Forging ahead: UnumProvident is offering reassessment to tens of thousands of California claimants.

Almost a year after inking a 48-state market conduct agreement and offering to reopen 215,000 previously denied claims, the largest writer of disability insurance in the United States--UnumProvident--reached an agreement on Oct. 3, 2005, with the California Department of Insurance. The agreement: To reassess 26,000 previously denied chums, and to change certain claim practices and policy provisions specific to its California business.

Similar to UnumProvident's Multistate Exam Settlement Agreement of Nov. 18, 2004, a principal feature of the California Settlement Agreement, or CSA, is the claim reassessment process, wherein the company will use new standards developed specifically for California claimants denied in California since Jan. 1, 1997.

Under the reassessment process, UnumProvident is required to notify California insureds--those whose claims were denied between Jan. 1, 1997, and Sept. 30, 2005--of the opportunity to have their claims reconsidered. These claimants have 60 days from the date of their notice to register for reassessment. And, those California insureds that previously elected to participate in the Multistate Exam Settlement Agreement reassessment process automatically will be reassessed under the rules and procedures set forth in the CSA.

The California reassessment process is expected to be completed by end of June 2007, with UnumProvident evaluating the earliest denials first. If UnumProvident determines that a claimant is disabled, the insured tan expect to receive past benefits and go back on claim, If UnumProvident upholds the claim denial, the insured can request an independent review of the claim decision.

As a result of the CSA, UnumProvident will enhance and continue to improve its claim handling by changing policy provisions specific to California. These changes include:

* New Definition of Total Disability. Own occupation total disability is the inability, to perform with reasonable continuity the substantial and material acts necessary to pursue the insured's usual occupation in the usual and customary way. Any occupation total disability is the inability to engage with reasonable continuity in another occupation in which the insured could reasonably be expected to perform satisfactorily in light of age, education, training, experience, station ha life, physical and mental capacity.

* Discontinue Using Discretionary Authority. Elimination of policy language delegating discretionary authority to the insurance company to determine eligibility for benefits and to interpret policy language, thereby eliminating the deferential "abuse of discretion" standard of review.

* Limit Offsets. The company will only offset for Social Security Disability Income actually received by a claimant (not estimated or due).

* Pre-existing Conditions. The company will no longer exclude conditions "contributed to or by" the pre-existing condition. Condition must have actually existed or been diagnosed prior to the effective date of coverage.

* Mental and Nervons Conditions. Limitation applies after the termination of any physiological-based disability.

* Self-Reported Conditions. Discontinue use of the "self-reported condition" limitation.

* Rehabilitation. Rehabilitation provisions will be voluntary (not mandatory).

UnumProvident also is amending the Multistate Exam Settlement Agreement to include mailing notice of the national claim reassessment process to 29,500 insureds whose claims were denied between Jan. 1, 1997, and Dec. 31, 1999. Eligible insureds who do not receive notice under the amendment, but who are entitled to request a reassessment, will have until June 30, 2006, to do so. In addition, UnumProvident is offering to reassess private label, acquired and reinsured block claims, as well as claims administered on behalf of employers, from Jan. 1, 1997, through Jan. 18, 2005 (and through Sept. 30, 2005 for California claimants).

Since March 2003, UnumProvident has undergone significant financial and operational restructuring, built a new management team led by Chief Executive Officer Thomas R. Watjen, and significantly improved its claim operation. Offering reassessment to almost 300,000 claimants on all blocks of the company's business and rolling back statute of limitations to claims denied since Jan. 1, 1997, speak loudly for new management and positive change. The CSA not only benefits previously denied policyholders, but it raises the legal bar so other carriers doing business in California are held to a higher standard--and that is good for consumers.

With the industry leader stepping up to correct the problems of the past and agreeing to claim changes nationally, the upcoming holidays will indeed be a time to celebrate.

Frank N. Darras, a Best's Review columnist, is a partner with law firm Shernoff Bidart Darras LLp, Claremont, Calif He is a plaintiff's lawyer representing disabled insureds. He can be reached at [e-mail].