Like most business dealings there are rules which dictate “fair and honest dealings between parties. Although some might think the disability insurance industry doesn’t have any rules, that’s simply not true. ERISA reviews are held to standards of “fiduciary duty” and are guided by the NAIC (National Association of Insurance Commissioners) Model Acts, put into law in all states. IDI claims are supposed to be guided by “good faith and fair dealing.” There ARE rules to operate by, but unfortunately some insurers don’t go by the established standards of “fair and honest review”, and although law, the NAIC Model Acts are unenforceable if an entity refuses to abide by them.
Within the last several months it has come to my attention that Reliance Standard is operating outside of the normal realm of ethical conduct. This observation comes to me via reports from attorneys I’ve helped with appeal reports, individual reports of unfair claims review practices, and dealings with Reliance personnel who continue the lies even when they are caught and faced with the untruth.
The most egregious “lie” out there is Reliance Standard’s statements to claimants that “ERISA requires private disability companies to obtain and review SSDI files to support disability.” I have to tell you that this statement communicated to claimants is unequivocally a lie. When faced with the falsehood, Reliance personnel cite the ERISA statute of 29 CFR Section 2560, of which I am very familiar. ERISA doesn’t say that.
ERISA is an acronym for the Employment Retirement Income Security Act of 1974. It is a federal law that establishes federal jurisdiction for all welfare plans including employer disability plans. Its provisions are federal law, which are entirely separate and different from state laws written for IDI contracts. There is no connection, or association between SSA, ERISA and private disability companies. None. Bottom line, ERISA has no provisions requiring Reliance Standard, or any other private insurer, to obtain SSDI files and review prior to making a decision on a claim.
Despite there being no connection between federal ERISA laws and private insurance, several insurers have tried to “create” a connection by saying, “…we want to make sure we give your claim every possible advantage.” Another lie. What they’re after is SSA Form 831, which is the Disability Determination and Transmittal form giving the listings under which applicants are approved. Insurance companies are always looking for cited mental health listings so they can deny claims at 24 months. They also want to make sure there are no “hidden”, or secret patient notes they didn’t know about.
SSA Form 831 also contains the name of the person who approved the claim, and for companies like Unum who once used the information to have a conversation with SSA people with the claimant on the phone, it seemed advantageous to engage in conflict to get a copy of the SSDI file. Although there are several other ways to “sell” giving SSDI files to insurers, you can be sure they are up to no good.
Recently, Reliance Standard has also been found to request Independent Medical Evaluations without having the benefit of all the medical information available for review. I guess, they just want to skip that part and go right for the IME jugular before the end of the 3rd Quarter profitability period. Although its Plans and policies do say the company can request an IME at any time, does it make sense to have an IME before reviewing all available medical? Well, it does, if you’re looking to deny claims quickly, before a profitability period.
In my opinion, Reliance Standard is quickly gaining a public reputation of misrepresentation, and unfair claims practices.In fact, the proof that I’m seeing indicates the company isn’t acting as a “fiduciary” at all.
If you have a Reliance Standard Plan, please be on your toes for statements, requests, and letters containing misrepresentations. It has quickly become the “standard” for Reliance Standard to have no standards at all.
Those who are victims of SSA false information should contact the SSA Inspector General or their regional EBSA of the local US Department of Labor to file a complaint.
