How to protect your client's ongoing benefits

AuthorScott M. Riemer/Jennifer L. Hess
Chapter 6
is chapter will address what happens after the insurance company
grants LTD benets to your client and how you can help secure your cli-
ent’s ongoing receipt of benets. Indeed, the insurance company will not
approve the claim indenitely. Rather, the insurance company will engage
in an ongoing investigation of the claim, which is often called “monitoring.”
During the monitoring phase, the insurance company will periodi-
cally request updated information from your client and his/her doctors to
determine ongoing benet entitlement. ese requests could be as often as
monthly, especially during the rst year and when your client has an illness
or injury that is expected to improve. With these requests, the insurance
company will be looking for improvement in your client’s medical condi-
tion(s), evidence of work activity or earnings, and other information that
may relate to your client’s credibility. e insurance company always will
be on the lookout for opportunities to terminate your client’s benets.
Disability benets never become an unmanaged annuity for the claimant.
Upon approval of benets, your client can expect the insurer will mon-
itor the claim by requiring continuing proof of claim on a periodic basis.
e insurer’s authority to request these updates comes from two
sources. First, insureds have a general obligation under state insurance
law to cooperate with an insurer’s reasonable investigation of a claim.
§6.1 ERISA Disability Claims and Litigation 6-66
For instance, in New York, “the failure of an insured to cooperate with
the insurer in its investigation of a claim constitutes a material breach of
the contract of insurance, and is a defense to a suit by the insured on the
policy.GuideOne Speciality Mut. Ins. Co. v. Congregation Bais Yisroel, 381
F.Supp.2d 267, 276 (S.D.N.Y. 2005), quoting, Evans v. International Ins.
Co., 562 N.Y.S.2d 692, 694 (1st Dep’t 1990); see also Eagley v. State Farm Ins.
Co., 2015 U.S. Dist. LEXIS 132184, at *15-16 (W.D.N.Y. Sep. 29, 2015).
Second, insureds have an obligation under the policy itself to cooper-
ate. LTD insurance policies always grant the insurer the right to request
continuing proof of loss, including the right to request a medical exam-
ination. Some examples of policy provisions are as follows:
Example 1:
We may investigate your claim at any time. At our expense, we
may have you examined at reasonable intervals by specialists of
our choice. We may deny or suspend LTD Benets if you fail to
attend an examination or cooperate with the examiner.
Example 2:
We will terminate benet payment on the rst to occur of: …the
date You fail to furnish Proof of Loss, when requested by us.
We may request Proof of Loss throughout Your Disability. In such
cases, we must receive the proof within 30 days of the request.
Example 3:
We may request that you send proof of continuing disability
indicating that you are under the regular care of a physician.
is proof, provided at your expense, must be received within
45 days of a request by us.
In some cases, you will be required to give [Insurer] authoriza-
tion to obtain additional medical information and to provide
non-medical information as part of your proof of claim, or proof of
continuing disability. [Insurer] will deny your claim, or stop send-
ing you payments, if the appropriate information is not submitted.

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