CIGNA Regulatory Settlement Agreement

There may be good news ahead for disabled insureds seeking benefits from the CIGNA companies, comprised of Life Insurance Company of North America (LINA), Connecticut General Insurance Company, and CIGNA Health and Life Insurance Company.  These “participating companies” entered into a Regulatory Settlement Agreement (“RSA”) with the insurance departments of the states of California, Connecticut, Maine, Massachusetts and Pennsylvania.  Other state insurance departments including Colorado’s Insurance Commissioner have agreed to participate in the agreement.  This RSA followed an extensive market conduct examination investigating the way these CIGNA companies have handled disability claims over the past several years.  The terms of the settlement provide that the CIGNA insurers will improve their claims review process through enhanced claim procedures and, importantly, will review previously denied long term disability claims.  CIGNA has agreed to reassess prior claims denied from January 1, 2009 through December 31, 2010, although there is an exception for residents of California whose reassessment period stretches back to January 1, 2008.  This reassessment program is meant to determine if those prior denied claims would have been impacted, or resulted in a different outcome, if the enhanced claim procedures agreed to in the RSA would have been utilized. It remains to be seen how fairly this program is actually administered.

Similar to the multistate regulatory settlement agreement between Unum Group and state regulators in 2005, CIGNA now agrees that certain “best practices” must be adhered to in reviewing long term disability claims under group policies.  Such “enhanced” claim procedures include providing significant weight to social security disability awards, guidelines for the use of external medical sources, assuring that the professionals utilized by CIGNA in the processing of claims are selected fairly to avoid internal bias, and providing better notice to claimants of information that should be submitted in support of their disability claims.

The agreement with CIGNA requires it to pay fines and administrative costs to the investigating states.  Additionally, the agreement subjects CIGNA to ongoing monitoring of previously denied claims now being reassessed under this remediation program.  Perhaps more importantly, a press release from the California Department of Insurance states that CIGNA has set aside $77,000,000 for projected payments to insureds whose claims were not handled properly. 

If your CIGNA (LINA or Connecticut General) long term disability claim was wrongfully denied in your mind between 2008 and 2010, you may want to contact the disability attorneys at the McDermott Law Firm to discuss your circumstances.  We are willing to provide a free phone consultation and initial review of your claim to determine if we can be of assistance in guiding you through the reassessment process.  Simply because CIGNA has agreed to altered its claims handling procedures does not mean that your previously denied claim will be quickly, easily, or ever overturned.  We have extensive experience in handling disability claims on behalf of disabled individuals and are happy to discuss how we can assist in guiding you through this process.