If you are reading this, you have probably been denied long term disability benefits by your LTD insurance carrier. Whether the denial was made by one of the well known disability companies like Manulife, Great West Life, Desjardins, or others, there is normally an opportunity to “appeal” or dispute the initial denial.
However, despite the ability to appeal, for the purposes of the limitation period to sue the insurance company you should treat the initial denial as the date when the clock starts ticking. That means that you should usually consider that the clock starts no later than the first denial. If you do not file the claim by the expiry of the limitation period then your right to sue may be taken away. If a client calls me and wants to try the appeal before suing, I normally discuss the limitation period with them and we set a date by which to hear from the insurer or sue.
Some people have a union that can assist them in appealing their disability denial. Unfortunately, I am often confronted with unions that are non-responsive to their union members. The most tragic cases that I have seen are ones where the claimant has been denied, their union has negotiated away their right to sue and they are required to go to arbitration with their union and the union is not assisting their member. The cases that I have had like that have posed very serious challenges.
Many people do not want to hire a lawyer or start a lawsuit unless they have no other options left. That is understandable – very few of my clients want to be in litigation – they just have no other choice. But you do not want the appeal process to drag on and it prejudices your ability to sue. I normally recommend that clients at least open a “wait and see” file with us so that we can monitor what occurs (I typically do not charge for that).
In some cases, I simply give clients the opinion that the insurer is not going to change their mind and they should just sue. That is not because their case is without merit, it’s just because I have a pretty good sense of which insurers are going to hold firm in certain types of cases. Some of the insurers take very firm positions in cases where the disability is “not objective” – ie: a chronic pain case, a psychological case, or a “level of pain” case.
My perspective is that, if a case is likely to go the litigation route and eventually result in a trial or settlement (pre-trial resolution), then there isn’t much point in delaying that. Fighting with an insurance company is stressful enough and the time spent doing that is best minimized.
In one recent case that I had, we sent a letter to the insurance company advising of the fact that we were issuing our lawsuit with the Court and the insurer responded by immediately re-instating the claimant and paying all of the benefits owing from the date of termination. Obviously, that was not the norm, but it does show that the insurers are sometimes taking notice of a lawyer coming on board and moving to litigation and perhaps there is a supervisor reviewing the matter. In that particular case, I had just concluded a successful claim against the exact same insurer with the exact same employer about a month before.