The Basics of Long-Term Disability Insurance 

A person never knows when they may be injured in a car crash or come down with a serious and debilitating illness. For this reason, many Illinois residents choose to purchase long-term disability insurance policies that will protect them in the event that a disability renders them unable to work. Unfortunately, insurers are notorious for denying valid claims, which can have serious consequences for disabled policyholders and their family members. 

Furthermore, while claimants who have had their claims denied can appeal the decision, the process that they must go through depends in large part on whether the policy is provided by a private insurer or whether the benefits were offered as part of an employer-sponsored plan. In either case, filing a claim and appealing a denial can take time and require policyholders to jump through a number of procedural hoops. If you are unable to work as a result of a disability, it is critical to retain an experienced long-term disability attorney who can evaluate your case. 

Rules for Insurance Providers

Almost all plans provided by Chicago employers are subject to a law called The Employee Retirement Income Security Act of 1974, or ERISA for short. In fact, some of the only exceptions apply to those plans offered to employees by government bodies and religious organizations. As a result, companies that offer long-term disability benefits to employers must outline specific procedures that claimants can follow when submitting a claim. On the other hand, long-term disability insurance policies purchased from a private carrier are only governed by state insurance law and do not have to comply with ERISA’s procedural requirements.

Defining Disability

Each insurance company’s definition of disability is different. For example, many group plans 

require an employee to establish that he or she is unable to fulfill any occupation in order to qualify as disabled. Other plans, however, define disability as the inability to perform the policyholder’s specific occupation, while some provide coverage based on a combination of the “own occupation” and “any occupation” standards. It’s important to understand exactly what is covered by your plan before filing a claim.

Denied Claims

If an employer denies a policyholder’s claim, the claimant is usually required to exhaust the plan’s internal appeals process before he or she can file a lawsuit in federal court. Often, this means that a claimant must submit an official appeal, in addition to further medical documentation, to the company and await its response. Individual long-term disability policyholders, however, can file an appeal in state court as soon as they receive notice of a denial. Finally, individual policyholders, unlike those who receive benefits from an employer, can file a suit in state court to collect damages for breach of contract, bad faith, or negligence, while those with ERISA claims can only receive the benefits that they were unfairly denied. 

Contact an Experienced Long-Term Disability Attorney in Chicago

If you were recently injured or diagnosed with an illness and are unable to work, please contact Bartolic Law to learn more about your eligibility to receive long-term disability benefits.