The Employment Retirement Income Security Act of 1974 (ERISA) is designed to protect the assets of those who place funds in retirement accounts while they are working is available when they retire or become disabled. Under ERISA, short-term and long-term disability policies are known as “plans” while those covered under them are known as “participants.” Despite the fact that ERISA is designed to protect benefits provided to employers, it sometimes makes it difficult for employees to obtain disability benefits.
De Novo Review
Before the enactment of ERISA, anyone who was wrongfully denied disability benefits could file a lawsuit under state law in order to enforce the disability contract. The court would then review the case “anew,” which is where the term “de novo review” comes from, and make a decision independent of the insurance company’s decision regarding the disability of the employee. After the passage of ERISA, however, the court no longer applied a de novo review, but instead only looked to see if there was a rational basis for the denial of the claim. The court only reviewed whether the insurer abused discretion or acted arbitrarily in denying the claim. Therefore, even if the court believes the person is truly disabled, if they find that the insurer had any rational reason for denying the claim, they may uphold the denial.
Private Employers Only
Our VA disability lawyers say that ERISA does not cover plans held by government employees. In addition, some church employees, as well as hospital employees who work in church-owned hospitals, may be exempt from ERISA standards as well. It is important to note that handling an ERISA claim is significantly different than handling other insurance claims, especially if a lawsuit will be required.
Contact VA Disability Lawyers
If you or a loved one has been placed on short- or long-term disability and your claim has been denied by the insurance company, it is critical that you contact experienced VA disability lawyers immediately in order to appeal your denial. Contact David M. Hicks at 314-812-4885 to arrange for a consultation regarding your rights under the law.