When the Employee Retirement Income Security Act (ERISA) of 1974 came into law, it controlled how employers could offer long-term disability insurance to their employees. This has led to a complex set of requirements for filing for a claim from any plan affected by the ERISA rules, and making even one mistake during the filing process can lead to rejection and delayed assistance. Go over your application with a fine tune comb to weed out these five common mistakes, preferably with the help of a claims professional.
Violating the Waiting Period
While you may need financial help immediately after your accident or injury that caused your permanent disability, most insurance plans mandated through ERISA rules have waiting periods. You must be disabled, ill, or injured for a specific number of days before you can start a claim and backdate your benefits. The waiting period varies depending on the particular plan, the injury or disability at the center of your claim, and the provider of the plan. Most waiting periods range between 90 and 180 days, although some are as short as one month. You won't lose your chance to file a claim by filing too early, but the claim won't be processed until the waiting period is up.
Failing to File for Social Security
Almost all insurance providers offering ERISA controlled disability coverage require you to file for disability benefits through the Social Security Administration when sending in an initial application for a claim. This is because any amount of compensation you receive from the SSA reduces the amount paid to you by the private insurance provider. Failing to secure any available SSI benefits could leave you with a rejected claim that can't be overturned because you didn't follow the rules set by the insurance company. If you are turned down for SSI, it does not necessarily prevent you from having your insurance claim approved by the company.
Appearing Able-Bodied and Well
Don't claim a level of disability that isn't well-supported by your daily activities. If you claim it's too painful for you to stand for more than 10 minutes, don't go shopping at a local grocery store without using a wheelchair provided by the store. Insurance companies rightfully monitor the activities of employees filing for ERISA claims to verify they're truly disabled, and it's not unheard of for applicants to get denied because they acted less disabled or ill than they claimed to be. Be sure to talk to your doctor about what's acceptable and what's not, and get these recommendations in writing.
Expecting Entire Salary
As with worker's compensation claims, ERISA disability insurance does not provide a full compensation of the lost wages to the employee who can no longer work. Each plan varies on how much it will cover of your former income, and some plans offer reduced percentages for mental and nervous conditions compared to physical ailments. Long-term disability insurance payments tend to replace between 80% and 50% of your former income. This can vary depending on the severity of your disability as well.
Working Only with Company Advisers
It's tempting to take the offer of free help from your human resource managers and other advisers working for your employer and their insurance company after a serious injury. However, they won't necessarily give you the best advice for achieving the results you're hoping for from your ERISA claim. It's best to get assistance from an outside source, such as a long-term disability lawyer with years of experience in the field, to make sure you're gathering the right evidence and compiling documents correctly to get your claim accepted the first time around.