BUZ insurance does not pay: understand the causes and take action successfully
30.04.25
9
Minutes
Katrin Straub
Managing Director at nextsure
Has your occupational disability insurance refused to pay out? This is a stressful situation, but no reason to give up. This article looks at the most common reasons for claims being rejected and shows you practical steps you can take to defend yourself and get the compensation you are entitled to.
The topic in brief and concise terms
If disability insurance does not pay out, the cause is often formal errors, not reaching the 50 per cent occupational disability level, or a breach of the pre-contractual duty of disclosure.
Accurate documentation, compliance with obligations to cooperate and deadlines, and honest answers to the health questions are crucial to success.
If your application is rejected, you should appeal, and with specialist support, for example from a specialist solicitor, you can significantly improve your chances.
Understanding Refusal of Performance: The Most Common Reasons at a Glance
If occupational disability insurance refuses to pay out, the reasons often fall into three main areas. One of the most common reasons, accounting for up to forty per cent of cases, is the insured person’s failure to fulfil their duty to cooperate. This means that documents are missing or there is no response to the insurer’s enquiries. Another key point is not reaching the required degree of occupational disability, usually fifty per cent, which is cited in more than fifty per cent of rejections. Finally, a breach of the pre-contractual duty of disclosure plays a significant role and is given as the reason in around twelve per cent of rejected applications. These figures show how important careful preparation and support during the claims process are.
The path to benefits: mastering the application process and duties to cooperate
The process from submitting the application to the insurer’s decision takes an average of ninety-nine days. If all documents are complete, a decision can be made in as little as nine days. To avoid delays or rejections, your active cooperation is essential. Create a detailed weekly schedule of your activities instead of using only the insurer’s forms. Communicate with the insurer in writing only to avoid misunderstandings arising from telephone information. Release your doctors from their duty of confidentiality only to a limited extent in order to retain control over your sensitive health data. A late-reported occupational disability can also lead to problems, so please observe the deadlines.
Your obligations to cooperate include, among other things:
Complete and truthful answers to all questions in the benefits claim.
Submission of all requested medical documents and doctors’ reports.
Accurate description of your most recent professional activity, including a typical weekly routine.
Where necessary, consent to the required examinations by doctors appointed by the insurer.
Immediate notification of changes to your health condition or professional situation.
The careful fulfilment of these obligations is an important building block for a successful benefits claim.
Received a rejection: strategies and next steps for those affected
A rejection of the disability insurance application is a severe blow, but it is not the end of the road. First, you should analyse the reason for rejection carefully, which the insurer must tell you. File a written objection and set out your reasons in detail, ideally with new or additional medical evidence. Be sure to observe the deadlines stated in the rejection notice for an appeal against the insurer’s rejection. Be sure to continue paying your insurance premiums so as not to jeopardise your insurance cover. If the objection is unsuccessful, the next step is often legal action, with sixty-four per cent of such proceedings ending in a settlement.
Expert knowledge: The pre-contractual duty of disclosure and its pitfalls
A breach of the pre-contractual duty of disclosure is a common reason for rejection, accounting for around twelve per cent of cases. When assessing a benefits claim, insurers examine very carefully whether all health questions were answered correctly and completely at the time the contract was concluded, often covering the previous ten years. If they identify false statements or the failure to disclose relevant pre-existing conditions, they may withdraw from the contract (§ 19 Insurance Contract Act), terminate it, or contest it on the grounds of fraudulent misrepresentation (§ 22 Insurance Contract Act). The limitation period for contesting a contract on the grounds of fraud is ten years from conclusion of the contract. Our expert tip: Submit an anonymised pre-contract risk enquiry before applying and answer health questions absolutely honestly in order to minimise this risk. A look at the Insurance Contract Act can also provide additional clarity here.
Understanding reference clauses: Abstract and concrete reference in detail
Reference clauses can mean that the insurer does not pay out despite incapacity for work in your previous occupation. With abstract reference, the insurer checks whether you could theoretically carry out another activity that matches your training, experience and previous standard of living (income and social esteem). The insurer must describe this reference occupation in detail and explain why it is reasonable to expect you to do it. Many modern policies waive abstract reference. Concrete reference comes into play when you are already voluntarily carrying out a new activity. Here, the insurer checks whether this new activity corresponds to your previous standard of living, with income losses of up to twenty per cent often being regarded as reasonable. Make sure your policy terms contain a clear definition of standard of living to avoid later disputes. For students and trainees, the standard of living after completion of training should ideally be used as the benchmark. The difference between incapacity for work and incapacity for employment is also relevant here.
Important aspects of reference clauses are:
The comparability of the social esteem of the new activity with the old one.
The level of income that can be earned (in the case of concrete reference, often a maximum of twenty per cent less than before).
The extent to which the new activity matches your training and abilities.
The health-related reasonableness of the referenced activity.
A precise review of these points is essential in the event of a claim.
The role of expert reports and the importance of professional support
In around seven per cent of disability assessments, medical expert reports are commissioned by the insurer. It is important to know that these experts are not always neutral and that their findings should be scrutinised critically, especially in the case of mental health conditions such as occupational disability due to depression. A specialist lawyer for occupational disability can help to ensure a level playing field and represent your interests. Experience shows that many cases that end up in court are settled through compromise – in sixty-four per cent of cases. Private legal expenses insurance can cover the costs of such a dispute and is therefore a sensible addition. Support from experts significantly increases your chances of receiving benefits.
nextsure provides discreet support when reviewing your claims. Our mission is to offer you comprehensive and easy-to-understand insurance solutions as a digital insurance portal.
The best protection against a refusal to pay benefits is careful preparation when taking out disability insurance. Honest and complete answers to the health questions are essential. Use the option of an anonymous pre-assessment to clarify your chances of acceptance and any possible terms in advance, without risking an entry in the insurers’ information and alert system (HIS). Keep a detailed record of all doctor visits and diagnoses from the past five to ten years. Check the policy terms carefully, especially clauses on abstract and concrete referral as well as the definition of occupational disability. A clear understanding of when the disability insurance pays out is crucial.
Checklist for preparation:
Work through the health history of the past ten years without gaps.
Answer all health questions in the application absolutely truthfully and completely.
Submit anonymous pre-assessments to several insurers (or have them submitted).
Check the policy terms carefully (waiver of abstract referral, customer-friendly regulation of concrete referral).
Choose the appropriate sum insured and term.
Seek professional advice.
These steps help avoid later problems when it comes to claiming benefits.
More useful links
Wikipedia offers a comprehensive article on occupational disability insurance.
Laws on the Internet contains the official text of Section 172 of the Insurance Contract Act (VVG).
FAQ
My BUZ insurance isn’t paying out. What are my first steps?
Carefully analyse the rejection letter to understand the reason. Submit a written appeal within the deadline and gather all relevant documents and medical evidence. It is advisable to consult a specialist solicitor for insurance law at an early stage.
What degree of occupational disability must be present for a benefit to be paid?
As a rule, there must be an occupational disability of at least fifty per cent. This means that you can no longer carry out at least fifty per cent of your last occupation, and this condition must be expected to last for at least six months.
What do abstract and concrete reference mean?
Abstract reference means the insurer can refer you to another occupation that you could theoretically still perform, even if you do not have a job. Concrete reference refers to a new activity that you are already actually carrying out. Both forms of referral are subject to conditions such as comparability of social standing and qualifications.
How long does the insurer have to review my claim?
The average processing time from the date of application is around ninety-nine days. If all required documents are available, a decision can also be made within nine days. Your cooperation is crucial for swift processing.
Should I waive my doctors’ duty of confidentiality?
It is recommended to release doctors from their duty of confidentiality only on a limited basis. This means the insurer may obtain information from each doctor only with your explicit consent for each individual doctor. This way, you retain control over your health data.
Is legal expenses insurance useful if you have problems with occupational disability insurance?
Yes, legal expenses insurance is very useful. It can cover the costs of lawyers and court proceedings if you have a dispute with your disability insurance. This can help you enforce your rights without a significant financial risk.
