A denial of disability insurance benefits too often comes as a surprise to individuals who file legitimate claims and are genuinely unable to competently perform their job duties with reasonable continuity. Making the decision to apply for disability insurance benefits is difficult; but when one determines that it is necessary, most individuals who have paid for these policies or are covered by a group policy expect the insurance company to fairly and objectively review their claim and pay the disability benefits to which they are entitled under the policy terms. Unfortunately insurance companies are not always inclined to timely review claims and pay the benefits owed under the policy. This is true for individual disability insurance policies (those taken out and paid for directly by the insured) and group policies (those procured by an employer as a benefit of employment or through a professional group/association). The focus of this blog is appealing the denial of group policies that fall under the Employee Retirement Income Security Act of 1974 (ERISA). It should be noted that filing a detailed and thorough appeal where a denial has been issued under an individual or group policy is extremely important; however under ERISA claims an appeal is required before a lawsuit can be filed and litigation is primarily limited to the information in the claim file at the time of the final denial.
While not all group policies fall under the ERISA statute, for example government employer sponsored benefit plans are normally exempt, many do. Somewhere towards the end of the denial letter in an ERISA claim there is (or should be) language advising that the claim is an ERISA claim and that the insured has 180 days to file an appeal. What is usually not stated in that language is that the insured’s failure to timely file an appeal may prevent the insured from pursuing further action or filing a lawsuit. Thus, it is extremely important that if your ERISA claim has been denied that you understand your policy terms, your rights under the policy, the applicable law, and that you file an appeal that contains all information you would want a court to review should the case need to be litigated. What is also left out of most ERISA denial letters is the fact that your appeal and the documents submitted with that appeal may be the only information you can submit in response to that appeal. If the disability insurance policy allows for only one appeal (and many do not provide for a second voluntary appeal), then the insured needs to include every piece of information, document, and evidence to be considered should the case need to proceed to trial. In order for court to overturn a denial of benefits the insured must prove that, not only was the insurance company’s denial of benefits wrong, but that it was “arbitrary and capricious”. This is a very high standard and insurance companies have become savvy about including information that would suggest their decision, even if incorrect, was not arbitrary and capricious.
Understanding the reasons for the denial and reviewing all documents in the claim file is an important first step in preparing an appeal. Under ERISA, claimants have a right to receive and review all documents in their claim file and upon which the denial of benefits was based. The appeal should address each reason for the denial and include evidence to counter the insurance company’s assertions, medical reviews, vocational reviews, and “expert” opinions. As indicated above, if the insurance company issues a final denial after the appeal has been timely submitted, then the insured can file a lawsuit. However, in most cases additional information proving disability cannot be added to the claim file or submitted to the court while the case is being litigated.
At Disability Insurance Law Group, we have years of experience successfully filing applications for disability benefits, appealing denied claims, litigating disability insurance claims, and getting wrongful benefit determinations overturned. If you are in the process of filing a claim for benefits, your claim has been denied and you plan to file an appeal, or have received a final denial and have questions about your rights and options, please contact our attorneys for a free consultation. We can be reached toll free at ((866) 363-3628 or via our website at www.DiLawgroup.com