A recent case from the Federal Court in New York has demonstrated that it is an abuse of discretion to terminate a claimant where liability had been accepted for a lengthy period of time, with no change in the claimant’s condition. Smith v. Liberty Life Assurance Co. of Boston (N.D.N.Y. 2009).
The decision serves to re-affirm the vitality of arguments that have been successfully lodged by claimants that where a claim has been approved due to the severity of a condition, absent a marked change in the condition in terms of improvement, it is improper for an insurer to alter its prior claim determination, or as stated by the Court “decisions to terminate benefits in the absence of a change in condition….are arbitrary and capricious.” The Court also chastised the insurer for crediting the opinion of a “newly hired” physician to review records, which appeared as “physician shopping”.
We have unfortunately seen this type of conduct as a recent trend, with insurers going after older files with renewed vigor, hoping to find files to terminate benefits. If your insurer is engaging in similar conduct, please contact our offices to discuss how we can assist you in fighting back against such improper conduct.