It is unfortunately common for those who have taken out disability insurance policies in good faith to find that their benefits are denied when it comes time to file a claim. Whether a person purchased an insurance policy through their employer or through a separate insurance agent, the process of obtaining benefits does not always go as smoothly as one may hope.
This is especially true when it comes to long-term disability insurance (LTD) obtained through an employer. This type of insurance is regulated differently from other types of insurance. They are usually treated as employee benefits and are subject to the provisions of the federal Employee Retirement Income Security Act of 1974 (ERISA).
ERISA has proven to be an important and controversial law when it comes to the subject of protecting employee benefits. Although the law was originally passed for protecting employees’ rights to collect certain benefits, such as pensions, long-term disability and health insurance, the effectiveness of the law has been diluted by the courts over time. As an ERISA disability claims attorney can tell you, it is now far more favorable to employers and insurance companies than employees. There are many cases where an employer uses this favorability to their advantage to deny an employee benefits to which they should be entitled.
If you get sick or injured and have to take time off work, your LTD insurance is probably the last thing you want to worry about or pay attention to. This sometimes makes it possible for ERISA administrators and insurance companies to deny claims without the claimant understanding the full extent of their benefits under the policy.
Because the rules are so complex and most claimants are not represented by an ERISA disability claims attorney, the insurer can often count on the claimant not understanding the requirements and benefits of the policy. For example, disabled claimants usually only have one chance to appeal an unfavorable decision in an ERISA LTD case. If the appeal is denied and the claimant wishes to have a court review the denial, the only evidence that may be reviewed is what was submitted to the insurance company for the appeal. In other words, what you submit at that stage is your one shot. A claimant who does not understand this particular nuance of the law may be at a severe disadvantage when they are preparing their appeal, while a claimant represented by an attorney who specialized in ERISA would be well equipped to file a comprehensive appeal.
Those who have become disabled or severely injured may need to rely on long-term disability benefits to help them through their recovery and subsequent periods without being able to work. If you have been denied ERISA benefits, you may want to discuss your case with a law firm familiar with ERISA law who knows your rights.