Disability insurer hit with
class action lawsuit
by Devlin Barrett,
Newsday.com, November 5,
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The nation's largest disability insurer was hit Tuesday with a
class action lawsuit charging the company wrongly denied
thousands of claims in order to cut costs.
The suit, filed in Manhattan federal court, charges
UnumProvident Corp. "has illegally victimized, and continues
to victimize, many thousands of disabled Americans."
UnumProvident has already been sued by a former doctor at the
company, who leveled similar allegations, and by numerous
policy-holders with denied claims.
The new lawsuit claims non-medical personnel at UnumProvident
routinely determine which claims should be denied, and then
use their own medical staff to create a "paper trail" to
justify the decision.
The suit charges UnumProvident and its subsidiaries "operate
long term disability denial factories, efficiently denying
claims, not on the merits of an individual claim but, rather,
to satisfy the self-interested financial goals of
UnumProvident and other group insurers."
The suit, filed by four people whose disability claims were
denied by UnumProvident, seeks unspecified monetary relief and
asks the courts to order UnumProvident to re-evaluate all of
the claims it has denied in recent years.
Company spokesman Tom White declined to comment on the suit
because UnumProvident had not yet seen the court papers.
UnumProvident has previously called the charges "absolutely
The company has said it handles 30 percent of the nation's
disability insurance business, and rejected about 2 percent of
disability claims in 2001.
About 3,500 people work for UnumProvident in Portland, Maine,
where the former Unum Corp. was founded. UnumProvident was
created by the 1999 merger of the Unum Corp. and The Provident
Companies, based in Chattanooga, Tenn., where there are more
than 2,217 workers.
UnumProvident employs about 100 doctors at claims offices in
Chattanooga; Portland; Worcester, Mass., and Glendale, Calif.