Life Insurance Governed by Federal Law
Many people purchase life insurance through their employer. The employer will often offer life insurance as part of a larger package of employee benefits. Typically, but not always, such policies are not governed by Texas law. Instead, a federal law, commonly referred to as ERISA, applies.
Capacity and undue influence challenges are possible for ERISA policies because they are not attacks on the designation based on reference to external documents or state laws regarding designations. Instead, they are attacks on the validity of the designation document itself.
ERISA provides for different remedies and procedures than Texas law. It is very important to consult an attorney experienced in handling ERISA claims. Some attorneys not familiar with ERISA will waste valuable time pursuing recovery in Texas court, instead of following proper administrative procedures.
It is often mandatory to exhaust the internal appeals process offered by the insurance company. During the internal appeal, it is essential to collect all available evidence for the administrative record in case that appeal is denied. If the internal appeal is denied, the next step is to file a federal lawsuit under ERISA.
In an ERISA lawsuit, it is a federal judge who will hear your case, not a jury. The evidence that was gathered in the internal appeal and entered into the administrative record is the evidence the judge will consider. The Judge has discretion to award you attorney's fees if it is determined the insurance company wrongfully denied the claim.
Time is of the essence if you are seeking life insurance benefits under an ERISA policy. Contact an experienced attorney as soon as possible to determine if ERISA or Texas law applies and the actions to be taken.