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Unum Continues to Systematically Deny Claims: Advocate

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Chattanooga, TNLinda Nee knows a thing or two about Unum. She once worked for Unum and while the Unum long-term disability insurance provider remains a powerhouse in the global insurance industry, there are those who think Unum has not changed its stripes of old.

Nee is one of them. A disability claims expert no longer associated with Unum, Nee remains an unflagging advocate of fairness in the insurance industry.

Her blog post of yesterday described how Unum at one time employed a practice of reducing financial reserves tied to a claim in order to improve profits by invoking a strategy that would see targeted claims denied within 90 days, whether the denial was justified or not.

"Whenever it became clear Unum's managers were not going to achieve profit targets, claims handlers were literally forced to go into the pay system and code various claims as '90 codes' in order to achieve financial reserve gains and immediate contributions to profit," Nee writes in her blog dated October 17th. "Once a claim was thus coded, managers harassed claims handlers to deny the claim sometime within the next 90 days. If there wasn't a good reason to deny the claim…well just make one up!"

The practice was in place in 1994 when Nee became joined the company and continued for a time, Nee writes after the merger with Provident in 1999. The so-called '90 codes' were eventually exposed and shut down.

Unum Sleight-of-Hand Still in Play, Says Advocate

But Nee says they never really went away entirely, thanks to the adoption of Reservation of Rights (ROR). According to Nee, ROR status would only be used for 90 days from the time a claim is filed with the expectation that the claim would be denied within that 90-day window. If denial initially fails Unum can keep the status in effect long-term, "and avoid the inevitable financial reserve loss that takes place when the status is removed," Nee writes.

"There is very little difference between 90 codes and ROR status since both practices reduce financial reserves and allow Unum to engage in 'off Balance Sheet financing' by understating its liability figures."

According to Nee the practice is current and is outlined in the Unum Benefit Claim Manual dated July 24th of this year.

"For current insureds ROR status means Unum is attempting to deny your claim whether it has a valid contractual reason to deny it or not."

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