Here we are at the end of the 3rd Qtr.and I’ve been receiving more calls than usual about claim denials. This means people are asking for attorney referrals and my advice regarding filing an appeal.
I’ve been saying for years now that it is unwise to file a disability claim appeal on your own. The word in the insurance community is that insurers are NOT overturning and paying claims hoping most insureds will just go away and not file lawsuits.
Both appeals and lawsuits should be well thought out before beginning down a path you may regret later on. In order to illustrate this, I’m going to use an example of a claimant with a $250/month benefit whose claim was recently denied by Unum.
In speaking with the claimant it was clear she wanted to appeal and possibly sue Unum. Although the benefits wasn’t much, she explained, it did pay a few fills. In the environment we are now working in, it’s not likely that any attorney would be interested in taking this case. The disability involved neuropathic vision problems that are difficult to support to begin with.
In order to send in a really good appeal, this claimant would need to spend another $10,000-$15,000 seeking out and obtaining new test results, occupational reviews, peer reviews etc. And, even then, she would have about a 50% chance of having her claim denial overturned and paid. Without an attorney, filing an appeal on her own places a successful income down to about 5%.
I can tell you that there are claimants out there who are so angry it wouldn’t matter if their benefit was $10/month, they would still try to sue Unum.
I can certainly understand the frustration of those who are angered by a claim denial. Look, I fought against this company from 2000-2008. I worked with John Garamendi in California, and Elliot Spitzer in New York, who was the only Attorney General attempting to bring criminal charges against Unum. I was the designated expert witness in approximately 85 cases against Unum and we won or settled them all. In the end, nothing changed, and in 2024 Unum is still engaging in unfair claims practices the way they have always done.
Regardless, of how angry people are about having a denied claim, if class actions, attempted RICO, and multiple lawsuits didn’t change Unum, one lawsuit won’t either.
What I’m talking about here, though, is the cost effectiveness of taking on an appeal and possible lawsuit when the monthly benefit is so low. Although a $225/month benefit pays a few bills, the costs incurred in in securing that kind of benefit are not worth the investment.
In fact, some might consider the contingency cost of an attorney a poor investment when if you take pencil to paper the cost of 30%/back/and 40% forward sometimes reaches 6 figures over the life of the claim to age 65 or 67. Think. If you have an ERISA claim and the attorney takes 40% of your future benefit that only leaves you with 20% of pre-disability earnings to live on.
Claimants should never make decisions to appeal, or not to appeal based on their anger or desire “to get Unum.” These decisions should be made based on whether or not the additional investment of $15,000 would be worth it to get $$225/month. If it’s not, try to find another way to add $225 to household income. Be innovative and creative, or, determine if you could “do something” in terms of work to earn $225/month.
The most important factor in making appeal decisions should be the financial one where the investment costs required to win are worth the long-term gain of the continued benefit. Cutting your nose off to spite your face only produces a very unattractive selfie. Be smart, and consider the costs involved when filing an appeal, hiring an attorney, or attempting to sue Unum.
