The Employee Retirement Income Security Act (ERISA) is a federal law that establishes minimum requirements for retirement plans and disability insurance plans, with the aim of protecting the people who participate in the plans.

Though primarily concerned with retirement plans, ERISA also applies to disability insurance plans. Asking “what is ERISA” can be the first step to understanding your rights if your disability insurance benefits claim is denied.

What Kinds of Plans Does ERISA Apply to?

ERISA only applies to retirement and disability plans offered by employers to their employees. It does not apply to plans purchased privately by an individual.

What is ERISA’s Requirement for Providers?

ERISA requires that plan providers inform plan participants sufficiently of the benefits covered under the plan.

Additionally, ERISA includes fiduciary responsibilities for plan administrators. This means that whomever is in charge of administering the plan must “run the plan solely in the interest of participants and beneficiaries and for the exclusive purpose of providing benefits and paying plan expenses.”

This ensures that plan participants’ interests are protected, even though an administrator, or the company providing the plan, may have other interests.

How Does ERISA Affect My Claim Denial?

If you filed a claim for disability benefits through a plan provided by your employer, your claim can either be accepted or denied. People may feel hopeless if their claim was denied, but they still have options.

ERISA requires an insurance provider to accept or deny a claim within 30 days. If a claim is denied, the provider must state why.

ERISA requires plan administrators to provide an outline of how a plan participant can appeal a claim denial. Once a person has been denied, and they have been given a reason for the denial, they can appeal the decision. This means that they can newly present their case.

What if My Claim and My Appeal Have Both Been Denied?

If your claim for disability benefits has been denied, and your appeal was unsuccessful, you may have to file a disability benefits lawsuit.

What are the Requirements to File a Benefits Denial Lawsuit?

Under ERISA, you must exhaust all of your appeals before filing a benefits denial lawsuit.

After a benefits lawsuit has been filed, a judge can determine if there has been an “abuse of discretion” in how a plan administrator chose to deny benefits. This means that there are limited ways in which a judge can intervene in a denial of benefits, but it does offer the chance for someone whose claims have been denied to receive compensation.

The American Bar Association notes that ERISA allows a court to “clarify [a plan participant’s] rights to future benefits under the terms of the plan.” This provision gives the court some power to help a plan participant ensure that they will continue to receive future benefits, if they do file a benefits lawsuit. 

If you have filed as many appeals as you can, and if you feel overwhelmed with the complexities of a disability insurance denial and find yourself asking “what is ERISA,” filing a disability insurance benefits lawsuit may be a way forward.

Do YOU have a legal claim? Fill out the form on this page now for a free, immediate, and confidential case evaluation. The bad faith insurance attorneys who work with Top Class Actions will contact you if you qualify to let you know if an individual lawsuit or Unum class action lawsuit is best for you. [In general, Unum bad faith lawsuits are filed individually by each plaintiff and are not class actions.] Hurry — statutes of limitations may apply.

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