Questions & Answers
To help guide you through the process, we have provided some of the questions most commonly asked of us.
Starting with our first communication with you as a potential client, what you tell us and what we advise you is confidential. It cannot be revealed by us (absent extraordinary circumstances), and you should not waive that confidentiality by sharing our discussion with other people. “My lawyer said” is not a sentence you should ever offer to anyone.
Your initial consultation and our initial investigation into your claim are free. We don’t believe in charging people for our services until we know we can help them.
Following our initial investigation, we may offer our services on a formal basis if we believe your claim has merit. At that time, you may choose between hourly or contingency fee agreements.
An hourly fee agreement is where you promise to pay the costs involved in handling your case and pay the attorneys an hourly rate. A contingency fee agreement is where your attorney would only be compensated for their time if, and only if, there was a recovery in your case. If there was no recovery in your case, then the attorney would not be paid.
We are also open to non-traditional methods, either through stair-step contingency fees (the fee begins at a lower setting and upon the occurrence of certain events in the process increases as time invested increases) or blended arrangements (costs are paid for by the client while the attorneys are not compensated for their hourly efforts until the end of the case).
Lawyers for insurance companies and corporations love the internet. Please refrain from engaging in any activities on the internet that might be construed as inconsistent with your claim. This includes posting your story as an advocate for reform. It is almost a given that the defense will conduct a thorough internet search on all claimants, so we must not give them ammunition.
For example, if you have an account on Facebook, MySpace, or LinkedIn that contains comments or pictures of ongoing activity, this could possibly be used as evidence that you are not as disabled as you claim. If you currently have a website that promotes professional or other activities, please notify us immediately.
Changing your privacy settings would also be advisable, but please know this does not mean the defense attorneys will not be able to see your posts because they may ask for a court to order the production of these materials.
Different insurance companies arrive at their decisions in different ways, and some have done the math and found that it is more profitable to deny a large number of claims that should have been accepted. This is because they save money on those claims where they can settle for low amounts and those claims where the insureds simply give up in frustration. This creates a perverse incentive for insurance companies to drag out litigation and fight claimants every step of the way.
In other words, your claim is simply viewed by the company as a small part of their big picture strategy for increasing profit and your individual circumstances have likely been ignored.
Typically, state law claims are tried before a jury. ERISA actions will not have a jury trial, and they will be decided by the judge assigned to your case. This can be very good, very bad, or mediocre news based upon the judge, but ERISA is typically going to be an uphill battle either way due to the standard of review. Like all people, judges may bring their own experiences and beliefs into the case, and this can color how the evidence is viewed. We cannot choose who the judge is but neither can the defendant(s).
How an ERISA case is managed can vary greatly depending on the court and judge in your case. In some ERISA cases, the judge may not allow witnesses and you may not be allowed to submit medical evidence that was not given to the insurance company before its final denial of your claim. Thus, it may be important to include everything possible that could help support your case before it ever gets to be a lawsuit.
If you obtain new evidence after the insurance company’s final denial, it may be appropriate to forward that evidence or Social Security decision to us so that we can have a full picture and consider whether there is a basis for including it as evidence. Sometimes a judge may consider evidence of the insurance company’s conflict of interest. This is generally evidence showing why the insurer and the claims handler were motivated to deny your claim in order to make more profit by not having to pay your benefits.
In the vast majority of lawsuits, the judge or jury simply asks “who is more right,” and will find in favor of that person. This is called the “preponderance of the evidence” standard. In many ERISA cases, the “abuse of discretion” standard is applied because insurers and employers have inserted language into the contracts and policies giving them the discretion to interpret and apply the policies as they see fit. Sadly, this means that in some ERISA lawsuits, the court does not ask if the insurer wrongly denied your claim. Instead, the court asks if the denial of your claim was unreasonable (this is also called arbitrary and capricious review). Thus, the court can find that you are and were disabled and you could still lose. Much has been written on this topic, and it is sad to see that ERISA, which was originally intended to protect workers, has been twisted in this way to routinely hurt them. There are some differences in how this standard is applied across the country, so it may be that you have a better or worse chance of recovery based upon your location and the location of your employer and insurer.
Under ERISA, the court will award (if you win) past-due benefits due under a disability policy up to the date of the court’s decision. The court may also order that your monthly benefits should be reinstated going forward. This means you will be put back “on claim,” and you can still be cut off again. You will be required to continue to submit proof of your disability to be entitled to future benefits. It could also be that the court simply decides to give the insurance company another shot at making the right decision (“remand”), and you may have to start all the way back at square one with nothing to show for it. This is often used by insurers to starve plaintiffs out and force acceptance of low settlement offers because this can add years to the process.
Please read everything carefully and think before responding to a physician’s questions. This includes those forms you have to fill out in the waiting room. The insurance company will be pouring through all of these materials looking for a reason to deny your claim, so make sure to give as much detail as possible at all times. For instance, if you are asked about the things you can no longer do because of your disability and nothing has gotten worse or changed since your last visit, then you should repeat those limitations each time. Checking a box that there are no restrictions will mean the insurance company will say you have no more restrictions and instead of no new restrictions.
Someone on our team is always standing by to receive your call, but please understand our attorneys are frequently out of the office or at meetings and may not be able to answer your phone call immediately. Similarly, it may not be possible to have a lengthy conversation with you while we have other clients or attorneys in the office. For that reason, we encourage our clients to schedule a phone conference if they need to speak with their lead attorney.
It is perfectly understandable and normal to take an insurer’s callous denial personally because it has very real and very difficult consequences on you and your family’s life. Their denial may also be viewed as a personal insult by implying that you are somehow faking your problems.
However, it is important to remember that you are likely just another number to the insurance company that affects their bottom line, and it is unlikely that anything you do in this case will make them learn their lesson or prevent them from taking advantage of someone else in the same way.
As difficult as it may be, it is important not to be driven by the main goal of getting even with the defendant, and we will do our best to give you the levelheaded advice that is necessary.
We will prepare a complaint, a document containing the facts of your case, and asking for certain “relief.” The defendant(s) will be served a copy of the complaint and typically within 30 to 60 days will then file an answer to the complaint. The “answer” may merely be a piece of paper denying the allegations made in the complaint. After that, the lawyers may meet to figure out the different dates for all the steps in litigation through the trial date or they may immediately begin the discovery phase of the case. There is often a significant lapse of time between the complaint being filed and the discovery beginning in earnest, so please do not be alarmed if it seems like nothing is happening.
Depending on the circumstances and the decision, we may choose to represent you for an appeal. Appeals can take years, and it is very hard to win an appeal.
Mediation is a meeting between the attorneys, the parties, and a mediator (a neutral attorney who works for both sides in a dispute) to attempt to reach a settlement. It is important to remember that nobody walks out of a settlement with everything they want, and both sides will leave having given something up if a settlement is reached. It is a compromise that will avoid the uncertainty, expense, and time of litigation. You will get less than everything you want, and the insurance company will pay more than it believes it should have to.
The parties will typically be in different rooms and the mediator will talk to both sides separately and try to help the parties reach a settlement. This will not be a mini-trial, and the ultimate decision of whether to accept or reject any offer will be yours. We will simply advise you of what the best course of action would be based upon our experience and knowledge. This includes advising what we believe the best counteroffers and responses would be.
Typically, no. What happens at the mediation will be kept confidential and should not be used against either side. This rule encourages both sides to speak freely about their case and not worry about things being held against them later.
Your case will be dismissed and there will be no decision regarding who was right or wrong. This will also typically involve signing a settlement agreement setting out what each side needs to do. The agreement will normally include a confidentiality agreement that forbids you from discussing how much you received or discussing the terms of the settlement. Although this is usually something the insurance company fights for, this can also protect you from having to explain your finances to people. You will also assume any tax consequences resulting from the settlement.
We do not give tax advice and encourage you to consult with an accountant. However, you should note for your tax advisor whether your benefits were paid for by your using after-tax dollars, or if your employer paid the premiums. You should consult with a tax specialist regarding any tax consequences you may incur.
Although a reasonable person would notice that proving disability for Social Security benefits is much more difficult than under most disability insurance policies, the law has been interpreted more and more favorably for insurance companies over the years. Now, in most jurisdictions, insurance companies only have to “consider” those other decisions and explain how they considered that evidence.
Insurance companies are very interested in whether you have obtained these (and other kinds of) benefits because they can often subtract those payments from what they owe under the policy. Further, if the SSA awards back benefits for a period where the insurer paid full benefits, the insurer will typically attempt to recover that money from you or subtract it from future payments. Insurers often require you to seek Social Security benefits under the policy, and they may even estimate your award and subtract it from payments if you do not.
They are extremely proactive in monitoring whether you have received any payments as a result of a disability finding, but they are also very careful to intentionally wall themselves off from any of the disability evidence or the decision itself. They do this so they can argue that this evidence should not be used in court, so it is important to obtain this evidence and submit it to your attorneys as soon as you can and to keep counsel informed of everything that happens in the process.
You should let them know because you are likely required to under the policy, and it could affect your credibility with the court if you don’t. Further, insurance companies typically employ companies that do nothing but monitor these awards, so they will most likely find out anyway. Finally, this will be strong evidence of your disability that we will want to use in your case, so it is best to make sure it is in the record.
Employers may offer an assortment of benefits that can be described as an umbrella. The different benefits within the umbrella are often interconnected in various ways. For instance, your life insurance policy may waive the premiums for any period where you are found disabled under the disability policy under the employer’s plan. These are often described as “ancillary” benefits, and it requires a skilled attorney to determine what benefits will trigger other benefits under different policies. Settlement could also implicate these triggers, so it is important to keep this in mind before making any decisions. For instance, one insurance company may argue that the other did not find you disabled during the period affected by the settlement.
Every attorney at Sinclair Law Firm is experienced in ERISA litigation. Frequently, the decision of who your case will be assigned to is based upon the attorney’s experience with your particular claim or the fact that he/she may have recently litigated a very similar issue. Rest assured that your attorney will be experienced and will be very capable of trying your case.
There are federal laws in place to protect pension and retirement funding for American workers. As part of those protections, the laws do not allow an employer to get rid of, or terminate, a pension plan unless certain requirements are met. One option that is allowed is to use the pension assets – the money and other assets that are currently set aside to pay for the pension liabilities – and purchase an annuity that provides the monthly benefit amount promised to employees.
Annuities are provided by insurance companies and, as with all businesses and investments, not all insurance companies are as stable as others. You may not be able to prevent the purchase of an annuity, but your employer must satisfy federal law when choosing which company will provide that annuity. Your employer should choose the safest available annuity to provide the benefits it has promised. If it doesn’t seem that is what the employer is doing, then you should have an attorney investigate the transaction.
Lump sums are tempting. Your employer likely has offered what looks like a large amount of money to replace your monthly pension payment. Doing this has a lot of benefits to your employer and puts a lot of risk on you. Federal law requires the calculation of a lump sum payment to use certain standard calculations.
Before deciding what to do, you should consider how stable your employer’s pension plan and your employer’s business are. If both are secure, you may be better off staying in the pension. You should also consider how investment savvy you are. Can you control your spending and saving enough to make that lump sum payment last long enough to provide for you and your dependents for the rest of your life?
You should also be aware of whether your pension provides for survivor’s benefits. If it does, your lump sum may not take that into consideration, and you could be giving up your spouse’s benefits. The result is almost always that you will receive less money and possibly less stability by accepting a lump sum instead of continuing to receive your pension payments.
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