Former Maintenance Mechanic Loses Claim For Denial Benefits Against Reliance Standard Life Insurance Company, After Employer Makes Oral Misrepresentations Concerning Disability Insurance Coverage

Generally, when employees have a question concerning their employer provided group long-term disability insurance coverage, the first place they turn is to their HR department. HR Departments are not in the business of underwriting, or interpreting insurance policies, and often do not have the adequate knowledge to competently answer specific questions concerning the terms and conditions of the disability insurance plan. They can, and should provide the employees with the long-term disability plan documents, and enrollment information, but beyond those tasks, should not be relied upon to answer questions concerning eligibility and coverage. It is important to know that, although the employer may be liable to its employee, as a fiduciary, misrepresentations made by an HR representative concerning plan coverage will not trump the terms and conditions of the long-term disability plan itself, and no liability will be placed on the long-term disability insurance company.

Employer Misrepresents Coverage Provided Through Group Long-term Disability Insurance Plan

Recently, the U.S. District Court for North Carolina, dismissed an action brought by a former maintenance mechanic against Reliance Standard Life Insurance Company, and his employer, US Cotton, for benefits which he claimed were owed under the his employer provided group long-term disability insurance plan.

Robert Breyan was diagnosed with chronic obstructive pulmonary disorder (COPD), a degenerative lung condition that impedes the ability to breathe. Mr. Breyan was advised by his doctors that he should maintain all of the disability insurance available to him, as his condition was not expected to improve, and that he would likely, one day, need to file a disability claim. Mr. Breyan maintained a private disability insurance policy, and also purchased coverage through the Reliance Standard long-term disability insurance plan, offered through US Cotton. On multiple occasions, Mr. Breyan was misinformed and assured by human resources at US Cotton that the Reliance Standard plan would provide him with 60% of his annual income. They failed to inform him of any possible reductions or offsets for other disability income benefits, such as Social Security disability, nor did they provide him with a summary plan description, describing the terms of the plan.

Due to his COPD, Mr. Breyan was eventually forced to file a long-term disability claim with Reliance Standard. Mr. Breyan’s claim with Reliance Standard was quickly approved, and shortly thereafter, he was approved for social security disability benefits as well. Mr. Breyan then learned that Reliance Standard had overpaid his claim, due to his receipt of social security disability benefits, and that it was reducing his monthly benefits by the monthly amount he was receiving from social security disability.

Mr. Breyan sued both Reliance Standard and his employer for wrongfully denying his disability benefits. Specifically, he claimed that he was due the amount that the human resources employees informed him he would receive, sixty percent of his salary until retirement age – without being reduced or offset by receipt of any other disability income benefits.

The U.S. District Court found that, although US Cotton induced Mr. Breyan to believe that the benefits he would receive would not be reduced or offset by other payments such as social security disability benefits, the law is clear, the plan documents rule. The court found that the oral representations, or misrepresentations, were immaterial as to the question of whether the benefits promised under the terms of the plan were denied.

Although the court dismissed the claim for wrongful denial of benefits against Reliance Standard, it allowed Mr. Breyan to maintain a claim against him employer, US Cotton, for breach of fiduciary duty. The court found that it is plausible for Mr. Breyan to show that US Cotton breached its fiduciary duty to him by not just misinforming him, but also by failing to comply with its affirmative duty to inform when it knew that silence might be harmful.

You can read about more cases with Reliance Standard on this page.

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We represent Reliance Standard clients nationwide and we encourage you to contact us for a FREE immediate phone consultation with one of our experienced disability insurance attorneys.

Can you help with a Reliance Standard disability insurance policy?

Our disability insurance lawyers help policy holders seeking short or long term disability insurance benefits from Reliance Standard. We have helped thousands of disability insurance claimants nationwide with monthly disability benefits. With more than 40 years of disability insurance experience we have helped individuals in almost every occupation and we are familiar with the disability income policies offered by Reliance Standard.

How do you help Reliance Standard claimants?

Our lawyers help individuals that have either purchased a Reliance Standard long term disability insurance policy from an insurance company or obtained short or long term disability insurance coverage as a benefit from their employer.

Our experienced lawyers can assist with Reliance Standard:

  • ERISA and Non-ERISA Appeals of Disability Benefit Denials
  • ERISA and Non-ERISA Disability Benefit Lawsuits
  • Applying For Short or Long Term Disability Benefits
  • Daily Handling & Management of Your Disability Claim
  • Disability Insurance Lump-Sum Buyout or Settlement Negotiations

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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, GoToMeeting.com 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.

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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.

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Gail T.

I contacted Dell & Schaefer after my insurance provider stated that they were coming to visit me at my home to see how I was doing. I was so worried about what this meant after being on claim with them for three years. I always felt like I was always waiting for the other shoe to drop with them after going through a very stressful claim application process. Gregory Dell promptly jumped in and got to work at creating a solution to streamline and ensure my claim was not in jeopardy.

The staff has worked with me every step of the way to make sure that the process of receiving my benefits is a positive one for me. I no longer dread dealing with my insurance claim representative as they handle everything for me. They clarified that I could also apply for SSDI and with their help I started receiving SSDI benefits within months. This firm has been a great advocate for me and I highly recommend them.

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