Important disclaimer: The information in this blog post is intended as general guidance for lawsuits filed under the Employee Retirement Income Security Act of 1974 (ERISA). If your claim is regarding an individual disability insurance policy not governed by ERISA, different steps will apply. Furthermore, every case is unique and you should consult an attorney for further information on your particular case.
If your Long-Term Disability benefits from an insurer such as The Hartford, MetLife, Reliance Standard Life Insurance Company, or Unum have been denied and you have exhausted all of your appeal rights under the terms of your policy, your next option is typically to file a lawsuit against the insurance company in federal court. If you haven’t already gotten an attorney to help you with the appeal process, this is the point where you will likely want to speak with an attorney to see if they can help with your case and file the lawsuit for you.
Once the lawsuit has been filed, you might be wondering what’s next? The below is a general outline of the next steps for Long-Term Disability Insurance lawsuits.
1. Your attorney will file the initiating document to start the lawsuit, called a complaint.
2. The insurance company will be served with the complaint and will have to file its answer to the complaint.
3. The court will set a scheduling conference, which will be a call between the parties’ attorneys to set the schedule for the case, including the dates that briefs to the court will be filed.
4. The insurance company will produce the administrative record, which consists of your claim file, containing any information reviewed by or produced by the insurance company during the review of your benefit claim.
5. Your attorney will review the administrative record and confirm that there are no disputes. A dispute may arise if the record contains something it shouldn’t contain, or if it does not contain something that it should contain.
6. The insurance company will file the record with the court. This is what the parties will use as a reference for the facts that support their positions.
7. On the appointed deadline, your attorney will submit a brief (a legal argument) in support of your claim for benefits and proposed findings of fact which lay out the relevant facts of the case.
8. Depending on the court/judge, the insurance company may also file a brief in support of their position at the same time, along with their own proposed facts, or they may only file a response to your brief and proposed findings of fact.
9. Your attorney will file a response or reply to the insurance company’s brief and their proposed findings of fact.
After each side has filed their briefs, the judge will make a determination on the claim. This can take several months or up to a year or more depending on the court’s schedule. The judge will make their determination only on the written record and briefs from the parties and you will not be able to speak to the judge or testify in front of a jury. You will also not be able to submit new evidence for the judge to consider, which is why it is important to have an attorney during the appeal stage to help ensure that all supportive evidence is submitted before the insurance company renders its final determination.
Potential Outcomes
The judge may decide that the insurance company’s decision was reasonable, in which case the insurance company will win the case and you will not receive any compensation.
The judge may determine that the insurance company’s decision to deny your benefits was unreasonable because they didn’t review the evidence completely enough, or there was a procedural issue, but may determine that there is not enough information in the record to actually award benefits. If that is the case, the judge will issue a remand and send your claim back to the insurance company to take another look at your claim.
The judge may also determine that the insurance company’s decision to deny your benefits was unreasonable and there is enough information for the judge to award back benefits (meaning what the insurance company should have paid you in the past). Typically the back benefit award will cover from the date the insurance company denied your claim until the date their rendered their final determination (because the judge will not have medical evidence beyond that point). At that point, the judge will remand your claim back to the insurance company for ongoing management of the claim.
Once the judge issues their determination, the losing side (either the claimant or the insurance company) may appeal the decision to the Court of Appeals. The winning side may file a request with the court to have the losing side pay their attorney’s fees.
Settlement Discussions
At any point in the lawsuit process (or even before the lawsuit is filed), the parties may engage in settlement negotiations. Before beginning settlement discussions, your attorney will talk you through what your worst case scenario and best case scenario would be if you let the judge decide the case, as well as what your future benefits would be worth if the insurance company had continued to approve your claim through the maximum benefit period. A settlement would involve the insurance company paying you one lump sum of money in order to completely close out the claim. The benefits of settlement include a faster resolution to the case, avoiding the risk of potentially losing the case if you let the judge decide, and avoiding having to continue to deal with the insurance company on an ongoing basis.
An Attorney Will Handle a Lawsuit Against the Long-Term Disability Carrier
When going up against an insurance company in court, it’s important to have an experienced attorney on your side. Whether you’re just looking into applying for benefits, appealing an insurance company’s denial, or at the point where a lawsuit is the next steps, if you would like to consult with an ERISA attorney, call our Madison office at 608-257-0040 or our Milwaukee office at 414-271-8650.