Where an insurer has wrongfully delayed or denied a covered claim, extra-contractual remedies are necessary to punish the conduct at issue and deter similar conduct in the future. UP argued in its brief that disgorgment of profits is an appropriate remedy for bad faith denial of a valid ERISA claim. UP reminded the Court of the Panel Majority’s own recognition that “…if no remedy beyond the award of benefits were allowed, insurance companies would have the perverse incentive to deny benefits for as long as possible, risking only litigation costs in the process.” Rochow I, 737 F.3d at 417.See DeBofsly and Associates’ blog for a full case summary.
- Disgorgement of Profits
ERISA should not preempt state insurance laws.
- Objective evidence of disability
Anti-consumer and anti-policyholder affects of denying coverage in disability cases involving both a disease that is difficult to document objectively and an overwhelming amount of medical evidence that favors a finding of complete disability. Long term care insurance companies are sometimes permitted too much discretion…
Participants and Beneficiaries suing on behalf of an ERISA plan under 502(a) (2) should be able to seek money from the plan in the same manner as a fiduciary. Petition for rehearing.