Long Term Disability Insurance claims can be difficult to effectively litigate conflict in federal court. One of the difficulties for claimants to overcome is the restrictive discovery rules that have evolved from the common law governing the Employee Retirement Income Securities Act (ERISA). ERISA applies to most disability insurance claims. “Discovery” refers to the ability of the parties in litigation to request information from the other side, such as in the form of written questions or oral depositions of individuals.
Disability Insurance Companies Use ERISA as a Shield
Insurance company such as Unum, Cigna, MetLife, The Hartford, and Aetna typically use ERISA common law as a shield and take the position that they do not have to comply with the disabled claimant’s discovery requests. The goal of the insurance companies is to prevent the claimant from investigace-companies/aetna-disabilitting whether their claim was handled fairly under the rules. In the Fifth Circuit, they have relied on an court opinion in Vega v. National Life Insurance Services, Inc. and its progeny, to argue that the only admissible [and therefore discoverable] evidence in an ERISA action was 1) the administrative record; 2) evidence involving the interpretation of the Plan; and 3) evidence explaining medical terms and procedures. This interpretation has greatly hindered the efforts of long term disability insurance claimants to investigate and prove abuse by the insurance companies.
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Supreme Court case of Metropolitan Life v. Glenn Recognizes Insurance Companies Conflict of Interest
This unfair discovery rule has changed for the better recently because of two recent cases. The Supreme Court recognized in Metropolitan Life Insurance Co. v. Glenn that when “a plan administrator both evaluates claims for benefits and pays benefits claims,” it creates a structural conflict of interest. 554 U.S. 105, 128 S. Ct. 2348, 171 L. Ed. 2d 299 (2008). The level of conflict is a factor in determining the court’s standard of review, abuse of discretion or de novo.
Fifth Circuit case of Crosby v. Louisiana Health Service Opens up Investigative Discovery Process of Insurance Company’s Unfair Practices
The Fifth Circuit Court of Appeals in Crosby v. Louisiana Health Service, 2011 U.S. App. Lexis 14739, (5th Cir. La., 2011) has recently held that discovery is permissible on “the existence and extent of a conflict of interest created by a plan administrator’s dual role in making benefits determinations and funding the plan.” Further, discovery is permissible regarding the “completeness of the administrative record [and] whether the plan administrator complied with ERISA’s procedural regulations.” In using the words “existence and extent of a conflict of interest” plaintiff can argue that the individual conflict of interest of the administrator’s employees, agents and consultants are discoverable as well.
If you have a long term disability insurance claim that has been denied and you have questions, contact disability attorney Marc Whitehead at 800-562-9830 or visit him at disabilitydenials.com and download his free ebook.
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