Michigan Long Term Disability Insurance Lawyer Blog

In testimony presented to Congress, the Washington Post recently reported on the testimony of Cigna Insurance's former VP, Wendell Potter who said insurers "make paperwork confusing because 'they realize that people will just simply give up and not pursue it' if they think they have been shortchanged."

Referring to the industry's objection to changing its business, Potter said he "worries 'that the industry's charm offensive, which is the most visible part of duplicitous and well-financed PR and lobbying campaigns, may well shape'" insurance reform in a way that is more beneficial to Wall Street than to "average Americans."

This "charm offensive" reminds me of those terrific Allstate commericals where the good looking gentleman says "Your in good hands with Allstate" after some vaguely disturbing scenario is played out in the background. Man, who wouldn't want to be in Allstate's hands. Unfortunately, when it comes time to pay a claim many of my client's feel like Allstate laced up some boxing gloves to cover those "good hands."

ABC news provides details of Mr. Potters testimony here.

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In my continuing effort to do the best job that I can for my Long Term Disability Insurance clients I attended that ACI Long Term Disability Insurance Conference in Boston this past week. For the the second year in a row that I have attended this conference I thought it was excellent. The seminar presenters were all top notch-clearly some of the best and brightest practicing in this niche area.

There were a number of very interesting and useful sessions dealing with the Supreme Court's Metlife v Glenn decision and how it is impacting cases across the country as well as various other in depth discussions on a number of relevant issues. The last day we had a panel of a half-dozen federal court judges discuss their view's of these cases.

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Michigan residents injured in auto accidents beware of Auto Insurance tactics.

According to the sworn testimony of a representative of State Farm Insurance it appears that the company paid millions of dollars to a consulting firm to analyze and modify its claims handling practices in the mid 90s. According to the recent testimony of former State Farm employee Robert Butler in the case of Armisted v. State Farm (No. 2:07-cv-10259, Hon. Arthur J. Tarnow) in the US District Court in Detroit, State Farm implemented the ACE program. An integral part of this program was to “capture opportunities.” Those “opportunities” happened to include the indemnity payments made to people who were insured by State Farm in Michigan when they were injured in a car accident. State Farm determined that there was the opportunity to capture millions of dollars annually in payments for PIP benefits.

Mr. Butler confirmed during his testimony that State Farm determined that it was settling too many cases. Accordingly, it appears to this writer that State Farm then decided that more claims should be forced into litigation in order for State Farm to “capture” the potential “opportunities.” In Michigan alone State Farm concluded the potential “opportunity” included about $30 million dollars a year in indemnity payments. Mr. Butler confirmed that the ACE program was a nationwide initiative.

The secret internal documents that State Farm was forced to produce in the litigation included a description of tactics to cause delays in paying claims, and hidden agenda tactics including the “surprise”, the “silence”, the “fake out”, the “go for broke”, and also the use of “absent authority tactics” to “pass the buck"- an effective technique to say you have no authority to deal with a claim.

This is another prime example of an insurance company putting the bottom line over the importance of the little people who may be injured and in need of benefits.

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In a tremendously important decision, the 6th Ciruit court of appeals affirmed today a decision limiting the language that disability insurance carriers can include in their policies to protect themselves from making payments. In American Council Of Life Insurers v. Ross, No. 08-1406 , the panel agreed that the Michigan Insurance Commissioner could restrict an ERISA plan from including language giving itself discretion to interpret the plan language and determine the participant's eligibility for those benefits.

This is critically important because up to this point in time Court's were forced to review these cases using the very deferential "arbitrary and capricious" standard of review. In non lawyer speak, the court did not review the evidence to determine if the insurance company made the correct decision. Instead, the court was forced to determine whether there was any reasonable basis for the decision. The practical effect of this limited standard of review was to make it exceedingly difficult for a claimant to win. After all, if the insurance company hires a qualified doctor to review the claim and that doctor says the claimant is not disabled then there is a reasonable basis for the claims decision. (And oh by the way, never mind that we use that same doctor over and over and over and pay him and the reviewing company that he works for hundreds of thousands of dollars a year. they can be fair an impartial. yeah right.)

Now, the courts will review these claims de novo. In other words, the Court will be empowered to determine whether or not the correct decision was made-Whether or not the claimant meets the policies definition of disability. This is really huge.

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In a recent decision, Delisle v Sun Life, the 6th Circuit Court of Appeals affirmed a decision requiring Long Term Disability Insurer Sun-Life to pay disability benefits even though 6 of its hired physicians supported its decision to terminate benefits.

In finding that Sun-Life's decision was arbitrary and capricious the Court recognized that 5 of the 6 physicians were "under regular contract with Sun Life" and that such physician reviewers may have an incentive to make a finding of not disabled in order to save their employers money and preserve their own consulting arrangements.

The Court also pointed out Sun Life's failure to attach any weight to the fact that plaintiff was awarded SSD benefits. In fact, Sun Life failed to even acknowledge the award in any of the three denial letters.

Continue reading "Long Term Disability Insurer ordered to pay" »

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The Second Circuit Court of Appeals cited First Unum's deception as one of the grounds for granting an attorney's claim for long term disability insurance benefits. In McCauley v First Unum the Court the Court cited several isntances of biased and deceptive claims review in granting McCauley's claim for disability benefits.

In an important decision the Court analyzed the claim under the new standard set forth by the Supreme Court in Metlife v Glenn. The Court cited in detail First Unum's history of deceptive claims handling and abusive tactics in reversing the denial decision.

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As reported in the Houston Chronicle Great American Insurance Company is trying to avoid paying claims for the deaths of multiple people killed in a fire in an office building by arguing that their deaths were actually caused by smoke inhallation which is "pollution." This despite the fact that the policy undoubtably provides coverage for loss caused by fire.

The attorney for several of the families described the insurance company's efforts to avoid responsibility as shocking. "It's an extraordinary effort by an insurance company to avoid paying on a contract for insurance" Not surprisingly, the insurance company and its legal representative had "no comment."

This is another classic example of the lengths to which an insurer will go to avoid responsibility. Profits over people.

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Justice Taylor Falsely Claims Wall Street Journal Backing

In what turns out to be a desperate campaign strategy, Justice Taylor has been claiming that the Wall Street Journal said the Michigan Supreme Court under his leadership is the best in the nation.

Guess what-this claim is totally false!!!

If you expected better from a sitting Michigan Supreme Court Justice, you would be disappointed. You see, it turns out that the reference to the Michigan Supreme Court was not contained in a Journal editorial. It was not the conclusion of a survey or comparative study of the various state Courts in the US.

Instead, it seems that in October, 2005, Mr. Patrick Wright, who worked for Justice Taylor, wrote an opinion piece in which he voiced his opinion that the Michigan Supreme Court "may be the finest court in the nation." The quote, attributed to the Journal "best in the nation", never appears, not even in Mr. Wright's viewpoint piece. The opinion expressed in the piece is Mr. Wright's, not the opinion or finding of the Wall Street Journal ownership, staff, or editorial board.

The plain meaning of the words used in Mr. Taylor's bio, on the other hand, is that the Wall Street Journal, as a paper, has made a determination that the Michigan Supreme Court is the best in the US. This is patently false. Not only were these words never used, though the Taylor site portrays them as a direct quote, they are obviously only the opinion of the opinion piece's author, a former member of Mr. Taylor' legal staff.

If you think this kind of misrepresentation is wrong, vote to restore fairness by voting for Judge Hathaway for the Michigan Supreme Court on the nonpartisan section of the ballot this November. Remember, you have not cast a vote for the supreme court until you check the box next to Judge Hathaway's name.

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Dr. Ghandi Gutta filed a claim for Long Term Disability Insurance when he was no longer able to continue his practice as a laparoscopic surgeon due to multiple medical conditions. When his definition of disability changed to "any occupation" at the end of two years his insurer, Standard Select, terminated his benefits contending that, even with his multiple medical conditions, he was able to work in the medical field.

Utilizing the the arbitrary and capricious standard of review, the court accepeted the insurer's argument that Dr. Gutti failed to provide persuasive evidence that he was unable to perform other work in the medical field and that he had the skills necessary to work as a medical director or assistant medical director. To make matters worse, the court also ordered Dr. Gutti to repay $74,000 in overpayments as a result of payments he recieved under a different disability policy.

This case illustrates how difficult it can be for claimaints to obtain benefits that are governed by ERISA.

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If you get hit by a drunk driver and break your arm or leg, do you think you should be able to sue the drunk who caused the accident, even if you make a good recovery?
If you get in a car accident but only miss three months of work, or a few semesters of school think you should be able to recover from the at-fault driver?

Not in Michigan, Not anymore. Why not? Because Cliff Taylor says so, that’s why.

In the case of Kreiner v. Fischer the court overruled decades of established law in order to make it harder for injured car accident victims to recover. The worst part of the decision is that the court simply fabricated a new rule requiring that the injuries affect the victims “course and trajectory” of their life. Taylor goes so far as to describe the law protecting insurance companies as the “no-fault temple.”

Since this decision, hundreds of cases have been dismissed for not meeting this new standard. I wonder how much money the Insurance Companies have saved? No wonder the Michigan Chamber of Commerce is running TV ads for Taylor.

I have pasted a few excerpts below from Supreme Court Justices Cavanaugh, Weaver and Kelly’s dissent.

By importing the concept of permanency of injury into MCL 500.3135—a concept
that is nowhere referenced in the text of the statute—the majority of four (Chief Justice
Taylor, and Justices Corrigan, Young, and Markman), in Kreiner v Fischer, 471 Mich
109 (2004), actively and judicially legislated a permanency and temporal requirement to
recover noneconomic damages in automobile accident cases. The Kreiner interpretation
of MCL 500.3135 is an unrestrained misuse and abuse of the power of interpretation
masquerading as an exercise in following the Legislature’s intent.
**************************************************
The majority suggests that my approach is sacrilegious to the “no-fault temple”
and is an exercise predicated on “studied ignorance.” Ante at 35. While
admittedly unaware that I was required to worship the no-fault insurance gods,
I believe that my “studied ignorance” is more properly labeled as “judicial
restraint.” If ignorance comes from applying this unambiguous statute as written
and not substituting my own view for that of the Legislature, I must say that
ignorance is bliss. If so-called wisdom comes from rewriting this unambiguous
statute to comport with my own preference on how the statute should be
written and applied, in this instance I must choose “ignorance.” Today’s
decision serves as a chilling reminder that activism comes in all guises,
including so-called textualism.

If you think this kind of judicial activism is wrong, vote to restore fairness by voting for Judge Hathaway for the Michigan Supreme Court on the nonpartisan section of the ballot this November. Remember, you have not cast a vote for the supreme court until you check the box next to Judge Hathaway's name.

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If the City plows the snow off the street and blocks the sidewalk and a child who is forced off the sidewalk is hit by a car and killed, do you think the City has any responsibility?

Not in Michigan, not anymore. Why not? Because Cliff Taylor says so, that's why.

In the case of Chantelle Buckner v City of Lansing, 480 Mich 1243 (2008) Justice Taylor's court told the dead child's family that the City of Lansing had no responsibility for plowing the snow off the street and blocking the sidewalk forcing the children into the street where she was struck and killed.

If you think this kind of judicial activism is wrong, vote to restore fairness by voting for Judge Hathaway for the Michigan Supreme Court on the nonpartisan section of the ballot this November. Remember, you have not cast a vote for the supreme court until you check the box next to Judge Hathaway's name.

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Think a landlord has a duty to fix the electrical wiring in a home.
What about if the tenant repeatedly tells the landlord that the electrical outlet sparks and smokes.
What if the landlord ignores the tenants repeated complaints and there is a fire which results in the death of six children? Think the family should be able to file a lawsuit?

Not in Michigan. Not anymore.
Why not? Because Cliff Taylor says so, that’s why.

In the case of McDowell v City of Detroit, Taylor’s court threw the family of six dead children out of court by finding that the landlord had no duty to fix the electrical system even though the family had repeatedly complained about sparks and smoke coming from the outlet. Defendants were on actual notice of the problems with the electrical outlet that eventually caught fire and other electrical components of the home as evidenced by nearly two years’ worth of complaints made by the tenant to defendants.

Taylor simply chose to ignore the lease and the law which respectively required that the landlord

Maintain electrical, plumbing, sanitary, heating, ventilating and
other facilities and appliances, supplied or required to be supplied by
Management in good and safe working order and condition.

Likewise, the law- MCL 125.471

requires that “[e]very dwelling and all the parts thereof including plumbing, heating,
ventilating and electrical wiring shall be kept in good repair by the owner.”

So even though the law and the lease clearly required the landlord to fix the wiring. Even though the family could not, by law, fix the wiring, Cliff Taylor lets the landlord off scott free.

If you think this kind of judicial activism is wrong, vote to restore fairness by voting for Judge Hathaway for the Michigan Supreme Court on the nonpartisan section of the ballot this November. Remember, you have not cast a vote for the supreme court until you check the box next to Judge Hathaway's name.

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