What Is ERISA and Why Does It Matter in Life Insurance Cases?
ERISA is a federal law that sets minimum standards for employer-sponsored benefit plans, including health, disability, retirement, and life insurance. When you receive life insurance coverage through your job or your loved one’s employer, the plan is likely subject to ERISA. This matters because ERISA preempts most state laws, meaning your ability to sue for benefits, bad faith, or emotional distress is significantly limited compared to private life insurance policies.
Under ERISA, you typically cannot sue for punitive damages or pain and suffering. However, you can sue for the amount of the denied benefit, legal fees, and—if the court finds serious procedural violations—sometimes equitable remedies such as reinstatement or surcharge. But before you can file a lawsuit, you must exhaust the plan’s internal appeal process, which has strict timelines.
Common ERISA Life Insurance Disputes We Handle
ERISA life insurance litigation may arise from a range of benefit denials and disputes. Some of the most common issues we litigate include:
Denial of coverage due to late or missing enrollment paperwork
Claim denials based on alleged plan lapses or employer administrative errors
Disputes over who the rightful beneficiary is under the plan
Denials based on exclusions, such as suicide or misrepresentation
Employer failure to notify the employee of plan changes or terminations
Conversion rights not being properly communicated when employment ends
Because ERISA litigation does not allow jury trials or traditional bad faith damages, the quality of your legal briefing and adherence to procedural rules is critical. Our attorneys specialize in identifying ERISA violations, building strong administrative records, and pushing back against employer negligence and insurer misconduct.
Step-by-Step Breakdown of the ERISA Litigation Process
ERISA lawsuits follow a unique structure compared to most civil litigation. Here's what to expect:
Pre-Litigation and Administrative Appeal
Before filing a lawsuit, you must file an internal appeal with the plan administrator—usually the insurer or employer. This appeal must be submitted within a limited window (typically 60 to 180 days after the denial). If you skip this step, courts will likely dismiss your case. During the appeal, you're building the "administrative record," which is all the court will review if you later sue.
Filing the Complaint
If the appeal is denied, litigation begins with the filing of a civil complaint in federal court. The complaint outlines the facts, the relevant plan provisions, and the relief sought. ERISA claims are usually brought under Section 502(a)(1)(B), which allows a participant or beneficiary to recover denied benefits.
The Defendant's Answer
The employer, insurer, or plan administrator will respond with an answer admitting or denying allegations. They may also raise affirmative defenses such as waiver, plan exclusions, or failure to exhaust administrative remedies.
Discovery (Limited in ERISA Cases)
Unlike most lawsuits, ERISA cases often have limited or no discovery. Courts generally confine review to the administrative record. However, if there's evidence of procedural irregularities or a conflict of interest, the court may allow limited discovery into how the denial decision was made.
Motions for Summary Judgment
In most ERISA cases, both sides file cross-motions for summary judgment. These motions ask the judge to decide the case based on the administrative record without a trial. Because there’s typically no jury, the court decides whether the denial was arbitrary and capricious or, in some cases, whether the claimant is entitled to de novo review.
Trial (Rare)
If summary judgment is denied, the case may proceed to a bench trial (heard by a judge, not a jury). But this is uncommon—most ERISA cases are resolved through summary judgment or settlement.
Appeals
Either side may appeal the district court’s ruling to the U.S. Court of Appeals. ERISA appellate cases can have broad implications, especially when procedural violations or plan ambiguities are involved.
Why Legal Help Is Critical in ERISA Claims
Unlike traditional life insurance lawsuits, ERISA litigation is often won or lost on paper. Judges don’t evaluate new evidence after the administrative appeal. That’s why it's critical to build a complete, persuasive record from the beginning—and that’s where we come in. Our firm drafts compelling administrative appeals, challenges improper procedures, and pushes insurers to the point of settlement or courtroom victory.
Insurers and employers have teams of legal experts. You should too.
FAQ: ERISA Life Insurance Litigation
What does ERISA cover in terms of life insurance? ERISA governs most employer-sponsored life insurance policies. If your loved one received life insurance through a job or retirement benefit, the policy is likely covered by ERISA.
Can I sue an insurance company under ERISA for denying a life insurance claim? Yes, but only after you complete the administrative appeal process. ERISA lawsuits allow beneficiaries to sue for denied benefits and, in some cases, legal fees—but not punitive damages or emotional distress.
How long do I have to file an appeal under ERISA? Generally, you have 60 to 180 days after receiving a denial letter to file an administrative appeal. Missing this deadline can forfeit your legal rights.
What happens if my employer failed to submit my enrollment paperwork? You may still have a valid claim if the employer was negligent. Courts have held employers liable when their administrative failures caused loss of coverage under ERISA plans.
Can I get discovery in an ERISA lawsuit? Discovery is limited in ERISA cases. Most courts only review the administrative record, but discovery may be allowed if there's evidence of bias, conflict of interest, or serious procedural flaws.
Do ERISA cases have jury trials? No. ERISA cases are decided by a judge, not a jury. This makes legal briefing and record development even more important.
Can I recover attorney’s fees if I win an ERISA case? Yes. Courts may award reasonable attorney’s fees to a prevailing party if certain conditions are met, such as showing that the insurer acted unreasonably.
What if the insurer delayed processing the claim? Unreasonable delays may be challenged under ERISA. Courts can penalize insurers who fail to make timely benefit determinations or who violate procedural rules.
Is a death claim covered if the employee was terminated before death? Maybe. Some plans allow for conversion to an individual policy, but employers often fail to inform employees of their rights. If notice wasn’t given, beneficiaries may still recover.
What is a “de novo” review under ERISA? In some cases, courts will review the denial from scratch (de novo), rather than deferring to the insurer’s decision. This can happen when the plan doesn’t grant discretion to the administrator or if procedural violations occurred.
Can I recover denied life insurance benefits years after the death? Possibly. While ERISA claims are subject to statutes of limitation, courts may toll the time if the beneficiary was unaware of the denial or misled by the plan administrator.
What is the standard of review in ERISA lawsuits? Courts typically use an "arbitrary and capricious" standard if the plan gives discretion to the administrator. If not, or if there are procedural violations, courts may apply de novo review.
Can I challenge a beneficiary designation under an ERISA policy? Yes. But ERISA preempts many state inheritance laws, and beneficiary disputes are resolved based on plan documents unless fraud, undue influence, or legal errors can be shown.
What is an ERISA plan administrator? This is the party responsible for overseeing the plan. It may be the employer, an HR department, or a third-party administrator. All communications and appeals usually go through this party.
How long does an ERISA lawsuit take? Most cases resolve within 6 to 18 months, but complex disputes—especially those involving appeals—can take longer.