Do I Have a Bad Faith Disability Claim Against My Disability Insurance Company?

There are only a handful of states that will allow an insured to bring a claim against a disability insurance company for bad faith claim handling or bad faith denial of benefits. In a recent video, Disability Attorneys Cesar Gavidia and Gregory Dell discuss common examples of Bad Faith Disability Insurance Claims. Bad faith claims are not permitted under group disability policies which are governed by ERISA. These types of claims are only permitted with private disability policies in certain states, the most prevalent being California. “Bad faith” can also be described as “unreasonable claim handling.”

Many claimants are of the belief that an insurance company acted in bad faith by merely denying their claim for disability benefits. Unfortunately a claim denial does not automatically mean an insurance company acted in bad faith. There are certain criteria that must first be met in order to prevail on a bad faith claim.

Some examples are:

1) the disability insurance company failing to comply with statutory time deadlines for responding to the claim;

2) failure to conduct a thorough investigation of a disability claim;

3) other unreasonable conduct such as relying on inconsistent or misleading reports as a basis for denying a claim for disability benefits.

Basically, an insurance company cannot put their own interests in front of the insured. It can be very difficult to prevail on a bad faith claim and often you must first prevail on other grounds, such as establishing breach of contract. In some states, the bad faith and disability denial claim can be present to a jury simultaneously. If your case proceeds to trial and the judge or jury find the disability insurance company did, in fact, act in bad faith, you may be awarded damages to include back benefits, compensation for debt incurred as a result of the benefit denial, bankruptcy, loss of your car, house, or other property – and in rare cases, awards of punitive damages may also be permitted.

Our law firm has handled numerous bad faith disability denials and it is important that you work with a disability law firm that is experienced in bad faith claim denials. Please feel free to contact any of our disability attorneys for a free consultation to discuss your potential bad faith disability insurance claim.

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There are 7 comments

  • Tabitha, if the policy was provided by your employer and is a group policy you can’t sue for bad faith. If it’s a policy you bought on your own separate from your job then you may be able to sue for bad faith if your state allows it. If you have a group policy and you can do your job in another workplace other than yours then you would not likely qualify as disabled under your group policy since your job is defined not as it is done in your place of work but how it’s defined in the national economy.

    Rachel AltersFeb 29, 2020  #7

  • I live in the state of Maine. I am now on my 3rd appeal with my short term disability company. In which they keep denying my claim do to work related. However, I am currently in controversy with works compensation. In the state of Maine there is a law called chapter 530. Which side ate the short term disability has to review on provisions and can’t deny do to work related. Yet they continue to do so. I do have the bureau of insurance investigation yet I feel they just giving me the runaround. At this point I know I am denied again for work related just haven’t received the letter. But called and heard it on the phone. So I am wondering at this point if I can file a lawsuit on bad faith. This is a private STD policy. Thank you for your time.

    TabithaFeb 29, 2020  #6

  • Armando, did you file the administrative appeal of the denial? The law only provides 180 days to file same, and failure to do so could prevent you from pursuing your legal rights. Please feel free to contact our office to discuss your claim.

    Stephen JessupJan 28, 2018  #5

  • I have been on std disability since July. Cigna Insurance has closed my case. I filed a grievance and was told I would receive a response in 5 days. Claims manager never calls back. I always provided paperwork for Cigna because they said they never received any fax. Which is a lie. I sent a complaint with California insurance department and recieved a call from Cigna just asking for information. I wanna sue them and file a cival lawsuit in California against claim manager.

    Armando M.Jan 27, 2018  #4

  • Unfortunately, LTD carriers are NOT subject to good faith claims handling. They do every thing in their power to delay the payment of claims including committing what would be considered fraudulent acts. In my case, Cigna insurance independent medical reviewer downgraded the surgery that was performed on me in order to make sure my original appeal was denied. Cigna then back tracked and created a “persona” of me in order to make sure the independent medical review would prove what they said. They also knowingly create a situation where they are not able to get medical information and then blamed my doctor for not providing this information. When I advised them that if the doctor released this information to them, he would violate the law, they told me that was the way they did business.

    So in closing, when dealing with a LTD carrier, you need to advise them in writing to request all information from you doctor in writing and no just phone calls and faxing information, and also when it comes to your treatment make sure you see on occupational therapist and not just a physical therapist in order to document your disability.

    Theodore DimarcelloApr 5, 2014  #3

  • Mark,

    Your options are dependent on the nature of your policy and the law governing same. Please feel free to contact our office to discuss how we may be able to assist you.

    Stephen JessupJan 24, 2014  #2

  • What are one’s option if the disability company has not responded nor made a decision on a claim after the 90 day elimination period? I am going on 4 months now, and the insurance told me 3 weeks ago that I was “pending”. I haven’t heard anything from them since. Total silence. When does bad faith come into play? I had a private policy. My doctor wrote a note stating that I was totally disable from my occupation.

    MarkJan 23, 2014  #1


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.

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No. For purposes of efficiency and to reduce expenses for our clients we have found that 99% of our clients prefer to communicate via telephone, e-mail, fax, 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 800-682-8331 or by email. Lawyer 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.


Bruce R. (Arizona)

Steve Dell has done an exceptional job with my disability application process. The firm is extremely well managed. They have acquired an incredible amount of experience over many years. I recommend them for disability insurance claims without reservation. 

Don (Florida)

I called this firm a few months ago completely disparaged due to a company cutting off disability benefits at a time that nearly caused me to lose everything.

Attorney Alex Palmera and Danielle worked hard to reach an amicable settlement and my case was settled a few months later. This is a good firm and the specific expertise in disability claims saved me countless hours of hassle at a time when an already fragile state existed.

Thank you Mr. Palamara and Danielle.

Sandra B. (Arkansas)

I have nothing but good things to say about how my buyout was handled with my disability claim. The level of professionalism was amazing. All of my questions and concerns were answered either by Danielle L. or Alex P. in such a timely manner and with such care I would recommend them in a heartbeat to anyone needing to approach their provider with buyout options.

They did a fantastic job communicating between the provider and me, always keeping my best interest at heart and always answering my many many questions. They really did take most of the stress out of this whole situation. I would give them a 10 out of 10 for every step of this crazy journey. Thank you so much for helping me through this.

Brenda R. (New York)

I needed assistance with an appeal for a LTD claim that was initially denied. Stephen understood what needed to happen to win the appeal and he did win the appeal for me.

Michael C. (Virginia)

Greg Dell and his assistant Anneli have been extremely responsive and helpful, not only our initial consultations, but in follow-ups 1 and 2 years later with the insurance company to ensure that they comply with their agreements (which they did), as well as a separate and only slightly-related inquiry about our health insurance. I always hear back from them very quickly, which is rare and greatly appreciated.

Jeff P. (Oklahoma)

After a very long and frustrating ordeal to keep my LTD payments coming I decided to seek assistance from and attorney. After much research and asking those in the legal profession Dell & Schaefer seemed to be the top choice. I reached out and Alex Palamara was the attorney assigned to my case. All I can say is the experience was outstanding. Both Alex and his Paralegal, Danielle Lauria were excellent to work with. They were very kind, concerned, understanding of my frustrations and treated me with the utmost respect. Communication was excellent with regular updates and telling me what I could expect in each stage of the process.

Alex was also very straight forward with what to expect and no pie in the sky promises or expectations were made. In the end we won our case and I believe it was solely due to their experience and knowledge of not only the laws but the insurance companies as a whole. I would highly recommend them and am very grateful for the help they afforded to me.

Chad B. (Illinois)

I originally spoke with 3 other long term disability lawyers about my case before contacting Dell and Schaefer. None of those law firms would take it. They said the chances of me winning was not good. After finding Dell and Schaefer online I spoke with one of the attorneys that has since left. He did take my case but later it was picked up by Rachel Alters. Rachel is amazing and a very intelligent attorney. She not only won my case but also was able to get my back pay for 6 months.

I also cannot say enough about Sonia Nogueira. Sonia was always quick to answer any of my questions. I would usually hear back from her within hours of sending her a email. I do not know where I would be if I hadn’t contacted them. My family and I cannot thank them enough. Don’t let an insurance company tell you they are not responsible for paying you. I paid them for 20 years monthly and they looked for any reason they could not to have to pay me when I needed my benefit. Thank you Rachel and Sonia for all you guys do.

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