Articles Posted in Life Insurance

Kantor & Kantor is honored to announce the selection of four attorneys from the firm for the 2015 Southern California Super Lawyers list. Inclusion in this list is reserved for attorneys who exhibit distinct excellence in their practice.

Super Lawyers, a prominent attorney rating service, identifies exceptional lawyers from more than 70 practice areas. The selected attorneys have attained substantial peer recognition and widespread professional achievement. The extensive and multiphase process used to determine 2014 California Super Lawyers relies on peer nominations, evaluations, and independent research.

All four lawyers were selected for their successes in representing people denied disability – particularly those with disabling conditions such as eating disorders, autoimmune diseases, Alzheimer’s, Parkinson’s, Multiple Sclerosis, cancer and mental illness – as well as assisting people recover benefits under long-term care, health and life insurance policies. This recognition and honor demonstrates the talent, dedication, and diligence of these attorneys; all of which they utilize to obtain the insurance benefits to which their clients are entitled.

Insurance companies are always looking for new ways to avoid paying claims; the newest trick in their book involves the denial of life insurance benefits by arguing that, despite prompt payment of premiums for a period of time in excess of two years, a contract never existed between themselves and their insureds.

In most states, life insurance policies include a clause known as an “incontestability provision” which is mandated by State Insurance Statutes. In essence, this clause prevents insurance companies from contesting the validity of a policy after a certain period of time. For example, if your policy has a two-year incontestability clause, the insurance company cannot contest the existence of a valid life insurance contract (and not pay you, the beneficiary) after premiums have been paid for two years. These clauses are designed to protect beneficiaries from an unfair denial of the life claim, especially in light of the fact that the insured him or herself is unavailable to dispute the insurance company’s arguments.

In Patterson v. Reliance Standard, Patterson v. Reliance Standard Life Ins. Co., 986 F. Supp. 2d 1140 (C.D. Cal. 2013), after paying for group life insurance for over five years, an insured with a valid life insurance policy passed away. Reliance Standard, despite the fact that five years of premiums had been paid, denied the claim on the specious ground that because the insured had not signed a form stating she was in good health, (which she was), the policy had never gone into effect, and it had no obligation to pay the $200,000 owed to her minor children in life insurance benefits.

Congratulations to Kantor and Kantor LLP who won the Small Business Community Association 2015 Best of Business Award for the Small Business category.

We are honored to have our work recognized in this way. Our attorneys and support staff work tirelessly to help those in our community get the benefits paid to which they are entitled. Medical Insurance, Disability Insurance, Long-term Care Insurance and Life Insurance are paramount to the health and longevity of those in our community. When Insurance companies fail to honor their contractual obligations to pay benefits under these policies, it is a detriment to our community.

We are grateful that our clients trust us and know that we get their benefits paid so they can continue to live healthy, fulfilling lives.

Every day we are asked similar questions by our clients and prospective clients. They typically revolve around such themes as”how can my insurance company blatantly refuse to pay?””Why is it that I have to engage a lawyer to fight for my benefits when my doctor has clearly proved that I am disabled?” And,”why can I only sue for the benefits I am owed and no punitive damages?”Unfortunately, we live with a system where insurers can, and do, deny disability claims that should be paid. Lawsuits are often necessary. Even then, people who need insurance benefits most can sometimes wait up to two years before their case goes to court or settles.

The Employee Retirement Security Act (“ERISA”), which is the law that governs most GROUP insurance policies, is stacked in favor of the insurance companies. ERISA imposes significant procedural limitations on the enforcement of group insurance benefits, and limits those benefits to those provided for in the policy. No emotional distress. No punitive damages. No out-of-pocket or consequential damages. And, attorneys fees only at the discretion of the Court. Employer Sponsored Group Policies fall under the Act unless they are a Government or Church Plan. ERISA is a federal body of legislation that establishes minimum standards for retirement, health, and other welfare benefit plans offered by employers to their employees. The Act expressly preempts all state legislation “relating to” an employee benefit plan, and federal courts have interpreted that phrase broadly, finding that a state law “relates to” a benefit plan “if it has a connection with or reference to such a plan.” The Act’s pre-emption clause extends to any state law allowing for recovery under an applicable plan. Unfortunately, this has resulted in a situation where ERISA preempts all common law tort actions for bad faith insurance and, consequently, does not allow plaintiffs to collect extra-contractual or punitive damages on claims involving covered insurance plans.

So what does this mean for the insured and the insurance company? For the insured it means that if they are denied health or disability benefits and they sue the insurance company under ERISA, the most they can hope for is that their benefits will be reinstated and back-paid to the time that they were denied; and that their attorney’s fees will be reimbursed in whole or part.

When purchasing life insurance, the policyholder usually nominates a beneficiary, as the person who will receive the money should something happen to the policyholder. Usually, if a beneficiary is not nominated, the spouse or closest heir will automatically be the beneficiary.

A life insurance claim denied by Cigna has ignited a debate in Pennsylvania over whether domestic partners should be viewed as spouses under insurance policies.

Albert Celec and Dr. Philip Ginnetti lived together as domestic partners beginning in 1994. In 1999, they entered into a shared living arrangement. In 2010, Dr. Ginnetti signed on as accepted a job in Ohio as Edinboro University’s provost and vice president. A big point of attraction for Dr. Ginnetti was the school’s non-discrimination policy toward employee benefits.

A common problem we see in correspondence from insurance companies to insureds is ambiguous and misleading language. A new life insurance matter we are handling provides a perfect example:

In this case, a woman who had just been diagnosed with terminal cancer, left work and applied for and was granted disability entitlements. She was subsequently repeatedly encouraged by her former employer to sign a form in order to receive her hard-earned pension of $80,000 in a lump sum. Unbeknownst to her, when she took her pension money it allegedly triggered an early retirement which had the unintended effect of reducing her life insurance benefit from $700,000 to $77,000. Upon her passing, her son found out for the first time that by taking the pension money his mother had, according to the insurer, “elected to retire,” and that he would only get 10% of what he thought he was going to receive.

The forms she signed never used the word “retirement” or “retiree,” instead opting to use words like “separation from service” or “former associate.” To make matters worse, the insurance company sent letters for several months after her alleged retirement, indicating the life insurance benefit was still the higher amount. The insurer claimed those letters were sent in error because they did not know about the pension payout/early retirement. That argument might make sense…except for the fact that the insurance company’s name is on the deposit slip for the pension payout, and the employer who processed the payout owns the insurance company!!!

From time-to-time we review a health insurance policy for a client who has been denied medical treatment, services, or benefits and we find that their policy contains a binding arbitration provision. Oftentimes our clients are surprised to hear this and need help understanding what this means for them and their case.

Arbitration is an out-of-court proceeding in which a neutral third party, called an arbitrator, hears evidence and then makes a binding decision. Arbitration is the most commonly used method of Alternative Dispute Resolution. Indeed, if you look closely enough, you may find an arbitration clause in the fine print of all kinds of contracts these days.

As an alternative to judges or courts settling disputes between consumers and businesses, binding arbitration works out a deal through an independent, third-party – the arbitrator. Binding arbitration may save time, money, and energy when two parties disagree over a contract, the performance of a service, or the exchange of goods. The arbitrator’s decision is final and cannot be disputed or appealed.

While we certainly do not recommend it, you may choose to handle your own short term disability or long term disability claim.

If you decide to make a disability claim on your own, there are at least three things you should keep in mind when dealing with an insurance company.

1. Insurance Companies are For-Profit businesses.

Congratulations to Kantor & Kantor’s associate Brent Dorian Brehm for being selected to Super Lawyer’s 2014 Southern California “Rising Stars” list! This special recognition highlights Brehm’s exceptional work in ERISA/ bad faith insurance litigation as a young emerging legal leader.

Acknowledgment through this impressive list is attained through a systematic and multiphase selection process. Professional achievement is assessed annually (on a state-by-state basis) through peer nominations and evaluations, and carefully combined with third party research. This comprehensive and diverse list of outstanding attorneys is utilized as a resource for attorneys and consumers searching for reputable legal counsel. The final published list represents no more than 5 percent of the lawyers in the state.

Brehm, an 8th year associate, has spent his entire career advocating for individual’s rights to disability, life, health, and long term care insurance benefits with one of the preeminent firms in the area of ERISA (Employee Retirement Income Security Act) and bad faith insurance litigation, Kantor & Kantor, LLP. While with the firm, Brehm has resolved well over 150 disputes with insurance companies on behalf of his clients, and has made the transition to lead attorney on many of his cases. At least 13 nationally reported decisions in his client’s favor (including five cases published in the official reporter and five trial judgments in which Brehm was lead counsel) speak as testament to Brehm’s advocacy, skill, and experience gained through practice.

Insurance benefits provided by your employer benefit plan are usually governed by the federal laws of ERISA (Employee Retirement Income Security Act). Not all plans are insured, and instead may be self-funded. But, when they are insured, your dealings will almost always be exclusively with an insurance company.

Under ERISA, you are entitled to receive, upon request and free of charge,”reasonable access to, and copies of all documents, records, and other information relevant to your claim for benefits, including any guidelines relied upon in making this determination.”

The quote above is standard boilerplate language that appears at the end of almost every denial letter issued by a health, life, or disability insurance company when the benefits are governed by ERISA. In such a case, an insurer is required by federal law to give you access to almost all of the documents they utilized in making a claim determination. This includes, but is not limited to, the policy or plan, the medical records, internal notes and memos, and the notes of their reviewing physicians.

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