Cigna has agreed to a wide-ranging re-evaluation of its disability claim denials from 2008, 2009, and 2010 in California and from 2009 and 2010 in Connecticut, Maine, Massachusetts, and Pennsylvania.
The settlement affects certain long term disability claims in all of Cigna’s units – Life Insurance Company of North America, Connecticut General Life Insurance Company, and Cigna Health and Life Insurance Company.
After multiple complaints to the insurance commissioners in these states, regulators found that Cigna ignored Social Security decisions, discounted the findings of independent physicians, and didn’t consider workers’ compensation records when evaluating claims. These practices forced Cigna to set aside $77 million for payments to current and past claimants who were improperly denied their disability benefits as well as to pay fines to the states. In addition, the settlement requires Cigna to:
- Establish a remediation program in which the companies’ enhanced claim procedures will be applied to certain previously denied or adversely terminated claims for residents of California, Connecticut, Maine, Massachusetts, or Pennsylvania.
- Enhance claim procedures to improve the claims handling process to benefit current and future policyholders.
- Participate in a 24 month monitoring program conducted by the insurance departments of each state, involving random sampling and on-going consultations.
- Undergo a re-examination upon completion of the monitoring period.
- Pay fines and administrative fees totaling $1.7 million.
“This regulatory action is intended to provide long-awaited relief for consumers who have a right to expect that their carrier will make good on contractual promises. As regulators, we hold carriers accountable for adhering to laws and regulations of each state in which they conduct business. This settlement resulted from market conduct exams and encompassed issues of serious concern. It is a solid example of regulatory cooperation in protecting the policyholders of Connecticut and other jurisdictions.” said Connecticut Insurance Commissioner Thomas Leonardi.
For the official press release from the California Department of Insurance, click here.
For a copy of the Maine market conduct examination, click here.
The full regulatory settlement can be found here.
Although not quite the magnitude of UNUM’s market conduct settlement a few years ago, Cigna’s agreement can have a great impact on those claimants who were improperly denied their disability benefits.
If you think you may be eligible to have Cigna’s denial of your long term disability claim reviewed or have any questions about this settlement, please feel free to contact our offices toll-free at (855) 828-4100 or visit our website to sign up for a free consultation.