Long-term disability benefits may be denied for a variety of reasons, most commonly because the insurer determines that the medical evidence does not sufficiently prove the claimant meets the policy’s definition of disability—whether that means being unable to perform their own occupation or any occupation for which they are reasonably suited. Other frequent grounds include incomplete or inconsistent documentation, failure to follow recommended treatment, the existence of a pre-existing condition exclusion, or findings that the claimant retains residual functional capacity to work. Long-term disability Denials can also stem from administrative issues, such as missing deadlines, incomplete claim forms, or the expiration of limited benefit periods for certain conditions.
“What are my chances?” is the first question most people ask after their long-term disability benefits are denied. The honest answer is that it depends, but not on luck. Your odds turn on a handful of factors that an experienced attorney can usually assess early. In Wisconsin, ERISA cases are heard in the Eastern and Western Districts of Wisconsin and governed by Seventh Circuit precedent. Here is what that law says about who wins and why.
Why there is no reliable win-rate number
Be wary of anyone who quotes a precise success rate. Insurers do not publish how often they overturn denials on internal appeal, and most ERISA lawsuits settle confidentially, so published court decisions show only a slice of outcomes. The more useful question is not “what percentage of people win?” but “what does my case look like on the factors courts care about?”
That distinction matters because there are really two appeals. The first is the internal appeal decided by the insurer, which often upholds its own decision. The second is the lawsuit, where a federal judge reviews the insurer’s decision. Your chances at the second stage depend heavily on what you did at the first.
Factor 1: The standard of review
No single factor affects your odds more. If the policy does not clearly give the insurer discretion, the court decides de novo whether you are disabled, giving the insurer’s conclusion no deference. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989); Krolnik v. Prudential Ins. Co. of Am., 570 F.3d 841, 843 (7th Cir. 2009). If the policy does grant discretion, the court asks only whether the denial was arbitrary and capricious, a far harder standard for claimants.
The Seventh Circuit insists that a grant of discretion be clear, Herzberger v. Standard Ins. Co., 205 F.3d 327, 331 (7th Cir. 2000), and has found common phrases like “satisfactory proof” insufficient. Diaz v. Prudential Ins. Co. of Am., 424 F.3d 635, 637–40 (7th Cir. 2005). Illinois bans discretionary clauses in many insured policies by regulation; Wisconsin claimants should not assume the same protection and should have the exact policy language reviewed.
Deferential review is not automatic defeat. The Seventh Circuit has stressed that it is not a rubber stamp and has reversed denials that ignored favorable evidence or lacked a reasoned explanation. Holmstrom v. Metro. Life Ins. Co., 615 F.3d 758, 766 (7th Cir. 2010); Majeski v. Metro. Life Ins. Co., 590 F.3d 478, 484–86 (7th Cir. 2009). But claimants also lose when the insurer’s decision rests on a rational reading of the record. Mote v. Aetna Life Ins. Co., 502 F.3d 601, 606–10 (7th Cir. 2007).
Factor 2: The strength of the record
Under deferential review, the court generally considers only the evidence the insurer had when it made its final decision. Perlman v. Swiss Bank Corp. Comprehensive Disability Prot. Plan, 195 F.3d 975, 981–82 (7th Cir. 1999). Cases are much stronger when the record contains detailed treating-physician opinions on functional limits, objective testing, lay statements, and a Social Security disability award. Claims based on pain or fatigue can succeed, too; the Seventh Circuit has rejected the idea that such conditions must be proven with objective tests. Hawkins v. First Union Corp. Long-Term Disability Plan, 326 F.3d 914, 919 (7th Cir. 2003).
Factor 3: The insurer’s own mistakes
Many claimants win because of how the insurer handled the claim. Red flags include:
· terminating benefits without evidence that your condition improved;
· relying on file reviewers who ignored or misread treating doctors’ findings;
· disregarding a Social Security award the insurer encouraged you to pursue;
· denial letters that give vague reasons or fail to say what evidence was missing.
Courts weigh an insurer’s conflict of interest when it both decides and pays claims, and give it more weight when the handling suggests bias. Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 117–18 (2008). ERISA also requires specific reasons and a “meaningful dialogue” with the claimant. Halpin v. W.W. Grainger, Inc., 962 F.2d 685, 690–92 (7th Cir. 1992); 29 U.S.C. § 1133.
What winning looks like.
Winning does not always mean a check. When an insurer wrongly terminates benefits it had been paying, the usual remedy is reinstatement with back benefits. Hackett v. Xerox Corp. Long-Term Disability Income Plan, 315 F.3d 771, 775–76 (7th Cir. 2003). When the problem is an inadequately explained initial denial, the court may send the claim back to the insurer for a new decision. Id. at 776. Even a remand can support an award of attorney’s fees. Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 255–56 (2010). And the risk of losing in court often drives insurers to settle, sometimes for a lump sum.
The bottom line.
Your chances are best when the policy calls for de novo review, the record is thorough, and the insurer cut corners. You cannot change your policy language or the insurer’s conduct, but you can build the record, and that work must happen before the internal appeal closes. An experienced ERISA attorney can review your policy, claim file, and denial letter and give you a realistic assessment of your case.
This article provides general information, not legal advice. Past results do not guarantee future outcomes.
