Many employees have long term disability insurance through their employer. For example, ABC, Inc. offers its employees various benefits, one of which is long term disability in the event the employee becomes disabled. It’s considered an important benefit since the likelihood of injury and the need for disability insurance is three and one half times greater than the need for life insurance during your working years. See here.
Once you have such insurance, any disputes arising as a result of a need for said insurance will be governed by ERISA (with some exceptions we won’t cover here). ERISA is the Employee Retirement Income Security Act. This law has many particular requirements and restrictions placed upon employers and administrators of such plans, and the documents governing said plans define the various roles of both the employer and administrator of the plan. The administrator of the plan is typically the employer or the insurance company providing the policy.
One such role of the administrator is to provide documents to plan participants, the employees or beneficiaries of the plans. Any plan participant can write the administrator and request copies of plan documents. If you don’t know who the administrator is, send the request to both the insurance company and the employer by certified mail. If you do that, they cannot claim they didn’t receive it or you sent it to the wrong entity.
Once the administrator of the plan receives the written request, the administrator has thirty (30) days to provide said documents. If the administrator fails to provide the documents within thirty (30) days, they will be subject to the penalties under the statute (they are allowed to request a reasonable payment for the copies of said documents). Under ERISA, the administrator is subject to a maximum penalty of up to $110 per day for every day they fail to provide the requested documents. The amount is up to the Judge and is usually based upon (1) the intent; (2) the delay; (3) the harm caused; (4) the importance of the documents; and (5) the number of requests. You can also request attorney fees if forced to hire an attorney to receive such documents, but that is also up to the Judge’s discretion. Here is a portion of the statutory provision for penalties:
ERISA 502(c), 29 U.S.C. 1132(c) provides for penalties for an administrator’s refusal to supply required information. Under that section of ERISA,
(1) Any administrator .[who fails to provide certain information]1 . . (B) who fails or refuses to comply with a request for any information which such administrator is required by this subchapter to furnish to a participant or beneficiary (unless such failure or refusal results from matters reasonably beyond the control of the administrator) by mailing the material requested to the last known address of the requesting participant or beneficiary within 30 days after such request may in the court’s discretion be personally liable to such participant or beneficiary in the amount of up to $100In the body 2 a day from the date of such failure or refusal, and the court may in its discretion order such other relief as it deems proper. For purposes of this paragraph, each violation described in subparagraph (A) with respect to any single participant, and each violation described in subparagraph (B) with respect to any single participant or beneficiary, shall be treated as a separate violation.
2 As required by the Debt Collection Improvement Act of 1996, the $100 limit has been increased to $110 for violations after July 29, 1997. 62 Fed. Reg. 40696.