To put it bluntly, ERISA plans favor the insurance companies quite a bit in a number of ways. One of the prominent examples of this is the fact that you are not allowed to file any state law claims against the insurer for engaging in bad business practices with you during your time with them.
What does that really mean, though? How much does it matter in the grand scheme of things? Hopefully it won’t matter at all for you in your disability insurance claim, but the blanket refusal of state law claims forbids you from going after your insurance company for a number of potential issues.
ERISA Plans: What the “No State Law Claims” Rule Keeps You from Doing
If you have insurance through your employer, you have no recourse in state law for the following:
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Mental anguish claims. Let’s say your insurer gives you the runaround when you’re trying to get disability and the extra time leads to a worsening of your condition that harms your mental health. Under normal circumstances, you should be able to file a suit against them for their part in your suffering, but this is not the case under ERISA Law.
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Consequential damage claims. Did your insurer knowingly try to prevent you from obtaining disability benefits even though they knew that you met their requirements? This isn’t legal, but it also isn’t something you can even argue against or punish if you have disability insurance through your employer.
Punitive damage claims. Similar in some ways to the above claim, this one is designed to legally and financially punish those who engage in actions that cause others harm. For example, an insurance company that refuses to give you disability until your condition has worsened to the point that they can’t fight it anymore. Private plans allow you sue the insurance company for illegally forcing you to wait, but ERISA plans just don’t work that way.
Deceptive trade practice claims. Do you think that your insurer acted in a deceptive manner when handling your claim or engaged in behaviors that attempted to break their contract with you? Well, if you’re getting your disability insurance through your employer, this point isn’t allowed to come into play due to the fact that you can’t sue them under ERISA Law.
Mandatory attorney fee reimbursement. Yes, that’s right. As someone insured under ERISA, you don’t even have the right to fight to get your attorney fees reimbursed.
While ERISA law protects the disability insurance companies from having to answer for their wrongdoings, there are still plenty of ways to win you your disability benefits. This is why having an experienced ERISA attorney on your side is so important. Some disability attorneys are unfamiliar with all of the ERISA regulations and don’t know the best way to go about winning you your benefits. Marc Whitehead & Associates has over twenty years of experience fighting for disability benefits under ERISA guidelines and we can help you too.
For more information on ERISA Law and what you can do to win your claim under these regulations, download a copy of my free e-book. And be sure to check back weekly for new blogs!
