UNUM Sues Long Term Disability Claimant for Overpayment and Wins

Mr. Vincente Alamos received ERISA Long Term Disability (LTD) benefits from Unum for the period of September 20, 2006 through September 19, 2011. During that time period, Mr. Alamos applied for and was ultimately awarded Social Security Disability Benefits dating back to December 1, 2006.

Unfortunately for Mr. Alamos and most LTD recipients, should you receive “Other Income Benefits” from other sources, the insurance companies get to “offset” (or reduce) the amount of money they get to pay you per month by that amount of money you receive from the other sources. Most ERISA LTD policies allow the insurance companies to “offset” the award of Social Security Disability Benefits that a claimant receives for himself/herself and sometimes even the benefits awarded for their spouses or dependent children. Additionally, if Social Security ultimately awards the individual back benefits for a previous time period already past, if the insurance company had already paid for that time period an overpayment will likely accrue and the policies allow for the insurance company to demand repayment of the overpayment.

Since Mr. Alamos was awarded SSDI benefits back to December 1, 2006, an overpayment accrued in the amount of $49,218.33. When Unum learned of the overpayment it notified Mr. Alamos and demanded repayment for the money. Mr. Alamos never reimbursed Unum for the overpayment and this lawsuit was filed on May 16, 2013.

Unum Sues of SSDI Overpayment

Unum filed an ERISA federal lawsuit in Arkansas against Mr. Alamos for the full overpayment owed of $49,218.33. Unfortunately for Mr. Alamos, the Federal Judge ruled completely in favor of Unum. The Judge found that the policy governing the case “clearly states that ‘Unum has the right to recover any overpayments due to fraud; any error Unum makes in processing a claim; and [the pariticpant’s] receipt of other income benefits.” Thus, the Court reasoned, that Mr. Alamos was “on notice at all times that he would be required to reimburse Unum for any Social Security benefits that were not deducted from Unum’s disability payments.” The Judge awarded Unum the full amount it desired in the amount of $49,218.33. Currently, the Judge is weighing whether interest, attorney fees and costs should be added as well.

Although this case was not handled by Dell & Schaefer, and Mr. Alamos was never a client of ours, it should be used to educate our current or future clients that Unum, like other insurance companies, can and do sue for failing to be reimbursed for overpayments they believe are owed.

If you have a similar situation or have been denied or are in fear of getting denied by Unum or any other disability insurance company, please do not delay and please contact Attorneys Dell & Schaefer for a free consultation and review of your claim.

Comments (4)

  • Ron, not if your disability benefits are no longer being paid.

    Rachel Alters Apr 30, 2021  #4

  • My UNUM disability expires on 07/31/21. If I happen to find employment after that date can UNUM claim an overpayment?

    Ron Apr 30, 2021  #3

  • Vivian,

    Please feel free to contact our office to discuss your claim in detail to determine what assistance we may be able to provide you.

    Stephen Jessup Jan 12, 2016  #2

  • I have been on short term disability since September the 18th. I was awarded Arkansas Medical Teacher Retirement. But, UNUM has denied my claim for short term disability. I was denied on 11/25/2016 and I desperately seeking legal help. I have 180 days to appeal.

    Vivian H. Jan 11, 2016  #1

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