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Employers Cannot Punish Employees for Exercising ERISA Rights

Fri Sep 14th, 2018 on     Insurance Claims,    

Though Florida employers are well aware of the standard discrimination and retaliation prohibitions that restrict their ability to discharge and otherwise punish employees for their actions — such as reporting discrimination in the workplace — there continues to be something of a blind spot when it comes to the exercise of ERISA-related rights. Those who exercise their ERISA-related rights may therefore find themselves subject to unexpected retaliatory action, despite the fact that it is prohibited by law.  Fortunately, ERISA offers such employees the opportunity to bring an action against their employer for various damages, an injunction, and a reinstatement of benefits. Consider the basics. Employment Retaliation is Prohibited Under ERISA Section 510 of the Employee Retirement Income Security Act (ERISA) clearly prohibits retaliation against any ERISA plan participant (i.e., covered employees) who exercise their ERISA-related rights, such as pursuing the benefits to which they’re entitled under their applicable plan. Retaliation is rather common, particularly in situations where the exercise of ERISA-related rights could expose the employer to additional costs, or where it could reveal that the employer has acted in bad faith, perhaps by violating their fiduciary duties to plan participants.  For example, if you are injured and are making a significant disability benefits claim under your ERISA-governed plan, then your employer may attempt to terminate you from your position or otherwise “force you out” in an effort to prevent you from exercising your rights and receiving the benefits at-issue. What Qualifies as Retaliation? If you bring a claim against […]

Disability Insurance: A Brief Look at Occupational Definitions

Fri Sep 7th, 2018 on     Disability Insurance,    

As a disability insurance policyholder, whether you are entitled to secure benefits for your disabling illness, injury, or other condition will depend primarily on your ability to demonstrate that your circumstances qualify you as “disabled” pursuant to the language of your insurance plan.  Insurers are incentivized to interpret plan definitions (and the severity and extent of your condition) in a manner that is unfavorable to your interests — if the insurer can plausibly deny your disability benefits claim, then they can save substantially on costs that would have otherwise been paid out to you. Given the importance of the “disability” definition for your benefits claim, and the likelihood that your insurer will attempt to muddy the waters by interpreting it — and your condition — in a way that is opposed to your interests, it’s worth understanding just how disability is defined in your plan so that you can effectively counter the arguments made by the insurer. Let’s take a look. Variable Definitions of Disability Disability insurance plans either have an own-occupation or an any-occupation definition of what constitutes a “disabling” condition.  The definition described in your plan can have a significant impact on your ability to recover benefits. Own Occupation When a disability insurance policy includes an own-occupation definition of a “disabling” condition, claimants may be awarded benefits so long as they can show that their illness, injury, or other condition has caused them to be unable to perform the major duties of their current occupation. For example, if […]

ERISA Summary Plan Descriptions Must Be Clear

Fri Aug 31st, 2018 on     Insurance Claims,    

The Employee Retirement Income Security Act (ERISA) was enacted in 1974, creating a new set of standards and protections for certain covered plans (i.e., private benefit plans granted or sponsored by an employer).  Since its enactment, ERISA has further expanded those standards and protections, which include rules surrounding the Summary Plan Description (SPD). The SPD is a critical document that details the rights and obligations of the policyholder and beneficiaries pursuant to the insurance plan, as well as identifying information about the plan sponsor, administrator, and other relevant concerns.  Under ERISA, the plan administrator must by default furnish the SPD to the policyholders, and must furnish the SPD to beneficiaries upon request. When pursuing a claim against your insurer in a dispute involving an ERISA-covered plan, it’s important that you request and obtain an SPD.  Your attorney will evaluate the SPD and help determine your rights and obligations under the plan, and whether those rights have been violated by the insurer or plan administrator. What Makes an SPD Inadequate? All employee benefit plans must have an SPD, which details the benefits at-issue, eligibility for such benefits, the timeline for benefits, the procedure for claiming benefits, and the various other rights and obligations of policyholders and beneficiaries under the plan.  An adequate SPD must accurately reflect the contents of the ERISA-covered plan — failure to provide an accurate summation of the plan (with the necessary information), or to legally furnish an updated plan to the policyholder or beneficiary, could expose the […]

What Does a Vocational Expert Do?

Fri Aug 24th, 2018 on     Insurance Claims,    

Though vocational experts are perhaps more well-known for their role in Social Security disputes, they also play a critical role in private disability benefits disputes — as such, it is important to understand how to use vocational experts to your advantage (and how to undermine the testimony of opposing vocational experts) for the purpose of strengthening your benefits claim. Vocational Experts and Disability Insurance Disputes Vocational experts have a very specific role in the disability insurance dispute context — they provide an opinion on career-related issues, which (in conjunction with the medical issues) lie at the very center of a disability benefits dispute.  More specifically, a vocational expert will consider your unique talents, training, education, and physical/mental limitations, and will give testimony as to your capabilities and prospects in the job market.  Vocational experts may also testify as to salary expectations, industry growth, opportunities for advancement in a given career path, and more. For example, if a vocational expert testifies as to the possibility of an alternative career, then they will also have to provide relevant information concerning the salary and opportunities for advancement in that alternative career, given your training/education/abilities.  If opportunities are more limited than your existing career, this difference must be accounted for. Countering Vocational Expert Testimony Vocational experts brought in by opposing counsel may give testimony that clearly conflicts with your interests.  Testimony is not dispositive, however.  It is absolutely possible to weaken and otherwise challenge the testimony of the vocational expert by calling into question […]

How Mediation Can Help Insurers and Claimants Resolve Their Dispute

Fri Aug 17th, 2018 on     Disability Insurance,    

In Florida, and throughout the country, mediation of complex insurance disputes (whether a disability insurance dispute, health insurance dispute, or otherwise) is a common strategic option employed to resolve the conflict before litigation.  Through the mediation process, the involved parties — insurer and policyholder — can negotiate a favorable settlement that satisfies their expectations while avoiding the hassles and difficulties typically associated with insurance litigation. Litigation May Be Fraught With Difficulties Litigation can be somewhat risky for many plaintiffs, whether in the insurance context or otherwise.  Going through with trial litigation can be time-consuming, expensive, emotionally frustrating, and uncertain.  For example, if you have suffered a disabling injury and are unable to return to work, then the prospect of litigation — and the possibility of a long and demanding trial process — may be undesirable. Generally speaking, insurance policyholders hope to secure benefits within a reasonable timeframe.  Litigation not only extends that period, but may expose the policyholder (and their insurance dispute) to public criticism, thus damaging other aspects of their life.  Thus, where possible, a negotiated settlement is usually preferred. How Mediation Can Lead to a Favorable Settlement Litigation is fundamentally hostile — each side is arrayed against the other, constantly seeking an advantage.  By contrast, mediation is a voluntary process where the disputing parties attempt to negotiate a settlement compromise in a more collaborative environment.  During a mediation, a neutral third-party mediator is selected.  The mediator will hear out the arguments presented by each party (in a less […]

What Are Residual Disability Benefits?

Fri Aug 10th, 2018 on     Disability Insurance,    

Residual disability benefits are common, in Florida and throughout the country — whether in the form of an insurance rider on a total coverage plan, or as a standalone income replacement policy — as a means with which to ensure that the claimant can secure at least some benefits after suffering a disabling event that is not necessarily catastrophic. For example, if you are injured in a car accident, then you may suffer a disability in the form of back spasms, but this disability may not be “total” in the sense that you might be capable of performing your existing job.  Residual benefits open up insurance coverage, to an extent, by allowing you to recover for disabilities that effect certain job duties, but that do not necessarily prevent you from working altogether. Despite the fact that residual benefits are intended to fill the coverage gaps typical of total disability insurance policies, many insurers will challenge residual benefits claims and make it difficult for claimants to secure the benefits to which they’re entitled. Qualifying for Benefits Whether you actually qualify for residual benefits depends on the particularities of your insurance plan — there is no universal, consistent baseline for residual benefits, as plans can vary quite substantially.  Residual benefits are a form of partial income replacement, and as such, many plans involve a showing of income loss of a sufficiently significant degree.  For example, your plan may require that you demonstrate — post-disability — that your income has fallen at least […]

How Benefits for Psychiatric Conditions Can Be Limited

Tue Jul 31st, 2018 on     Disability Insurance,    

Disability insurance coverage can surprise many policyholders who put too much trust in their insurer to “do right” by them.  All too often, disability insurance policyholders believe that they are well-protected by their private policy, only to find that their insurer is taking steps to avoid or minimize the payout altogether. In many cases, the insurance contract itself includes language that could expose the policyholder to a dispute down the line, when they have actually been disabled.  It is increasingly common for insurers to include a limitation on benefits for disability claims that are premised on psychiatric conditions (i.e., mental disorders) — this limitation is commonly referred to as the “mental and nervous” provision. Let’s briefly consider the fundamentals. How the Mental and Nervous Provision Works Claimants may be initially confused by the application of the “mental and nervous” provision in their insurance policy, but it’s rather simple in effect.  The provision essentially limits the duration of benefits payments for disability claims where the cause of the disability at-issue is based exclusively on a psychiatric condition. Generally speaking, only the length of payments are limited, not the amount.  For example, if you have been suffering from a substance abuse condition (say, alcoholism), and the addiction is so serious that it has effectively rendered you disabled and unable to work, then you may be entitled to benefits, but only for a limited period of time — perhaps a two-year period. Insurance policies can vary quite a bit, but as a general […]

Adverse Benefit Determinations Under ERISA

Tue Jul 24th, 2018 on     Insurance Claims,    

The Employee Retirement Income Security Act (ERISA) established certain standards for qualifying plans — more specifically, for private employee benefit plans — that are intended to protect employee-claimants from abuse, mismanagement, and various other concerns commonly encountered in the insurance dispute context.  Over the years, ERISA has been expanded quite substantially.  If your insurance plan is governed by ERISA regulation, you may be entitled to notification and the opportunity to appeal an adverse decision relating to your benefits. What is an Adverse Benefit Determination? Pursuant to existing ERISA regulation, an “adverse benefit determination” is any decision by the insurer that involves the denial, reduction, or termination of an insurance benefit. For example, if your insurer chooses to reduce your benefits on the basis of improvements in your disabling condition, then that would almost certainly constitute an adverse benefit determination. Adverse benefit determinations afford the claimant certain rights necessary to protect their interests.  When an insurer (plan covered by ERISA) makes an adverse benefit determination, they must provide adequate notice of the decision.  Further, the claimant must be given the opportunity to appeal within 180 days of the adverse benefit determination at-issue.  This 180-day rule gives the claimant a significant time period with which to secure qualified legal assistance and challenge the insurer’s decision. Insurance Plan Administrator Must Give a Reasonable Basis for the Determination Discretionary authority of insurers in ERISA-covered plans is limited.  Any and all adverse benefit determinations must be accompanied by an explanation that gives a reasonable basis […]

Countering an Insurance Denial for a Lapsed Policy

Tue Jul 17th, 2018 on     Insurance Claims,    

Oftentimes — in Florida and elsewhere — insurers will deny otherwise legitimate claims due to the coverage having lapsed.  Insurance coverage will lapse when the claimant has failed to make a premium payment before the applicable due date.  This applies to all types of insurance coverage, from disability insurance to health insurance to property insurance, and more.  If the coverage lapsed before the events giving rise to the claim (i.e., an accident that renders you disabled), then you may not be entitled to receive benefits under the policy at issue. It’s important to note, however, that there are a number of tools that give claimants “extra” time to make a premium payment before coverage lapses.  Further, insurers have certain duties that they must adhere to — failure to do so may lead to a determination that the coverage has not actually lapsed. Consider the following counter-arguments to an insurance denial that is justified on the basis of a lapsed policy. Grace Period Still Applicable Your insurance policy grace period covers you in the event that you fail to make a premium payment on time.  Though every insurance plan is different (and that applies to grace periods, too), generally speaking, grace periods will last for roughly two to three months after the missed payment.  If you fail to pay for your outstanding premiums before the grace period finishes, then the policy will be deemed “lapsed” at the time of the original missed payment. For example, suppose that you miss your March […]

Disability Insurers May Offer to Buyout Claimants

Tue Jul 10th, 2018 on     Disability Insurance,    

Disability claimants may be surprised to find that — despite the fact that they have never lapsed on insurance payments and are submitting a reasonable disability benefits claim — the insurer response is unaccommodating.  Disability insurers employ a number of questionable tactics in order to force the claimant into a vulnerable position.  For example, if you have been rendered permanently disabled due to a degenerative condition, the insurer may deny your claim, delay your claim, or undervalue your claim.  Doing so gives the insurer substantial leverage during later negotiations. Oftentimes, disability insurers use the “lump sum buyout” to avoid having to pay long-term benefits, or to end the insurance dispute altogether.  Lump sum buyouts are not necessarily unfavorable to the claimant, however.  Accepting a lump sum buyout is a perfectly reasonable option in some cases. Let’s explore the basics of an insurance buyout. What is a Lump Sum Buyout? In the disability insurance context, a lump sum buyout — otherwise known as an insurance settlement — is effectively an offer to purchase the claim at-issue.  Stated simply, the insurer offers to pay some agreed-upon amount in a lump sum, and you (the disability claimant) must agree to abandon your legal rights under the policy.  You will not be entitled to receive further benefits under the policy, nor will you be entitled to sue the insurer for damages. Lump sum buyouts are often used as a way to clean up what may appear to a messy insurance dispute.  For example, rather […]

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