The other week I wrote about why accident claims take 2-3 years to resolve. If there’s anything positive to be said about long term disability claims, it’s that they resolve more quickly.
1-2 years is the norm.
There’s two main reasons I’m going to outline today:
- The Nature of the Claim Itself
If you read the What is My Personal Injury Lawsuit Timeline blog, you’ll understand that insurance companies set reserves.
With an accident claim, there’s always lots of factors involved and different ways to determine pain and suffering so that reserve is always shifting as the case develops.
A long term disability claim, in contrast, is not about pain and suffering (at the legal level), it is about an existing contract and what you’re entitled to receive under that contract. The nature of a long term disability suit lends itself to quicker resolution because the reserve issue is mitigated.
Consider this: A long term disability insurance company can figure out the reserve because they know the maximum amount of benefit from day one. The math is easy.
Now obviously the disability itself is not straight forward; you generally need to make the case about the severity of your disability and its impact on you. The insurance company will say why you should work, and you will say why you can’t and provide evidence to support that.
But the value of the case doesn’t change much, only whether or not they’re going to pay it out.
For example, let’s say your benefit is $1500 per month. That means your benefit is worth $18k per year. Now we’ll assume you’re 55 years of age. Most policies end at 65, so the company knows the most it’s going to pay out is $180k over ten years. They might pay less because they’ll assume you’ll take CPP (that’s a whole other blog post all together) and you might be able to work a little, but still, they KNOW the maximum amount they have to set aside for you from day one. The entire reserve issue that influences so many accident claims goes away.
- Long Term Disability Companies are Smart (in a good way)
Long Term Disability companies are sophisticated.
Why is this? Well, the representatives generally know their stuff and don’t waste time with unnecessary steps.
I’ve been involved in many cases where the insurance company didn’t require a discovery (this never happens with an accident claim.) In fact, it’s not uncommon to see long term disability insurance companies settle quickly and go all the way to mediation without a discovery.
I appreciate that they often use in-house counsel which is smart because it saves time. I also appreciate that they don’t always do defense medicals which I think are redundant.
Overall, I find they’re more streamlined than other types of insurance companies. I suspect this is because they’re negotiating with a known value from the beginning.
Do They Ever Take Longer Than Two Years?
The only times I’ve seen long term disability cases extend over 2 years or more is when other types of lawsuits are involved.
For example, if the claim is because of a car accident, there may also be an accident suit where the monetary value of pain and suffering must be assessed – that process usually takes 2-3 years.
But even then, it’s still a good idea to hire a lawyer who you trust is going to see your case through as quickly as possible, (but not so quickly as to jeopardize it.)
My advice? Work with a personal injury lawyer who gets paid only when you get paid, and whose fee depends on the size of settlement. That way you’re working together.
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