ERISA Life Insurance Claim Denied and Appeal Process

• Dec.28.2022
• ERISA Claims

If need help understanding why your ERISA life insurance claim was denied and the appeal process, contact John Peace at Peace Law Firm by calling 864-298-0500 today.

The death of a loved one is nothing short of devastating. And that hardship is made all the more difficult when you receive a rejection from your loved one’s employer after filing a life insurance claim. The Employee Retirement Income Security Act (ERISA) sets strict minimum standards for multiple types of employer-sponsored insurance programs.

Life insurance plans are among the types of plans covered by ERISA. This means ERISA may give you options to appeal and even take legal action after a life insurance claim is denied.

In this blog post, we’ll discuss what’s involved in the ERISA appeal process after a life insurance claim denial. We’ll cover the legal rights of ERISA beneficiaries, common reasons claims are denied, and what you need for a successful appeal. Keep in mind: this is a general overview of the ERISA appeals process. Your options and course of action can vary depending on your situation.

But taking a large company to federal court is a major step that requires careful planning and legal assistance. If your life insurance claim was denied, we recommend consulting with an experienced ERISA life insurance attorney right away. 

Understanding the Rights of ERISA Beneficiaries

ERISA is a federal law that regulates employer-provided group benefit plans. Under ERISA, private companies have an obligation to keep employee beneficiaries informed about enrollment requirements, coverage updates, premium costs, and other important plan information.

The law also grants employee policy-holders and their beneficiaries certain rights and protections, including administrative and legal avenues for pursuing denied benefits. Therefore, if an insurance company abuses its power by improperly denying coverage, ERISA gives you the right to file a lawsuit in federal court to recover the benefits you’re promised.

However, before you take legal action against an insurer, you have to go through ERISA’s administrative appeals process. This involves collecting and submitting additional documentation to the insurance company to support your case for receiving benefits. After the insurer reviews your appeal, they may grant you the requested benefits. 

If the insurer rejects your second claim, then you may consider taking legal action. If you choose to pursue litigation, an ERISA attorney can help you file a lawsuit in federal court. Then, a judge will review the evidence in your case and decide if you’re entitled to life insurance benefits. 

Preparing to File an ERISA Appeal After a Denial of Life Insurance

Before filing an ERISA appeal for a denied life insurance claim, there are several important actions to take. Following these preparatory steps can have a significant impact on your chances of success.

Contact an ERISA Attorney

The support of a legal professional is essential when making an ERISA appeal. Navigating the obscure details of a life insurance policy and complex federal law requires the guidance of a skilled lawyer. An attorney experienced with ERISA cases is the best person to help you understand your rights and options for appeal. ERISA appeals follow strict rules and procedures.

Even small mistakes can lead to another denial. A qualified ERISA lawyer can answer your questions throughout the process and help you avoid common pitfalls when constructing your appeal. 

Confirm Eligibility 

ERISA applies to virtually every insurance plan provided by a private-sector employer. However, there are a few exceptions. For instance, ERISA will not apply to a life insurance plan provided by a religious institution.

Nor will it cover plans provided by government employers, including local, state, and federal governments. Before filing an appeal, ensure ERISA covers your loved one’s employer.

Determine Why Your Claim Was Denied 

Before appealing, you need to understand why the insurance company denied the claim. Life insurance companies do not make money when they grant insurance claims. Consequently, these companies will go to great lengths to find a reason to deny your claim.

Many times, the reason behind the denial is an obscure part of the life insurance policy or a technicality. In any case, you need to understand the exact reason for the denial before starting the appeal process. Some of the most common reasons that insurance companies deny claims include the following:

• Your claim included inaccurate or incomplete information. In general, only lies or omissions should result in a denial. A minor error about an insignificant fact, like a missing number in your address, should not lead to a denial. 
• Your loved one died during the contestability period. The contestability period, which generally lasts about two years after the purchase of the policy, gives the company special rights to investigate your application. The insurance company may deny your claim if it finds there is missing or incomplete information in the life insurance application. 
• The policy does not include your loved one’s cause of death. Life insurance policies often contain a long list of causes of death that are excluded from coverage. Common causes that a policy will not cover include death caused by a dangerous hobby, war, and suicide. 
• You or your loved one failed to pay policy premiums. You or your loved one must be up-to-date on premium payments. Although many companies will tolerate late payments if they are less than 30 days late, longer periods will void your policy. 

The insurance company should send you a written letter explaining why it rejected your claim. Your attorney can help you review this letter in detail and understand your insurer’s reasons for denying your request. This letter may also include instructions on how to begin the ERISA appeal process.

Filing an ERISA Appeal for Denial of Life Insurance

Once you have taken these preliminary steps, you can begin filing your ERISA appeal for denial of life insurance. Here’s a breakdown of the appeal process and some important strategies for protecting your claim at each stage.    

Identify Deadlines

It is also critical that you pay attention to all applicable deadlines related to your appeal. While ERISA gives plaintiffs unique rights, it also demands they follow strict procedural rules. Insurance companies generally give life insurance claimants 60 days to file an appeal. However, this can vary depending on your plan.

Make sure you understand how long you have to take action and don’t wait too long to do so. Most importantly, do not wait until after the applicable deadline to file your ERISA appeal. If your appeal is not timely, the court will throw out your claim and prohibit any future appeals.

If your claim succeeds, you can receive the full amount provided by the life insurance policy. 

Collect Evidence

Gather any evidence you have that supports your claim for benefits. This may include:

• A coroner’s report, 
• Hospital paperwork, 
• The life insurance policy,
• Proof of premium payments, and  
• Even a statement from an expert. 

Include all favorable evidence with your application. It’s important to be as thorough as possible when you’re gathering documentation. If you end up filing a lawsuit, you and your lawyer can only rely on the evidence you submitted during the administrative appeal. Your attorney can help you gather and present evidence to support your appeal claim. 

Organize and File Paperwork

Organize your documentation and prepare to submit it to the insurance company. Be sure to follow your insurer’s instructions as carefully as possible when filing your appeal. Even a small error can be an excuse to deny benefits.

Before you send everything off, it’s a good idea to make a copy of all the paperwork you’re submitting to the insurer. Keep this digital or physical record of your appeal in a safe place. 

After you’ve filed your appeal, don’t forget about it. It’s a good idea to check in with the insurance company to ensure they received your appeal and all relevant documents. Your lawyer can help make arrangements to follow up with your insurer. 

Decisions and Next Steps 

Insurance companies generally have 45 days to review and make a decision on claim appeals. However, they can legally request to extend this period of time. The final decision should come to you in writing. If they deny your claim again, you now have the option to pursue legal action through a federal lawsuit. 

Be aware: ERISA lawsuits follow slightly different rules and procedures compared to other civil claims filed in federal court. A judge, not a jury, will review and rule on your case. Your attorney won’t be able to present additional evidence beyond what you’ve already filed in your administrative appeal.

The success of your lawsuit depends on the strength of your evidence and your attorney’s expertise in ERISA case law. That’s why it’s essential to seek out an advocate with a proven track record of success in ERISA appeal cases.

Need Legal Assistance with Your ERISA Life Insurance Claim?

Moving forward after your ERISA life insurance claim is denied is hard. Additionally, the appeal process is not easy to navigate without legal counsel. ERISA-related litigation is complex and has many unique requirements. Even a simple mistake can lead to you losing your appeal, leaving your financial future uncertain. 

The good news is that you do not have to jeopardize your financial future by filing an ERISA appeal on your own. Trust your future to John Peace and the Peace Law Firm. We have extensive experience with the ERISA process. Thanks to that experience, we have successfully appealed many ERISA denials and helped our clients put their lives back together after a tragedy.

We offer free initial consultations for all potential clients. Give us a call or contact us online so that we can work together to get you the life insurance benefits you deserve.

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