Unum Disability Claim – A history of denying valid claims
Author: Attorney Lonnie Roach
Long-Term Disability (LTD) insurance providers have long had a reputation for denying legitimate claims.
In 2002, CBS 60 Minutes broadcast a special on Unum’s unscrupulous practices.
The program interviewed an eye surgeon with Parkinson’s whose claim was denied, an Unum employee who was given quotas of claims to deny, and a doctor who was pressured to present medical opinions in favor of denying claims. Around the same time, Dateline also released a special on disability benefits where they interview Unum employees discussing how they were pressured into denying as many claims as possible.
Claims Denied to Retain Reserves
Investigation into Unum’s history and practices revealed indications that starting in the 1990s the company began a policy of denying claims in response to the growing number of claims filed by customers who held “own occupation” policies. Such policies insured individuals with occupational specialties against disabilities arising from their particular occupational specialty.
The high demand for benefit payouts was compounded by the era’s low interest rates.
It is suspected that as a strategy to retain its financial reserves until a more fortuitous financial climate arrived, Unum began to deny long-term disability claims in many states including Texas by applying a set of stringent review initiatives that included heightened scrutiny of psychiatric claims; more frequent covert surveillance of claimants; insistence on having the claimant undergo dubious independent medical examinations; and:
- Changing policies without the authorization or knowledge of claimants
- Improperly investigating claims and relying on opinions from unqualified experts
- Refusing to acknowledge a disability
- Asserting the disability was a pre-existing condition
- Applying delaying tactics aimed at exhausting the claimant and ensuring a lower settlement
- Paying only partial benefits for a total disability
In the years that followed, Unum Provident lost many important lawsuits, costing them millions of dollars.
After investigations into Unum Provident, it became clear CEO, Harold Chandler, and Senior Vice President of Claims, Ralph Mohney, highly incentivized denying claims for profit. The lawsuits and investigations culminated in an agreement between Unum and the insurance regulators of each state. The agreement stipulated that Unum and their subsidiaries would improve their claims handling practices. The settlement occurred after a lengthy investigation by the regulatory agencies of Maine, Massachusetts, and Tennessee found Unum to be engaged in systemic unfair claim settlement practices.
The agreement lays out a plan of corrective action.
The plan involves dramatic changes to how the company is run. Unum was required to add three independent directors to their Board of Directors, one of which is to be in charge of an audit committee while the other two form a Regulatory Compliance Committee. Additionally, Unum was required to create a Regulatory Compliance Unit in charge of monitoring compliance with ERISA requirements and the agreement itself. Unum was asked to create a Claim Reassessment Unit tasked with re-assessing claims denied on or after January 1, 1997. However recent reports suggest that only 10% of required claims were ever reevaluated.
If you have a Unum disability claim denied or any other long term disability claim denied you may still qualify for benefits. Contact an experienced Long-Term disability lawyer at 512-454-4000
Today, Unum still regularly denies even legitimate claims, but at no significantly greater rate than any other LTD insurer.
While they have made some reforms, their original abusive practices created a bad precedent for the industry that still has not completely faded.
In a recent case Lonnie Roach of Bemis, Roach & Reed argued before the Fifth Circuit Court of Appeals, the court found that multiple mistakes committed by Unum reviewing doctors affected those appellate reviews to the extent that they could not be considered substantial evidence in support of Unum’s decision to deny benefits.
If your claim and appeal have been denied by Unum, it is therefore crucial to go through the entire administrative record carefully in order to locate any mistakes committed by Unum review personnel. These mistakes can often be used to overturn a wrongful denial of benefits.
For most people, their ability to work is their ability to live.
Roughly half of Americans live paycheck-to-paycheck; only 45% of households have enough money to cover a month of lost income. If a breadwinner becomes injured or ill and can no longer work, the effects on a household’s financial stability can be devastating. While Social Security helps cover some of the difference, the average Social Security benefit is only $1,503/mo (2020). This is well below the roughly $3,714/mo the average American earns. Also, an individual is only eligible for Social Security if they are entirely disabled. Many people suffer from an injury or illness and cannot do the job they once did, but are still functional enough to perform a more menial (and lower-paying) position. Many workers choose to carry Long-Term Disability (LTD) policies to protect their ability to earn.
LTD policies generally pay a percentage of lost income, usually much more than is covered by Social Security. LTD benefits can be an essential life-line to those who have lost a job because of injury or illness. It can be devastating if an individual doesn’t receive the benefits they paid premiums for. If your Unum disability claim has been denied, contact the attorneys at Bemis, Roach and Reed for a free consultation. We handle claims against most Long-Term Disability Insurers. We have the experience and knowledge needed to appeal your claim successfully. Call 512-454-4000 and get help NOW.
Author: Attorney Lonnie Roach has been practicing law for over 29 years. He is Superlawyers rated by Thomson Reuters and is Top AV Preeminent® and Client Champion rated by Martindale Hubbell. Through his extensive litigation Mr. Roach obtained board certifications from the Texas Board of Legal Specialization. Lonnie is admitted to practice in the United States District Court - all Texas Districts and the U.S. Court of Appeals, Fifth Circuit. Highly experienced in Long Term Disability denials and appeals governed by the “ERISA” Mr. Roach is a member of the Texas Trial Lawyers Association, Austin Bar Association, and is a past the director of the Capital Area Trial Lawyers Association (Director 1999-2005) Mr. Roach and all the members of Bemis, Roach & Reed have been active participants in the Travis County Lawyer referral service.
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