Yes. It's legal for an insurance company to perform surveillance. The insurance company in your case is likely trying to see if your restrictions are less than what you and your doctor say. Avoid doing any strenuous activity outside. The insurer will try to make it look like there's nothing wrong with you. While you may be able to bend over and pick something up once, this doesn't mean that you can do it all day. They may make a videotape that may be very misleading. Be smart and protect your rights in your case.