ERISA stands for Employee Retirement Income Security Act. The act covers both short-term and long-term disability, protecting the rights of employees when they are unable to work due to circumstances outside of their control. If you become disabled, you must file an ERISA claim with your employer.
An ERISA claim is a formal claim to your employer regarding your disability. Most companies require you to complete physical forms. You’ll complete your forms, the employer will complete a few forms and you’ll need a statement from your physician as well. Finally, you’ll need to sign releases so that the insurance company can obtain the medical records necessary to validate the claim.
Investigating the Claim
Just because you make a claim doesn’t mean you’ll get approved. The insurance company that holds the disability policies must do its own investigation. The insurance company will:
- Review your claim forms
- Obtain necessary medical documentation if you sign the release
Each insurance company differs, but expect the claim process to take between one and four months. At the end of the investigation, the insurance company will provide a letter with its findings. If you’re approved, you get your benefits and learn the details of how long they’ll last.
If you’re denied the claim, the letter will contain the reasons why you were denied. It will also include the details necessary to appeal the denial, if you choose to do so.
Dealing with a Denied Claim
If your claim is denied, you have the right to appeal it. Your letter will let you know the steps to take. You can do this on your own or with the help of an attorney. If your appeal is denied and you think it’s unfair treatment, you may then take legal action, which will require the help of an attorney.
Keep in mind, though, if your injury is work-related, ERISA won’t play a role. Instead, you’ll need to file a workmen’s compensation claim and go after your employer for the compensation.
What are the Benefits?
The benefits offered by your company’s disability insurance will differ. For example, each company defines disability differently. Some consider you disabled if you can no longer perform the basic duties of your current job. Others don’t consider you disabled until you are unable to perform the duties of any job, not just your current job.
Do you Pay Taxes on the Benefits?
Whether or not you pay taxes on the benefits depend on the situation. If you paid into a policy pre-tax, you’ll owe taxes on the benefits when you use them. If you have your own policy that you paid for after you paid your taxes, your benefits are tax-free.
The ERISA Act helps protect employees in many aspects, not just disability. If you become disabled and it’s not work-related, you may be eligible for short-term or long-term disability depending on the depth of the disability and your abilities to work in any occupation, not just your current job.