Some people have access to long-term disability (LTD) insurance policies through their employers. Other people, who are perhaps self-employed or whose employers who do not offer this coverage, may purchase an individual LTD insurance policy through an insurance broker. The major difference between the two policies concerns the rights and protections that you have under these policies. As an individual policyholder, you have individual rights and remedies that you do not have as a group policyholder.

Most group LTD policies are governed by the Employee Retirement Income Security Act (ERISA), which governs the procedures that insurance companies must follow in maintaining and administering these policies. ERISA, however, also severely limits the rights of individual policyholders when it comes to the denial of benefits and appeal rights. As a result, it is crucial to know whether you have an employer-sponsored policy that falls under ERISA or an individual policy that offers you far more rights.

For example, if an insurance company denies you LTD benefits pursuant to a group policy governed by ERISA, you cannot file a lawsuit in court challenging that decision, in which you normally would have a trial in front of a jury or judge. Rather, ERISA requires you to first exhaust your administrative remedies, which means that you must file an administrative appeal with your insurance company if it denies you benefits. You can submit additional information, but there is no requirement that your insurance company actively obtain more medical information or even rely on a medical professional to make a decision about your claim.

Furthermore, if the insurance company denies your claim following your administrative appeal, you can file an appeal in federal court. However, you will not appear in court, there will be no trial over the matter, and the judge will never hear testimony from any medical experts. Rather, the judge is limited to reviewing the documents and records provided by the insurance company. The only decision for the judge is whether the insurance company made an incorrect decision based on the evidence that it had to consider. Unlike with an individual LTD policy, there is no trial, no opportunity to be heard, and no chance to argue your case in front of a judge.

Bonnici Law Group has handled the claims of countless individuals who have encountered difficulties in procuring long-term disability benefits under their employers’ ERISA-governed insurance policies. We will protect your rights and advocate on your behalf throughout every stage of the claims process. Call our office at 858-261-5454 to set up an appointment to speak with us today.