If you have a claim for benefits under an insurance policy or an employee benefit plan that has been wrongfully denied, the denial at its core is a breach of contract – breaching the promise to pay benefits. That breach of contract claim has traditionally been governed by state law. However in 1974 Congress passed the Employee Retirement Income Security Act known as ERISA designed to protect employees in employer sponsored pension and welfare benefit plans.
The general rule is that if your benefits are provided through an employer sponsored plan then it is governed by ERISA and not state law. The exception is if it is a governmental plan or church plan. In other words if you are employed by a governmental entity or a church you are not subject to ERISA. In that case your local state laws would govern your claim.
If you purchased your own disability policy, life insurance policy or accidental death and disability policy then all claims would continue to be governed by your local state law.
What Do You Do If Your ERISA Claim Is Denied?
1. Calendar the dates within which to file an appeal.
If your claim is denied you will receive a letter setting forth the reasons for denial. The letter will also set forth your rights to appeal the denial and the time frames for doing so. For disability claims that should be 180 days from receipt of the letter and for a life insurance or accidental death claim it should be 60 days. Calendar these dates because it is very important that your appeal is filed within that time frame.
2. Request a copy of your claim file.
You have a right under the law to a copy of your claim file (often referred to as the administrative record). You should make a written request for a copy of the entire claim file from the insurance company or administrator who denied your claim. They are obligated to provide you the file within 30 days of a written request. The file will include all the medical records reviewed, their own in-house physicians reports and those of their vocational consultants. This file will give you a better understanding of the reasons behind their denial.
3. Obtain a copy of your insurance policy or plan.
If you do not have a copy of your policy or plan you can obtain one from either your employer or the insurer who denied your claim. The policy and/or plan language is critical to your claim.
4. Contact an attorney who specializes in ERISA claims.
This may be a 1st step to take since an experienced ERISA attorney will take each of the above steps on your behalf if you have not already done so. If you believe your claim has significant value then it is well worth making sure that you obtain the assistance of an attorney specializing in ERISA claims. The law applicable to these claims is unique and technical. We have seen too many occasions where employees have tried to handle their own appeal or have an inexperienced attorney (their Worker’s Compensation or Social Security attorney) submit the appeal that make our job more difficult to fix the harm done. The initial conference with Stennett & Casino will cost you nothing. Therefore there is no reason not to get the input of an experienced ERISA attorney.