Many group life insurance plans maintained inside the United States are ERISA plans. ERISA plans are employer-sponsored plans that usually deduct premium payments from the employees or make contributions by the employer. ERISA does not apply to welfare group plans established or maintained by government organizations or religious institutions. In spite of the fact that ERISA offers many protections to plan participants, many claimants are denied their benefits.
ERISA laws are very complex and can be very case-specific. A person who just lost a loved one may have a hard time navigating an ERISA life insurance claim denial without legal help. If your ERISA claim has been denied, be aware of a time frame within which you are expected to file a comprehensive legal brief. The administrative appeal is the first mandatory step in fighting an ERISA claim denial and you should consider consulting a lawyer.
In this article, our ERISA attorneys have prepared a guide to help you better understand how ERISA works, what rights plan beneficiaries have and how to fight a claim denial. If you, or someone you know has issues with a denied ERISA claim, call us at 888-510-2212 for a free consultation.
What Is ERISA and How Does It Work?
ERISA, Employee Retirement Income Security Act of 1974, is a federal law that governs all claims for benefits from an employee or group welfare benefit plan. An employee welfare benefit plan is any plan, fund, or program established or maintained by an employer or by an employee organization which provides employee benefits such as life, health, or disability. As such, if your right to benefits was through a plan established by a private sector employer or an employee organization (e.g., a labor union), it is most likely governed by ERISA.
The purpose of ERISA is to require plans to provide participants with accurate plan information about plan features, outline fiduciary responsibilities for the plan administrator and managers, establish a complaint and appeals process for participants whose benefits have been denied, and give participants the right to sue for denied benefits and breaches of fiduciary duty.
What Plans are Covered by ERISA?
In most cases, when the employer buys life insurance for its employees, it is provided through an insurance company. If there is a plan and the plan was “established or maintained” by a private sector employer (or employee organization), it is probably covered by ERISA.
There are two exceptions to ERISA coverage:
- Plans sponsored by churches and church-related entities are not covered by ERISA, unless an election is made to have ERISA coverage.
- Plans established or maintained by government entities for their employees, or plans which are maintained solely to comply with workers’ compensation, unemployment, or disability laws are not covered by ERISA.
How Do I Know If My Benefit Plan Is Controlled By ERISA?
If your Employer is engaged in any of the following activities, a Court will likely find that the employer “established or maintained” the Plan, mandating ERISA coverage.
- The employer is paying all or even part of the policy premiums;
- The employer is urging employees to join the plan;
- The employer is retaining some of the deducted premium to administer the plan;
- The employer is keeping track of who is in the plan;
- The employer is answering questions for the plan members about their coverage.
What Does an ERISA Life Insurance Attorney Do?
A life insurance attorney specializing in ERISA analyzes how an ERISA plan operates and makes sure plan participants are offered all the protections under the law. If a life insurance claim is wrongfully denied, an ERISA attorney will represent beneficiaries in their ERISA appeal and litigation to recover the denied life insurance benefits. You should hire a life insurance lawyer specializing in ERISA if:
- your employer/insurer provided you with incorrect or misleading information about your life insurance coverage;
- your employer/insurer terminated your life insurance coverage without informing you;
- your employer/insurer failed to advise you of your rights to your life insurance coverage if your employment terminated;
- your employer/insurer withdrew premiums from your paycheck for life insurance coverage that did not exist;
- Your employer/insurer approved your evidence of insurability (statement of health) and withdrew premiums from your paycheck for increased coverage but denied your life insurance claim after the insured’s death;
- your employer/insurer failed to provide you with a copy of the life insurance policy/Summary Plan Description or denied you access to plan documents regarding your life insurance benefit;
- your employer/insurer revoked you as a beneficiary on a life insurance policy without explanation.
ERISA Claims Procedures
Before an ERISA life insurance claim is filed, it is important to check your Summary Plan Description and Summary of Benefits and Coverage to ensure the beneficiary is eligible to receive benefits. Plans usually provide specific definitions for eligibility. For example, in some cases, a dependent can only be insured up to a certain age and stops being considered a dependent if his/her status changes. In other cases, only full-time employees who are actively at work are eligible for coverage.
The Summary Plan Description provided by the plan must have information on where to send your completed claim forms, what additional documents to include, and the plan’s contact information. If you decide to file an ERISA life insurance claim yourself, you may want to contact your employer/HR and request claim forms and all relevant details in filing a claim. Keeping a thorough record of your communications with the employer and the insurance company is essential in making sure you do not miss a deadline.
If you want to make sure you file the claim and do it correctly within the required time frame, our lawyers can help. Call 888-510-2212 for a free case evaluation.
Denied ERISA Claims
If your life insurance ERISA claim is denied, the insurance company must send you a denial letter in writing. The denial letter must include the following information:
- The reasons why your claim was denied;
- The specific provisions in the insurance plan on which the denial is based;
- What documents and the insurance company reviewed in deciding your claim;
- What additional information you need to include in your appeal for the insurance company to reconsider your original claim;
- How to correctly submit an appeal;
- The deadline to file an appeal;
- A description of your rights as an ERISA beneficiary to file a lawsuit to recover the proceeds.
ERISA Appeal Process
An ERISA appeal is the procedure you must follow if your claim for benefits was denied under ERISA law.
In most ERISA cases, you need to submit an administrative appeal before filing a lawsuit against the insurance company or the employer. Otherwise, your court action may be barred. To maximize your chances at recovering the full and fair benefits you are owed, you need to consult with a lawyer that has experience with ERISA cases.
How to File an Appeal Successfully
The denial letter which the insurer sends to the beneficiary usually sets out a procedure for filing an ERISA appeal – it provides the appeals unit address, ERISA deadlines and the information on the independent review examiner who will conduct the review.
It is in your best interests to have the assistance of a competent, experienced ERISA attorney when you file an appeal.
However if you decide to file an appeal on your own, keep in mind the following tips:
- As a beneficiary to a denied ERISA claim, you are entitled to only one appeal;
- The deadline to file an ERISA appeal is usually 60 days from the date you receive the denial letter. This means that within sixty days you need to investigate the denial, gather supporting documents, draft the appeal and file it;
- Failure to appeal before the given deadline means you waive your right to pursue the claim any further;
- If you call the insurance company and state that you “want to appeal the denial of benefits,” the insurer may treat your statement as an appeal and will start a review process immediately. If you later file a formal appeal, it will not be accepted. Make sure that you clearly state that you intend to file an appeal in the near future and now want to get the life insurance policy and other relevant records in order to prepare for the appeal;
- Every piece of information you plan to include in a lawsuit must be part of the record during the appeal;
- Any information you omit may never be heard or considered by a court.
- Review of an appeal usually takes 60 days and the insurer will notify you in writing if there is a delay. In rare cases where the appeal review is conducted by a committee or board of trustees which meets at least quarterly, making a decision on your appeal can take up to 120 days;
- Once the final decision has been made, you will be told the reason and the plan rules upon which the decision was based;
- If your appeal is denied, you cannot file another administrative appeal with the help of a lawyer.
Your appeal should include:
- New evidence – documentation, legal briefs, medical opinions, research reports, expert reports, etc.;
- The complete file on the insured from the insurance company before initiating an appeal. The file may include the life insurance policy, doctor’s notes, medical records, videos, expert opinions, internal call/email log, videos and recorded phone conversations;
- Relevant ERISA provisions;
- Additional statements from doctors if the claim denial is based on health history of the insured;
- Written affidavits from your friends and family members if they are familiar with the insured’s health/condition/circumstances and can support your position.
Unfortunately, even if with these precautions, an appeal prepared without a legal brief is rarely winning. ERISA laws are very complex and require a thorough investigation. Consider consulting legal counsel. Life insurance lawyers at our law firm have the experience you need to help you recover your ERISA benefits.
What If Your Appeal Was Denied: ERISA Lawsuits
ERISA mandates that before a beneficiary files a lawsuit after her claim has been denied, she should exhaust all administrative remedies – submit an internal appeal. In other words, if your life insurance claim is controlled by ERISA and it has been denied, you can only file a lawsuit after your administrative appeal is denied. Read more about how to deal with ERISA litigations.
If you consider filing a lawsuit to review a denied claim under ERISA, our law firm can help. We have successfully reversed many denied life insurance claims and can help you recover your wrongfully denied benefits fast.
Our ERISA Attorneys Can Help Win Denied Claims and Appeals
At Kadetskaya Law Firm, we have a high success rate of recovering the benefits our clients were rightfully entitled to.
Our ERISA attorneys work on a contingent fee basis – it means you will not need to pay unless you recover the proceeds. Only then will we charge a reasonable legal fee. We take pride in offering competitive contingent fee structures and will work with you to ensure you are comfortable with the fee.
If you or someone you know has issues with a denied ERISA claim, call us at 888-510-2212 for a free consultation. We have the experience you need to win your case.
Here are a few cases successfully handled by our ERISA lawyers: