Michigan ERISA Lawyers
You worked hard and built your career in order to achieve a fulfilling lifestyle. But a serious health problem can quickly throw everything into disarray.
When you have long-term disability (LTD) insurance, you have protection against a health crisis that could lead to a financial crisis because you can’t work.
The income from LTD insurance can keep you financially independent.
Long-term disability insurance policies, however, are not all the same.
This kind of insurance comes in two major types:
- Employer plans, usually governed by ERISA, the federal Employee Retirement Income Security Act
- Individual plans, which you buy privately from an insurance agent and are subject to state laws, not federal ERISA rules
If your insurer denied your long-term disability benefits—or terminated benefits you already were receiving—your next steps will be shaped by the type of policy you have.
An experienced LTD lawyer, like those at Levine Benjamin Law Firm, can help you understand your options.
What would you like to do?
Get Your Maximum Benefits:
ERISA vs. Individual Plans
Differences between ERISA and individual LTD plans come in several areas:
- Your Premium Costs
- Your Benefit Amounts
- Definitions of Disability
- Your Avenues of Appeal
- Which Court Hears Your Case
- How Courts View Your Claim
- Taking Your Coverage with You
- The Taxes You Pay
1. Your Premium Costs
Long-term disability coverage offered by your employer (under ERISA) is generally less expensive than individual plans you can buy privately. Your employer might even pay some or all of the monthly premiums.
2. Your Benefit Amounts
When you have to make a claim because you can’t work, a group plan through your job generally provides smaller payments than individual plans—in the range of 50% to 75% of your salary
Individual plans usually pay more, and you can choose the amount of your coverage.
3. Definitions of Disability
Long-term disability insurance categorizes disabilities in two ways: Health problems that prevent you from doing your own job and health problems that prevent you from doing any job.
It’s harder to win benefits if you have to prove you can’t do any job that exists. But this is what many ERISA plans require. Or they say you can get benefits if you can’t do your own job for 24 months—but after 24 months, they raise the standard so you must show you can’t do any job.
With individual policies, you can arrange “own job” and “any job” coverage however you like.
4. Your Avenues of Appeal
When your long-term disability benefits are denied or terminated, you can—and often should—appeal the decision.
With ERISA plans, you have to go all the way through your insurer’s appeals process before you can file a lawsuit to get your benefits. If you have an individual policy, you don’t necessarily have to go through every step of appeals within the insurance company before you can sue.
5. Which Court Hears Your Case
Sometimes when other appeals don’t work, you have to go to court. Your type of policy determines which court you use.
If you have a group, ERISA policy, you have to sue in federal court. Individual policies allow you to sue in state court over issues such as insurance bad faith and breach of contract.
6. How Courts View Your Claim
When you go to court under ERISA with your employer’s LTD policy, you have to prove that by denying your claim, the insurance company lacked any evidence and was flat-out wrong.
When an insurer denies or stops your benefits in an individual policy, state courts will consider whether the insurer violated the contract it had with you.
7. Taking Your Coverage with You
When you leave a job, your coverage under a group plan ends. You can keep your individual LTD coverage when you change jobs or have periods of unemployment.
8. The Taxes You Pay
Under group plans, your long-term disability insurance premiums are usually paid, either by you or your employer, before taxes are deducted. But when you receive benefits, you have to pay income taxes on those benefits.
Under individual plans, you usually pay for your coverage with after-tax money. But when the policy is paying you benefits, you don’t have to pay taxes on those payments.
How to Fight Your LTD Denial
When you’re denied long-term disability benefits, you should appeal to protect the life you’ve built.
But LTD is a complicated area of law.
Don’t miss any deadlines during your appeal. That could jeopardize your case.
Sometimes insurance companies conduct surveillance on you looking for reasons to turn you down. Sometimes they tell you just to write a letter protesting your denial, but that’s not good enough.
Your exact strategy for your appeal will be driven by the kind of policy you have and your particular circumstances.
Bring In Someone to Back You Up
It’s best to talk to a lawyer.
At Levine Benjamin, we’ll evaluate your case for free. And we don’t charge a fee until you win.
Levine Benjamin Law Firm has experienced long-term disability lawyers who can fight to get you the maximum possible disability income.