A disability denial lawsuit has been filed against Unum Life Insurance Company of America by a Texas woman who alleges the company wrongfully denied her disability insurance benefits.

Plaintiff Lori K. filed this Unum lawsuit after she was allegedly denied certain disability benefits by the insurance company. During 2010, Lori reportedly became disabled while working for Baker Botts LLP, through which she had a Unum long term disability policy.

Following her disability diagnosis, Lori submitted a disability claim to Unum to receive disability benefits. Although this disability claim was initially accepted, Unum later reversed its decision and denied the plaintiff’s disability claim sometime around November 2013. Lori appealed her claim, but was once again denied Unum disability benefits earlier this year.

According to the Unum disability denial lawsuit:

“Plaintiff has exhausted all administrative remedies available to her under the plan. All conditions precedent to this cause of action have been met or have occurred. Plaintiff is entitled to recover under the civil enforcement provisions of ERISA and seeks the benefits she has been denied, clarification of her right to receive future benefits under the plan, attorney’s fees and expenses incurred herein and other appropriate equitable relief.”

Lori is not the only policy holder to allegedly be denied long term disability benefits without cause by Unum Life Insurance Co. Many individuals have filed Unum disability denial lawsuits or joined Unum class action lawsuits seeking compensation.

The Unum Disability Denial Lawsuit is Case No. 4:14-cv-003025, in the U.S. District Court for the Southern District of Texas.

Background on Unum Group

Unum Group, also known as Unum Life Insurance Company of America and formerly known as Union Mutual Life, is an insurance provider that has sold various types of policies to the American public since 1848.

However, according to allegations by multiple plaintiffs, there have been reports that Unum allegedly engaged in a cash flow underwriting scheme. Cash flow underwriting is the practice of selling many insurance policies without assessing the future risks for each potential policy holder. Unum would then allegedly profit from the initial premiums paid by Unum customers by investing the premiums.

Because of this cash flow underwriting practice, Unum Group was able to gain control over a significant portion of the long-term disability insurance market. Around 1993, the interest rates for life insurance policies suddenly experienced a significant decrease, which in turn meant a loss of profits for Unum. In order to retain some profits, plaintiffs of many disability denial lawsuits allege Unum developed a habit to intentionally deny qualifying policy holders their long term disability benefits.