No one who is unable to work due to an injury or disability should be denied the benefits they are entitled to receive under their Life Insurance Company of North America Long Term Disability (LTD) policy. Life Insurance Company of North America is also known as Cigna Life Insurance Company and may be referred to as LINA for short.
LINA Long Term Disability Insurance Claims
LINA sells Short-Term Disability and Long Term Disability insurance plans to individuals, but the bulk of its sales of long term disability insurance policies are sold as group plans to large companies, and to unions and associations.
What is Long Term Disability Insurance?
According to some estimates, the average employee with a long term disability misses as much as two and one-half (2.5) years of work.
Long term disability insurance is intended to protect an employee from the loss of income in the event that he or she is unable to work for an extended period of time due to a disabling illness, injury, or accident. A LINA long term disability plan provides that a portion of covered income is replaced and paid directly to the disabled employee. Most policies will pay 60 percent of your insured pre-disability earnings (reduced by deductible income from other sources such as Social Security or Worker’s Compensation) while out due to an approved disability. Most LTD policies do not take effect until after an “elimination period”, which is typically a six month waiting period.
LINA primarily offers two types of disability benefits:
- Short Term Disability: STD benefits help employees who suffer a temporary illness that leaves them out of work for a short time (typically up to 6 months);
- Long Term Disability: LTD benefits offer employees protection if they are unable to work for an extended period of time. LTD benefits usually kick in after a 6 month waiting period and are usually (but not always) payable to the claimant’s retirement age.
LINA Policies: Limited Coverage Under “Own Occupation” Definition of Disability
Most LINA group plan policies define the term “disability” as the inability to perform one’s “own occupation”; however, the time period for such coverage is typically very short. Most “own occ” periods are limited to a six month, a one year period or a two year period. Once the short “own occupation” term expires, the definition of disability changes to whether the claimant can perform “any occupation.” Even if a claim is approved under the “own occupation” definition of disability, many claims are “cut-off” or terminated once the definition switches to “any occupation”; in other words, many claims are cut-off at the two-year mark.
LINA Has a History of Denying or Terminating Legitimate Claims
In recent years, LINA has gained a reputation for denying large numbers claims for long term disability benefits by requiring additional “objective information”, and then denying the claims when the claimants do not provide such documentation.
Just recently – in 2013 – LINA’s parent company Cigna entered into a multi-state settlement with the insurance commissioners of five U.S. States for improper long term disability claims handling practices. The settlement came after the insurance departments’ investigation into Cigna’s improper denials of long term disability claims and wrongful termination of existing benefit claims. As further detailed below, the settlement required Cigna to improve their claims handling processes and establish a program to review long term disability claims that had been improperly denied or terminated.
The insurance departments of California, Connecticut, Maine, Massachusetts, and Pennsylvania conducted individual claims examinations of Cigna’s disability insurance claims handling practices.
The following were some of the specific allegations against Cigna:
- Failing to adopt and implement reasonable standards for the prompt investigation and processing of disability insurance claims;
- Failing to disclose to claimants pertinent facts or insurance policy provisions relating to coverage issues;
- Unreasonably denying claims where it knew that the information it required to approve disability benefits existed, but it did not obtain or review the information prior to making the denial decision;
- Failing to perform any functional testing of its own, or to conduct a peer review of medical records on file;
- Failing to consult with health care professionals with appropriate training and experience in the field of medicine relating to the underlying disabling condition;
- Wrongfully terminating claims during the “any occupation” definition of disability policy period without performing a transferable skills analysis and labor market survey to identify alternate occupations appropriate to the respective claimants based on their restrictions, limitations, education, training, and experience;
- Failing to provide complete information from the claim file to the health care expert performing a medical review of the records;
- Failing to clarify a claimant’s restrictions and limitations when appropriate with the attending physician who was supporting disability.
During the claims examinations, insurance department officials found claim handling irregularities, including:
- Failing to give due consideration to the medical findings of independent physicians;
- Discounting information provided by Social Security Disability decisions; and
- Failing to give appropriate consideration to worker’s compensation records.
The California Insurance Commissioner Dave Jones issued the following statement after the settlement:
“This case involves long term disability claims and is an important win for California consumers. … When people are injured or disabled, it is particularly important that their claims are handled quickly and fairly. The agreement with Cigna puts into place more effective claim handling procedures, which will ensure consumer protection for policyholders.”
Under the settlement agreement, the Cigna Group is required to:
- Enhance claim procedures to improve the claims handling process to benefit current and future policyholders.
- Establish a remediation program in which the companies’ enhanced claim procedures will be applied to certain previously denied or adversely terminated claims for residents of states whose insurance commissioners also signed the settlement agreement.
- Participate in a 24-month monitoring program conducted by the insurance departments of the five lead states in the action involving random sampling and ongoing consultation.
- Undergo a re-examination upon completion of the monitoring period.
- Pay fines and administrative fees totaling $1,675,000 to the five lead state states, which are California, Connecticut, Maine, Massachusetts, and Pennsylvania.
The “enhanced” claim procedures Cigna agreed to adopt include the following:
- Give more appropriate consideration to awards of Social Security Disability Insurance (SSDI) benefits;
- Gather and analyze medical records for the claimant’s full medical history;
- Enhanced use and selection of External Medical Resources; and
- Provide full and complete documentation to its various vocational and medical reviewers.
The Cigna companies are now re-evaluating certain claims and have set aside $77 million for projected payments to policyholders across the nation whose claims were not handled properly. Cigna is also paying a $500,000 penalty directly to the California Department of Insurance in addition to $150,000 to reimburse the department for the cost of ongoing monitoring required under the settlement agreement.
LINA Long Term Disability Insurance Appeal Attorney
Attorney Nick Ortiz is a LINA disability lawyer with over a decade of experience in representing consumers in insurance claims. Mr. Ortiz has the skill and insight needed to help you address a wide range of issues relating to your Life Insurance Company of North America disability benefits claim, including:
- Filing an appeal to a denial letter or denied claim: Unfortunately, a large number of LINA disability claims are denied or terminated (cut-off after having previously been approved). A notice of denial is not the end of your claim rights. You usually have the right to file a number of internal appeals to LINA. We will help you understand the reasoning behind your denial, work with you to gather the appropriate evidence and documentation to satisfy your “proof of loss”, and otherwise work diligently to address any purported deficiencies LINA found with your documentation and paperwork before perfecting your appeal. Our goal is to document your disability in a manner that clearly demonstrates your impairments and your qualification for benefits.
- Taking your case to court: In some cases, we are successful in having LINA put the claimant “on claim” and reinstate benefits through the internal appeals process with LINA’s claims department without resorting to litigation. In other instances, however, Life Insurance Company of North America may continue to deny your claim. Should the internal appeals process fail, you have the right to file an ERISA lawsuit to have your case reviewed by a federal judge. We will help you file the ERISA suit, and prepare all necessary documentation for the court review process. It is worth noting that all LTD claims are not subject to ERISA. We will also determine whether your claim is exempt from ERISA, thereby allowing you to file the lawsuit in state court, which offers policyholders greater protections.
We have successfully represented numerous LINA disability insurance policyholders in their fight to obtain or hold onto their long term disability benefits. If you have had your LTD claim denied or terminated by LINA, you need the skilled guidance of disability insurance attorneys that have experience in representing LINA claimants. Call our office today for a free case evaluation at (888) 321-8131.