I have filed a statement of claim against my former insurer after they wrongly terminated my LTD benefits. In the interim, I have filed for CPP-D (which was approved) and DTC (waiting to hear back).
I am feeling very anxious about the outcome of my case. I am afraid my lawyer will try to force me to accept pennies on the dollar as part of a mediation settlement. However, I am in my 30s and I need a sum that can potentially support me until retirement.
Has anyone been through something similar? Would you care to provide an estimation of what a reasonable settlement might be? I.e. a percentage of PV?
Sorry to hear your LTD company is doing this to do. Good news is you have been approved for CPP-D, which is a big step. The test for CPP-D is usually higher than the test for LTD. This bodes well in your favor and also gives you a source of income while you fight your LTD company.
I would read this page if I were you. It was very helpful to me and can get you on the right path. Sorry I don’t have any exact figures of amounts, but it is highly dependent on the length of your disability and what you can prove.
One thing I can almost guarantee is that it is impossible to get a settlement at a mediation that would support you until retirement. That is not realistic for someone who is in their 30s.
LTD insurers will never pay out that much. In most cases you are looking at a maximum settlement of: past benefits + 2-5 years of future payments. You can sometimes get more than 5 years of future payments (We have gotten as much as 10 years in one case), but that is rare and very dependent on the facts.
The thing to understand is that insurers would rather put a person on benefits than pay out large lump sum settlements. They can then build a stronger case against the person, or the person may die and they won’t have to pay them, etc.
So for someone in their 30s my question for them is always…how likely is it that you are going to be able to get back to some type of work. Lump sum settlements for young people only make sense if:
You aren’t financially dependent on the LTD payments and just want the insurer out of your life
You likely can return to work sometime in the next 5 years and this settlement can act as a financial bridge to allow you to return to work on your own terms
You don’t have a strong case and there is a good chance you will lose at court
Your lawyer cannot force you to do anything. You have full control over your case. It is always your decision to settle or keep fighting for approval.
I hope this helps. Discuss your concerns with your lawyer. Trust with your lawyer is extremely important. It is important to have a very frank and honest relationship with them.
David Brannen
Disability Lawyer with Resolute Legal
The response posted above is based on the limited factual information made available and is not intended as a full and complete response to the question. The only reliable manner to obtain complete and adequate legal advice is to consult with a lawyer, fully explain your situation, and allow the lawyer enough time to research the applicable law and facts required to give an adequate opinion. The basic information provided above is intended as a public service only, a full one-on-one discussion with a lawyer should be done before taking any any action. The information posted on this forum is available to the viewing public and is not intended to create a lawyer client relationship with any person. If you want one-on-one advice, please click here to request a free consultation or call toll free 1-877-917-7050 to speak with a member with our disability claim support team.
Wow, thank you so much for your detailed reply, David. This definitely provides me with more clarity on process.
So if I understood correctly, the maximum offered in mediation is typically 5 years. I can opt to go to court since I feel that I have a strong case, but is it true that courts can not award future payments?
So the court could award me back payments and possibly punitive damages, and order that I be put back on claim?
I can’t speak to your situation without knowing all the facts. But generally speaking 2-5 years is a common max range. That depends on a lot of factors.
One word of caution. Almost every person I meet believes they have a strong case – and I am often in disagreement with them over that. So make sure your lawyer agrees you have a strong case before opting to go to trial. And keep an open mind if they tell you your case isn’t as strong as you think it is. You need to view your case as the decision-maker (judge) will view it, not as you know it to be.
Being honest and legitimately unable to work – while obviously very important – is not enough to have a strong case. This is where many people misjudge their situation. Legal cases are about how the judge perceives you and what you can prove in court. As I say in my books – the truth is not enough.
If you check out my bio, you will see I wanted to be a lawyer after my grandfather lost a “sure thing” case at trial when I was ten. This case was supposed to be impossible to lose. It was a terrible situation for my family
I tell everyone to forget about punitive damages. They are awarded in only the rarest and most extreme situations. 99% of cases are not going to fall into that situation. I recommend never factoring punitive damages into your assessment of settlement, mediations, etc, unless you have a strong punitive damages case. In my entire career, I have had a total of 3 cases that could actually win (or won) punitive damages.
Mental distress damages are something difference and it is possible to win those at trial in a broader ranges of situations. However, you should not count on these types of damages at mediations or out of court settlements.
Courts cannot award future payments in long term disability case. They can only enforce the insurance policy as it is written. They can only require past payments to be paid and can say that you meet the requirements for payment as of the day of their decision. that means insurance companies will re-start month to month payments. But, it doesn’t prevent the insurance company from continuing to adjudicate the claim and from terminating benefits in the future again.
Thanks again for all of the info. I will definitely discuss all of this with my lawyer. This is an incredible service you are providing and it is much appreciated.