For professional athletes, bearing the risk of a career-ending injury is just an every day part of the job.

As is the case with anyone who works for a living, a disability could have a profound effect on their ability to earn income, giving them an insurable interest in their own health and well-being.

Because of the high risk of injury and the large dollar amounts involved, group disability insurance policies are often prohibitively expensive for many professional clubs and players.

As a result, some athletes pursuing a professional career choose to take out disability insurance with a private insurance company, such as Unum Life Insurance Company. But getting those benefits in case of catastrophic injury requires making a claim, and claims can be denied – sometimes wrongfully.

Professional athletes may face particular opposition from their insurance companies, due to the fact that their claims tend to be for unusually high dollar amounts. These companies have a financial interest in avoiding paying big-dollar claims any way they can.

The high value of professional athletes’ claims, plus the high likelihood of injury inherent in sports, makes professional athletes particularly vulnerable to bad faith insurance denial.

ERISA Provisions

Some athletes can take advantage of group benefits plans that are administered by their professional sports associations. Group plans like this are subject to the provisions of the federal Employee Retirement Income Security Act of 1974, or ERISA.

The differences between an ERISA-governed group plan and a private plan that may be subject to state law are worth considering for an athlete who may need to claim disability benefits someday. Though ERISA was passed ostensibly to protect claimants, some say it does more to protect the interests of insurance companies who may have wrongfully denied a claim.

The ERISA claims process is filled with pitfalls unfamiliar to inexperienced claimants. Each step in the process has its legally-mandated deadline, and missing a deadline could delay or end an athlete’s entitlement to benefits.

If a claimant appeals after an insurance company denies a disability insurance claim, the insurance company gets a chance to review the decision at as many as two levels before the claimant has the right to take the insurance company to court.

Pursuing the appeal into court does not necessarily improve the athlete’s chances of success. Disability insurance denials under ERISA get a standard of review that is highly deferential to the insurance company.

Generally, in a disability insurance lawsuit the athlete will get no opportunity to present new evidence in court – the court will review only the record of evidence that was available to the insurance company. Also, damages in an ERISA review are limited to benefits withheld, plus interest. In contrast, appealing the denial of a private individual policy may allow recovery of other damages, including the possibility of punitive damages.

Unum Disability Insurance Denial

Unum and its related companies have denied thousands of such claims for disability insurance. Under investigation by the Department of Labor, the company agreed to review about 200,000 claims denied or closed since January 1, 2000. Some claims denied by Unum involved misreading medical records, changing policies without the policyholder’s knowledge or consent, relying on opinions from unqualified sources, and denying claims without offering a medical examination.

Athletes denied disability benefits by Unum need not take the denial sitting down. Attorneys are interested in investigating these denials on a case-by-case basis.