Most claimants are totally unaware their ERISA Plans enter them into a stacked-deck game of Texas Hold’em they eventually cannot not win. Claimants believe their STD/LTD Plans are benefits paid for by employers that make up a sizable portion of their well-earned employee benefit package. But, the truth is, ERISA Employer Group Plans are full of loopholes that are used to separate claimants from their benefits, and in accordance with Plan provisions.
Although most ERISA insurance companies have many different SSDI scams to deprive claimants of benefits, the one that appears to be the most egregious involves what is called an “estoppel.” An “estoppel” as in the case of ERISA Plans, involves using the SSDI application provisions both FOR and AGAINST claimants at the same time.
Here’s how it works. First, the insurance company forces a claimant to apply for SSDI benefits. In fact, most ERISA Plans say something like (paraphrased): “When [your insurer] determines you are eligible for social security disability you must apply, and keep the appeals going if you don’t want us to take an estimate from your benefit.” Claimants panic and apply for benefits.
When benefits are approved, and paid with a large retroactive award, the insurer demands repayment of the SSDI overpayment. Once the overpayment is recovered, the insurer then “risk manages” the claim further, and alleges the claimant has work capacity and denies the claim.
First, the insurer determines the claimant is totally disabled and should apply for SSDI, then when the overpayment is recovered, alleges the claimant isn’t totally disabled at all, has work capacity, and denies the claim. In reality, the insurer first used the SSDI provisions in favor of the claimant for total disability, and then used the same provisions to allege work capacity thereby terminating benefits.
It’s a set-up folks! When challenged, insurers always have a good story. Unum, for example, sends its claimants to Independent Medical Evaluations to document work capacity. When the claimant said, “But I was determined to be totally disabled by SSA”, Unum responds, “We have more recent information SSA didn’t have at the time it awarded you benefits, therefore, we have justification to disagree, and to deny your claim.”
This is a classic example of what an estoppel is: “using a Plan provision both for the claimant, and then against the claimant in order to obtain profitability at the claimant’s expense. You might be asking, “Why do they [the courts] allow this? Well, they don’t always, but it takes a very, very, good attorney to blow holes in it in court. My impression is that it has become so common place that most attorneys barely pay it much attention.
Reliance Standard is exceptionally good at pulling this Ace from its sleeve. This is only one of the many scams insurers use to profit from SSDI Plan provisions. Please make note of it, and be aware. Group Plans are not secure sources of benefits because of the many scams insurers have in place to fold the claimant’s hand when it comes to benefits.
