It’s easy to be impressed with the package of group employee benefits that come with a new job – and rightfully so. From medical insurance to 401K matching, personal time off, child care considerations and more, it’s nice to know that you’re covered and valued as part of your new team. But one of those benefits may hold a surprise or two if you ever actually need it: the disability insurance policy.
As one of the largest group disability insurers in the country, Lincoln Financial holds a high percentage of these policies. This makes them a good example of how group disability policies work and what happens when navigating the arduous process of a disability insurance claim, application, denial, appeal and eventual lawsuit. Here’s an overview of what you could be facing, along with some disability insurance lawyer tips from professionals who navigate this maze every single day.
About Lincoln Financial Disability Policies
Lincoln Financial sells a slew of insurance-related products, but some of the most controversial claims come from the division handling its disability insurance policies. As noted, Lincoln Financial Group has been a big player in the insurance market for a long time – and they got huge after buying and merging with Liberty Mutual. After a somewhat rocky start to the merged company, the behemoth disability insurers are now considered middle-of-the-road when it comes to smooth claim processing, according to disability insurance attorney Gregory Dell.
“Their claim reviews are on average,” explains Gregory Dell. “They’re usually on time with what they do. But they can be very tough when it comes to evaluating a claim and making a claim decision.”
Trained disability lawyers handle thousands of claims with major insurers every year, and the Dell & Schaefer insurance law firm has represented hundreds of claimants holding policies with Lincoln Financial alone. Gregory Dell estimates that about 99% of Lincoln’s disability products are group policies contained in employer-provided benefit packages, which are governed by ERISA laws and regulations.
Lincoln Financial: Applying for Your Benefits
When employees find themselves in the unfortunate position of needing to claim the disability benefits in their policy, the obvious first step is to send in the application. Depending on the complexity of the person’s medical records and how much documentation Lincoln requests, the turnaround time can vary widely. However, disability lawyer Rachel Alters states that there is typically some kind of response and/or decision within 45 days.
It’s not uncommon for Lincoln Financial to ask for more information before deciding to approve or deny the claim. Much of this revolves around the “definition of disability” and whether the disabling condition allows you to continue in your current job. This essentially boils down to what’s termed your “own occupation” and your ability to perform the material and substantial duties involved.
The insurance company attempts to define the disabled claimant’s “own occupation” as it applies to the national economy and is termed within the O*NET dictionary of occupational titles. This typically erases the nuances of what the person actually does within the day-to-day context of their actual position, giving the insurer an advantage by pigeonholing the claimant into a narrow, predefined or generic job definition.
In many disability policies, if the claimant does get approved, the definition will shift after 24 months of coverage. Instead of being able to perform his or her pre-disability “own occupation,” the policyholder must now meet a standard of being able to do the material substantial duties of “any” gainful occupation. Rachel Alters explains that this definition basically means, “can you do a job sitting at a desk 40 hours a week?”
She further notes that every policy is different and that the disabled claimant needs someone who can explain the definitions of disability and pinpoint the details that may be hidden or obscured with complicated language. For example, some policies have an income component that requires the “any occupation” job to pay either 60 percent or 80 percent of the original pre-disability salary. Many policies from Lincoln Financial also have what’s known as a “mental nervous limitation” that caps benefits at 24 months for any kind of nervous disability such as depression, anxiety, bipolar and, usually, schizophrenia.
These are just a few of the many details to be aware of when applying for benefits stated in your policy. And the unfortunate reality is that a high percentage of policyholders end up with a denied disability claim. That’s when the appeals process comes into play.
Lincoln Financial: Appealing Disability Insurance Claim Denials
Anyone who’s been denied long-term disability benefits has the right to appeal that decision, which presents the opportunity to include more personalized details about job descriptions, medical conditions and related limitations. One unusual thing about Lincoln Financial appeals is that the company requires the policyholder to complete two appeals if the initial one is unsuccessful. Only after the second appeal can the disabled person file a lawsuit to fight for benefits.
During the appeals process, Lincoln Financial will usually refute any medical evidence included in the appeal. Depending on the benefit amount at stake, they can rely on their own in-house doctors and nurses or go outside for third-party medical experts. There are options ranging from a simple paper review to a functional capacity evaluation or an IME (independent medical exam). The goal is typically to find conflicting evidence that disagrees with the claimant’s attending physician.
Gregory Dell explains that, in his experience, there are two primary reasons that Lincoln denies disability claims.
- Lincoln Financial says that the claimant’s subjective complaints do not match the objective evidence in the medical file. This essentially means that they’re denying the claim because they don’t see an MRI, X-ray, diagnostic study, blood work or any other kind of objective study that supports the medical complaints. But conditions such as fibromyalgia or chronic fatigue syndrome are real conditions for which no objective tests exist, and the diagnosis relies heavily on self-reporting.
- The insurer commonly runs video surveillance on the claimant. This can become the basis for a denial if the claimant has inadvertently worded something too narrowly in the application process. For example, if he claims an inability to sit for longer than an hour, but then video surveillance catches him doing so at an event that goes for 1.5 hours, that provides a reason for denial.
“When you put yourself in that little box,” cautions disability insurance lawyer Rachel Alters, “if you get caught on video sitting for more than two hours or picking something up on one occasion that’s more than you’re allotted, then they will say, oh, this person is not telling the truth. They’re exaggerating. They’re clearly capable of working.”
Lincoln Financial: Filing a Lawsuit
Once the second appeal with Lincoln Financial has been denied, the only remaining option is to file a lawsuit in federal court to win the benefits stated in the long-term disability policy. The case is filed under ERISA laws, and Lincoln has the opportunity to answer the complaint. The judge gives a list of dates and deadlines for mediations, trials and, sometimes, a required mediation session.
Claimants with legal representation will often have their disability attorneys involved in ongoing settlement discussions with the insurance company, to avoid the precarious nature of lawsuits and the potential for losing the case. The federal judge hearing the case, unfortunately, never gets to meet the disable claimant and instead relies only on the claim file and presented motions to determine whether Lincoln was “arbitrary and capricious” in the denial of the claim.
In order for Lincoln to win, they would only need to have one reasonable basis to deny the claim. If, on the other hand, the court rules in favor of the policyholder, the usual remedy is to award the back benefits the claimant is owed and then remand the case back to Lincoln for reinstating the claim – and potentially reviewing it yet again to prove a continuing disability.
Lincoln Financial: Taking a Settlement Offer
Many claimants, weary from the fight and weakened by the disabling condition itself, consider the option of accepting a settlement from Lincoln Financial. A typical settlement offer includes a certain monetary percentage of what the policyholder would be owed over the course of his or her lifetime or over the duration of the entire claim. A claim usually ends of age 65 or at Social Security retirement age.
Attorney Gregory Dell notes that it may not always be worth the risk of rolling the dice with a federal judge in order to get the considerably higher amount of lifetime claim money versus losing the case and receiving nothing. Another consideration is that it can take from 18 months to three years to get to a final judgment, which is a long road for a person who’s not getting any money at all while disabled.
Most claimants who choose to go the settlement route will depend on a disability attorney to negotiate on their behalf, with a goal of getting a resolution and expeditious offer with a couple of months. The insurance company has an incentive to settle in order to avoid potentially thousands of dollars in attorney fees if they lose, especially if a seasoned and skillful lawyer is representing the claimant.
“We’ve handled so many claims against Lincoln that they know, if they go the distance with us, they’re going to rack up hundreds of hours in attorney’s fees,” explained Gregory Dell. “And if they do lose, they’re going to be looking at another couple hundred thousand dollars in attorney’s fees that they’re going to have to pay.”
Regardless of what stage of the disability claim you are in, it pays (literally) to have a legal expert review your case and let you know what options are available. A disability insurance law firm such as Dell & Schaefer will provide a free consultation to let you know where you stand and what steps to take next.