New York's highest court has ruled that insurers must pay claimants under group disability policies who have pre-existing conditions.
The insurance company may only exclude the first 12 months of payments, but must make full payment after that, starting in the 13th month of a long term disability.
The case in New York was against Metlife, filed by Mitchell Benesowtz, a former employee of Honeywell Corp. After he became disabled and filing his claim, Metlife decided that Mr. Benesowitz had a pre-existing medical condition and denied his claim for benefits completely.
Metlife relied upon a clause in his policy, but the state Court of Appeals in Albany ruled that a state law passed in 1993 only allows the insurance companies to deny payment for the first 12 months of a disability.
The practice of denying these claims due to pre-existing conditions has been an industry-wide problem for consumers.
New Yorkers insured under group plans purchased by their employers, from Unum, First Unum, Aetna, CIGNA, Hartford, Prudential, Liberty Mutual, Guardian, Fortis and others. Because of the Metlife ruling, all of these companies will have to pay claims where the claimant suffers from a pre-existing condition, except for the first 12 months of the long-term disability.
Under certain circumstances, the ruling could also affect consumers who do not reside in New York, attorneys involved in the case said.
