Super Lawyers
Consumer Attorneys California
AV Preeminent
State Bar of California
American Association for Justice

Noneconomic Damages and Long-Term Disability Insurance Denials

It is not unusual for an insurance company to deny a claim for long-term disability insurance benefits on flimsy grounds. It may continue to deny the claim on review even if the claimant has submitted clear and persuasive evidence of disability. When this happens, it comes as no surprise that the claimant, who may be suffering from a significant physical or mental impairment that is preventing her from working, will also experience serious anxiety and stress because of the LTD insurer’s egregious denial.

After all, the claimant is not only facing the loss of her job, but is also dealing with a serious, disabling condition. When the insurer wrongfully denies income replacement benefits under the LTD policy, it usually does not take long for bills to become seriously overdue, thereby creating a financial crisis.

When an insurance company causes this kind of mental anguish, it is natural to want to recover against it in a lawsuit for the distress that has been caused. Unfortunately, in many situations, these kinds of damages are not available.

Erisa Does not Allow Noneconomic Damages

Almost all LTD policies available through employers are governed by ERISA, a complicated and rather rigid federal law that does not allow a claimant to recover noneconomic damages against an insurer, no matter how bad the carrier has behaved in its denial or termination of benefits.

Noneconomic or nonpecuniary damages means those that are not financially measurable like a medical bill or a wage amount are. Noneconomic damages may include:

  • Emotional distress
  • Pain and suffering
  • Loss of enjoyment of life
  • Aggravation
  • Embarrassment
  • Grief
  • And similar harm to a claimant that is a personal, but not a financial loss
Private LTD Policies Governed by State Law may Allow Noneconomic Losses

Normally if a person does not procure his or her LTD policy through an employer, he or she might buy it on the open market as a private purchase. In such a case, the terms of the insurance contract and state law will normally govern the policy and legal remedies available for breaching it. In many states, if the claimant can show that an LTD claim was denied by the insurance company in bad faith, he or she may be able to recover noneconomic damages like those for emotional distress and the others listed above.

In some situations, under a private policy, if the insurer’s behavior has been particularly bad, punitive damages may even be available as a form of punishment.

Talk to an LTD lawyer to understand what law governs your policy and what damages may be available to you if you experience an improper claim denial.

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