Texas Disability Insurance Attorney Regularly Fight ERISA Disability Denials
In Texas, a claimant’s ability to challenge a denial of disability benefits depends on many factors, not the least of which is whether the disability insurance policy is governed by ERISA. Another critical factor is having a good lawyer: a Texas disability attorney must have considerable experience in handling ERISA disability denials to have any chance of either winning an Appeal or convincing a judge to reverse a disability claim denial. While not every disability policy is governed by ERISA, the majority are and being prepared is critical.
Texas Passes Law Banning Discretionary Clauses in Disability Policies
Every ERISA disability denial lawsuit begins with consideration of whether the disability insurance policy contains a “discretionary clause,” which is nothing more than insurance company language written to give them the right to interpret certain terms of the disability policy and make a final claim decision. Many insurance companies try to build this kind of language into policies to limit claims and to restrict a court’s ability to overturn insurance company decisions. With a discretionary clause, the court must defer to the insurance company and can only reverse the denial if it is “arbitrary and capricious.” However, if a disability policy does not contain a discretionary clause, then a court is not restricted in their review of a disability claim denial.
“As of January 1, 2012, the State of Texas passed a law which prohibits any insurance company from issuing or selling a disability policy which contains a discretionary clause. The Texas law banning discretionary clauses only applies to disability policies issued or renewed after Janaury 1, 2012″.
A Texas Court’s Review of a Claim Denial
The Fifth Circuit Court of Appeals – Texas’ highest federal court – explained the “arbitrary and capricious” standard of review in the case of Firman v. Life Insurance Company of North America. That case involved a dispute over insurance benefits. The plaintiff’s husband died in single-vehicle accident. The police report indicated that his truck veered off the street when entering a curve and then he overcorrected, causing the truck to rollover. Without a seatbelt, he was partially ejected out of the passenger window and crushed by the truck. He died instantly. Toxicology tests showed he had alcohol in his system at the time of the crash.
The widow filed a claim for insurance benefits under two Group Accident Policies. Although both policies were accidental death policies, neither defined the term “accident.” While the policies excluded coverage for injuries from certain activities, they didn’t contain any exclusion for deaths resulting from intoxication or the use of controlled substances. But both policies gave LINA (also known as CIGNA) “full discretionary authority to administer and interpret” the policies.
LINA denied the claim on the ground that the incident was not an accident. In its view, the deceased would have been aware of the risks involved in operating a vehicle under the influence and, for this reason, his death was a foreseeable result of his actions and not an accident. In fact, LINA announced a rule that driving while intoxicated automatically precludes a finding of an accident under any circumstance.
The Texas Court’s Basis for Overruling Cigna’s Denial of an Accidental Death Benefit Claim
The Fifth Circuit Court of Appeals found that LINA / CIGNA had improperly denied coverage. Even though the policy gave LINA the right to make some decisions, the Fifth Circuit Court of Appeals determined that the decision to deny coverage could not stand. The court said that LINA could not assume that all alcohol-related deaths are automatically foreseeable and therefore non-accidental. Some alcohol-related incidents may be foreseeable, while others may not. LINA’s categorical approach was fundamentally unreasonable. The court’s decision was bolstered by the way LINA handled the claim including:
- LINA had a conflict of interest, as the insurance company was both the claims administrator and the source of funds for paying claims;
- LINA offered no evidence, other than the blood-alcohol content, to contradict the argument that the incident was an accident; and
- LINA misrepresented the severity of the intoxication by comparing the deceased’s urine-alcohol content to the legal limit for blood-alcohol content.
Ultimately, the court characterized LINA’s actions as arbitrary and capricious, which resulted in an order requiring LINA to pay the insurance benefits to the widow.
Firman v. Life Insurance Company of North America, No. 11-20451, 2012 WL 2161135 (5th Cir. June 15, 2012)
Resources to Help You Win Disability Benefits
Submit a Strong Cigna Appeal Package
We work with you, your doctors, and other experts to submit a very strong Cigna appeal.
Sue Cigna
We have filed thousands of disability denial lawsuits in federal Courts nationwide against Cigna.
Get Your Cigna Disability Application Approved
Prevent a Cigna Disability Benefit Denial
Negotiate a Cigna Lump-Sum Settlement
Our goal is to negotiate the highest possible buyout of your long-term disability policy.
Policy Holder Rating
Payment delays!
Cigna (NYL) denied my claim
Hold up on payments!!!
Paid Family Leave
They should all rot in hell
They will constantly come up with anything to delay paying you
Don't count on Cigna!!! You will be very disappointed!!!
They will do anything to avoid paying
Q: Why can Cigna get away with not paying me anything for my disability?
Q: Do I have to be an active employee to apply for LTD?
Q: Can Cigna refuse to give me a copy of my short term disability policy?
Q: Is my plan governed by ERISA?
Q: Can I add a physical disability claim to my mental health one without seeing a doctor (hard to get an appointment with COVID)?
Q: Do you handle CIGNA cases in Florida?
Q: How can Cigna get away with not answering my calls?
Q: Do you handle closed cases only, or open ones as well?
Is Cigna Seeking To Offset Disability Benefit by Social Security Survivor Benefit?
Is Cigna's Denial of Your Appeal Really a Denial?
What Should a Claimant Expect When Suing Cigna or any Other Disability Company for Long Term Disability Benefits?
Are Cigna Short Term Disability Denials on the Rise?
Cigna's latest strategies for handling and denying disability benefit claims
Is a Claimant's Complaints of Pain Enough to Qualify for Short or Long Term Disability Insurance Benefits?
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?
Is My "No-Fault" Auto Insurance Settlement an Offset Under My Long Term Disability Insurance Policy?
Cigna Sued For Failing To Make A Timely Decision on Appeal
CIGNA Overturns a Waiver of Premium for Group Life Insurance Policy
Cigna Admits Error In Denying Disability Benefits
CIGNA Overturned Their Denial of LTD Benefits for Nevada Healthcare Coordinator
CIGNA Denies Technology Manager under the Own Occupation Provision & Dell Disability Lawyers Wins Appeal
CIGNA overturned previous denial of waiver of life insurance premiums
Dell Disability Lawyers successfully appeal denial of benefits to claimant with CRPS/RSD
LINA overturned its previous LTD denial for Medical Technologist
Reviews from Our Clients






