Employers that offer workers short- and long-term disability benefits under the Employee Retirement Income Security Act (ERISA) have new rules for reviewing and managing disability claims filed on or after April 1, 2018.
These changes, which the Department of Labor first introduced in 2016, aim to provide workers with greater protections when plan fiduciaries and insurance providers deny their claims for disability benefits. Among the new procedural standards with which ERISA plans must comply are the following:
If an ERISA plan fails to follow these regulations, the claimant will be deemed to have exhausted all the administrative remedies available to him or her and have the right to file a federal lawsuit against the plan. It remains to be seen if this provision will increase the already significant number of ERISA disability-related litigation.
Businesses should have reviewed the language in their retirement plans and their non-qualified deferred compensation plans to ensure they reflect the new disability-claims procedures and the impact these changes will have of those plans. For example, if existing plan documents state that the administrator determines whether an employee is truly disabled, the plan must update the document to reflect the new rules.
The professionals with Provenance Wealth Advisors work with businesses of all sizes, through start-ups, mergers and acquisitions, to design benefits plans and implement best practices that meet regulatory compliance and serve the needs of plan sponsors and participants.
About the Author: Sean Deviney is a CFP®* professional and retirement plan advisor with Provenance Wealth Advisors, an independent financial services firm that often works with Berkowitz Pollack Brant Advisors and Accountants. For more information, call (954) 712-8888 or email email@example.com.
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Sean Deviney is a registered representative of and offers securities through Raymond James Financial Services, Inc., Member FINRA/SIPC. Raymond James is not affiliated with and does not endorse the opinions or services of Berkowitz Pollack Brant Advisors and Accountants. PWA is not a registered broker/dealer and is independent of Raymond James Financial Services. Investment Advisory Services offered through Raymond James Financial Services Advisors, Inc., and Provenance Wealth Advisors.
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* Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™ and federally registered CFP (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements.