How to cope with the denial of your short-term disability claim

On Behalf of | Mar 2, 2020 | ERISA Long-Term Disability Benefits

Disability benefits protect you from the financial hardship that could result from an illness or injury. Most people know about long-term disability insurance as an option to protect them from a protracted absence from work due to health reasons or an injury. Quite a few people also carry short-term disability insurance, which offers similar coverage that starts sooner and ends when long-term disability benefits apply to a situation.

If you find yourself applying for short-term disability benefits, you probably need them because you don’t have enough income or savings to cover your cost-of-living expenses after a sudden illness or accident. A denial of that claim could leave you in a difficult financial position until you can qualify for long-term disability benefits or return to work.

What’s the difference between short- and long-term disability?

As the name implies, the primary difference between short-term disability and long-term disability benefits is when a policyholder qualifies for the benefit and how long it will last. Most long-term disability plans do not take effect for at least 90 days. That means you have to go for three months without any income before long-term disability insurance starts helping you. Some policies take 180 days or longer before they allow an individual to file a claim.

Short-term disability insurance can offer immediate benefits when you have a condition that leaves you unable to work. Those benefits will last until you qualify for long-term disability benefits, which can last for years or even the rest of your life depending on the severity of your injuries or medical condition. If you applied for short-term disability and got denied, you may feel panicked and unsure of what to do.

If you obtain the insurance through your employer, you have certain rights

Employer-sponsored or offered disability insurance is a common inclusion in benefit plans. In some cases, these benefits are subject to regulations set by the Employee Retirement Income Security Act of 1974 (ERISA), which is a federal law regarding employer benefits that employees depend on for financial reasons.

ERISA specifically allows for individuals with a denied claim to bring an appeal against that denial and outlines the obligations of an insurance company or plan administrator to those who hold policies subject to ERISA requirements. Unlike many other kinds of employer-provided insurance, short-term disability benefits are not always subject to ERISA.

However, even non-ERISA short-term disability plans typically have an appeal option for those who file an initially unsuccessful claim. Succeeding in that appeal can help you recover the benefits you needed after an injury or illness. Particularly if your initial application or claim for benefits was done on your own, securing professional legal help for an appeal related to the denial of your short-term disability benefits may be in your best interests.