CIGNA's wrongful termination of disability waiver of life insurance premium reversed by court

MacNally v. LINA (CIGNA) highlights the complications that can occur when a person has both a disability and life insurance policy with the same insurance company. The terms of the policies can vary slightly. In this case, LINA claimed that the provisions under the life insurance policy held by William MacNally were different from the provisions under his long-term disability plan. Even though the life insurance policy included a clause waiving premiums if MacNally became disabled, LINA claims that the life insurance policy had a stiffer requirement than the long term disability policy.

Because MacNally’s long-term disability plan also had an earnings clause requiring LINA to continue paying him benefits if he was unable to earn 80% of his predisability earnings, even if he was able to work in an occupation for which he is education and experience qualified him for, he could still collect long-term disability benefits under the “any occupation” terms of his disability plan. The life insurance policy required that MacNally not be able to work at all in a full-time job in order to qualify for the waiver of his life insurance premiums.

While CIGNA ultimately found that MacNally was disabled and qualified for long-term disability under “any occupation” as defined in his LTD plan, the life insurance company found that he still did not qualify for a waiver of his life insurance premiums.

A summary of Mr. MacNally’s history will demonstrate why the Court found LINA’s decision wrong.

When MacNally first applied for long-term disability benefits in July 2002 he was able to present documentation from his physicians that demonstrated that his condition had worsened over time. He had resisted the advice of his doctors and his employer for two full years, preferring to continue working as long as possible before he could bring himself to accept the label of “disabled.” It wasn’t until his employer finally pressured him into disability leave, then downsized his executive position, that MacNally finally applied for disability benefits, and the waiver of life insurance premiums included as a benefit in his life insurance policy.

Long-term Disability Attorney Argues Against LINA’s Actions

It was with some struggle that MacNally succeeded in perfecting his long-term disability claim, LINA claiming that he had not supplied sufficient medical information. He wisely hired a firm that was skilled in long-term disability insurance litigation to represent him through the appeals process. His disability attorneys supported his appeal with 18 pieces of evidence– medical records, letters from colleagues, letters from MacNally and his wife, a job description of MacNally’s responsibilities as an executive, and general information about multiple sclerosis.

This information wasn’t enough, because LINA asked for more records. After these were supplied, MacNally’s file was sent to a neurologist who confirmed that MacNally was unable to do his job. His application for long-term disability under the “own occupation” provision of his disability plan was approved retroactive to July 3, 2002. Shortly after, LINA approved the waiver of premium benefit for MacNally’s life insurance plan.

Over the next four years, MacNally applied for Social Security disability income benefits, for which he was approved in February 2004. Social Security found that he was disabled as of September 1, 2003. When the “any occupation” reassessment of MacNally’s qualifications for benefits rolled around in 2004, LINA approved his continuing benefits under the stricter definition of disability. It wasn’t until he had been receiving benefits from LINA for four years, that the life insurance plan chose to reassess whether or not he qualified for the waiver of insurance premiums.

In order to retain his disability benefits, MacNally had been providing supplemental information on a regular basis. It was asked to update his information in July 2006. He did so by completing a new claim form. His treating neurologist also filled out a physical ability assessment (PAA) form. He also provided other medical records in August 2006.

Information that LINA saw on the physical ability assessment form suggested that MacNally might actually be able to return to work, so the life insurance company ordered a transferable skills analysis (TSA). Two jobs were identified, one being his former position as an administrator in a healthcare facility. Even though his disability insurance plan could not terminate his benefits because the positions would not allow MacNally to earn over 80% of his previous income, his life insurance policy was worded slightly differently. His premiums would only continue to be waived if he was unable to work in any position at any wage level.

MacNally was unable to successfully convince LINA that he was unable to work in any position. No amount of information presented by his treating physicians would reverse LINA’s conclusion that he could return to work using the skills that he already had if he chose to. In fact before he had completed his appeals process, LINA had concluded that he was able to do five different sedentary jobs, not just two. He had no option but to take his claim to Court.

Court Reviews LINA’s Decision Through Fresh Eyes

So how did the Court review LINA’s decision? LINA agreed that the Court should look at the life insurance company’s decision through the evidence present in MacNally’s administrative record. His disability attorney agreed that this was the proper form of review.

MacNally’s disability attorney challenged LINA’s conclusion that he could work on two grounds. First, he argued that MacNally was not capable of working in any occupation, including the five identified in LINA’s TSA’s. Secondly, the disability attorney argued that the life insurance policy included an implied wage threshold.

While the Court could not agree with the second argument, there was no question that MacNally’s medical records supported his complete disability from any occupation. While this might not have been true in 2002, when his own occupation required that he be able to work 60 to 70 hours per week, the evidence suggested that by September 2006 when LINA terminated the waiver of life insurance premium, MacNally would no longer be able to work a 40 hour day.

The Court found that MacNally would be unable to work not only because his fatigue was so severe when it occurred, but it was also completely unpredictable. Notes in his medical record reflected that there were days in which he could not drive because he was too exhausted to manipulate the brake and gas pedals.

The Court also found that the Social Security administration’s decision finding MacNally disabled was a factor worth considering. While LINA was not obligated to consider this information, it rejected the Social Security decision, depending instead on the opinion of a physician that had no expertise in the area of multiple sclerosis. The Court found showed a bias against continuing to pay the waived premiums. LINA had also depended on a neuropsychological test report which did not consider any of the complicating symptoms of multiple sclerosis, only whether MacNally had any mental/cognitive difficulties that would keep him from working.

The Court concluded that LINA had consistently ignored medical evidence that didn’t fit into the picture life insurance plan was trying to create– a picture of someone who should be able to pay for their life insurance because they were able to work. A great deal of evidence had been distorted and taken out of context.

Not only did the Court order that LINA reinstate the waiver of his life insurance premiums, the Court also ordered LINA to pay his attorney fees. The reason behind this was twofold. LINA had not acted toward MacNally as a fiduciary acting in his best interest and in the interest of other plan participants. Rather the life insurance company had pursued a plan of action demonstrating that its goal was to deny MacNally’s claim by only considering evidence is found favorable to itself. The Court found that because LINA had behaved as an adversary rather than a fiduciary, MacNally have the right to recover his attorney’s fees.

MacNally’s only requirement in order to take advantage of the attorney’s fees was to file an affidavit document for the attorney’s fees and costs he was seeking to recover within 30 days. LINA would then have 15 days in which to respond.

This case highlights the fact that not only long-term disability benefits can be terminated. Other benefits that can be awarded because of disability, such as the waiver of insurance premium clause in MacNally’s life insurance policy, can also be wrongfully denied by an insurance company. It is very important to contact an attorney who is skilled in handling claims against these insurance companies.


Did you find this helpful?
Unhelpful (0)

Resources to Help You Win Disability Benefits

Disability Benefit Denial Options
Submit a Strong Cigna Appeal Package

We work with you, your doctors, and other experts to submit a very strong Cigna appeal.

Learn more

Sue Cigna

We have filed thousands of disability denial lawsuits in federal Courts nationwide against Cigna.

Learn more

Protect Your Benefits
Get Your Cigna Disability Application Approved
We help claimants throughout the entire application process.

Learn more

Prevent a Cigna Disability Benefit Denial
We manage every aspect of your disability claim following claim approval.

Learn more

Negotiate a Cigna Lump-Sum Settlement

Our goal is to negotiate the highest possible buyout of your long-term disability policy.

Learn more

Answered Questions by Our Lawyers
(70)
Showing 8 of 70 Answered Questions

Q: Why can Cigna get away with not paying me anything for my disability?

Answered on November 6th 2022 by Attorney Jay Symonds
A: Barbara: It sounds like you have a complex situation. Unfortunately, it also sounds like you had legal represe... Read More >

Q: Do I have to be an active employee to apply for LTD?

Answered on October 27th 2022 by Attorney Steven Dell
A: Lori: Generally speaking, if out on claim and a new/different disability arises you can add that to your exist... Read More >

Q: Can Cigna refuse to give me a copy of my short term disability policy?

Answered on September 2nd 2022 by Attorney Cesar Gavidia
A: Dave, since the policyholder is your employer CIGNA can refuse to provide it to you. You should contact your e... Read More >

Q: Is my plan governed by ERISA?

Answered on October 9th 2020 by Attorney Alex Palamara
A: LeRoy, we will have to review the policy in order to give an opinion as to whether it would be governed by ERI... Read More >

Q: Can I add a physical disability claim to my mental health one without seeing a doctor (hard to get an appointment with COVID)?

Answered on April 14th 2020 by Attorney Cesar Gavidia
A: Heather, the only way to effectively include your physical disability claim is to see a physician qualified to... Read More >

Q: Do you handle CIGNA cases in Florida?

Answered on February 12th 2020 by Attorney Rachel Alters
A: Vito, yes. We absolutely do handle Cigna cases in Florida. Please email me at Rachel@diattorney.com and send... Read More >

Q: How can Cigna get away with not answering my calls?

Answered on July 22nd 2019 by Attorney Stephen Jessup
A: Carol, knowing Cigna it sounds like they are approving your claim on appeal for a closed period of time and th... Read More >

Q: Do you handle closed cases only, or open ones as well?

Answered on May 10th 2019 by Attorney Stephen Jessup
A: Renee, we handle all types of open claims with Cigna – applications, claims handling, appeals, lawsuits, buy... Read More >
Helpful Videos
(861)
Showing 12 of 861 Videos
Disability Benefit Tips
(329)
Showing 8 of 329 Benefit Tips

Is Cigna Seeking To Offset Disability Benefit by Social Security Survivor Benefit?

I recently spoke with a gentleman who called into our office who has been receiving long term disability benefits from Cigna for several years... Read More >

Is Cigna's Denial of Your Appeal Really a Denial?

Following the submission of your appeal has Cigna sent you a letter stating that after review of the information provided on appeal their deci... Read More >

What Should a Claimant Expect When Suing Cigna or any Other Disability Company for Long Term Disability Benefits?

ERISA disability lawsuits are complicated due to the pro-insurance company laws. Our disabili... Read More >

Are Cigna Short Term Disability Denials on the Rise?

When it comes to claims for short term disability benefits under ERISA governed group policies, more often than not the short term disability ... Read More >

Cigna's latest strategies for handling and denying disability benefit claims

Watch Gregory Dell and Stephen Jessup discuss Cigna's latest strategy for handling disability... Read More >

Is a Claimant's Complaints of Pain Enough to Qualify for Short or Long Term Disability Insurance Benefits?

The answer to this question applies to the vast majority of long term disability insurance claims that we handle on a daily basis. Pain is sub... Read More >

Is My Insurance Company Allowed to Take An Offset of My Monthly LTD Benefit for Social Security Benefits My Kids Receive As A Result of My Disability?

It is common practice for insurance companies to find ways to limit the amount of money they have to pay to claimants. If you are receiving lo... Read More >

Is My "No-Fault" Auto Insurance Settlement an Offset Under My Long Term Disability Insurance Policy?

If your policy is an employer provided group disability policy governed by ERISA, then any proceeds you receive from a settlement based on "No... Read More >
Dell Disability Cases
(369)
Showing 8 of 369 Dell Disability Cases

Cigna Sued For Failing To Make A Timely Decision on Appeal

If your disability insurance claim has ever been denied you will have received a formal denial letter from your insurance carrier in which you... Read More >

CIGNA Overturns a Waiver of Premium for Group Life Insurance Policy

In early 2019, the widow of a decease man contacted our firm as she was troubled by the actions of CIGNA, also known as Life Insurance Company... Read More >

Cigna Admits Error In Denying Disability Benefits

Our client, a former school teacher, suffering from multiple severe medical conditions including autonomic nervous system damage, small fiber ... Read More >

CIGNA Overturned Their Denial of LTD Benefits for Nevada Healthcare Coordinator

Our client, Ms. G, formerly worked as a Healthcare Coordinator for a large regional healthcare provider. For many years Ms. G suffered from ch... Read More >

CIGNA Denies Technology Manager under the Own Occupation Provision & Dell Disability Lawyers Wins Appeal

Our client, Mr. N, formerly worked as a Technology Manager / Vice President for a large bank. For many years Mr. N suffered from chronic debil... Read More >

CIGNA overturned previous denial of waiver of life insurance premiums

Our client was the husband and beneficiary of Ms. S, who formerly worked as a registered nurse for a regional Healthcare System. In January 20... Read More >

Dell Disability Lawyers successfully appeal denial of benefits to claimant with CRPS/RSD

Ms. S contacted our firm after receiving a letter from her disability carrier, Cigna, denying her claim for short term disability benefits und... Read More >

LINA overturned its previous LTD denial for Medical Technologist

Our client, Ms. H, formerly worked as a Medical Technologist for a National Clinical Laboratory. In July 2017 a number of medical issues, incl... Read More >
Disability Lawsuit Stories
(764)
Showing 8 of 764 Lawsuit Stories

Cigna Denial of LTD Benefits for Schlumberger Shop Manager Upheld

In Jerry Courville v. Life Insurance Co of North America (LINA), Plaintiff was employed as a shop manager for Schlum... Read More >

Missouri Court Rules Cigna Wrongfully Terminated Disability Benefits

In the case of Lapidus vs. Life Ins. Co. of N. Am. a Missouri federal court ruled against Cigna finding that Cigna wrongfully terminated long ... Read More >

Missouri Court Orders Cigna to Pay LTD Benefits to Medical Sales Executive

The Plaintiff in this case was vice-president of Medical Benefits at BJC Healthcare when a severe back condition required her to have a spinal... Read More >

Cigna's Termination of Disability Benefits was Arbitrary and Capricious

The case of Lani Kyle Moar v. Cigna Corporation, et al., demonstrates the lengths insurance companies will go to avoid paying long term disabi... Read More >

Court Criticizes Lina For Failing to Perform Independent Examination

Disability Insurance companies are criticized often for failing to perform independent medical evaluations and instead relying exclusively on ... Read More >

Lockheed Martin Systems Integration Analyst Wins Long-term Disability Lawsuit against CIGNA

Cal Van Steen had been employed as a Systems Integration Business Analyst at Lockheed Martin Corporation and participated in the company’s g... Read More >

Colorado District Court overturns denial of benefits by Life Insurance Company of North America

In Johnson v. Life Insurance Company of America, a Colorado District Court ruled in favor of the claimant finding LINA’s decision unsupporte... Read More >

Texas Judge Disagrees with Cigna and Applies Claimant Friendly Disability Standard of Review

In Brasseur v. Life Insurance Company of America (LINA), Plaintiff Wilfred Brasseur, a computer engineer, worked in the Houston office of Chic... Read More >

Reviews from Our Clients

Request a Free Consultation

Our Lawyers Respond Same Day

5 Ways We Help Get Your Benefits Paid

Get Your Disability Application Approved

Our goal is to get your application for disability income benefits approved. Applying for disability benefits can be a difficult process and the information you provide is critical. Most disability insurance companies look at your application in hopes of finding a reason to deny your claim. Your disability company will ask you to complete numerous forms, interview you, request lots of information, speak with your doctors and possibly request to have you examined by their "hired gun" doctor.

Through our experience of having helped thousands of disability insurance claimants, our lawyers will guide you through the entire application process and give you the best chance to get your disability claim approved the first time.

Submit A Strong Appeal Package

If your disability insurance benefits have been wrongfully denied, then our lawyers know exactly what it takes to get your disability claim approved. You only get once chance to submit an Appeal, therefore every piece of evidence that will support your disability claim must be included. The goal is to win your disability benefits at the Appeal level, but while preparing your Appeal you must consider how a federal judge will review your disability claim if your benefit denial is upheld.

Preparing a strong disability appeal package is an art that requires you to understand how the courts interpret your disability policy language, ERISA regulations / laws, and how to strategically present evidence in support of your definition of "disability". We encourage you to contact any of our lawyers for a free immediate review of your disability denial.

Sue Your Disability Company

98% of the disability insurance lawsuits filed by our law firm have resulted in either the payment of benefits or a lump-sum settlement agreement. Our disability lawyers have filed ERISA governed and private policy long term disability insurance lawsuits against every major disability insurance company in state and federal courts nationwide and we love fighting for the "little guy" against the multi-billion dollar insurance company giants.

We have recovered hundreds of millions of dollars for our clients and we would like the opportunity to provide you with a free review of your disability benefit denial. There are many complex factors in a disability benefit lawsuit and the legal battle to win long term disability benefits can be fierce.

Prevent A Disability Benefit Denial

Approval of long-term disability is a continuous process as every disability insurance company will evaluate your eligibility for benefits on a monthly basis. You can never let your guard down and assume that your disability company will continue to pay your benefits for as long as you think you need them.

Our law firm offers a reasonable flat fee monthly claim handling service in which we handle every aspect of your long-term disability claim and do whatever it takes to make sure you are paid every month.

Negotiate a Lump-Sum Settlement

Let's discuss if a lump-sum settlement or buyout of your disability insurance claim is both available and makes financial sense for you. Our lawyers have negotiated more than five-hundred million dollars in disability insurance buyouts and we know how to get you a maximum settlement. A disability insurance company is not required to offer a buyout and not every disability company offers them.

Questions About Hiring Us

Who are Dell Disability Lawyers?

We are disability insurance lawyers that know how to get your short or long term disability benefits paid. As a nationwide law firm we have helped thousands of disability insurance claimants throughout the United States to collect hundreds of millions of dollars of disability insurance benefits from every major disability insurance company.

In more than 98% of our cases, our lawyers have been able to either get our clients paid monthly disability benefits or obtain a one-time lump-sum settlement. Our lawyers have seen it all when it comes to disability insurance claims and we know exactly what it takes for your disability claim to be approved.

We welcome you to contact any of our attorneys for a free immediate review of your disability claim. We also invite you to visit and subscribe to our YouTube channel where we have more than 700 videos and regularly provide tips to help protect your disability benefits.

Who do you help?

Our lawyers help individuals that have either purchased a long term disability insurance policy from an insurance company or obtained short or long term disability insurance coverage as a benefit from their employer. We have helped individuals in almost every type of occupation with monthly disability benefit payments ranging from $1,500 to $50,000.

Our clients include all types of employees ranging from retail associates, sales representatives, government employees, police officers, teachers, janitors, nurses, pilots, truck drivers, financial advisors, doctors, dentists, veterinarians, lawyers, consultants, IT professionals, engineers, professional athletes, business owners, and high level executives.

A strong understanding and presentation of the duties of your occupation is essential for securing disability insurance benefits.

Do you work in my state?

Yes. We are a national disability insurance law firm that is available to represent you regardless of where you live in the United States. We have partner lawyers in every state and we have filed lawsuits in most federal courts nationwide. Our disability lawyers represent disability claimants at all stages of a claim for disability insurance benefits. There is nothing that our lawyers have not seen in the disability insurance world.

What are your fees?

Since we represent disability insurance claimants at different stages of a disability insurance claim we offer a variety of different fee options. We understand that claimants living on disability insurance benefits have a limited source of income; therefore we always try to work with the claimant to make our attorney fees as affordable as possible.

The three available fee options are a contingency fee agreement (no attorney fee or cost unless we make a recovery), hourly fee or fixed flat rate.

In every case we provide each client with a written fee agreement detailing the terms and conditions. We always offer a free initial phone consultation and we appreciate the opportunity to work with you in obtaining payment of your disability insurance benefits.

Do I have to come to your office to work with your law firm?

No. For purposes of efficiency and to reduce expenses for our clients we have found that 99% of our clients prefer to communicate via phone, email, fax, GoToMeeting sessions, or Skype. If you prefer an initial in-person meeting please let us know. A disability company will never require you to come to their office and similarly we are set up so that we handle your entire claim without the need for you to come to our office.

How can I contact you?

When you call us during normal business hours you will immediately speak with a disability attorney. We can be reached at 800-698-9159 or by email. Lawyers and staff must return all client calls same day. Client emails are usually replied to within the same business day and seem to be the preferred and most efficient method of communication for most clients.