ERISA & Life Insurance: Tips On Collecting Your Benefits
ERISA (Employee Retirement Income Security Act) governs most life insurance benefit plans. While collecting those benefits is easy is most cases, it can be difficult in some. We asked Ron Dean, a California attorney who has been practicing ERISA law for over 35 years, to provide us with some tips on how to collect your benefits. Here’s what he told us:
- Identify potential issues. There are all kinds of issues that arise. Frequently, you have accidental life insurance where the death has to arise from an accident. You may an issue as to whether a pre existing condition contributed to the accident. You have issues with the specific language in the policy or who’s the proper beneficiary. Sometimes, for instance, a person will designate their wife as the beneficiary. Then there’s a divorce and the participant forgets to remove his wife as the beneficiary. Even though the wife may have waived the benefit in the divorce, the plan still goes by who the designated beneficiary is. The Supreme Court actually upheld a case this year on that very issue.
- Beware of insurance company tactics. Insurance companies will often use tactics to avoid or delay payments. One of them is that they want to make sure you are who you say you are. Another is that they often have competing claims on the policy, so they’re not going to pay anyone until the claimants resolve it for themselves, which usually results in litigation. Sometimes they’ll pay the basic benefits, but investigate additional and supplemental benefits. As a rule though, the efficiency of the payment of life insurance policies is much greater than disability policies.
- Exhaust your administrative remedies. Before filing a lawsuit against your insurance company, it’s important to exhaust your administrative remedies. Show the court you did everything you could to avoid having to go to court – that you’re the good guy and they’re the bad guy. That’s very important in all litigation is to show that you’re that good guy. By being reasonable and rational and patient and explaining things over and over, you will go into court as the good guy.
- Consult with someone who understands ERISA matters. An attorney’s experience in life insurance matters is important. Life insurance presents a unique set of circumstances, especially in ERISA cases involving life insurance which requires a double set of unique skills. Most attorneys can handle a simple insurance case, but most attorneys can’t handle an ERISA case, whether it’s disability, life insurance or pension.
If you’ve been denied valid benefits under ERISA, consult with an experienced ERISA attorney to discuss your situation and evaluate your options. Consultations are free, without obligation and strictly confidential.