure
Is your disability insurance not paying out? This is a stressful situation, but not a reason to give up. This article highlights the most common reasons for benefit rejections and outlines specific steps to help you fight back and claim your rights.
The topic in brief and concise terms
If the occupational disability insurance does not pay, it is often due to formal errors, the failure to reach the disability level of fifty percent, or a breach of pre-contractual disclosure obligations.
Accurate documentation, compliance with obligations and deadlines, as well as honest answers to health questions are crucial for success.
In the event of a rejection, you should file an objection, and with professional support, such as from a specialised lawyer, you can significantly improve your chances.
Understanding Refusal of Performance: An Overview of the Most Common Reasons
When the occupational disability insurance refuses payment, the causes often fall into three main areas. One of the most common reasons, accounting for up to forty percent of cases, is the insured's failure to fulfil cooperation obligations. This means documents are missing or there is no response to inquiries from the insurer. Another key point is the failure to meet the required degree of disability, usually fifty percent, which is cited in over fifty percent of rejections. Finally, the violation of the pre-contractual duty of disclosure plays a significant role, being mentioned as the cause in around twelve percent of rejected applications. These figures highlight the importance of careful preparation and support in the claims application process.
The Path to Benefits: Mastering Application Submission and Cooperation Obligations
The process from application to the insurance decision takes an average of ninety-nine days. If all documents are complete, a decision may already be made after nine days. To avoid delays or rejections, your active participation is essential. Create a detailed weekly schedule of your activities instead of just using the insurer’s forms. Communicate with the insurer exclusively in writing to avoid misunderstandings from phone conversations. Only partially release your doctors from their confidentiality obligations to maintain control over your sensitive health data. A disability reported too late can also lead to issues, so pay attention to deadlines.
Your participation obligations include, among others:
Complete and truthful answers to all questions in the benefit application.
Submission of all requested medical records and doctors’ reports.
Accurate description of your last exercised professional activity, including a typical weekly schedule.
Possibly consenting to required assessments by doctors commissioned by the insurance company.
Immediate reporting of changes in your health condition or professional situation.
Careful fulfillment of these obligations is an important component for a successful benefit application.
Received rejection: Strategies and next steps for those affected
A rejection of the disability insurance application is a severe blow, but not the end of the road. You should first carefully analyze the reason for rejection, which the insurance company must inform you of. Submit a written appeal and detail it comprehensively, ideally with new or additional medical evidence. Be sure to observe the deadlines mentioned in the rejection notice for an appeal against the insurance rejection. Be sure to continue paying your insurance premiums to avoid jeopardizing your coverage. If the appeal is unsuccessful, the next step is often litigation, with sixty-four percent of such cases ending in a settlement.
Expert knowledge: The pitfalls of pre-contractual disclosure requirements
The violation of the pre-contractual duty of disclosure is a common reason for rejection, applying in about twelve percent of cases. Insurers scrutinize claim applications very carefully to determine whether all health questions were answered accurately and completely at the time of contract conclusion, often covering the last ten years. If they discover false information or concealment of relevant pre-existing conditions, they can withdraw from the contract (§ 19 Insurance Contract Act), terminate it, or contest it due to fraudulent misrepresentation (§ 22 Insurance Contract Act). The period for contestation due to fraud is ten years from the conclusion of the contract. Our expert tip: Make an anonymous risk inquiry before submitting an application and answer all health questions absolutely honestly to minimize this risk. A look at the Insurance Contract Act can provide additional clarity here.
Understanding Referral Clauses: Abstract and Concrete Referral in Detail
Referral clauses can result in the insurance not paying despite disability in the original profession. With the abstract referral, the insurer checks whether you could theoretically engage in another activity that corresponds to your education, experience, and previous social status (income and social appreciation). The insurer must clearly describe this referral occupation and demonstrate its reasonableness. Many modern contracts waive the abstract referral. The concrete referral comes into play when you voluntarily pursue a new occupation. Here, the insurer checks whether this new activity corresponds to your previous social status, whereby income losses of up to twenty percent are often considered reasonable. Pay attention to a clear definition of social status in your contract conditions to avoid future disputes. For students and trainees, the social status ideally should be based on the post-qualification period. The difference between occupational disability and incapacity to work is also relevant here.
Important aspects of referral clauses are:
The comparability of the social appreciation of the new activity with the old one.
The attainable income level (with concrete referral often no more than twenty percent less than before).
The alignment of the new activity with your education and skills.
The health reasonableness of the referral activity.
Careful examination of these points is essential in the event of a claim.
The role of expert reports and the importance of professional support
In approximately seven percent of the performance examinations, medical assessments are commissioned by the insurance company. It is important to know that these assessors are not always neutral and their results should be critically questioned, especially in cases of mental illnesses such as occupational disability due to depression. A specialised lawyer for occupational disability can provide "equality of arms" here and represent your interests. Experience shows that many cases that go to court are settled by a compromise—in sixty-four percent of cases. A private legal expenses insurance can cover the costs of such a dispute and is therefore a worthwhile addition. The support of experts significantly increases your chances of benefits.
nextsure supports you discreetly in reviewing your claims. Our mission is to offer you comprehensive and understandable protection solutions as a digital insurance portal.
Prevention and proper preparation: How to minimize risks
The best protection against benefit refusal is careful preparation when taking out occupational disability insurance. An honest and complete response to health questions is crucial. Take advantage of the opportunity for an anonymous risk assessment to clarify your acceptance chances and possible conditions in advance, without risking an entry in the insurance industry's information and hint system (HIS). Document all doctor visits and diagnoses from the last five to ten years precisely. Check the insurance conditions carefully, especially clauses on abstraction and concrete referral as well as the definition of occupational disability. Knowing exactly when the disability insurance pays out is essential.
Preparation checklist:
Thoroughly compile health history for the last ten years.
Answer all health questions in the application absolutely truthfully and completely.
Have anonymous risk assessments conducted at several companies.
Review insurance terms carefully (waiver of abstract referral, customer-friendly regulation of concrete referral).
Choose an appropriate insurance amount and term.
Seek professional advice.
These steps help avoid future issues when claiming benefits.
More useful links
Wikipedia offers an extensive article on occupational disability insurance.
Laws in the Internet contains the official text of Section 172 of the Insurance Contract Act (VVG).
FAQ
My disability insurance BUZ is not paying out, what are my first steps?
Carefully analyse the rejection letter to understand the reason. Submit a written objection within the deadline and gather all relevant documents and medical evidence. It is advisable to consult a specialist lawyer for insurance law at an early stage.
What degree of occupational disability must be present for a benefit?
Typically, there must be at least a fifty percent incapacity to work. This means you are unable to perform at least fifty percent of your last occupation, and this condition is expected to last for at least six months.
What does abstract and concrete referencing mean?
Abstract referral means the insurer can refer you to another profession that you could theoretically still perform, even if you don't have a job. Concrete referral refers to a new activity that you are already actually engaged in. Both referrals are subject to conditions such as comparability of social status and qualification.
How long does the insurance company have to review my claim?
The average processing time from application submission is about ninety-nine days. If all necessary documents are available, a decision can also be made within nine days. Your cooperation is crucial for a swift processing.
Should I release my doctors from their duty of confidentiality?
It is recommended to release doctors from their duty of confidentiality only to a limited extent. This means the insurer can only obtain information with your explicit consent for each individual doctor. This way, you retain control over your health data.
Is legal protection insurance advisable for issues with the disability insurance?
Yes, legal protection insurance is very sensible. It can cover the costs for lawyers and court proceedings if you have a dispute with your disability insurance. This can help you enforce your rights without the risk of high costs.
