Disability Insurance Blog

Sedgwick – A Dangerous Third Party Administrator

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Friday, March 4th, 2011

A recent case reveals that it is often worse to have a third party administrator reviewing and considering eligibility for long term disability insurance benefits than it is to have an insurance company considering the claim.

Sedgwick Claims Management Services is such an entity, and their conduct has been criticized by one recent court. However, the existence of these third party entities is making it dangerous for the claimant community, as all too often, judges are formulating the opinion that these entities do not suffer from any conflict of interest that exists where an insurance company both decides claims and pays benefits. Notwithstanding some guidance from the United States Supreme Court that such relationships might also suffer from a conflict of interest, where a third party administrator has been involved, the challenges facing claimants have intensified.

In this recently decided case, one court has taken Sedgwick to task for its failing to provide a claimant with a full and fair review of his claim. The court found that Sedgwick failed to provide the claimant with relevant documents, and therefore impacted the claimant securing a full and fair review.

If your claim has been delayed or denied, or you are dealing with a third party administrator on your claim for disability insurance benefits, remember that you are not alone, we can help.