Long-Term Disability (LTD) seems like a good idea. After all, 1 out of 3 U.S. workers will require some form of supplemental disability income during their lifetime. Since most workers can only survive 3 months out of work, it makes LTD insurance sound better all the time. At least that is what the insurance companies want you to believe.
The documentary, “bad faith” tells the story of people who had paid for their LTD insurance for years, but found that when they became disabled, the insurance company would pay for a year or two only before denying their claim. These are people with serious health problems and not the kind of subjective problems that you sometimes hear about when a fraudulent claimant is caught in the act. These are objective medical issues that show up on x-rays. Things that cannot be faked.
According to a former insurance claims investigator, the insurance companies work under the premise that 90% of all claims are fraudulent. In reality, it is approximately 10% of claims which are fraudulent. A former litigator, who himself filed a LTD claim, says that it doesn’t matter to the insurance company whether the claim is legitimate or not. The insurance companies know that it is a numbers game and when claims are denied, there are a certain number of people who will just give up–and that adds to their bottom line.
Part of the insurance game, in denying claims, is to hire minimally educated, aggressive, and fiercely loyal claims adjustors. It is part of the process because they know if they continually deny, the claimant will become more financially desperate and settle for far less than they are entitled.
It really doesn’t matter what your doctors say or what MRIs, or XRAYS, or surgical reports reveal. The only thing that is important to the claims adjuster is keeping his or her job and that means saving the company money. Translation: deny, deny, and deny.
The director of “bad faith,” Barbara Donahue, feels strongly about the subject of how insurance companies deny legitimate LTD claims, and to show her commitment she has distributed a copy of “bad faith” to every Governor and state Attorney General in the U.S..
During October, Donahue will be visiting Washington to distribute a copy of “bad faith” to every Senator and Representative. One of her goals is to have the McCarran-Ferguson Act repealed. It was a law Congress passed in 1945 that prohibited the Federal government from overseeing insurance policies. Yes, you read that right–the Federal government is not allowed to have a say in the regulations of insurance policies.
You may want to contact your state Senators and Representatives in Washington about the McCarran-Ferguson Act and let them know you want it appealed.
If you are one of the countless individuals who had LTD and were denied benefits, after an injury, please take a moment to share your story. It is important that you are heard because you are not alone. Hopefully, with a collective voice Washington will repeal the McCarran-Ferguson Act and stop the insurance companies’ abusive acts.