Welfare Benefit Plan ERISA News
May 2017

 
When Close Is Not Close Enough:
A Shift Towards Strict Compliance for ERISA Claim Procedures

"A string of cases in the Second Circuit Court of Appeals is putting ERISA claims administrators on notice that falling short of strict compliance with the DOL's claims and appeal regulations may cost administrators a deferential standard of review.... Under the DOL's final regulations governing disability benefit claims, if a plan fails to strictly comply with the new disability claims regulations, a claimant may file a civil suit under ERISA Section 502(a) immediately without exhausting the plan's administrative remedies and the plan administrator's benefit determination will be subject to de novo review.... The recent cases offer some lessons about the types of violations that may cause a plan administrator to lose its deferential standard of review." (Trucker Huss)

A Few Considerations During Form 5500 Season
"Both the IRS and DOL comment that improperly completed Form 5500s will increase the probability that they may take a closer look at plan matters. This article includes a short list of considerations and questions aimed at helping plan sponsor employers avoid government investigation otherwise prompted by a 'wrong' answer on the Form 5500." (The ERISA Law Group)

Employer Liable for Failing to Provide
Life Insurance Conversion Information to
Disabled Employee

"Notwithstanding that the right to convert to an individual insurance policy had long since expired, the court crafted a remedy under ERISA that imposed a surcharge on the employer equal to the $750,000 in life insurance that the physician employee would have elected to convert to an individual policy but for the plan administrator's breach of its fiduciary duty; the court also awarded the physician's spouse interest, legal fees and costs associated with bringing the lawsuit. Because the ability to convert to an individual policy was no longer available, the employer, and not the insurance company, is obligated to make all of these payments." [Erwood v. Life Insurance Company of North America and Wellstar Health System, Inc. Group Life Insurance Program, No. 14-1284 (W.D. Penn. Apr. 13, 2017)] (Buchanan Ingersoll & Rooney PC)
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© 2017 ERISAPros, LLC, All rights reserved. Information on ERISAPros' website, its newsletter, “News & Views,” and its blog, “ERISA Wonk,” is published as a general informational source. Information and articles are general in nature and are not intended to constitute legal or tax advice in any particular matter. Blog posts and comments reflect the personal views of their respective authors - not those of ERISAPros. Transmission of this information does not create an attorney-client relationship. ERISAPros, LLC is not a law firm and is not giving legal or tax advice. It does not warrant and is not responsible for errors or omissions in the content on its website or in its newsletters. ERISA is a complicated and confusing law. Summary Plan Descriptions (SPDs), Wrap Plan Documents, and Form 5500s require review and updating by qualified ERISA compliance professionals.

 

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