Every Bad Faith Insurance Victim Cannot Have Good Morning America As Their Lawyer

Brent Adams — Sun, 01 Feb 2009 21:20:18 GMT

Susan Kristoff of West Palm Beach, Florida was diagnosed with Stage IV metastatic breast cancer which was spreading throughout her body.

There was no question in the mind of any of her doctors that she was unable to work and would be for quite some time.

Nevertheless, her disability insurance company, CIGNA refused to pay her disability insurance benefits.

Under her contract CIGNA was required to pay 60 percent of her pre-disability income throughout the time she remained disabled.

Fortunately for Susan Kristoff, American Broadcasting Companies News Department learned of Susan's plight. They came to bat for her and posed some hard questions to CIGNA. CIGNA refused to respond but instead sent an insurance industry lackey, Susan Pisana, a representative of the insurance company trade group, America's Health Insurance Plans who gave the usually insurance company spiel to the effect that insurance companies have "every incentive to continue to get better".

Soon thereafter, CIGNA announced that based on "additional information … her disability benefits would be covered".

What was this "additional information" that caused CIGNA to do an about face? Of course, there was no additional information. CIGNA simply realized that their position was untenable and could not be held up to public scrutiny by ABC television.

As stated by Susan Kristoff's lawyer, Alicia Paulina Grisham, "Its not additional information … the only thing that changed this case is that 'Good Morning America' started calling CIGNA. And they knew that there was a good chance that their normal insurance delay tactics would be exposed."

This case had a happy outcome for Susan Kristoff. However, not every disabled person can have a major television network come to their aid. For most people, the deny-and-delay tactics regularly employed by disability insurance companies will prevail and the deserving disabled policyholder will get nothing.

Most disability insurance policies in this country are governed by a federal law known as the Employers' Retirement Income Security Act, (ERISA). The act was designed to protect America's workers from corporate management who made a regular practice of stealing from employees' pension funds. Unfortunately, federal judges have horribly distorted the law which now serves as a refuge for disability insurance companies who are not willing to live up to their obligations to their disabled policyholders.

Under ERISA, there is no incentive for an insurance to pay claims. If an insurance company refuses to pay, the only consequence is the court will make them do what they should have done from the beginning, pay the claim. Sometimes judges award interest and attorneys' fees. However, that is no real incentive to discourage this improper conduct.

Insurance companies need the threat of the possibility of having to pay punitive damages in order to discourage their unfair conduct. Under ERISA, punitive damages or not allowed. Insurance companies need to understand that they will be punished for not paying claims fairly. Otherwise, there is no incentive to settle.

Hopefully with the change in administration, the new president and congress will take steps to correct this horrible anomaly in the law. Otherwise, there will continue to be hundreds of thousands of Susan Kristoffs who will not have the benefit of intervention by a major television network.

Originally posted at InjuryBoard by Brent Adams

Fayetteville Personal Injury Lawyer - bad faith insurance practices

Every Bad Faith Insurance Victim Cannot Have Good Morning America As Their Lawyer