Disability Claims and Social Media: Not a Good Mix

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In a recently decided Fifth Circuit case, email evidence from a former lover turned the tables on an attorney who claimed disability while at the same time enjoying a full and vigorous lifestyle.

In Truitt v Unum Life Insurance Company of America, Ms. Truitt is described as an attorney who practiced international oil and gas litigation until pain in her lower back, left leg and foot left her disabled. Ceasing work due to the disability, Ms. Truitt applied for and collected disability insurance benefits from Unum.

Like many individuals collecting disability, Ms. Truitt became the subject of ongoing review by Unum. Surveillance video illustrated Ms. Truitt carrying boxes, bags, pumpkins…and a dog.

Further medical evaluation led Unum to terminate her disability benefits based on her apparent ability to participate in sedentary work like that expected of an attorney. After appeal by Ms. Truitt, Unum reinstated disability payments upon advice of a vocational specialist who felt Ms. Truitt would not be able to travel internationally as required by her specialty.

Following reinstatement of her benefits, a man who identified himself as having a personal relationship with Ms. Truitt provided approximately 600 pages of emails that detail activities like:

  • International pleasure travel to Ireland, Russia, Rome, France and Guatemala
  • Dancing on a boat deck, rigorously cleaning house, lifting, and engaging in extensive adventure travel
  • Performing legal work
  • Considering a slip and fall at home and the resulting bruise as beneficial for her upcoming medical exam with Unum

Based on these revelations and further medical investigation, Unum terminated the benefits of Ms. Truitt, ultimately resulting in a decision by the Fifth Circuit that upheld their decision while remanding an issue of repayment of benefits back to the district court.

Social media and an undone personal relationship worked to uncover insurance fraud in this case. If denied rightly owed disability payments, speak with an experienced attorney in New York.

Negotiating Settlement of a Disability Claim

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Whether you purchased a disability plan or were provided coverage by an employer-sponsored plan, now you need the coverage. Dealing with sudden or gradual disability is challenging, especially if the condition reduces or eliminates your ability to support your current standard of living.

Opportunities to settle your disability claim occur throughout the claims and payment process. Pivotal settlement points occur:

  • Early on, when adjusting to disability and seeking fulfillment of your claim
  • During litigation
  • During the time you receive disability payments, the insurance company may, depending on assessment of your case, seek to conclude payment responsibilities to you through a lump sum payment
  • You may initiate the process to settle a claim
  • An insurance company may review settlement if they believe your condition has improved

The decision to take a lump sum payout, either through structured payments that terminate in time, or in one payment, is complicated. Factors that play into your decision include your age, expected medical condition, presence of other benefits plans or employer programs and your needs as you see them.

Once you accept a disability settlement, the responsibility of the insurance company terminates, regardless of whether your medical condition deteriorates and the settlement runs out. No insurance company easily pays policy limits, and disability insurance is no different.

You spent a lifetime building a career and security in New York. When dealing with a disability, work with experienced attorneys to help you navigate the complexities of your coverage.

ERISA Denials Are Not the End of the Road

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If a plan administrator initially denies your disability, health or life insurance benefit claim, you should never take “no” for an answer. Under the Employee Retirement Income Security Act of 1974 (ERISA), you have certain rights when your claim is denied.

ERISA requires a very specific process for claims and appeals, but offers significant opportunities to overturn an initial denial. First, someone other than the person who issued the initial denial must review your appeal and must give no deference to the prior decision. Second, the carrier must identify the specific information that is requires in order for the claimant to perfect the claim and provide an explanation of why the information is necessary. Third, the appeal process presents the claimant an opportunity to provide the carrier with additional medical records and expert reports that support the disability claim and which may not have been submitted in the original claim process.

In general, the ERISA appeal process includes the following steps, all of which must be completed within the 180-day deadline:

  • Requesting plan documents — The insurance policy and other plan documents provide valuable information about the benefits you are entitled to, the claim administration and appeal procedures and the parties responsible for making claim decisions.
  • Obtaining your claim file —We request your entire file from the insurance company, including medical and employment records, expert testimony that was considered and internal records, such as telephone logs and emails. The file may reveal the plan administrator’s basis for denying a claim, erroneous or missing information and even non-compliance with federal laws.
  • Reviewing the denial letter — Carefully reviewing the initial claim denial letter helps determine the strategy for successfully pursuing an appeal.
  • Documenting your claim — It is important to gather as much documentation as possible to support your claim. Persuasive evidence includes opinion letters from qualified medical providers, medical literature and witness statements from employers, co-workers, friends and family.
  • Drafting the appeal letter — The appeal letter explains why the plan administrator erred in denying the claim, including policy misinterpretations, flawed medical or vocational assessments and improper claim procedures. The letter also outlines any new evidence submitted, including medical opinions and details about the claimant’s daily life.

If your appeal is denied, the plan administrator must provide written notice, which explains the reasons the claim was denied, describes any additional appeal procedures offered by the plan, and confirms your rights to seek judicial review of the decision. The internal appeal process must also be exhausted before any court action can be filed.

At Michael Sepe, LLC, our New York insurance attorneys have extensive experience with the ERISA appeals process and work diligently to obtain the best possible resolution to your claim.

Failure to Provide Timely Notice Can Invalidate Your Insurance Claim

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Most commercial liability insurance contracts require claimants to provide a notice of claim to the insurer within a specified period of time. The failure to do so can prove fatal to your ability to obtain coverage.

In The Travelers Indemnity Company v. Orange And Rockland Utilities, Inc., the Supreme Court of New York recently ruled that The Travelers Indemnity Company was not obligated to provide coverage for pollution remediation at several manufactured gas plants owned by Orange and Rockland Utilities, Inc. (ORU) because the company waited too long to file its claim.

ORU first notified Travelers of potential environmental liabilities in 1994. However, the insurance company maintained that ORU was sufficiently aware of its potential liability at the sites as early as 1981. Travelers introduced ongoing correspondence between ORU and environmental regulators, other insurers and outside consultants to substantiate its claim that ORU provided untimely notice.

Under New York law, an insured is required to provide notice after becoming aware of a reasonable possibility that the policy will be implicated. Compliance with the notice provisions of a liability insurance policy is a condition precedent to coverage, which means that a failure to comply terminates the insurer’s obligation to provide coverage. In this case, the court agreed that ORU failed to satisfy the requirement of timely notice without offering a valid excuse, pointing to regulatory contacts and internal reports predating the insurance claim by several years.

As this case highlights, it is imperative to follow the claim reporting rules detailed in your policy. Basic tips for ensuring compliance include:

  • Understanding your reporting provisions before a claim arises
  • Reporting all claims and potential claims immediately
  • Keeping detailed documentation of all correspondence with your broker and insurer

For additional information about filing a proper and timely notice of claim, contact a skilled New York insurance attorney at Michael Sepe, LLC.

Smile, You’re on Camera: Insurance Companies Use Surveillance to Monitor Claimants

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The National Security Agency isn’t the only one spying on the public. Insurance companies often use surveillance to investigate disability claims.

While it may seem creepy, most surveillance practices, which include taking photos or video of activities outside the home, are legal and admissible in court. The rationale is that insurance companies are entitled to root out fraudulent claims.

Unfortunately, insurance companies also use surveillance to deny perfectly valid claims. In a 2009 case reported by ABC News, The Hartford attempted to discontinue disability insurance payments based on video footage of Jack “Rocky” Whitten eating salsa and chips at a local restaurant. The insurance company argued that the video captured by a private investigator proved that Whitten, who suffered a broken neck on the job and was declared permanently disabled by his doctors, was fit to perform “full time sedentary occupations.”

This is a clear example of an insurance company improperly overemphasizing the significance of surveillance images. Thanks to the assistance of a disability attorney and the negative press coverage, The Hartford ultimately reinstated Whitten’s benefits and paid him over $45,000 in past due payments.

As this case highlights, photos and video footage can be powerful tools for insurance companies. While they often do not tell the whole story, it can be difficult for claimants to rebut the evidence. So it’s best to assume that you are being watched.

Insurance companies are more likely to use surveillance footage to pressure unrepresented claimants to abandon their claims, even when the videos or photos are harmless. To ensure you receive the benefits to which you are entitled, it is advisable to consult with an experienced New York disability attorney at Michael Sepe, LLC.

New Procedures for Filing Notice of Claim

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Filing a notice of claim with a governmental agency is a prerequisite to filing suit. Without proper notice, any subsequent lawsuit can be thrown out of court. The problem has been that every municipality, school district or public authority has its own rules for when and whom to serve. Too often legitimate claims have been discarded because of confusion over the notice of claim process.

The Uniform Notice of Claims Act (S.7641-B and A.10657-A) was introduced to end this confusion. Sponsored by Senator Jack M. Martins (R-Nassau County) and Assemblywoman Helene Weinstein (D-Brooklyn), it was signed into law by Governor Andrew Cuomo on December 17, 2012. The new law provides attorneys with the option of filing a notice of claim with the New York secretary of state, who then has the authority to forward the notice to the proper agency. Second, the law imposes a uniform requirement that claimants have 90 days to file a notice of claim. Third, except for wrongful death actions, claimants have one year and 90 days as a statute of limitations in which to commence suit against the government entity.

Furthermore, the filing fee was raised from $40 to $250 with half going to the localities and half staying with the secretary of state. Some counties objected to the new streamlining, afraid that the easier system would overwhelm the secretary of state’s office and further delay resolution of claims. The new law will go into effect one 180 days after it was approved by the governor.

In the Wake of Sandy

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Insurance claims for property losses caused by post-tropical cyclone Sandy might have been easier if Hurricane Irene hadn’t hit the East Coast just a year before. Hurricane Irene left $10 billion in damages in her wake.  Many homeowners’ insurance policies saw drastic changes after Irene, whether or not the homeowner filed any claim. In addition to escalated rates, many new policies included wind and hurricane exclusions and deductibles.

Other insurance companies included “anti-concurrent causation clauses,” which deny coverage for damage resulting from multiple causes when one cause is covered and the other is not.

Flood insurance, a prerequisite for most mortgages, now requires insurers to use federal data to allocate costs where a home is totally destroyed by flooding and other causes, so that the homeowner has recourse if there are multiple causes. Sandy is putting these new provisions to a practical test.

Homeowners should be careful when speaking with insurance claims adjusters, because a characterization might be used later to disqualify a claim. With initial estimates of property damage and business interruption exceeding $50 billion, homeowners and business owners might see a long and complicated claims process. It isn’t necessarily bad faith, but the sheer number of claims that will be filed. With Congress balking, authorizing a first increment of only $9.7 billion, the claims process might be further delayed for lack of funds.

4,451 FEMA personnel were deployed in the wake of the storm and over 500,000 assistance claims were registered.

In all, 8.1 million homes lost power in outages affecting 17 states.

Declaratory Judgment — Powerful Litigation Tool for Plaintiffs

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New York Civil Practice Law & Rules, Article 30 Sec. 3001 provides litigants with an extraordinary tool to save time and money. A declaratory judgment offers policyholders and insurance companies a quick way to resolve their respective rights and obligations under an insurance policy even before liability under the policy is decided. Originating in the early 1900s, the federal judiciary adopted the procedure in 1934, although without creating an independent ground for federal jurisdiction. This legislation came at the behest of the Commissioners on Uniform State Laws, which first urged adoption of the Uniform Declaratory Judgments Act in 1922.

In Lang v. Hanover Insurance Co, in 2004, the New York Court of Appeals denied an injured party the right to a declaratory action against a tortfeasor’s (i.e., a person who committed a tort) insurance company. In this circumstance, the insurance carrier had denied coverage for the plaintiff’s injury when the tortfeasor filed a timely notice of claim. The tortfeasor later filed for bankruptcy, and the injured plaintiff sought to ensure himself coverage from the defendant’s carrier. The Court of Appeals refused to allow the plaintiff a right to a declaratory judgment against another policyholder’s insurance company. The Court insisted that the plaintiff first get a judgment against the tortfeasor, which would then be submitted to the insurance carrier for payment.

The New York legislature compromised this harsh rule, when in January 2009, it amended CPLR §3001 and §3420 of the Insurance Law. The new amendment will allow a personal injury plaintiff to “confirm that there is a fund to pay the judgment before, not after, slogging through the underlying litigation,” by initiating a declaratory judgment action against the insurance company that disclaims coverage even if the plaintiff is not the policyholder.

Getting Organized to File an ERISA Claim

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The Employee Retirement Income Security Act of 1974 (ERISA) protects the interests of participants and their beneficiaries who depend on benefits from private employee benefit plans rather than privately procured insurance. An employee welfare benefit plan is a plan, fund or program that provides medical, surgical, hospital, sickness, accident, disability, death, severance, unemployment, vacation, apprenticeship, day care center, scholarship funds and pre-paid legal benefits. The claiming procedure can be difficult, with strict deadlines and rigorous documentation. The exact requirements for seeking benefits are contained within the insurance contract and vary from policy to policy.

Most policies require that the employee file a claim for benefits with the person designated by the plan to receive such claims. The plan might also require immediate notification when an employee enters the hospital or sees a doctor. Other plans require that the employee actually pay the medical bill and seek reimbursement. A frustrating requirement of some policies is a detailed substantiation by a physician explaining an inability to perform each necessary work function. This documentation can be difficult to satisfy without legal assistance.

The disability insurance carrier must respond to the claim within 90 days, or 180 days if an extension is granted. If there is no response, the claimant can infer that the claim has been rejected. ERISA requires that the plan explain the reasons for denial and include an explanation of the process for full review and appeal. Most plans require an appeal to be filed within 60 days, unless the insurance carrier offers a longer period. Any action on the appeal must be made by the carrier within 120 days of the appeal filing.

Failure to strictly comply with ERISA and insurance policy contract terms can shutout an otherwise qualified claimant. Disability claimants should consult with an experienced ERISA disability insurance attorney to protect their benefits and rights. An experienced attorney can negotiate a lump sum claim settlement, litigate inappropriate denials of claims and even pursue insurance bad faith lawsuits.