The primary focus of ERISA – the Employee Retirement Income Security Act of 1974 is regulating retirement plans of private employers. But ERISA protections affect many other employee benefits, including disability insurance plans.
Workers should understand that ERISA applies only to disability insurance employers provide but not those that employees can purchase elsewhere. Knowing how these plans are administered and your rights are essential if an insurance company denies a disability claim.
Employer requirements for disability benefits
Under ERISA-regulated disability plans, employers must provide their workers with information on their rights to obtain disability benefits. These government-mandated requirements include:
- Comprehensive descriptions of what is covered and what is not covered
- A step-by-step explanation of filing a claim if you are injured
- Overview of the appeals process if the insurer denies the claim
While employers manage these plans, insurance companies usually administer them. The insurer’s goal is to pay out as little as possible as it is normally the insurance company’s money that is paid out. (There are self-insured plans where the employer pays the benefit, and an insurance company may just administer the claims.)
Reasons that ERISA disability claims are denied
After you file a claim, insurance providers must accept or deny it within 45 days. However, they can extend that period by 30 days with notification. Denials can happen for many reasons, such as:
- Paperwork errors, lack of details or missed deadlines
- Inadequate medical documentation
- Pre-existing conditions
- Policy exclusions
- Evidence through social media or other sources that contradict your claim
Many rejections result from honest mistakes, but insurance companies look for any technicality to deny benefits.
Appealing a rejected claim
If your claim is denied, ERISA guidelines dictate the deadlines to file an appeal as well as for the insurance company to accept or reject your appeal. It is crucial to supply as much supporting evidence as possible, that may letters from your employer, witnesses and detailed doctor’s reports.
Providing this information during the appeal is also crucial in case the insurer refuses to change its decision, and you file a lawsuit claiming they wrongly denied your benefits. Without proper and supportive documentation being submitted to the insurance company during the appeal review process, the judge will likely not allow it to be introduced during litigation and therefore may be more likely to accept the insurer’s decision.
Disability claims are complex, so it is advisable to consult an experienced ERISA attorney at the beginning of the process. This is especially true if your disability keeps you from working and you have no other source of income. Your attorney understands the complex ERISA requirements as well as your rights in getting the benefits you deserve.