Northwestern Mutual Disability Claim Denial Reversed By Court

A Colorado court recently brought down a very harsh ruling against Northwestern for blatantly abusing its discretion in denying long-term disability benefits to a Colorado Family Law Attorney (Mr. M) who suffered congestive heart failure and underwent aortic valve replacement surgery and thoracic aortic aneurysm repair.

Two interesting issues were addressed by the Court in its ruling. The first is the applicability of a certain Colorado statute (Colo. Rev. Stat. § 10-3-1116), and the second is Northwestern’s interpretation of the plan’s own occupation definition of disability in the context of Mr. M being an attorney specializing in the practice of Family Law.

Colorado law does not permit plan or claim administrators to reserve discretion to interpret the terms of the policy or determine eligibility for benefits

Colo. Rev. Stat. § 10-3-1116 states in pertinent part that:

This statute went into effect in August 2008. Mr. M’s policy with Northwestern became effective on March 1, 1995. The Colorado Supreme Court holds clearly that this statute will not apply retroactively. However, Mr. M argued that, because his firm renewed the policy in 2009, the renewed policy is subject to the terms and conditions of the statue.

Unfortunately, the Court did not agree with Mr. M. It found that to apply this statute to the renewal of a 13 year old policy would impose new obligations and restrictions that were not considered when the parties originally executed the policy. Parties should know and understand their obligations under a policy at the time it is issued and it would not make sense for policies to be automatically altered based on the “whim” of Colorado’s legislature.

Northwestern was wrong in its interpretation of the policy’s “own occupation” definition of disability

In its letter upholding the denial of Mr. M’s claim for long term disability benefits, Northwestern explained that it was not required to consider Mr. M’s occupation specifically as a Family Law attorney or “Divorce Law Litigator”, nor was it limited to considering the types of cases he handled as “high conflict/high asset/children with special needs litigation” cases. Northwestern stated that the Own Occupation definition was not workplace or employer specific, but rather, it referred to a set of duties as they are performed in a typical industry setting. Accordingly, Northwestern analyzed whether Mr. M was disabled based on the general duties of a lawyer and did not take into consideration his specific duties in practicing family law.

The Court determined that Northwestern was wrong by not taking into consideration Mr. M’s specific duties as a family law attorney. In oral argument, Northwestern argued that Mr. M chose not to return to work in the practice of family law and that he could have chosen to practice law in another area because he was qualified to do so as a “general practitioner”. The Court states that, while attorneys are not technically permitted to “specialize” in certain areas of law, the reality is that most do practice within a narrow field and this serves to allow the attorney to hone his/her knowledge of the subject matter over years of practice so that he/she is competent in that area and can effectively litigate claims when presented with diverse and complicated sets of facts patterns. The Court goes on to state that it would be “counterintuitive to hold that an attorney such as [Mr. M], who has practiced family law his entire legal career, could immediately switch to and successfully practice in another area of the law without serious malpractice concerns.”

The Court determined that Northwestern’s denial of benefits based on its interpretation of the “own occupation” definition was unreasonable and that, “To believe Northwestern’s argument, I would have to disregard: (1) the inherent difficulties involved with practicing law; and (2) [Mr. M]’s physical condition after heart surgery. I will not do so.”

Northwestern also abused its discretion by ignoring the medical evidence

Mr. M’s policy provided that the insured shall receive disability benefits, if disabled, on the 91st day of disability. Northwestern denied his claim stating that he did not qualify for benefits because he was not disabled for the required 90 day period. However, upon review of the administrative record, the Court found that Mr. M attempted to return to work in a limited capacity but that the effects of congestive heart failure prevented him from working and, even in a low stress position, he experienced chest discomfort, tightness and some anxiety. One of Mr. M’s treating physicians stated that, “it does not appear to me that [Mr. M]’s heart has reverted to normal”, and that, “we know that [Mr. M]’s heart is still structurally abnormal”¦”.

A second treating physician initially stated in 2009 that Mr. M was able to return to full-time work. However, that physician subsequently, in 2010, wrote a letter which stated, “[Mr. M] is currently enrolled and taking part in a cardiac rehabilitation program. Due to his commitment to his recovery he is unable to work during his treatment period. Mr. M is due to complete his program June 13, 2010.” Northwestern, in its review of Mr. M’s claim, discounted the subsequent letter from this physician because it contradicted the previous opinion. However, the Court found that the 2010 opinion coincided with the first physician’s opinion, and that “two doctors state that [Mr. M] is not able to return to work.”

The Court ruled that, starting on his date of disability, Mr. M had a physical injury/illness that impaired his ability to perform the material duties of an attorney as it is usually performed in the general economy and that he was disabled for the required 90 day period under the policy. Further, Northwestern’s decision to uphold its denial of Mr. M’s LTD claim was an abuse of discretion and that such decision “does not lie anywhere on the ‘continuum of reasonableness.'” The Court ordered that Northwestern pay the maximum amount of benefits available to Mr. M under the terms of his policy.

Attorneys Dell & Schaefer did not represent Mr. M in his disability claim, appeal or lawsuit. If you have questions regarding your claim for disability benefits, or if your disability claim has been denied, feel free to call Disability Attorneys Dell & Schaefer for a free consultation.

On our website, you can read more about Northwestern Mutual disability claims, user comments and case summaries by clicking here.

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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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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.

Paul L. (New York)

Words can only scratch the surface regarding my experience working with Attorneys Dell & Schaefer. It’s a very emotional experience making the decision to utilize disability insurance. The unknowns were/are scary. From the very first phone call, the support staff was/are very professional and reassuring. I have been working with Attorney Steven Dell for approximately 10 years. He is confident, reassuring, listens to and addresses all my concern, and is extremely dilligent in understanding my specific policies for how they impact me. It is very reassuring that Steven handles and deals with the insurance company on my behalf. Attorney Dell’s team, and specifically Merlin, Attorney Dell’s assistant, is simply fantastic. Her professionalism and attention to detail have made all my communications with the office seamless.

Simply put, my experience with Dell & Schaefer made the emotional rollercoaster experience of my neck surgery seem like a walk in the park.

Thank You, Thank You, Thank You, to both Attorney Steven Dell and to Merlin for how you have helped me over these past 10 years.

Dilligence, Reassurance, Professionalism at every step, Confidence, Results.

With 10 years experience with working with Dell & Schaefer, taking that step to call Attorneys Dell & Schaefer was one of the best professional and personal decisions I have ever made.

You want to know what you can do – the below comment about posting your first name and last name initial on our website. Put up my full name, phone number, and email address. I will gladly speak to anyone about your office and tell them my story and how instrumental Steven and Merlin have been in my life over the past 10 years.

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