Disability Insurance Archives - Page 34 of 44

Components of an Individual Long-Term Disability Insurance Claim

When you purchase an own occupation individual disability insurance policy, the insurer promises to pay for total disability or residual disability in the event you are unable to perform the substantial and material duties of your occupation due to an injury or sickness. However, recovering under your disability policy may entail a multistep process as summarized below.

Step 1: Supporting Your Long-Term Disability Insurance Claim

Gather and request all relevant medical and occupational information. Your employer may need to provide information regarding your occupational duties and salary information. Health care providers may take anywhere from a few days to a few weeks to transmit your medical records. In the meantime, speak with your physicians/therapists about certifying your disability status in a letter to the insurer or by completion of an Attending Physician Form. Make sure your physicians/therapists understand your specific occupational duties (e.g., sitting or walking for prolonged periods, using a keyboard or specific tools, lifting requirements), so they have a clear picture of how your medical condition prevents you from performing these duties. A certification letter offers strong support for your disability, describing your medical condition and the objective and/or subjective proof of your medical condition, describing your occupational duties, and describing why your medical conditions render you unable to perform the substantial and material acts necessary to the performance of your occupation in the usual or customary way and with reasonable continuity.

Step 2: Filing Your Long-Term Disability Insurance Claim

Once you have obtained the necessary medical and occupational information necessary to support your disability claim, you must file a claim for disability benefits with your disability insurance carrier. If you do not have your disability policy handy, request a copy of from your insurer. The policy contains a description of your benefits and your insurer’s definition of “disability.” Review the insurer’s definition of “disability” and compare it with the California definition. Under California law, “total disability” means that the insured is unable to perform the substantial and material acts necessary to the prosecution of your occupation in the usual or customary way and with reasonable continuity. You need only satisfy the easier of the two standards to qualify for disability benefits under your individual policy. If you believe that you qualify, request and complete the required claim forms and submit them to the insurer. Many carriers now have the forms available online. Keep copies of all the documents you submit and all communications you have with the insurer.

Step 3: Monitoring Your Long-Term Disability Insurance Claim Status

The insurer must approve or deny your claim within 30 days following receipt of all necessary information. Note the insurer may request a 30-day extension by notifying you in writing within 30 days after your claim is filed. Similarly, if the insurer requests additional medical information, they may need to have another 30 days following receipt of the requested information to issue a decision on your claim. Therefore, the faster insurers receive your medical documents and support for your disability, the sooner they will render a decision on your disability insurance claim. Make a note on your calendar of the last correspondence you had with the disability insurance insurer, and call the insurer to check the claim status if you do not receive any updates within 30 days.

Step 4: Handling a Long-Term Disability Insurance Claim Denial

If your claim is denied, review the denial letter and note the reasons provided. Common reasons for denials include a lack of supporting medical documentation, the insurer’s determination that a medical condition is not severe enough to be disabling and/or that there is no objective evidence to support your disability. If you have additional supporting documentation, you may contact the insurer to submit additional information for an appeal, or another review of your claim. However, if your documentation supports your disability, and you suspect your insurer improperly denied your claim, consult with an experienced insurance coverage attorney such as the McKennon Law Group PC to determine whether you have a good case that the law firm will take on a contingency fee basis. If your insurer breached your disability insurance contract and/or acted in bad faith, an experienced attorney can help you recover not only the policy benefits, but also emotional distress damages, consequential damages, attorneys’ fees, pre-judgment interest and punitive damages.

McKennon Law Group PC is extremely well suited to litigate your ERISA and bad faith disability, health or life insurance claims. We are nationally recognized experts in insurance bad faith law and ERISA insurance claims, appeals and litigation. With offices in Los Angeles, Orange County, San Francisco, and San Diego, contact us today to learn how our attorneys can help you with your ERISA and bad faith insurance claims.

For additional information, please see our Disability Insurance FAQs and Insurance Bad Faith FAQs.

LINA Ordered to Pay the McKennon Law Group Attorneys’ Fees and Costs

On May 13, 2014, a respected Central District of California Federal Court Judge, Margaret M. Morrow, issued an Order granting Plaintiff’s Motion for Attorneys’ Fees and Costs. In the Order, Life Insurance Company of North America (“LINA”) was ordered to pay the McKennon Law Group PC approximately $50,000 in attorneys’ fees and costs following the successful resolution of a dispute over long-term disability insurance benefits due pursuant to an ERISA-governed group policy. LINA reinstated the plaintiff’s claim for long-term disability benefits shortly after the McKennon Law Group PC filed the Complaint. In the Order, Judge Morrow approved Robert McKennon’s hourly rate based upon Mr. McKennon’s experience and skill, which appears to be the highest hourly rate ever allowed for an attorney in an ERISA case filed in Southern California.

A Pro-Insurer Decision Provides Guidance for Insureds on the Application of Estoppel and Waiver to Statute of Limitations Defenses in Disability Insurance ERISA Cases

At times, decisions that appear favorable to insurers can also have unexpectedly positive take-aways for policy holders. Gordon v. Deloitte & Touche, __ F.3d ___, 2014 U.S. App. LEXIS 6688 (9th Cir. April 11, 2014) is just such a case. Although, the Ninth Circuit in Gordon ruled in favor of the insurer in finding that the insured’s ERISA action was barred by the California four-year statute of limitations, the Court also reaffirmed and clarified the standards for evoking waiver and estoppel arguments to prevent insurance companies from raising a statute of limitations or contractual limitations defense.

The plaintiff in Gordon was an insured under a long-term disability plan (the “Plan”) governed by ERISA. The plan was insured and administered by MetLife. The insured sought disability benefits under the Plan due to depression. After initially paying benefits to the insured, MetLife terminated benefits. The insured subsequently filed two appeals. In 2004, MetLife denied the insured’s second appeal, but indicated in the denial letter that she had 180 days to appeal the decision. The insured did not file an appeal and took no action for more than four years. Then, in 2009, after receiving a request from the California Department of Insurance to reevaluate the claim, MetLife reopened her claim. However, MetLife upheld its original decision to terminate benefits. MetLife’s denial letter advised the insured that she had 180 days to appeal and, that if the appeal was denied, she would have the right to bring a civil action under ERISA section 502(a).

In January 2011, the insured filed a complaint in federal district court. The district court granted the Plan’s motion for summary judgment, finding that the insured’s action was barred by the applicable four-year statute of limitation and the Plan’s three-year contractual limitation. The insured appealed arguing that MetLife’s limitation defense does not bar her action because: (1) reopening the claim file reset the statute of limitation; (2) the insurer waived its limitation defense; and (3) the insurer was estopped from asserting a limitation defense. All three arguments were ultimately rejected by the Ninth Circuit who affirmed the district court’s decision. However, in reaching this decision, the Court provided valuable edification of the limits placed on the use of time bars as a defense to claim brought under ERISA. As an initial matter, given the nearly seven years that had passed between the filing of the complaint and when the 180 day period to file an appeal expired, the court found that the statute of limitations had clearly ran and did not consider whether the three-year contractual limitation period applied.

The Court then addressed the insured’s argument that reconsideration of her claim in 2009 revived the statute of limitations pursuant to California law regarding creation of a new cause of action resulting from acknowledgment of debt. However, the Court reiterated that federal law governs determination of the accrual of an ERISA action and the Court found that reopening the claim file by itself is not sufficient to revive the statute of limitations. Next, the Court considered the insured’s estoppel argument. Significantly, the Court definitively acknowledged that, as a general rule, an insurance carrier will be estopped from relying on a statute of limitations defense when its own prior representations or conduct have caused the plaintiff to run afoul of the statute and equity justifies holding the defendant responsible for the outcome. However, the Court found that in this particular case, the statute of limitations had already run when MetLife informed the insured in its 2009 denial letter that she could bring an ERISA action.

Finally, the Ninth Circuit addressed for the first time in this case, whether a waiver argument can be used by insureds to prevent insurers from raising a limitation defense in ERISA cases. Turning to California law for guidance, the Court concluded that, based on a review of California decisions, an insurance company cannot waive the statute of limitations after it has run. Nevertheless, adopting the position taken by the Seventh Circuit, the Court found that even if waiver or estoppel were available in this case, the insured would have to show either detrimental reliance or some misconduct by the insured. Here, the Court held the insured had simply not shown any detrimental reliance or unfair conduct by MetLife. However, it is important to note that the Court in Gordon did not address the United States Supreme Court’s recent decision in Heimeshoff. In that decision, which was discussed in our prior blog article, the Supreme Court explicitly reserved for their use traditional equitable remedies including equitable tolling, waiver and estoppel. Given, the Supreme Court’s clear position on this issue, the Ninth Circuit will likely be more inclined to allow waiver arguments to be used to prevent insurers from raising a limitation defense in the future.

The Gordon decision highlights many of the potential pitfalls for insureds in dealing with navigating often complex rules regarding statute of limitations and contractual limitations. More importantly, it reaffirmed that estoppel can still prevent insurers from raising a limitations defense. The decision leaves open whether waiver may be used as well to prevent insurance companies from using contractual limitation periods as a defense if the insured can show detrimental reliance or self-serving misconduct by the insurer. However, given the Supreme Court’s affirmation of the applicability of traditional equitable remedies in ERISA cases in Heimeshoff v. Hartford Life & Accident Insurance Co. and Wal-mart Stores, Inc., 134 S. Ct. 604 (Dec. 16, 2013) courts in the Ninth Circuit will likely allow insureds to use waiver and estoppel to overcome statute of limitation defenses in certain limited situations. The Gordon decision should serve as a reminder to insureds to act immediately if their claims are denied and to contact an attorney to ensure that they do not forfeit their right to file a lawsuit. This is especially true in dealing with disability LTD insurance, health insurance and life insurance matters.

Leaders in Long-Term Disability Insurance, Life Insurance and ERISA Insurance Litigation

We founded McKennon Law Group PC for one purpose: to provide our clients effective representation targeted to get the best results possible. With single-minded focus, we aim to achieve our client’s objectives in an aggressive, yet professional manner.

We have arbitrated, tried, appealed, and resolved hundreds of insurance disputes, including but not limited to the following: long-term disability insurance, property/casualty, commercial general liability insurance, lifeinsurance, health insurance, professional liability, officers and directors liability insurance, employment practices liability insurance, homeowners and business owners property and liability insurance. We have litigated disputes involving but not limited to: insurance and real estate agent/broker liability and other consumer and general business matters. We have recovered millions of dollars in both judgments and settlements for our clients.

When you need an attorney, choosing the right law firm is the most important decision you will make. We are counted among California’s leading long-termdisability insurance, life insurance,insurance coverage,ERISA, business, and consumer attorneys. Our attorneys are nationally recognized in long-termdisability insurance, life insuranceand health insurance and ERISA/Employee benefit insurancelitigation, and are frequent authors and speakers at national and local conferences on these topics.

Los Angeles/Orange County Disability Insurance Claims

Every year, thousands of people suffering from severe sickness or injuries have to file claims with their disability insurance company. Disability insurance policies are often complicated and difficult to interpret correctly, which can cause problems for those looking to follow the rules and regulations that are set on both the insured and the insurance company. Especially because disability insurance is intended as a form of income replacement, it is important to file these claims correctly to ensure you receive payment.

There are a few different kinds of disability insurance, each with it’s own set of difficult regulations. Long-term and short-term disability insurance policies are purchased either directly from an insurance company or through an employer, and includes disability insurance related to business overhead, credit cards, mortgages, and occupations. Insurance policies bought individually usually must adhere to state laws, while policies attained through an employer are regulated by ERISA.

However, occasionally even if a claim is filed correctly, an insurance company may deny a legitimate disability claim. Most often, these denials are unlawful and you can sue your insurance company for the benefits due to you. If you purchased your policy individually, you can potentially sue for damages caused by the company’s bad faith, includingemotional distress, attorneys’ fees, and interest on overdue benefits, as well as for the policy benefits originally owed. Similarly, if you received your policy through an employer, you can sue for attorneys’ fees, interest on unpaid benefits, and the owed policy benefits.

While taking action against an insurance company can seem overwhelming, doing so will insure that you and your family receive the necessary support. The attorneys at McKennon Law Group PC specialize in handling individual and ERISA disability insurance and bad faith insurance disputes, and we’ve successfully litigated hundreds of disability insurance cases over the past 28 years. Contact us today to learn how our Los Angeles and Orange County attorneys can help you with your disability insurance case.

ERISA Administrator Must Show That a Theoretical Job Actually Exists in Order to Serve as Justification for Claim Denial

A common justification for denying a claim for long-term disability insurance benefits or short-term disability insurance benefits is that the claimant is capable of returning to work in another job. However, insurers / ERISA administrators are not allowed to deny a claim just because an insured might be capable of returning to any job, rather the identified job must be based on the insured’s education, training and experience. Further, the occupation must be “gainful,” which usually means that it pays the insured at least 50%-60% of his or her pre-disability income. In Kennard v. Means Industries, Inc., 2014 U.S. App. LEXIS 2846 (6th Cir. Feb. 13, 2014), the Sixth Circuit imposed another important requirement — the insurer must prove that the theoretical job actually exists.

During an accident, Kyle Kennard inhaled fumes from a chemical spill, which severely injured his lungs and rendered him ultra-sensitive to noxious fumes. Following the accident, Kennard’s treating physician found that for the rest of his life, Kennard would be limited to working in a “clean-air environment.” Kennard was awarded disability benefits by the Social Security Administration, and then applied for disability insurance benefits under his employer’s ERISA-governed employee welfare benefit plan.

Pursuant to the terms of the Plan, Kennard was required to submit to an examination by a physician chosen by the Claim Administrator. Following an examination, the physician found that Kennard was employable “as long as he could be guaranteed that he would be placed in an absolute clean air environment with absolutely no noxious fumes or inhalants, as he is extremely sensitive to this.” Given this finding, the ERISA administrator denied Kennard’s claim for disability insurance benefits on the grounds that he was capable of sedentary work in a clean-air environment. The district court ruled that this decision was not arbitrary and capricious, but the Sixth Circuit reversed that ruling.

In finding that the denial of Kennard’s claim for long-term disability insurance benefits was improper, the court noted that “a valid denial of benefits premised on Dr. Levinson’s opinion would need to include evidence of the existence of absolute-clean-air jobs available to Kennard,” and noted that the SSA found that there are no jobs in the national economy that Kennard could perform. To support the denial decision, the administrator was required to identify a job he could perform “in terms of a real American workplace,” and present evidence of jobs available to the claimant. Because the ERISA administrator offered no evidence of the existence of the job used as the basis for the denial, the court found that the denial decision was improper.

In other words, if an insurer denies a claim for benefits after finding that the claimant can perform a particular job, there must be evidence that the job exists. It is improper to deny a claim based on a job that only hypothetically exists.

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