Key Takeaways:
- The Northern District of California ruled that Hartford Life and Accident Insurance Company abused its discretion when it terminated Steven Ehrlich’s long-term disability (LTD) benefits.
- The court found Hartford’s handling of the claim riddled with inconsistencies, inadequate investigation, and a lack of fair process.
- Plaintiff was awarded LTD benefits based on physical impairments—including fibromyalgia and neuropathy—not mental illness as claimed by Hartford.
Background: Physical Disability Ends Career for Senior Executive
Steven Ehrlich, a former senior vice president of marketing, became disabled in 2016 due to a range of serious physical conditions, including fibromyalgia, autoimmune neuropathy, and persistent Lyme disease. His symptoms, which included debilitating pain, fatigue, tremors, and cognitive issues made it impossible for him to continue working. Initially approved for LTD benefits, Ehrlich’s claim was terminated twice by Hartford (which had acquired Aetna’s group benefits business).
Hartford’s Flawed Evaluation Leads to Final Benefit Termination
The termination at the heart of this case occurred in 2019. After conducting a medical examination through its physician consultant, Dr. Thomas Allems—who lacked mental health credentials—Hartford concluded Ehrlich’s disability stemmed not from physical conditions but from “severe depression” and “conversion disorder.” As a result of Dr. Allem’s medical report, Hartford:
- Terminated Ehrlich’s LTD benefits for physical disability.
- Required Ehrlich to seek psychiatric care to continue receiving mental health-related benefits.
- Eventually terminated all benefits when Ehrlich did not provide evidence of psychiatric treatment.
Ehrlich appealed the decision, asserting that his primary disabling conditions were physical and well-documented by multiple treating physicians.
Court Finds Hartford Abused Its Discretion Under ERISA
The US District Court for the Northen District of California, applying a moderately skeptical lens due to Hartford’s structural conflict of interest (as both insurer and administrator), ruled that Hartford abused its discretion. The court noted the following regarding Hartford’s LTD termination and appeal denial:
- Inconsistent Reasoning: Hartford flip-flopped between classifying Ehrlich’s condition as physical or mental without adequate justification.
- Biased Review Process: The insurer relied exclusively on a single medical evaluation, ignored or misrepresented treating physicians’ reports, and failed to seek additional psychiatric evaluations despite claiming a mental health diagnosis.
- Procedural Violations: Hartford failed to comply with ERISA guidelines requiring full and fair review, including notice of deficiencies and opportunity to respond.
- Failure to Weigh SSA Determination: The Social Security Administration had already determined Ehrlich was disabled based on his physical impairments, a fact Hartford failed to meaningfully address.
Court Orders Reinstatement of LTD Benefits
The court held that Hartford’s unjustified termination entitled Ehrlich to reinstatement of benefits, potentially retroactive to the date of termination. The final remedy was left for further submission of motion documents by the parties.
Why This Decision Matters for Disability Claimants
This ruling provides a crucial reminder that insurance companies cannot arbitrarily reclassify or dismiss legitimate physical disabilities as mental conditions to trigger policy limitations. The court emphasized the importance of:
- Relying on appropriately credentialed medical professionals
- Following proper administrative procedures under ERISA
- Giving due weight to treating physician reports and SSA findings
- Conducting unbiased, thorough evaluations
For individuals facing similar long-term disability denials, Ehrlich v. Hartford illustrates the value of rigorous legal scrutiny and informed advocacy.
How Dabdoub Law Firm Helps in Cases Like This
At Dabdoub Law Firm, we focus exclusively on disability and life insurance claims, including ERISA-governed and individual disability insurance (IDI) policies. We have:
- A nationwide practice representing clients in all 50 states
- A proven track record against every major insurance company, including Hartford and Aetna
- Deep expertise in fighting wrongful LTD terminations, including those involving misclassification of conditions
- Litigation strength in federal court and an unwavering commitment to our clients’ long-term well-being
If your claim was denied or terminated for reasons that feel unjust or misinformed, we’re here to help.
The court’s ruling in Ehrlich v. Hartford sends a strong message: insurers cannot cut corners, dismiss legitimate evidence, or twist medical findings to deny benefits. For anyone struggling with a denied long-term disability claim, this case shows what’s possible when you push back with facts—and the right legal team.