Court Rules Hartford Can Recoup Long-Term Disability Benefit Overpayment After Disabled Widow’s Benefit Goes Unoffset for Four Years

In Harling v. Hartford Life and Accident Insurance Co., No. 6:24-cv-1237-ACA, 2026 WL 837100 (N.D. Ala. Mar. 26, 2026), a federal district court in Alabama granted summary judgment in favor of Hartford Life and Accident Insurance Company after finding that the insurer reasonably classified a disabled widow’s Social Security benefit as an offsettable “Other Income Benefit” under an ERISA long-term disability policy — and that Hartford’s years-long failure to actually apply the offset constituted a calculation error, not a change in position that the claimant could challenge or resist.

Background

Harling became disabled in 2019 and applied for both Social Security benefits and long-term disability benefits under her employer’s Hartford-administered plan. The Social Security Administration awarded her two separate benefits: a standard Social Security Disability Insurance benefit and a disabled divorced widow’s benefit — available to her before age sixty because of her disability. Hartford’s policy reduced monthly benefits by any “Other Income Benefits,” defined as benefits received for loss of income as a result of the period of disability, with “disability benefits under the United States Social Security Act” listed as an example.

When Hartford approved Harling’s LTD claim in January 2021, its approval letter and attached worksheet explicitly identified the disabled widow’s benefit as an offset. The following month, however, a Hartford claim examiner incorrectly concluded that Harling could not receive both the disabled widow’s benefit and standard Social Security disability benefits simultaneously, removed the offset, and recalculated her monthly payment upward. For the next four years, Hartford paid her benefits without applying the disabled widow’s benefit as an offset.

The problem surfaced in November 2023 when an internal review revealed that Hartford’s vendor had not been accounting for both Social Security awards. Hartford then requested — and finally received — the disabled widow’s benefit award letter, confirmed the error, and informed Harling that she had been overpaid $16,665.10. After Harford denied Harling’s internal appeal, she sued to prevent Hartford from recovering the funds or reducing her future payments.

Analysis

The court applied the Eleventh Circuit’s six-step framework from Blankenship v. Metropolitan Life Insurance Co. and addressed four issues.

First, on standard of review, the court assumed without deciding that Hartford’s interpretation of the disabled widow’s benefit as an offset was de novo wrong, then moved to the remaining steps. Because Harling’s policy granted Hartford full discretionary authority to determine eligibility and interpret policy terms, the arbitrary and capricious standard governed. The court rejected Harling’s three arguments for de novo review: that the policy incorporated a statutory definition of “disability benefits” from the Social Security Act (unsupported by the policy’s text); that Hartford’s rationale was impermissibly post hoc (no authority supported changing the standard on that basis); and that Hartford failed to provide a full and fair review by withholding portions of the claim file (the relevant regulation entitled her only to relevant documents, and she identified none that were missing).

Second, on the merits of the offset determination, the court held that Hartford’s interpretation was reasonable. The policy defined “Other Income Benefits” to include any benefit for loss of income received as a result of the period of disability. It was undisputed that Harling would not have received the disabled widow’s benefit before age sixty but for her disability, that the SSA’s own award letter characterized it as a “disability benefit,” and that the benefit was designed in part to replace lost income. The court found the policy’s list of examples non-exhaustive and gave deference to Hartford’s reasonable reading.

Third, on Harling’s argument that Hartford had improperly “reconsidered” a prior determination outside the plan’s mandatory forty-five-day decision window, the court disagreed. Hartford’s original approval letter and worksheet had always identified the disabled widow’s benefit as an offset. The intervening years of miscalculation reflected an error — not a changed position — and the policy’s error provision expressly authorized Hartford to recover overpayments. The claims procedure deadline and the error provision operated independently; no deadline applied to Hartford’s demand for repayment.

Fourth, the court rejected all three of Harling’s equitable defenses. The voluntary payment doctrine failed because it derives from state law, and ERISA federal common law governs — with no authority supporting its application in this context. Laches failed because it is an affirmative defense, not a standalone basis for a plaintiff’s cause of action. And equitable estoppel failed because Harling could not point to any ambiguity in the policy’s text or any representation by Hartford that the disabled widow’s benefit would not be an offset — the written record showed exactly the opposite.

Takeaway

This decision highlights two practical risks for disability claimants navigating multiple benefit streams. First, a long-term disability insurer’s failure to apply an offset — even for years — does not necessarily constitute a waiver or a new determination that the claimant can challenge. If the original approval letter identified the offset and the policy contains an error-recovery provision, the insurer retains the right to recoup. Second, claimants who receive more than one Social Security benefit should carefully review their LTD policy’s offset language and their insurer’s benefit calculations at the outset. The interplay between SSDI and secondary benefits like disabled widow’s benefits can create significant overpayment exposure that comes due years later.