Why is it so important to determine whether my LTD coverage is under an individual or group policy?
The remedies available to an insured under an individual disability policy are vastly different than those under a group policy. If the insurance coverage is under a group policy provided by the insured’s employer, the policy is likely governed by ERISA. If the policy is governed by ERISA, then certain state laws that offer consumers protection and remedies for relief are “preempted” by ERISA regulations. In short, if the LTD plan is governed by ERISA, the disability insurance company has no exposure to bad faith damages and thus has no real incentive to pay the claim.