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New ERISA Rules Raise Standards for Insurer LTD Claim Processing

Are you an employee or professional in Northern California who is covered by an employer-sponsored long-term disability insurance plan?

If so, you might reasonably harbor some concerns regarding your benefits program administered, in theory, in compliance with the federal law known as ERISA. ERISA imposes procedural requirements on insurers and claims administrators when they process LTD claims. ERISA standards are intended to make the process fairer for claimants.

Worries about how your LTD plan is administered are understandable. Perhaps a co-worker battling a long-term disability is facing stark challenges from your plan’s fiduciary or insurance provider that strike you as being unfair and even in bad faith.

Alternatively, maybe you yourself recently suffered the denial of LTD benefits on a basis that seems unreasonable or even so unclearly expressed that you do not know how to respond.

Many employees covered by ERISA plans are overwhelmed by both LTD policy language that is hyper-technical and claim outcomes that seem unjust. In many instances, a hide-the-ball mentality and anti-worker bias seem clear.

Good news. New regulations issued by the U.S. Department of Labor raise the standards and tighten the procedures with which insurers and claims administrators must comply when processing LTD claims in ERISA-governed plans. Workers who are suffering with disabling conditions at the same time as they are fighting with claims administrators now effectively have more rights and remedies throughout the process.

Moreover, they can now more easily spotlight wrongful behavior that undermines their rights and reasonable expectations regarding insurer behavior.

What Has Changed Concerning Employer-Sponsored Disability Plans?

For starters, April 1 ushered in a host of claimant-friendly procedures that the LTD insurer or claims administrator must scrupulously follow in processing every LTD claim, particularly if issuing a denial. Importantly, a claimant will now have the benefit of a vastly sped-up court review process in instances where the new rules are ignored or not followed precisely.

What New Procedural Protections Now Exist for Denied LTD Claims?

U.S. Department of Labor rules going forward offer enhanced safeguards to affected individuals, including protections that:

  • Ensure claims are adjudicated by individuals who are independent and impartial
  • Improve disclosure requirements, including a claimant’s right to receive upon request the insurance company’s entire file it created for the claim
  • Require the plan to notify the claimant of any new or additional information that the claims administrator will rely upon to deny a claim on appeal

This notification must be done prior to the actual denial in order to give the claimant a reasonable time to respond to any new evidence before the denial is issued.

If the plan administrator fails to comply with the new rules for any disability claim filed on or after April 1, it will be deemed that the claimant has already exhausted all administrative remedies under the plan — meaning they can go straight to court and file a lawsuit.

Claimants in insurance matters often face stark challenges as they pursue legitimate claims, a reality that can be especially trying for injured or ill workers.

It should be heartening for LTD claimants under ERISA plans to know that beefed-up safeguards now exist to help protect them when they encounter rejection. The improved regulations are meant to bring more fundamental fairness to the LTD claims process.

Client Reviews
Just when I thought there was no hope to recover my LTD benefits, I found attorney Constantin Roboostoff. With his expertise, I was able to recover all of my back long term disability benefits. Other attorneys wouldn’t take my case because it wasn’t cut and dry. Mr. Roboostoff took the challenge and did an incredible job. Not only did he get my current disability benefits going, he also recovered all my back benefits. He was a true blessing and I would recommend him whole heartedly. CW
It was my pleasure to make contact with Scott Kalkin three years ago after other lawyers had turned me away and told me I would not succeed in my lawsuit. Thanks to Scott's thoroughness, dedication, and diligence, my lawsuit WAS successful and he saw me through to the end, which included putting legal pressure on the insurance company which had invested so much time, personnel, and money, in not paying me what was due. RB
As soon as I met with Scott, I could tell he was knowledgeable, resourceful, experienced, highly professional, and would be dedicated to getting me fair treatment. Scott has handled all interactions with my insurance company ever since. Being able to rely on him to represent me has been a huge relief for a chronically ill person. SO