Unum rakes in billions of dollars each year selling group and individual disability insurance plans to employees and individuals in the U.S. and UK. Like a lot of insurance companies, Unum is quick to take your money, but not so quick when it comes to paying you disability benefits if you find yourself unable to work due to an illness or injury. Unum is one of the leaders in denying disability benefits claims. Their tactics aren’t always ethical, and the company has been ordered by the courts to pay out millions in fines and settlements.
$40 Million Settlement
In 2008, a class action lawsuit was filed alleging that Unum (as Unum Provident) misled investors by inflating its stock share price by producing inaccurate accounting and financial statements, as well as resorting to improper handling of disability claims. The lawsuit involved thousands of people who bought Unum Provident securities from March 2000 to April 2003.
Unum Group agreed to pay a federal class action settlement in the amount of $40 million, accepting the settlement without admitting liability. Unum has created a $40 million fund to be distributed among these investors. Unum still denies the allegation.
From Class Action to Lawsuit Alleging Social Security Fraud
Shortly after this class action lawsuit, Unum faced another lawsuit filed on behalf of the Social Security Administration. This lawsuit was filed under the False Claims Act, a federal qui-tam (whistleblower) statute that grants citizens the ability to sue on behalf of government programs if they believe they have evidence of fraud.
Unum was alleged to have required disability claimants to apply for Social Security disability benefits, even though they were not eligible, as a prerequisite for receiving their insurance payments under their Unum policy.
The criteria for qualifying for disability benefits under the Social Security Administration are much stricter than most private insurers, as Unum is well aware. This tactic results in policyholders filing false or obviously ineligible claims to the SSA, the objective being to create longer delays in Unum’s claims processing.
The lawsuit asserted that these referrals were clogging up an already overloaded Social Security disability system with questionable applications, and forcing taxpayers to pay to pick up the tab for the needless processing costs — all to create more profit for Unum.
Although it is standard practice for insurance companies to urge claimants to file for Social Security Disability, it serves no one’s interest other than Unum’s when they know the claimant will not be found eligible for Social Security disability in the first place. It’s simply a ploy by which Unum can delay, deny, reduce or terminate claims that would be payable under their own policies.
Has Unum Asked You to Apply For SSDI Benefits?
Unum Group, one of the largest insurance companies in the world, still dominates the US market for disability insurance. If you’ve been told by Unum or another insurer to file for SSA disability benefits as a condition for having your Unum claim for disability benefits approved, please contact the Unum disability attorneys at Marc Whitehead & Associates to discuss your concerns.
Marc Whitehead & Associates is a national disability insurance law firm that has earned the trust and respect from clients across the country. Don’t fall for Unum’s delay and denial games. Contact Marc Whitehead & Associates to help you get the disability benefits you deserve.
Want to learn more about Unum’s history of class action lawsuits? Check out our article, A History of Unum and Class Actions.