Some long-term disability (LTD) insurance policies are referred to as "ERISA disability insurance policies." What's ERISA? ERISA stands for the Employee Retirement Income Security Act of 1974. ERISA was originally passed to set standards for private pension fund administration, but it controls any plan classified as an employee welfare benefit plan. Today ERISA has a substantial impact on long-term disability insurance plans.
ERISA protects employees in that it requires insurance companies and employers to act in good faith, provide plan information to employees, and allow employees to appeal if they are denied benefits. It also prevents employers from discriminating or retaliating against employees who file long-term disability claims. However, ERISA also limits employees' trial rights in federal court (the only place employees can sue their LTD insurance companies if they have an ERISA plan). For more information, see our article on suing a long-term disability (LTD) insurance company.
ERISA governs any long-term disability policy that is purchased for employees by a private employer. Individual plans -- that is, those purchased with after-tax dollars by an individual, are not governed by ERISA, and many plans sold to governmental agencies with state or federal employees are not subject to ERISA.
ERISA-governed plans and individually purchased plans are quite different, especially in the appeals process. To learn more, see our article on ERISA vs. Individual Long-Term Disability Plans.
Whether your particular long-term disability plan is governed by ERISA or not, it's advisable to seek a consultation from a long-term disability lawyer if you are denied LTD benefits.