It can be confusing trying to figure out the amount of Long Term Disability Insurance benefits the insurance company should pay. Here is a brief outline of how the amount is commonly determined.
Step 1.-Figure out your base monthly income. (Take your yearly income and divide by 12. Beware however-commonly excludes overtime and bonuses.)
Step 2. Multiply by the benefit percentage listed in the Insurance Policy. Commonly 66 2/3%. (However, I have seen many other rates from 40-70%.)
SMDA recently convinced LTD insurer Cigna to overturn its claims denial decision for a registered nurse who developed significant low back pain that prevented her from performing her own occupation. Our client had degenerative disc disease that had progressed over the years eventually leaving her unable to work. Cigna initially denied her claim finding she was not disabled.
SMDA filed a comprehensive administrative appeal which established that the functional limitations the client experienced made it impossible for her to perform the material duties of her own occupation. Cigna overturned the claims denial decision and agreed to retroactively reinstate her LTD benefits and put her back on claim.
A US District Court Judge recently granted a motion filed by SMDA granting LTD benefits to one of our clients. The Court found that the third party administrator had abused its discretion in recommending a denial of benefits. The Court found that the client’s serious back problems along with the multiple powerful pain medications prevented him from performing the duties of his own occupation.
SMDA partner, Patrick Derkacz, recently recovered $1.2 million dollars on behalf of his seriously injured clients. Mr. Derkacz convinced State Farm to pay this significant settlement the day after taking the deposition of the at-fault driver who offered testimony that he was not responsible for causing this rear end accident. The at-fault driver tried to blame everyone but himself, including the seriously injured driver of the car he struck for not traveling the minimum speed on the freeway. (The freeway traffic was slowing to a stop for a previous accident!) State Farm likely realized that any potential jury would not look kindly upon Defendant’s ridiculous testimony.
This significant recovery should help the elderly couple injured in the crash the economic cushion they need to live their lives as they wish.
SMDA recently convinced Cigna to overturn a claims denial decision by filing a comprehensive administrative appeal of the LTD claims denial decision.
SMDA was hired by a client who worked for Norwegian Cruise Lines who developed significant back problems. His back problems became so severe that he was put off the ship by the ship’s doctor and shortly thereafter underwent back surgery. He did his best to return to work but continued to experience significant problems. The ship’s doctor again discharged him from the ship.
Despite this information, CIgna originally denied his claim for LTD insurance benefits. SMDA convinced Cigna to reverse its denial decision after obtaining, reviewing and analyzing the voluminous medical records and explaining why he continued to satisfy the insurance policy’s definition of disability.
In a case mentioned previously on this Blog, a Long Term Disability Insurer (MetLife) reversed its claims denial decision upon remand from Federal Court.
The client last worked in 2009 and can expect more than five years of past due benefits. This is an unusual circumstance for a case with a long and twisting procedural history.
The client originally came to SMDA while represented by another law firm while she was facing a motion to dismiss her case based on the statute of limitations. SMDA agreed to take her case and won the motion to dismiss-convincing the Court that the language of MetLife’s LTD insurance policy was ambiguous in explaining when she had to file suit to preserve her claim.
The US Supreme Court heard oral arguments yesterday in the Heimeshoff v Hartford Life case. The question considered by the Court was when does the statute of limitations start to run? Ms. Heimeshoff (and the Department of Labor who filed an amicus brief) argued that the limitations period should not commence until after her LTD claim was denied because she could not bring suit until she had exhausted her administrative remedies.
This case presents an interesting issue of whether an insurance company has the contractual right to require the statute of limitations to start running well before a claimant has the ability to bring a lawsuit. It would seem that issues of fundamental fairness would dictate that a limitations period cannot start to run before a claimant has the ability to seek court review.
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HartfordBusiness.com is reporting that LTD Insurer Cigna has agreed to pay $77 million dollars to settle claims brought by regulators in four states for improperly handling long term disability claims.
While it is not clear what initiated this particular dispute, it has been this firm’s experience that we see more complaints about Cigna LTD claims and cases than any other LTD carrier. In fact, we see more Cigna cases than most of the other LTD insurer’s combined. Cigna is my most “frequent flier.” I am not sure of that is because Cigna has the largest market share or if it is a result of its claims handling decisions. It would seem this regulatory settlement might favor the latter explanation. This reminds me of the Unum regulatory settlement almost 10 years ago. It will be interesting to follow this story as more details emerge.
If you have a Cigna claim that has been denied give us a call for a free consultation.
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I came across this recent article by the Onion satirizing Long Term Disability insurer giant, Cigna. WARNING-STRONG LANGUAGE, NOT APPROPRIATE FOR ALL. The article takes a satirical poke at CIGNA for failing to treat its insureds fairly. While the article is obviously based upon the Onion’s imagination it will likely strike a chord with anyone who has been put through the arduous LTD claims process or had their claim denied from some apparently bogus reason.
I have to say that I get more calls about CIGNA denials than almost all the other LTD insurance companies combined. I also have personally represented a number of clients where the claims denial rationale leaves me scratching my head. Bad claims decisions make good cases. Unfortunately, the client/insured is the one who pays the price while struggling to make ends meet until the claims denial can be reversed.
Our client went off work due to the progression of her Meniere’s disease.
She went back to work part-time and struggled to work five-hour days. She was scheduled to return to work full-time in November but was unable to do so due to her medical condition. She did gradually increase her hours but was never able to return to full-time work. She became completely unable to work the following March due to her Meniere’s disease and migraines.
When the LTD insurance company denied her appeal SMDA filed suit. During a court ordered facilitation a confidential settlement was reached.
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Long Term Disability Insurance Lawyer Blog