What must be provided to a participant who has their benefits claim denied?

When a participant has their benefits claim denied, it is essential that they receive a clear reason for the denial in writing. This written explanation is crucial because it allows the participant to understand why their claim was not approved and what specific criteria or policy rules were cited in the decision. Having a documented reason helps ensure that the participant has the necessary information to assess the situation, decide on the next steps, and potentially prepare for an appeal if they believe the denial was unjust.

While other forms of communication, such as a phone call or additional information about the appeals process, can be useful, they do not substitute for the necessity of providing a clear written explanation. This written notice is a requirement under various regulations governing employee benefit plans, ensuring transparency and fair dealing in the claims process. This promotes participant trust in the plan and helps maintain compliance with legal obligations.