The present case involves an ERISA claim for short term disability and long term disability insurance benefits where the claimant argues that the administrator improperly denied his claims for benefits. Marc Kouzmanoff (“Kouzmanoff”) was a sales representative for Thompson Reuters Holdings, Inc. (“Thompson Reuters”). In 2001, he developed diabetes; later, in 2016, he applied for disability benefits arguing that his job duties included a high risk of injury or death as a result of his inability to control his blood sugar. Kouzmanoff held both short-term disability and long-term disability policies through Thompson Reuters that were administered by Unum Life Insurance Company of America (“Unum”).
The purpose of the short-term disability policy is that it “replaces a portion of [a claimant’s] income in the event a sickness or injury prevents [him] from working for a period of time” except for a disability “caused by, contributed by, or resulting from [an] occupational sickness or injury.” If a claimant qualifies for short-term disability, that person is entitled to 100% of weekly earnings for the first six weeks, followed by 80% of weekly earnings for the next nineteen weeks. Further, an elimination period requires that the claimant must be continuously disabled for an entire week in order to be considered eligible.
The long-term disability policy’s elimination period is either one hundred and eighty days or the end of the short-term disability period, whichever is later. Long-term disability benefits could be up to 66.6667% of monthly earnings for up to 42 months, with a maximum benefit of $15,000 per month. This amount would, however, be less any deductible income.
In order to qualify for either short-term disability or long-term disability under the Unum STD and LTD policies, there were six elements that the claimant must have proven. First, the claimant must have shown that he was being treated by a doctor. Second, he must have kept a record of his weekly earnings. Third, he must have identified the date that the disability started. Fourth, he must have identified what was causing his disability. Fifth, he must have denoted the extent of his disability, including any restrictions or limitations from work. Sixth – and last – he must have provided the information of any hospital, institution, or other treatment location, along with any doctors’ names and addresses.
After Kouzmanoff filed his claim for both short- and long-term disability benefits, Unum denied his claims. Kouzmanoff then filed the instant suit as two separate claims which were subsequently consolidated into one. The first of Kouzmanoff’s main grievances against Unum is that it failed to consider the extent of his job duties in relation to determining whether he was disabled. Second, Kouzmanoff argued that working to reach a quota under stress – and with time pressures – rendered him disabled.
Here, the Court stated, “the insured has the burden of showing that a covered loss has occurred, while the insurer has the burden of showing that a loss falls within an exclusionary clause of the policy.” Further, under the terms of the long-term disability policy, the claimant is considered to be disabled if he “is limited from performing the material and substantial duties of [his] regular occupation due to [a] sickness or injury; and [the employee] ha[s] a 20% or more loss in [ ] indexed monthly earnings due to that same sickness or injury.” This means that not only does Kouzmanoff have to show that he has an illness, but that that illness caused him to be limited in his work performance and show a minimum of a 20% reduction in his earnings.
Here, the court issued several holdings. First, Kouzmanoff did not show that he had an occupational limitation. Second, he did not make an adequate showing that diabetes would have caused such limitations.
Kouzmanoff’s job duties included reaching sales revenue goals, working with a quota system, building relationships, meeting work deadlines, traveling, and working from home. Unum examined the demands of such job duties as they relate to nationwide standards of the occupation. This involved looking at both the physical and cognitive requirements of the U.S. Department of Labor for national economy expectations. Here, Kouzmanoff addressed only the specific demands of his occupation as opposed to those in the national economy.
Further, the court held that the record did not show that Kouzmanoff’s diabetes was severe enough to render him disabled. His diabetes had no noted effect on his job performance and did not prevent Kouzmanoff from working. In 2015, he refused to lower his number of work hours, while in 2016, he stated that he felt like he was in his “prime”. Nor was there any record of blood sugar readings that were poor. The court concluded that Kouzmanoff did not exhibit how he successfully met the elimination period requirements.
In addition to the above, the court believed that even if “the inability to work under a quota system [and] under stress and urgent time pressures” was a disability that limited Kouzmanoff, there would be a question as to the cause of that disability. More specifically, the court questioned whether Kouzmanoff’s diabetes was a substantial nexus to his limitations. After additional examination, the court held that there was no evidence in the record to show that diabetes is the determining factor of whether or not Kouzmanoff can work.
One of Kouzmanoff’s doctors stated that his personality, stress, medication inconsistency, diet, and habits all contributed to the mismanagement of his diabetes. Further, there was no long-term evidence of disability and the record pointed to the contrary. For example, Kouzmanoff had diabetes in 2014 and stress in 2016, but only sought to stop working in 2016 and not in 2014. Overall, it appeared to the court that diabetes was not the cause of Kouzmanoff’s disability. Finally, the court held that Kouzmanoff failed to show, by a preponderance of the evidence, that his disability was caused by diabetes.
Therefore, the court found in favor of Unum in this case. This meant that the court agreed with Unum that Kouzmanoff was not entitled to long-term disability benefits and the complaint against Unum was dismissed.[Note: this claim was not handled by the Ortiz Law Firm. It is merely summarized here for a better understanding of how Federal Courts are handling long term disability insurance claims.]
Here is a copy of the decision in PDF: Kouzmanoff v. Unum