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Long Term Disability Benefits – FAQ about suing the Insurance Company


If you were wrongfully denied Long Term Disability benefits, or they were wrongfully terminated, you may consider suing the insurance company to obtain your benefits. We are answering the most commonly asked questions regarding suing the insurance company.

Who do I sue?

In most Long Term Disability cases, you sue the insurance company that is refusing to pay your benefi­ts. Sometimes it may be necessary to sue your employer or a non-pro­fit board of trustees that administrates your LTD plan. In some rarer cases you may need to sue the broker who sold you the policy.

What do I sue for?

In all LTD lawsuits, you sue for the payment of the disability benefi­ts to which you are entitled. If the denial of your claim caused you to suffer a great amount of stress, you can sue for compensation for “mental distress”. You can also claim pre- and post-judgment interest on the amounts claimed, as well as a contribution from the defendants towards your legal fees.

Some lawsuits may also include punitive damages for “bad faith”. This is rare and only awarded if the insurance company has acted in a particularly malicious, vindictive and harsh manner. It’s probably safe to assume that your insurance company has a lot more money (and more lawyers) at its disposal than you do. This means the “relationship” mentioned above is not an equal one. Because the insurance company has more resources than the people it insures, it is required to act in “good faith”. That basically means that it needs to act fairly towards you rather than act exclusively in its own best interest. Although the insurance company is more powerful than you, it must treat you as an equal partner in the contract (your insurance policy).

If the insurance company doesn’t do that, it has acted in bad faith. Here are a few examples:

  • You have reports from several medical professionals that say you aren’t able to work, but the insurance company’s in-house doctor says you can and the insurance company ignores your reports in favour of its own.
  • Cutting off your benefits without telling you why.
  • Consistently making late payments or missing payments altogether.

The courts recognize bad faith when it happens so if it has happened to you, you have legal options at your disposal. If the insurance company is found to have acted in bad faith, a judge can order them to pay compensation to you on top of whatever it owes you for your disability benefits.

What is the process involved in suing the insurance company?

Generally, the court process begins by delivering a Statement of Claim (commonly called a lawsuit) which sets out the allegations you are making against the insurance company. Once the insurance company receives it they will immediately stop any ongoing internal appeal. The insurance company will then ­file a defense against your lawsuit and documents will be exchanged. At some point you will be asked questions under oath and you will likely need to undergo medical assessments, both with your own doctor and the doctor for the insurance company. Usually there are then settlement negotiations, where both sides attempt to come to an agreement. This may lead to a mediation or settlement conference. If that is not effective, the matter will go to trial.

Do I have to go to court?

If the settlement negotiations (and mediation, if it happens) fail, your case will end up in court and a judge or jury will decide whether your benefi­ts will be reinstated or not. However, most lawsuits settle before going to court.

Cantini Law|Droit offers a free consultation where you can discuss your Long Term Disability case with a lawyer. The consultation is confidential and there is no obligation. Contact us today at 1-800-606-2529.

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