A Florida woman has become one of the most recent to appeal an Unum disability insurance denial to a federal court.

Plaintiff Irma B. alleges she purchased a disability insurance policy as a benefit provided by her employer, West Florida Medical Center Clinic PA.

The policy is administered by the defendant, Unum Life Insurance Company of America.

Around May 2015, Irma claims, she suffered a stroke. The residuals of her stroke left her with exertional and non-exertional impairments that have rendered her totally disabled and unable to work in her own occupation, she alleges.

In June 2015, Irma made a timely application to Unum for benefits under her disability insurance policy. Unum denied her claim – improperly, Irma says – months later, in December 2015.

She filed an internal appeal with Unum in September 2016. The next month, Unum sent Irma a letter upholding its previous denial. Unum said that the evidence in its file did not support a finding that Irma was disabled under the “own occupation” provision of her policy.

In the same letter, Unum informed Irma of her right to appeal its decision in court. Having exhausted all of her administrative remedies with the company, Irma then filed this Unum lawsuit.

Disability Insurance Appeals Under ERISA

Since Irma’s disability insurance policy was provided through her employer, it’s governed by ERISA, the federal Employee Retirement Income Security Act. ERISA was originally enacted to protect many different kinds of employee benefits.

However, attorneys familiar with how ERISA works today say the law now favors insurance companies like Unum over plaintiffs like Irma.

For starters, ERISA gives insurance companies the right to reconsider a denial before the claimant appeals it with a disability denial lawsuit. The law also lays out intricate procedural requirements for making such an internal appeal, including a timeline with lots of deadlines.

Under many ERISA-governed policies, the insurer gets broad discretion to deny coverage – and ERISA allows a judge to undo those denials only in certain limited circumstances.

The law supports policies that give the company discretion to administer claims. To get a court to reverse a denial under such a policy requires the claimant to show the company abused that discretion, and that’s usually a very difficult thing to prove.

Once the claimant gets a final denial, she can appeal that denial to a federal court. But unlike most bad faith insurance lawsuits, which are usually governed by state law, ERISA lawsuits restrict what evidence the claimant can bring and the remedies they can seek.

The court will review the denial based only on the evidence that was available to the insurance company at the time of the denial – so the claimant doesn’t get to offer testimony or any new documentation.

Even if the claimant wins their ERISA lawsuit, their damage award may only cover benefits withheld. Under ERISA, even if a claimant can show the insurance company denied their claim in bad faith, the claimant doesn’t get to seek punitive damages – an extra-large monetary award that’s designed to punish the company for knowingly or willfully overstepping its bounds.

Irma’s Unum Disability Insurance Lawsuit is Case No. 3:16-cv-00598 in the U.S. District Court for the Northern District of Florida.