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While this blog is normally devoted to all things Long Term Disability, I wanted to give a shout out to my legal partner, Phil Serafini who obtained an outstanding result in a automobile no-fault case.

SMDA was contacted by the mother of a minor who was involved in a serious one car MVA on 7/23/12 one day before a lawsuit had to be filed to force their car insurance company, Home – Owners, to pay her daughter’s Michigan No-Fault Insurance Benefits. Their insurance company denied the claim because at the time of the MVA, the client was 15 years old and driving, contrary to Michigan law, without a parent in the car and her mother had given a statement to Home-Owners that her daughter did not have permission. Her father allegedly made a comment at the scene that could be construed as meaning that his daughter did not have permission as well.

The primary issue for trial was whether the minor had her parents’ permission to take their car on the date of the MVA. If she had taken the vehicle without permission, she would be barred from no fault benefits under MCL 500.3113(a). Her mother testified at trial that Alison had permission and that she wasn’t initially truthful with the Home-Owners adjuster as she was concerned she could go to jail as the owner of the vehicle and be unable to care for her catastrophically injured daughter. Her father testified at trial that Alison had permission the day of the MVA and that he didn’t recall the alleged statement at the accident scene. However, if such statement was made, it would have been directed towards her mother as he initially disagreed with her decision to let Alison take and operate the vehicle without a parent present. Alison’s discovery deposition, now deceased, was read at trial. She also testified she had parents’ permission to regularly take and use the car before and on the date of the MVA.

A panel of the 6th Circuit Court of appeals recently overturned Aetna Life Insurance Company’s decision denying LTD benefits to one of our client’s. In Mckenna v Aetna Life Insurance Co. the court found that Aetna improperly rejected our client’s claim for benefits.

In sum, although it is Appellant’s burden to prove that she was entitled to LTD benefits, she unquestionably met that burden when she proved to Aetna’s satisfaction that her condition resulted in functional impairments that prevented her from performing the material duties of her own occupation through February 23, 2013.

The court explained:

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.

While this Blog is usually devoted to issues involving LTD claims and cases, I felt I needed to go off topic for a minute.

The Michigan Supreme Court issued a decision this past week in a case where a disabled young man drowned in a public swimming pool. Investigation revealed that the lifeguard on duty was distracted, not in his designated position, and ignored several calls for help from another student who saw the disabled young man under water.

In an opinion written by (Justice) Brian Zahra the Court dismissed the claim finding that the lifeguard’s failure to act was not the proximate cause of the young man’s death even though timely action might have prevented his death. Instead, and I am not making this up, the Court determined the proximate cause of death was “that which caused him to remain submerged in the deep end of the pool without resurfacing.”

In Rochow v. Life Ins. Co. of N. Am., 2015 U.S. App. LEXIS 3532 (6th Cir. 2015), the Sixth Circuit Court of Appeals (the Court) en banc overturned a previous decision of a 3 judge panel that had allowed plaintiff’s claim for the disgorgement of profits earned by the disability insurer.

Background: Under the ERISA statute and regulations the only traditional remedy for a claimant was the recovery of the monthly LTD benefits that were wrongfully denied. This remedial scheme has one very large problem-there is no incentive for the LTD insurance company to pay the benefits. In other words, if the LTD insurance company denies a claim for benefits, it gets to keep and use the money during the time period it takes for the claimant to file his or her claim, administrative appeal and lawsuit. During that time the insurance company can invest this money and earn a significant return. At the same time, the claimant is deprived of the use of the money. So, at the end of the day, if a claimant wins their ERISA suit for LTD benefits, the LTD insurer only pays the past due monthly benefits and gets to keep the return on the investment. In Rochow’s case the Life Insurance Company of North America was eventually ordered to pay about $700,000 in disability benefits, but it got to keep almost 3 million dollars it had earned on the money while the claim and lawsuit was pending.
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The US District Court for the Eastern District of Michigan recently determined that LTD Insurer-MetLife wrongfully denied a claimant’s request for LTD benefits.

SMDA was retained by the claimant after her administrative remedies had been exhausted and suit had been filed. The client had been employed as an Audit Manager for Deloitte LLP when she developed a condition which caused orthostatic intolerance which resulted in unpredictable and intermittent dizziness and fainting spells. Her own doctors said that when these episodes occurred she must be able to lie down during the day.

MetLife obtained a paid paper review by an outside physician who determined that the Insured “may need to sit or lie down as needed.” Relying on this recommendation, MetLife’s in-house vocational reviewer then concluded that the claimant was capable of performing the duties of her own occupation because her employer would allow her to “sit as needed.”

SMDA recently convinced Long Term Disability Insurer Cigna to reverse its original claims denial decision by filing a comprehensive administrative appeal.

SMDA was retained by a very nice client who was having significant mental health problems that were significantly aggravated by stress. The client retained our firm after Cigna rejected her claim for LTD benefits but prior to the expiration of the 180 day period she had to complete her administrative appeal. The ability to appeal the claims denial decision within 180 days is required by the ERISA statute and regulations.

Upon consideration of the administrative appeal Cigna overturned the claims denial decision and retroactively reinstated the clients LTD benefits. The client received a lump sum for the past due benefits and will continue to receive monthly benefit checks so long as she continues to meet the policy’s definition of disability during the 24 month pay period for mental health problems.

SMDA recently convinced Long Term Disability Insurer, Lincoln Financial Group, to reverse its decision to deny Disability Benefit payments to a Physician.

Our client had developed a degenerative orthopedic condition that resulted in several joint replacement surgeries. Lincoln Financial voluntarily paid Total Disability benefits while the client was recovering from each of the surgeries.

However, when the doctor returned to work he was only able to resume a part time schedule. Lincoln Financial rejected the physicians claim for additional benefits asserting that he was no longer Totally Disabled. However, upon examination of the Plan document it became apparent that the policy provided for Partial Disability benefits. SMDA convinced Lincoln to reverse its claims denial decision by filing a comprehensive administrative appeal analyzing the Plan language as well as the clients ongoing restrictions and limitations.

SMDA recently convinced an LTD insurer to overturn its claims denial decision by filing a comprehensive administrative appeal on behalf of our client. SMDA’s client had filed a claim for disability benefits as a result of serious depression and anxiety. The LTD insurance company originally denied the claim contending that since the claimant was still able to care for her profoundly disabled teenager she was not entitled to disability benefits.

SMDA successfully pointed out the fallacy of this argument convincing the insurer to retroactively reinstate the disability benefit claim and put the client back on claim.

The Michigan Department of Insurance and Financial Services released its list of complaint ratios for 2013 recently. Leading the pack by a wide margin, with 101 complaints, State Farm Mutual Auto Insurance Company had more than twice the volume of complaints than its nearest competitor. Although, to be fair, if you added up all of the complaints against Allstate and related entities it is pretty close. By my count there were (14+27+7+46=94) complaints against Allstate and Esurance.

These results come as no surprise as our firm frequently sees claims denied by each of these companies.