Court Orders Life Insurance Company Of North America To Pay Claimant Long-Term Disability Benefits

After failing to pay a LINA disability policyholder his entitled disability benefits the insurance company was forced by a New York court to follow through with its contractual obligations. Curt, a former employee of BorgWarner Morse TEC Inc. received long-term disability benefits under the group insurance policy issued by LINA. LINA later concluded the BorgWarner employee no longer met the definition of disabled under the policy and terminated his benefits.

Curt and his New York disability attorney sued LINA asking the district court to order LINA to pay Curt his disability benefits as well as prejudgment interest and attorney’s fees.

Curt worked as a Senior Designer/Automotive Design Drafter for BorgWarner at the time he went out on medical leave. After working for BorgWarner for more than 20 years Curt was diagnosed as suffering from diabetes mellitus, lower back pain, neck pain, hypertension, sleep apnea, congestive heart failure and coronary artery disease. Curt made a claim to LINA for short-term disability benefits, which was approved and paid by LINA from June 2004 through December 2004. Curt’s claim was then transitioned to a claim for LTD benefits which was approved on January 2005, effective December 2004. About a year later, LINA notified Curt that it was beginning an investigation to determine if Curt was disabled under the Policy’s “any occupation” definition of disability, which would be effective June 2007. LINA then requested updated medical information from Curt’s treating physicians.

The collective opinions submitted by Curt of his treating physicians confirmed that Curt was totally disabled from any occupation with one physician stating: “[Curt’s] ‘prognosis is poor’ and he is frequently unable to perform many daily living tasks, let alone be able to work in any capacity. I do not feel that [Curt] will ever be able to return to work.” Nevertheless, LINA hired a vocational rehabilitation counselor who reviewed Curt’s medical records and concluded that Curt was capable of functioning in a full sedentary capacity and in some light capacity. Based on its hired doctor’s opinions, LINA requested a transferable skills analysis (“TSA”) to identify occupations that Curt would be capable of performing.

In June 2007, LINA terminated Curt’s benefits claiming it had based its determination on the medical records and results of the TSA. Curt appealed LINA’s decision noting in his appeal that he had been approved for Social Security Disability benefits and providing updated medical records and letters from his physicians.

Despite all the supporting medical documentation, LINA upheld its determination on both of Curt’s appeals. Curt sued LINA in a New York district court. The court, after reviewing LINA’s decision, found LINA’s termination of benefits was unreasonable and ordered LINA to reinstate Curt’s LTD benefits going forward as well as retroactively to the original date of termination.