ERISA Archives - Page 8 of 50 - McKennon Law Group

How Do ERISA Lawsuits Work?

If you have employee benefits sponsored by your employer and are insured under a group
insurance plan, you are entitled to certain benefits. Many of these benefits, such as pensions,
healthcare, accidental death and dismemberment benefits or disability benefits, are protected by
federal law through ERISA. However, employers or insurance companies will often attempt to
deny your right to benefits. When this happens, ERISA litigation is a means of recovering the
benefits to which you are entitled.

ERISA lawsuits are most often the result of insurance companies, also known in ERISA as
“claim fiduciaries,” denying life, health, accidental death or disability benefits. If you have
submitted a claim under your group insurance policy and your insurer has denied it, your next
step is to contact an ERISA litigation attorney and, possibly, file suit to recover your benefits.
ERISA claims can often be resolved with the threat of litigation without ever going to court.

Litigation is time-consuming and expensive, so it is in everyone’s best interest to resolve an
issue before a lawsuit is filed. However, there are times when employers or insurance
companies dig in their heels and force you to take them to court to access the benefits you need
and deserve.

Who Can File An ERISA Lawsuit?

There are only four groups of people who can sue under ERISA: insurance plan participants,
plan beneficiaries, plan fiduciaries, and the Secretary of Labor. Most often, suits are brought by
employees or former employees against their insurance company and/or employer.

If you belong to a group that can sue under ERISA, you will have to know when and how to file
your lawsuit. Beyond the other resources available to you, it is best to consult a proven advocate for disability insurance claims in San Diego and keep in communication with your lawyer while you consider a lawsuit.

Is There A Time Limit To File An ERISA Lawsuit?

There is no specific statute of limitations for most ERISA claims involving recovery of unpaid
benefits, so the courts have determined that the applicable statute of limitations is taken from a
state’s statute of limitations for breach of contract. However, there is another deadline that is
equally important, if not more so: the contractual limitations period determined by each
insurance policy, which may be shorter than the applicable state statute of limitations. You
should carefully read through your plan’s deadlines for filing ERISA claims, appeals, or litigation.

It is vital to take timely action, because if you miss the policy’s deadline to file, there is likely
nothing else you can do. It is critical to consult with an ERISA litigation lawyer who knows how
to interpret these provisions, as they are very complicated and can be easily missed.

If you previously filed an ERISA claim that was denied, there is a mandatory administrative
review process you must go through before filing a lawsuit. Once your claim is denied, you
should consult with your attorney as soon as possible to understand your new timeline for filing
a lawsuit.

How Do I File An ERISA Lawsuit?

Once you have exhausted any available administrative remedies and the insurance company
still refuses to pay your benefits, you can file a lawsuit under ERISA.

The first step to start the ERISA litigation process is having your lawyer file a summons and
complaint in a federal court, which then triggers a time within which the insurance company or
employer is to respond to the complaint, typically 21 days. The insurance company may reach
out at any time with a settlement offer, which can eliminate the need to continue with litigation, if
you accept the offer. However, if no settlement is reached, your case will most likely be decided
with a bench trial before the trial court judge (generally on the “Administrative Record”) without
witnesses. There are no jury trials in ERISA matters. Your case can be decided in your favor, in
the insurance company’s favor, or be sent back to the insurance company to be re-evaluated,
known as a remand.

What Happens in the ERISA Litigation Process?

If litigation becomes your only option to get your benefits paid, federal court litigation will
typically consist of the following:

You first file a formal legal complaint against your employer or insurance company (the
entities responsible for denial of your benefits) in the appropriate federal district court,
and then serve the summons and complaint on the insurance company.
The employer and the insurance company then hire their own attorneys and file a
response to the complaint, with an answer or motion to dismiss the complaint.
The parties go through the FRCP 26 process and share information with each other and
the court.
The parties go through the discovery process. This is where both sides of the case
request and exchange relevant documentation and any other information relevant to the
case.
The parties engage in alternative dispute resolution, such as mediation, in an attempt to
settle the dispute.
The parties file special cross-motions for judgment and attend a federal court hearing,
where a judge will determine whether you are entitled to receive benefits.

To give your case the best chance of success, you should obtain all the relevant evidence as
quickly as possible and always cooperate with your attorney.

How Can An Insurance Attorney Help Me?

ERISA litigation can be complicated. If you need help deciding whether you have a valid claim
to sue under ERISA, you should consult with a knowledgeable ERISA life and disability
insurance attorney.

At McKennon Law Group PC, your first consultation is free. Get the advice and professional
representation you need with the trusted ERISA lawyers at McKennon Law Group PC

What Is ERISA?

ERISA is the Employee Retirement Income Security Act, the federal law enacted in 1974 that applies to employers’ group insurance plans. ERISA provides standards that insurers are required to meet in managing and operating group employee benefit plans. ERISA covers several types of group benefit plans, such as disability, life, and health plans, pensions, and 401(k)s. ERISA’s primary purpose is to protect the interests of employees and their beneficiaries by ensuring that employee benefit plan assets are appropriately managed and that plans are financially sound.

When an employer or plan administrator fails to abide by ERISA requirements, an employee may have grounds to bring ERISA claims in court. If you think your employer or plan administrator has failed in supporting your rights under an ERISA plan or failed in providing you plan benefits to which you are entitled, a highly experienced ERISA attorney can help you understand your options.

What Are Employers’ Main Obligations Under ERISA?

ERISA requires employers and plan administrators to manage plans responsibly and to protect the assets in the plans for the benefit of employees.

To that end, they have three primary obligations.

They must act as fiduciaries or select and choose proper fiduciaries. A fiduciary is someone who is legally obligated to protect the financial interests of another. The agencies or people who administer ERISA plans, including retirement plans and pensions, must act in the best interests of the plan participants and beneficiaries. They also must make the best possible decisions to protect plan assets. For example, an employer may not use an ERISA plan’s assets to fund business growth initiatives, as it would not be in the plan beneficiaries’ best interests. They must also choose fiduciaries who will act in the best interests of ERISA plan participants and their beneficiaries.
They must adequately inform plan participants. Employers must provide education and information to employees to help them understand the plan and make the best decision about whether to participate in the plan. For example, an employer must disclose the material terms of the ERISA plan by distributing a Summary Plan Description.
They must provide a method for handling disputes by ERISA plan participants and their beneficiaries. Employers must institute a process through which employees can file complaints when they have issues or grievances with a plan, the management of a plan, or their access to benefits. Employers must also provide an appeals process that allows employees to have a fresh set of eyes review initial benefits denials if they are not satisfied with the initial decision.

Required Reporting and Forms for ERISA

ERISA includes several notice requirements about plans and how they will be administered. This helps ensure that ERISA plans are well organized, thought out, and transparent. These requirements include:

A plan document. This written plan must name the plan administrator, describe how benefits are paid, describe claims processes, and must include language that protects participants’ privacy, for example with regard to medical information.
A Summary Plan Description. This is a shorter version of the plan document that provides highlights most relevant to plan participants. It is meant to provide plan information and transparency in a more user-friendly way.
Annual filings. Employers and ERISA plan administrators may need to file annual reports with the U.S. Department of Labor or other governing bodies.

What Are Some Common ERISA Violations?

If employers are found violate ERISA, they can face civil action or criminal charges. However, violations still occur. Some common ways employers fail to meet ERISA requirements are:

Not providing benefits owed under a plan
Not meeting time deadlines provided by ERISA to make decisions on claims for benefits
Not placing the correct information in letters denying benefits under a plan
Not appropriately funding a plan or otherwise breaching a fiduciary duty
Reducing promised benefits after they have been earned
Retaliating against employees who take action to enforce their rights by withholding or otherwise altering benefits or access to benefits.
Imposing costs or limitations on mental health coverage and treatment benefits that are not imposed on other parts of a plan
Failing to meet notice, reporting, or documentation requirements

What Can You Do to Enforce Your Rights Under ERISA?

If you believe your benefits are not being administered properly or that you are not getting what you are entitled to, you should immediately consult with an experienced ERISA claims attorney who can guide you through the process and handle the appeal of a claim denial or who can institute litigation on your behalf. ERISA provides tight time frames to appeal claim denials so you must act quickly. For example, a plan participant or beneficiary has only 60 days from the receipt of a life insurance or accidental death insurance claim denial to file an appeal. If you miss the appeal deadline, you may have missed your opportunity to litigate the claim denial.

ERISA litigation is a complex process that primarily takes place in the federal court system. As such, it is important to have an experienced ERISA lawyer on your side to file such a case or to handle an appeal. For more information about how an ERISA lawyer can help you assert and fight for your rights under ERISA, reach out to the McKennon Law Group, PC, for a free consultation.

Most mid-size and large companies provide their employees with specific benefits, such as life insurance, disability insurance, health insurance and pension benefits. Such benefits can include a defined-benefit pension plan. A defined-benefit plan is a type of retirement plan sponsored by employers. It involves a promised specific benefit that cannot be reduced once it is earned or “vested.” These plans are employer-sponsored, employer-funded benefits, and the amount you are promised as a benefit depends on the specifics of your plan. They are governed by a federal law called the Employee Retirement Income Security Act of 1974 (“ERISA”).

Find out more about defined-benefit plans, including your ability to file ERISA insurance and ERISA pension claims, from an experienced ERISA pension attorney if you believe you are being denied benefits that were promised to you and rightfully earned.

How Is the Defined Benefit Determined?

Some defined-benefits plans include a promise for a specific dollar amount. For example, you might have a promised benefit of $200 per month when you retire. More commonly, the defined benefit is calculated using some type of formula that involves factors such as your annual earnings, your age, or how long you worked with an employer.

As an example, a potential calculation might take 1% of your average monthly salary for the final five years you worked for an employer. That number might be multiplied by your total years of service to arrive at a promised benefit amount. If, for example, someone earned an average of $6,000 per month for the final five years of their service with a company, 1% would be $60 per month. If the person had 10 years of service with the company, the benefit would be $7,200.

You typically must meet eligibility requirements to earn the vested right to benefits contributed by your employer. That might mean working a certain number of years before you are fully vested. Part-time employees may be allowed to join the plan in some cases, and if they work a minimum number of hours a year, they have to be credited with a proportion of the benefits that a full-time employee might receive.

Can the Promised Benefits Be Reduced?

No, benefits you have already accrued in a defined-benefit plan cannot be reduced or taken away. However, the rate at which future benefits are accrued can be changed, which can lead to reduced benefits in the future.

For example, if a benefit is set up to accrue at a rate of $10 a month, the employer can decide to make a change to reduce the accrual rate to $8 a month starting at a certain period, such as July 2023. The $10 per month accrued prior to that date cannot be reduced once it has vested, but after July 2023, you would accrue benefits at the lower rate.

Defined-Benefit Plan Versus Defined-Contribution Plan

It is important to understand the difference between a defined benefit versus a defined contribution plan.

With a defined-contribution plan, you are not promised a specific benefit upon retirement. Instead, you can contribute to the plan via pre-tax contributions from your paycheck. Your employer also contributes funds to your account, either via a calculated benefit contribution amount or a contribution match.

You manage the investment of the funds in the account, and when you retire, you can start taking withdrawals from the total funds that have accumulated over time. One of the most familiar defined contribution plans is the 401(k).

What Is the Pension Benefit Guaranty Corporation?

The Pension Benefit Guaranty Corporation is a corporation chartered by the federal government for the purpose of guaranteeing some types of defined benefits. If your defined-benefit plan is covered by this guarantee, you will receive the promised benefits even if the plan itself is terminated.

The Pension Benefit Guaranty Corporation was created when the federal government passed the Employee Retirement Income Security Act of 1974, or ERISA. Other provisions of ERISA include required accountability of plans and the ability for participants to sue for their benefits or if they feel that a fiduciary duty has been breached by the administrators of a plan.

When to Consult an Attorney

You worked hard for your retirement benefits throughout the years, so you want to know that you can count on them to pay out as promised when the time comes. Many people base their plans for retirement, long-term care decisions, and other important financial choices on the hope that their benefits will pay out as planned, especially pension plan benefits that they have earned over time.

Unfortunately, sometimes there are issues with future pension benefits payments. They can range from clerical errors, such as someone calculating a benefit incorrectly, to serious bad faith that involves companies or plans not paying out what was promised, losing pension claims information, and not properly maintaining relevant pension plan documents. This problem is exacerbated by company mergers and acquisitions.

In these cases, working with an ERISA pension lawyer can help you fight for the benefits that are rightfully yours. A lawyer can help you understand why your benefits might be held up or not as much as you feel they should be. They can also help you navigate appeals and complaint processes and file a lawsuit if necessary to attempt to seek compensation for lost benefits, and/or you can bring breach of fiduciary duty claims, among other claims, under ERISA.

For more information on how experienced ERISA pension lawyers can help with ERISA pension claims and other employee benefits, contact the McKennon Law Group PC today.

What Are the Reasons a Life Insurance Claim Is Denied?

If your life insurance claim has been denied, there are a number of reasons an insurance company may deny a claim, among them:

The type of death not being covered by the policy (most often because the death was self-inflicted)
Exclusions in the policy apply to exclude coverage
Relevant information was not given at the beginning of the insurance process and the policy is rescinded
The policy premiums had not been timely paid

What Are a Life Insurance Company’s Responsibilities?

It is important to know what duties life insurance companies owe you, the insurance customer, so that you can properly assess whether your insurer has properly lapsed your policy. A list of common responsibilities are:

If your policy is due to lapse soon, the insurance company is obligated to send you several notices warning of the possibility your policy will lapse.
Insurance companies must send clear and obvious pending lapse notices to your correct address.
Insurance companies must follow all state laws that pertain to grace periods or notification specifications.
In some circumstances, customers who are 65 or older are owed special notification if their policy is in danger of lapsing.
Insurance companies must properly allocate the premiums paid to them.
Insurance companies must notify of your right to designate a third-party to receive insurance notices.

Depending on the circumstances of a particular case, an insurance company’s failure to follow one or more of the above obligations may preclude them from lapsing your life insurance policy and denying your claim.

What Steps Should You Take to Respond to a Life Insurance Denial Involving a Policy Lapse?

If your life insurance claim has been denied because your life policy has lapsed, there are steps you should take to respond to the denial. These steps are:

Carefully review the insurer’s denial letter. Typically, life insurance claim denials must be in writing and explain the policy terms the insurer is relying on to deny the claim and the reasons for the denial. Therefore, it is critical to carefully review the life insurance claim denial letter. You may be able to correct mistakes that may exist in the letter by providing new information to the insurer that can result in a reversal of the denial decision.
Contact your insurance company. By doing this, you can learn why you were denied and clear up any mistakes on either your or the company’s part. You also may be able to discuss what information the insurer needs to properly pay the claim. This is also your opportunity to find out what kind of documentation (such as a death certificate or proof of premiums being paid) you should have available as evidence for an appeal.
Contact a life insurance claims lawyer. You should strongly consider hiring an experienced life insurance claims attorney to assist you to give yourself the best chance at success. If the reason for the claim denial is that your policy was lapsed, you will need to know why it was lapsed and why the insurer may have improperly lapsed your policy. Laws and regulations are very complex when it comes to life insurance, and especially life insurance lapses, and an experienced life insurance claim lawyer can help you successfully navigate your rights and can adequately respond to the insurer.. Your lawyer should help you identify and organize the evidence you need and act as a go-between with the insurance company and yourself.
Gather all relevant documentation/evidence. By this point, you should know exactly why the initial claim was denied and so should have a sense of what evidence you may need. For example, evidence of payments made, premium and lapse notices, grace period notices, and other relevant letters between you and your insurer. Your lawyer will help determine what you should look for on this step.
Decide if you want to or are required to appeal the decision. Once all your evidence and argumentation is in place, you will need to submit your official appeal. This step can be done on your behalf by your lawyer as well.
Keep in communication. Once your appeal has been submitted, you or your lawyer should keep checking in with the insurance company and getting updates on the status of your case.
If your appeal is denied, consider whether you should file litigation against your insurer.

If you have any questions about life insurance, do not hesitate to schedule your free consultation with McKennon Law Group PC to determine your rights.

New Hope If Your Disability Insurance Claim is Denied

If you file a claim for long-term disability insurance benefits, and that claim is denied, arrange at once to meet with a California life and disability insurance claims attorney. That attorney will take the appropriate steps to fight for the disability insurance benefits you deserve and need.

If you have purchased long-term disability insurance through your employer, your policy is likely governed by ERISA, the Employee Retirement Income Security Act of 1974. ERISA sets minimum standards for the group insurance plans provided through private employers.

If your ERISA disability insurance claim is rejected, you will not be alone. Claims for disability benefits under ERISA are frequently rejected. If your own claim for disability benefits is denied, arrange at once to speak with a California life and disability insurance claims lawyer.

What Determines Your Eligibility for Disability Insurance Benefits?

Proving to an insurance company that you are disabled is a challenge. A doctor’s statement is usually not sufficient. Even disability claims that are approved by the Social Security Administration may be rejected by an insurance company if you are covered under a group disability policy through an employer.

It is the insurance company’s definition of a disability – and not the Social Security Administration’s definition – that will determine if you qualify for long-term disability insurance benefits.

However, in a recent California case, the Social Security Administration’s award of disability benefits played a key role in a judge’s decision in favor of the plaintiff. It is a precedent-setting decision that may help many more disability insurance applicants obtain their benefits.

What is an Administrative Record?

What is notable about Logan v. Prudential Insurance Company of America is the way the judge considered Mrs. Logan’s Social Security Disability Insurance (SSDI) award letter.

Her attorneys at McKennon Law Group PC filed a motion to include the SSDI award letter with the administrative record of the case because it was evidence that Mrs. Logan was in fact disabled and because the award letter was not available until after the case’s administrative record had already been prepared.

Generally speaking, new evidence may not be introduced in these cases. When a federal judge hears an ERISA case, the administrative record is typically the only evidence considered. It includes every document provided by the plaintiff or the plan administrator that is pertinent to the case.

Why Was Logan v. Prudential Insurance Company of America Important?

The motion to include the SSDI award letter with the administrative record of Mrs. Logan’s case was denied. However, the judge wrote that the “Social Security Administration’s decision . . . corroborates [Mrs.] Logan’s own and her doctors’ accounts of her disabling pain.”

While the SSDI award letter did not become part of the administrative record, the simple fact that the SSDI award letter was issued was considered supporting evidence for Mrs. Logan’s claim.

As a result of Logan, a court can now use the issuance of an SSDI award letter to support a disability insurance claim even if the award letter is not included in the administrative record of the case.

What if Your Own Disability Insurance Claim is Denied?

If your own ERISA-based disability insurance claim is denied, consult a California life and disability insurance claims attorney and appeal that denial. Your lawyer will help you prepare an appeal and ensure that you are compliant with ERISA guidelines.

U.S. District Courts have jurisdiction over ERISA-related cases. If you file an administrative appeal with the insurance company to no avail, your California life and disability insurance claims lawyer may then bring a lawsuit against the insurance company in federal court.

After Logan v. Prudential Insurance Company of America, if you have been awarded disability benefits by the Social Security Administration, your lawsuit against an insurance company that has denied your disability claim is now more likely to prevail.

If you need ERISA disability or life insurance benefits and your claim has been rejected, act now, and promptly schedule a consultation with a California life and disability insurance attorney such as the highly successful and experienced team for ERISA Claims at McKennon Law Group PC.

Good News if Your Claim for Long-Term Disability Insurance Has Been Rejected

If your application for long-term disability insurance is denied, discuss your rights at once with a California life and disability insurance claims lawyer. That lawyer will take legal action to help you obtain the disability benefits you need and deserve.

In some cases, the denial of a claim for disability insurance may constitute an abuse of discretion by the insurance company, according to a recent ruling handed down by the U.S. District Court for the Central District of California entitled McGuire v. Life Insurance Company of North America, a case that McKennon Law Group PC handled for its client, Brenda McGuire.

The case was heard in federal rather than state court because the plaintiff’s insurance plan was purchased through her employer, and employer-provided group insurance plans are governed by ERISA, the federal Employee Retirement Income Security Act of 1974.

What Are the Two Standards of Review?

If you sue an insurance company that rejects your ERISA governed disability claim, and your California life and disability insurance claims attorney persuades the court that the company’s decision was wrong, even then, your lawsuit may not succeed, depending on the review standard.

Two review standards are used by the courts that hear these cases. A court may use the “abuse of discretion” standard of review or the “de novo” standard of review:

To win a lawsuit under the abuse of discretion review standard, a court must determine that an insurance company’s rejection of your claim abused that company’s discretion. This standard, in which courts must give some deference to disability insurers, is a more difficult standard for a disability insurance claimant to prove under ERISA.

Under the de novo standard of review, a judge only decides whether an insurance company’s rejection of your claim was wrong or right. The de novo standard provides neither side with an advantage going to trial.

What Was Decided in McGuire v. Life Insurance Company of North America?

The District Court determined that Life Insurance Company of North America (LINA) abused its discretion by denying long-term disability benefits to a former community relations manager at Republic Services, a firm that provides waste disposal services across the United States.

The case was decided under the abuse of discretion standard, which is uncommon in ERISA cases pending in California because of a California statute that makes most ERISA cases subject to the de novo standard of review. The court clarified under what circumstances an insurer who denies a disability insurance claim has abused its discretion.

When a court reviews a decision to reject benefits in an ERISA case, it often does so under the de novo standard, which gives no advantage to the insurance company.

Most policies, however, give an insurance company the discretion to determine eligibility for benefits and to construe the policy’s conditions and terms. In these types of cases, the abuse of discretion standard applies if the claimant is from a state that does not have an anti-discretion statute, such as California’s anti-discretion statute.

What Were the Issues in McGuire v. LINA and Why is this Decision Important?

LINA contended that ERISA did not require them to have particular specialists review McGuire’s medical records. The judge Carmac Carney disagreed and found LINA’s failure to use specialists was a procedural irregularity indicating an abuse of discretion.

LINA contended that ERISA does not require that an insurance company have a claimant examined in-person by one of its health professionals and that by not doing so, it did not matter and had no effect on whether it abused its discretion. However, in deciding whether LINA abused its discretion, Judge Carney ruled that this decision to do so does matter.

LINA additionally contended that McGuire’s medical records did not precisely explain how her medical condition prevented her from working. The judge noted that LINA never contacted the doctors to seek clarification and ignored other evidence that verified McGuire’s reports of pain.

LINA also insisted that because McGuire declined surgery and pain medication, she was not disabled. The judge stated that McGuire could not be faulted because pain medications and surgery both carry considerable risk.

The judge found no evidence that McGuire was a malingerer, but he determined that LINA had abused its discretion. The court ruled in McGuire’s favor and awarded her the long-term disability benefits.

Read from the full case file here.

What Should You Know About Disability Insurance Claims?

If you file a disability insurance claim and your claim has been denied – you need the advice that a California life and disability insurance claims lawyer can provide.

Your first legal consultation is provided without cost or obligation. It is your chance to receive the advice you may need and to find out more about how the law may apply to your own situation.

If you need ERISA disability or life insurance benefits and your claim has been rejected, act now, and promptly schedule a consultation with an ERISA claims lawyer such as highly successful and experienced team at McKennon Law Group PC.

What is ERISA Litigation?