Michigan Lawyers Weekly recently published an article “Long term Disability Insurance and ERISA” written by SMDA Partner, Patrick Derkacz. Following is an excerpt from the article.
THE SET-UP
So your client got sick or hurt and hasn’t been able to work for months. They applied for LTD benefits when their doctor told them they cannot work anymore and haven’t had a paycheck for months. They are behind on their mortgage and car payment. They are getting hammered by late fees and might lose the house. They are holding on by their fingernails. They call in a panic because they just received a letter from the LTD insurer, explaining that the claim has been denied because the Insurer’s in-house nurse determined “there is no objective evidence that you are unable to perform the material and substantial duties of your occupation.”
After recovering from their shock and surprise they get angry. The client wants you to immediately file suit to make the insurer pays for their emotional distress, for all those late fees, for the insurance companies obvious bad faith. They want punitive damages. They want a million dollars. Surely a jury of their peers will punish this kind of behavior.
Not so fast you get to say. Have you ever heard of ERISA? No? Well, let me explain.
The article may be viewed at http://milawyersweekly.com/. A subscription is required.