A federal judge ruled in favor of an insured claimant in a lawsuit filed against First Unum Life Insurance Company. In doing so, the claimant was granted long term disability insurance benefits retroactively beginning in 1995. In addition, it was discovered that UNUM operated under a conflict of interest by not only acting as the claim benefits payer, but also the claims administrator. The claimant in this case was insured through a long term disability insurance policy purchased by his employer and later under a conversion policy.
Initially, UNUM denied coverage citing that the policy had terminated and the conversion policy did not apply because the allowable time for filing a claim had expired. UNUM unsuccessfully argued this point and in addition argued that the claimant should not be entitled to benefits because the claimant had tried to return to work during this time period. However, the attorneys for the claimant successfully argued that the attempted effort to return to work was involuntary due to his financial situation. The court agreed.