District Court Ordered to Evaluate Unum’s Pre-Existing Condition Claim

In Wayne Torpy v. Unum Life Insurance Company of America, both Unum and Plaintiff Torpy appealed a ruling of the New Mexico District Court. Although several issues were presented, since the one resolved by the Court of Appeals vacated the lower court decision, the resolution of the other issues were left to the District Court to resolve on remand.

Overview of Relevant Facts

Plaintiff Torpy was a police officer who retired from the City of Melbourne, Florida, police department in 2003 and began receiving a retirement pension. He then moved to New Mexico and in 2005 took a job as Police Chief of Los Alamos County where he was covered by a long-term disability policy.

Torpy’s trouble began in November 2012 when he had a stroke. He returned to work in January 2013, but then had to quit work for heart surgery in February. He returned to work in March, but finally in June 2013, he quit work completely and applied for long-term disability benefits.

Unum agreed Torpy was disabled, but there was a disagreement about how the benefits should be calculated and whether Torpy had a pre-existing condition. The District Court ruled that whether or not he had a pre-existing condition did not matter, and calculated his benefits in a way that provided him the maximum amount available. Unum challenged this ruling on appeal.

The Appellate Court agreed with Unum and remanded to the District Court for a determination of: 1) whether or not Torpy had a pre-existing condition; and 2) if so, to determine benefits accordingly.

On Remand, the District Court Must Determine if Torpy Had a Pre-Existing Condition and Calculate Benefits Accordingly

Whether Torpy had a pre-existing condition made a big difference in the calculation of benefits in this case. The issue arose because when Torpy began working for Los Alamos County in 2005, employees were covered by a policy issued by Union Security Insurance Company. Beginning January 1, 2013, the county switched to Unum as its insurance provider. Torpy’s last day of work was June 25, 2013, due to his heart surgery. But, he had been off work for a few weeks in 2012 due to his stroke. He filed a claim for disability benefits under both policies.

The new Unum policy had a Continuity of Coverage Clause which allowed some policyholders to collect long term disability benefits who might otherwise be barred by Unum’s pre-existing condition provision, because they would have been covered under the Union Security plan which would not have barred Torpy’s recovery of benefits for a pre-existing condition. The District Court did not consider whether or not Torpy had a pre-existing condition, ruling that “it makes no difference to the benefits determination.”

The Appellate Court remanded to the District Court on the grounds that, “Torpy’s benefits calculation will be different depending on whether he had a pre-existing condition under Unum’s policy. The district court was mistaken to hold otherwise.”

This case was not handled by our office, but we think it can be helpful to those who may be faced with a pre-existing condition clause in their disability insurance policies. If you have a question about this, or any other aspect of your disability claim, contact one of our disability attorneys at Dell & Schaefer for a free consultation.

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Having had several lung surgeries including a wedge resection, lobe removal and pleurodesis as well as MAC lung disease, I was diagnosed with stage vi (end stage) COPD in October 2012. With my lung function at 23% it was becoming very difficult to manage my daily life let alone continue working in my management role at a large healthcare company. After meeting with my primary physician and my pulmonologist, it was agreed that I should stop working and submit a claim for disability. I was 52 at the time. My short term disability plan with Mutual of Omaha paid my claim for 3 months at which time it was converted to my long term disability plan with no issues. I continued to collect my LTD benefit from February 2013 until November 20th 2014 when I received a letter saying I could return to my previous position and there was nothing in my medical records to indicate disability. I was shocked to say the least, as my condition is chronic and progressive and in fact my condition had continued to decline. I didn’t know what to do and knew I did not have the knowledge or experience to appeal their decision. I was very afraid as we depended on this income to pay our bills, that’s why I held the policy for many years, to protect my family. I want to add that I applied for and was approved for Social Security disability benefits shortly after diagnosis.

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