Mr. K was working as a Sales Representative. His company had purchased a group long-term disability insurance policy through Liberty Mutual (underwritten by Liberty Life Assurance Company of Boston). This insurance policy provided long-term disability (LTD) insurance to all full-time, actively working employees.
When Mr. K’s symptoms associate with his medical conditions became such that he could no longer perform the duties of his own occupation, he applied for and began receiving short term disability benefits, approved by Liberty Mutual. Prior to the exhaustion of his STD benefits, Liberty Mutual informed Mr. K that his claim would be reviewed for consideration under the long-term disability policy. After its review, Liberty Mutual agreed he continued to be disabled under the terms of the LTD policy and paid his LTD benefits.
LTD Claim Termination
However, only one month later, Liberty Mutual terminated Mr. K’s LTD benefits and informed him that he was required to request a review within 180-days by submitting a letter stating the reasons he felt the claim should not have been denied. Despite not understanding what was required of him, due to Liberty Mutual’s deficient appeal instructions, Mr. K timely appealed this adverse decision providing the documentation Liberty Mutual suggested he submit. Despite the supporting evidence submitted by Mr. K, Liberty Mutual continued to deny his disability claim.
Mr. K then contacted our office requesting assistance with this denial. Our office submitted two separate requests for an additional opportunity to appeal his claim given the deficiencies in Liberty’s denial letter. ERISA requires that specific reasons for denial of plan benefits be communicated to the claimant and that the claimant be afforded an opportunity for “full and fair review” by the administrator. In this instance, we asserted that Liberty Mutual failed to provide our client with an accurate picture of the importance of the appeal process and the full breadth of evidence which could, and should, have been submitted. Liberty Mutual denied both requests knowing that the appeal evidence previously submitted could have been more detailed.
Lawsuit Filed Against Liberty Mutual
Given the lack of cooperation from Liberty and in light of its decision to deny benefits, our office filed a lawsuit in the federal district court in Colorado alleging that Liberty Mutual had failed to live up to the terms of the disability insurance contract. The parties eventually reached a mutually agreeable confidential settlement at mediation.
In our experience, insurers rarely explain to the denied claimant the importance of the internal appeal that must be submitted following a denial or termination of disability insurance benefits. The insurer is required to notify the insured of all evidence that can be submitted to “perfect” the claim but rarely does. If you have questions about a denied disability claim or require assistance with your internal appeal, please contact the Denver long-term disability attorneys at McDermott Law, LLC. Whether you are located in Colorado, the surrounding states or anywhere in the country, we can likely provide the specialized legal assistance you require.