Health insurance policies are supposed to offer us coverage for a variety of situations. There are times, unfortunately, when insurance companies deny a claim for illegitimate reasons. This can be particularly devastating to the insured person, particularly if they are dealing with a long-term disability.
People who are victims of unethical disability claim denials have options for recourse. If your claim in denied, you can either file an appeal or a lawsuit against the insurance company, depending on individual circumstances.
An insurance company may attempt to deny or unreasonably delay a disability claim by repeatedly requesting information, claiming a patient lied on the insurance claim, disputing against a medical diagnosis, claiming a disability doesn't exist and by outright cancelling the insurance policy. Depending on the situation, these methods may be examples of acting in bad faith.
In California, there are two different types of denied disability actions:
- California denied disability insurance claims - If you obtained your health insurance through a broker (rather than an employer) you have "first party insurance." As such, you may file a bad faith insurance lawsuit against your insurance company. Through this lawsuit, you may be eligible to obtain damages to cover medical bills, punitive damages, and pain and suffering in severe bad faith insurance cases.
- Denied ERISA insurance claims - If you have health insurance through your employer, your insurance claim is covered under the Employee Retirement Income Security Act (ERISA). Therefore, the next step after a denied claim is to file an appeal within 180 days of the decision. If your appeal is denied, then your next step is to file a lawsuit.
Whether you have a bad faith or ERISA insurance claim, your case can benefit greatly from legal advice, guidance and advocacy. Contact an experienced attorney to discuss your options.