Last week an Unum lawsuit was filed by a New York policyholder, claiming that the giant insurance company wrongfully terminated his short-term disability benefits and denied his claim for LTD. Steven Krol made a disability claim on his Unum policy when he was diagnosed with vascular dementia - a condition similar to Alzheimer’s disease but typically with a more immediate impairment. Unum made good on short-term disability for one year, but for reasons not yet publicly known, denied Krol his LTD. Krol, who worked for an insurance company, claims that he is still disabled and therefore entitled to disability insurance until he is 65 years old, in 2023.
It is mind-boggling that Unum can deny a policyholder with vascular dementia. There is no cure for this disease and the FDA has not approved any drugs to treat the symptoms. To top it off, Krol may not see his 65th birthday because vascular dementia shortens lifespan, according to the Alzheimer’s Association. Furthermore, vascular dementia is the second most common cause of dementia after Alzheimer’s disease. Surely Unum recognizes these facts.
Unum terminated LTD benefits in August of 2014 to a partner in a global accounting firm who earned $85,572.67 per month. (Plaintiff John) Doe had been under doctors’ care for almost two years in an attempt to treat “unremitting fatigue and fecal incontinence.” The man’s condition may in part have been caused by a “stressful” job, but Unum didn’t take the stress factor into consideration.
Unum hired investigators who conducted five days of surveillance on Doe. They reported that Doe left his home just three short times. For the rest of the time, he was housebound. The plan administrator determined that the surveillance footage supported the plaintiff’s claim and that Unum:
(1) failed to consider, despite consistent documentation from Doe’s treating physicians, the effect of Doe’s fatigue and fecal incontinence on his ability to work;
(2) failed to analyze Doe’s ability to do the specific tasks his job requires;
3) did not acknowledge the extent to which the surveillance footage supported Doe’s self-reported symptoms; and
(4) conflated Doe’s occasional travel with his ability to work a demanding job.
In other words, Unum chose to ignore information that was favorable to Doe’s case while emphasizing facts unfavorable to his case. The plan administrator ruled that Unum’s decision to deny benefits was “arbitrary and capricious” and it was not the product of reasonable decision-making.
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One insurance provider (Disability RMS) has suggested that a possible reason for lack of participation is the bad press disability insurance has gotten over the years. But perhaps it is because insurance companies like Unum have been practicing bad faith by denying disability insurance for more than a decade: they continue to deny policyholders their rightful benefits. It just happens that some of those policyholders have received media coverage.