What is ERISA and How Does It Apply to Your Disability Claim?

What is ERISA? It is shorthand for the Employee Retirement Income Security Act, a federal law passed in 1974 that regulates employee benefits for all private employers (those which are not the government or a church).

What does ERISA have to do with your Short Term Disability ("STD") or Long Term Disability ("LTD") claim? If you have STD or LTD insurance through work, then ERISA applies to your coverage. If you have become disabled and have to file a claim, your claim is going to subject to ERISA. That means that you lose a lot of rights that people who buy individual STD or LTD coverage have under state law. The federal ERISA law allows federal courts, not state courts, to hear ERISA disability claims. ERISA also prohibits jury trials like you might get in state court. Finally, many states require insurance companies that lose disability cases in court to pay your attorney fees, but under ERISA, it is an option that the federal judge may require, but often does not.

Finally, the most important thing to understand about ERISA claims is what is called the "standard of review." This is the method a judge uses to review your claim if it goes to court. Under ERISA, most STD and LTD cases are reviewed under an abuse of discretion standard of review on motions submitted by both parties. There is no trial, and the judge has an obligation to uphold a denial if there is any reasonable basis for the insurance company's decision to deny the claim. Compare that to state court where a jury would get to hear from you and your doctors in a real trial if you have bought your own insurance from a local insurance agent outside of work. In fact, all of the evidence in an ERISA case gets created before a case is finally denied. If you have an ERISA claim, be sure to get all of your doctors records, opinion letters, forms and other information in support of your claim in to the administrator BEFORE you get the last denial letter. If you wait, you will not be able to get it into evidence in court.

In many ways, ERISA works in favor of plan administrators - usually an insurance company. You should hire an experienced ERISA attorney if you become disabled and have STD or LTD coverage through work.



Copyright (c) 2008 by John V. Tucker and Tucker & Ludin, P.A. All rights reserved. For assistance with your Long Term Disability claim, ERISA Disability benefit claim, Social Security Disability claim, or Veterans Disability compensation or pension claim, call Disability Lawyer John Tucker at (866) 282-5260.