Disability Amendment Sign Up Form
See below for a brief explanation of the new rule.
What is this about?
The Department of Labor has issued new requirements for disability claims and review procedures that take effect April 1, 2018. All ERISA plans (e.g., SERPs, other 457(b) and (f) plans, LTD plans, and split dollar plans) that provide benefits on disability require updates to reflect the new requirements. Failing to update exposes the employer to loss of procedural protections otherwise available under ERISA.
The new requirements are intended to facilitate prompt and impartial decisions on claims for disability benefits. Under the new requirements:
- Administrator response periods are shortened
- Those adjudicating the claims must be impartial and independent
- The administrator must describe the basis for not following expert or professional evaluations
- Notices must be written in a culturally and linguistically appropriate manner
Failure to establish (or follow) compliant procedures allows the claimant to go directly to litigation rather than having first to complete the claims and review procedures in the plan. More importantly, in the litigation the employer loses the advantage of the presumption that the employer’s determination in a compliant claims and review process was correct.
Please let us know if you have questions about the new requirements and how they will affect your welfare and nonqualified pension plans under ERISA.