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Dawson and Rosenthal
Dawson and Rosenthal

San Diego Disability Insurance Attorney

A claimant relies on disability insurance when he or she is especially vulnerable. In exchange for payment of premiums, a policyholder reasonably expects a timely issuance of benefits when he or she needs it most. Unfortunately, insurers will employ a variety of tactics to delay or deny claims for disability. Many of these tactics are illegal under California law.

If you believe your insurance company is acting in bad faith concerning your disability claim, you may have legal grounds for a claim against them. Contact the lawyers at Dawson & Rosenthal, P.C. to schedule a free review of your legal options today. For five decades, California residents have been choosing our firm to represent them in their time of need:

  • We only take on a few cases at a time, which means we can give your case the undivided attention it deserves.
  • Our firm only works with bad faith insurance law, which gives us a superior depth of experience.
  • We offer our services on a contingency-fee basis, which means you’ll only owe attorney’s fees if we win a settlement or court judgment on your behalf.

Common Causes for Disability Insurance Claim Denials and Delays

Insurance companies may deny or delay claims for several reasons, but some are more common than others. Additionally, only some of them are legal or based on sound evidence. Some of the most common causes of disability insurance claim denials and delays include:

  • Lack of hard medical evidence. Sometimes, an insurance company will deny a claim because a medical provider fails to document how an injury disrupts a person’s quality of life or ability to do his or her job.
  • A previous denial on record. Many people believe filing a new disability claim will be better than trying to appeal a previous one. Unfortunately, this may only lead to an additional denial.
  • Failure to follow a prescribed treatment plan. In some cases, an insurer may refuse to pay a claim because it believes a person is not following a doctor’s orders to recuperate.

Disability Insurance Claim Denials and Delays and Bad Faith Insurance

Some grounds for disability claim denials are legitimate, while others constitute bad faith. Insurance companies have a duty to put the interests of a policyholder above its own profits. Additionally, it must try to find evidence to support a claim, not to deny it.

An insurance claim denial or delay may arise to insurance bad faith when the following elements apply:

  • An insurance company fails to conduct a thorough investigation into a claim.
  • It makes unreasonable or unnecessary claims for additional evidence to support a claim.
  • It coerces a claimant into making statements that support a denial.
  • It underpays on an insurance claim without explanation.
  • It fails to disclose policy limits or other pertinent information.

Types of disability insurance

There are various types of disability insurance available to workers who have been injured in California. However, we do want to point out that there is a difference between workers’ compensation insurance and disability insurance. When a person sustains an on-the-job injury, they are entitled to various types of financial assistance. This can include workers’ compensation short- and long-term disability benefits.

Workers’ compensation disability benefits will only apply to those who sustained an injury while conducting work-related activities. However, disability insurance will cover individuals who become disabled due to both work-related and non-work-related medical conditions.

There are various types of disability insurance the person could receive if compensation from. This can include the following:

  • Short-term disability insurance (STDI) will pay up to 80% of a person’s gross monthly income, but this typically only will last for three to six months.
  • Long-term disability insurance (LTD) will usually pay up to 60% of a person’s gross monthly income for anywhere up to two years after the injury occurs up until the date of a person’s regular retirement.

Both STDI and LTD are often provided by an employer or the retirement plan that the employee has.

In addition to these two types of disability insurance, we also want to mention Social Security Disability Insurance (SSDI). This type of disability insurance is typically available to anybody from the federal government, but it will only cover those who have sustained significantly disabling injuries or illnesses and are completely unable to work. SSDI is hard to get approved.

Finally, there are various types of private disability insurance policies that individuals can purchase to fill the gaps between insurance carriers and the insurance policies they may already have from their employer. These policies must be purchased separately by individuals.

What to do if your disability benefits have been denied?

There are various steps that individuals can take if their disability benefits have been denied or if they have stopped receiving benefits. In California, there are various types of appeals processes that a person can go through in these situations.

What a person does after a denial of disability insurance largely has to do with what type of disability coverage they are dealing with. If the long-term disability plan is provided by or paid for by the employer, then it will inevitably be governed by the Employee Retirement Income Security Act of 1974 (ERISA).

Under ERISA, there are various limitations that require claimants to file administrative appeals in a timely manner before they can pursue a lawsuit against the insurance carrier. Typically, this means a person needs to go through the administrative appeals process before they can file a lawsuit. This process, along with any extensions filed by either side, can take a significant amount of time period

If disability insurance is not covered under ERISA guidelines, a person will still have to follow the specific deals processes established by the individual insurance carrier. However, it may be possible to bring an insurance bad faith claim against a non-ERISA-regulated insurance policy quicker than an ERISA-regulated policy or carrier.

If the denial is for Social Security Disability Insurance (SSDI), the claimant will have to appeal the denial within 60 days from receiving their denial letter. The Social Security Administration has very specific guidelines in place for handling denial appeals, and claimants are also guaranteed the right to representation when they are seeking their benefits.

Proving Insurance Bad Faith in Disability Claim Denials

It can be difficult for the average person to prove insurance bad faith has occurred following a disability claim. A claimant has a right to file an appeal and requests an explanation for the claim denial. Once he or she exhausts these avenues, it’s time to turn to other options.

When an insurance company acts in bad faith, a policyholder may be able to pursue legal recourse against the company to demand fair payment on a claim, as well as accrued interest and possibly punitive damages. Doing so requires the guidance of a denied disability or San Diego workers’ compensation insurance attorney. At Dawson & Rosenthal, P.C. our sole practice is bad faith insurance law. We readily identify instances of bad faith dealing and hold the responsible parties accountable for their actions. Contact us to discuss your legal options in a free initial consultation today.