On August 28, 2012, the federal court in Manhattan held that de novo is the appropriate standard of judicial review for disability insurance claims denied by Prudential Insurance Company. This ruling is the first of its kind within the Second Circuit. The decision effectively makes it more difficult for Prudential to deny valid disability claims brought by disabled individuals in New York.
In the case, Prudential argued that the language in their “Summary of Plan Description” (SPD) should be used to determine the appropriate standard of review, rather than the plain language of the actual insurance policy. The SPD contains language granting Prudential the right to discretionary authority in determining the eligibility for benefits. Prudential asserted that this language entitled it to the “arbitrary and capricious" standard of review, which is a very high standard giving great deference to Prudential's determinations. Riemer & Associates, however, convinced the court that de novo was the more appropriate standard of review, allowing the Court to more thoroughly review Prudential's determination without giving it deference.
The Court's decision helps level the playing field. Individuals victimized by Prudential's arbitrary claim denials can now more effectively litigate their claims in New York and Connecticut under a much more appropriate standard of judicial review. Through the Court's decision, Riemer & Associates is forcing insurance companies to be held more accountable when deciding disability claims.
Click here to view the Court's decision in full: Download file
For more information explaining how (ERISA) governs the content and distribution of SPD’s, please click http://www.dol.gov/ebsa/newsroom/fserisa.html">here.