Disability insurance helps injured and impaired people stay financially afloat. Depending on the policy and coverage, a private disability plan can completely replace your normal income while you recover from a trauma. Long-term disability plans may create an ongoing source of income should you become permanently disabled. However, insurance has its limits. If you recover or are capable of some form of suitable work, you have an ethical and legal responsibility to inform your insurer and discontinue receiving disability payments.
Injuries and medical conditions sometimes prevent a person from ever returning to her former line of work. Depending on your training and education, it may be difficult to find suitable work commensurate with your abilities. However, those who have enough physical capacity and education have a responsibility to look for alternate forms of work. For example, injured police officers no longer fit for patrol duties often take desk jobs within their departments. A nurse whose medical condition makes her unable to run the hospital floor may seek comparably paying work as telephonic case manager. An injured firefighter may find he's able to start a safety consulting business that relies more on his knowledge than physical abilities.
Although traumas, surgeries and sicknesses can take their toll, in many cases, recovery is possible. Some people become used to receiving their earnings through insurance and find they don't necessarily want to return to work in a hurry. Others may find that a workplace injury or physical challenge posed by work frightens them. For example, a worker who had a heart attack at work may develop a negative association with the workplace and an aversion to returning. Nonetheless, disability insurance is there to help those in need, and continuing to claim when you no longer have a disability constitutes insurance fraud.
Failure to terminate disability benefits when you no longer qualify can bring serious consequences. If an insurer, including the federal Social Security Administration, discovers you have claimed benefits despite being capable of work, it will likely demand you repay money you shouldn't have received. Additionally, insurance fraud is both a state and federal crime. Falsely claiming Supplemental Security Income or Social Security Disability Income can result in federal criminal prosecution.
Professionals sometimes take out specialized disability policies that define disabilities as not being able to do their specific jobs. Thus, a physician with this kind of specialized policy may be eligible for disability if a disability renders her unable to work as a physician -- even if she could perform some other kind of work. Usually, such policies carry high premiums and are meant to protect those used to high incomes resulting for their narrow and highly technical training.