Total Disability Benefits Paid for Policyholder in ERISA Case

Permanent and Total Disability Benefits Paid by National Union After Lawsuit Filed Following  Benefits Denial in ERISA Claim and Appeal

Long-term Disability Insurers Look for Any Opportunity to Deny a Claim

In a nutshell, National Union Fire Insurance Company (NUFIC) attempted to exploit our client Dan’s (not his real name) commendable attempt to return to work while totally disabled, even though that short attempt ended in failure. 

Dan, age 60, was a Process Technician at Dow Chemical Company. He fell while on a fishing trip and injured his arm and shoulder, leaving his arm useless after multiple surgeries. Dow had an ERISA-governed permanent and total disability plan insured by NUFIC. Benefits were payable if he were rendered “permanently and totally” disabled within 365 days of the date of the accident.

Insurance Companies Will Exploit Best Efforts to Work, Despite the Efforts Ending in Failure

At Dan’s insistence, before the 365 days were up, his surgeon released him to attempt a return to “light duty” desk work, with special accommodations, although telling Dan it would never work, and that he was permanently and totally disabled. Dow agreed to let him try. Dan reported to work at Dow for a short period, but literally “just sat there”. He couldn’t even reach to type or use a keyboard due to severe shoulder pain. Still less than 365 days post-accident, his surgeon essentially said “I told you so”, and declared him disabled from working in any capacity, as he knew he was all along. Even the Social Security Administration declared Dan totally disabled. 

NUFIC based its hair-splitting denial of benefits on the absence in the record of the word “permanently” in the surgeon’s declaration of total disability. Thus, said NUFIC, the record could not support the required “permanently and totally” disabled within 365 days after the accident. 

Insurance Companies Know How to Use ERISA Law Technicalities to Deny Claims. Claimants and Their Attorneys Need to Know as Well!

Technically, NUFIC was right. Dan came to us after administratively appealing the denial on his own. His appeal would have been his last chance to correct that technical shortfall in the record if an attorney had filed suit without curing the problem first. Under ERISA law, the court cannot consider any evidence that was not made a part of the official administrative record before suit is filed. 

So we got with his surgeon to confirm that Dan was “permanently and totally” disabled before the 365 day mark after his accident, although the medical record had left out the “permanently” part. The surgeon issued a “to whom it may concern” letter to that effect. By sending the letter to NUFIC before filing suit with a request that they consider it and reconsider their denial, it became part of the administrative record for the court to consider. NUFIC rejected it, so we filed suit seeking full benefits and attorney fees. NUFIC later saw the light and settled the case at mediation for a confidential sum. 

Dan had paid years of premium for permanent and total disability coverage, and never should have been forced to sue for the benefits he was entitled to receive.

Results may vary. Every case is different, and no outcome can be guaranteed.