Life Insurance and AD&D Benefit Claims

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Good morning, ERISA Watchers!  This week’s notable decision is Tran v. Minnesota Life Ins. Co., No. 18-1723, __F.3d__, 2019 WL 1894769 (7th Cir. Apr. 29, 2019). The Seventh Circuit reversed the district court’s ruling finding that the insured’s death from autoerotic asphyxiation was an accidental death payable under his life insurance policy.  The Seventh Circuit held that a reasonable person would interpret the insured’s death from autoerotic asphyxiation to be death due to an “intentionally self-inflicted injury,” which is excluded from the life insurance policy.

If in addition to being unable to say “autoerotic asphyxiation” five times fast you also don’t know what it refers to, the Seventh Circuit noted its definition as “a sexual practice by which a person purposefully restricts blood flow to the brain to induce a feeling of euphoria. ‘Asphyxiophilia’ as defined in the DSM-5 is a subset of sexual masochism disorder, by which an ‘individual engages in the practice of achieving sexual arousal related to restriction of breathing.’” (citing to the 5th edition of the American Psychiatric Association, Diagnostic and Statistical Manual of Mental Disorders).  
Continue Reading Seventh Circuit Holds that Death by Autoerotic Asphyxiation Is Excluded under AD&D Policy

This week’s notable decision is another claimant-unfriendly opinion out of the Fourth Circuit neck of the woods – Dawson-Murdock v. National Counseling Group, Inc., et al., No. 3:18-CV-58, 2018 WL 3744020 (E.D. Va. Aug. 7, 2018). 

In this case, Plaintiff Dawson-Murdock deceased husband, Wayne Murdock, worked full-time for Defendant National Counseling Group, Inc. (“NCG”).  As a full-time employee, he was covered by a group life insurance policy funded by Unum Life Insurance Company of America.  On March 21, 2016, Wayne switched to part-time work.  Though it’s not clear from the opinion as to why Wayne reduced his work hours, the fact that he died six months later suggests it was due to a medical condition.  After he started part-time work, Wayne continued to pay premiums for his life insurance coverage. 
Continue Reading Court Rules No Remedy Available for Aggrieved Life Insurance Beneficiary

This week’s notable decision is White v. Life Insurance Company Of North America, No. 17-30356, __F.3d__, 2018 WL 2978641 (5th Cir. June 13, 2018), a dispute over life insurance benefits based on the application of an exclusion for death caused by intoxication or drug abuse.  What’s interesting about this case is that the insurance company had discretion to decide claims and it was a close call based on the evidence.  Ordinarily, when the evidence presents a close call, a court will uphold the administrator’s decision, especially under abuse of discretion review.  But in this case, the Fifth Circuit was troubled that LINA withheld an expert report that it commissioned during the claims process and violated ERISA Regulations by failing to disclose the report to the beneficiary.  This fact appeared to tip the scale in favor of the beneficiary.  The message to insurance companies should be loud and clear:  It doesn’t pay to hide the ball.
Continue Reading Fifth Circuit Rules in Favor of Life Insurance Beneficiary Based on Expert Report Insurer Failed to Disclose During Claims Process