This week’s notable decision results from a series of unfortunate events. It also highlights an issue plan administrators and participants should be aware of when there is a switch of group life insurance policies. In Cole v. American Heritage Life Insurance Company, No. 3:17-CV-494-PPS, 2018 WL 1875632 (N.D. Ind. Apr. 18, 2018), the district court enforced Defendant American Heritage Life Insurance Company’s group life insurance policy’s Suicide Exclusion in order to deny benefits for the life of Plaintiff’s deceased husband. The Suicide Exclusion limits benefits to the amount of premiums paid if the insured commits suicide within 2 years of the certification date. In this case, the insured committed suicide on January 2, 2016, one day after the American Heritage policy went into effect on January 1, 2016. This seems cut and dry, except for one fact: the insured was covered under the employer’s life insurance group policy offered by a different insurance company, Lincoln National, from January 1, 2014 until January 1, 2016. That policy did not contain a suicide exclusion.
Continue Reading Court Enforces Suicide Exclusion In Group Life Insurance Policy Despite Insured’s Prior Coverage
In Life Insurance Dispute, the Eleventh Circuit Holds that a Party Who Is Not a Named Beneficiary May Not Sue the Plan for Any Benefits
This week’s notable decision is Metlife Life & Annuity Co. of Connecticut v. Akpele, No. 16-15677, __F.3d__, 2018 WL 1527147 (11th Cir. Mar. 29, 2018), an interpleader action brought by MetLife to determine the proper beneficiary to the proceeds of a life insurance policy purchased by Dr. Akpele to fund the AIE Surgical Practice Defined Benefit Plan that he had established as its sole member and trustee pursuant to ERISA. The case involves a complicated procedural history, so I’ll just summarize the major issues the Eleventh Circuit decided as to the proper amount and beneficiary of the disputed proceeds.
Continue Reading In Life Insurance Dispute, the Eleventh Circuit Holds that a Party Who Is Not a Named Beneficiary May Not Sue the Plan for Any Benefits
No Remedy for Breach of Fiduciary Duty Related to Group Life Insurance Enrollment
This week’s notable decision, Schwartz v. Keolis Commuter Servs., No. 16-CV-11506-LTS, 2018 WL 1411202 (D. Mass. Mar. 20, 2018), involves the mishandling of an employee’s group life insurance enrollment and evidence of insurability. Though post-Cigna Corp. v. Amara we have seen courts find cognizable claims for breaches of fiduciary duty that used to have no remedy, this unfortunate case is an example of when a breach of fiduciary duty lacks a remedy because there is no recognizable harm.
In this case, the employee, Sofiya Schwartz, started working for Massachusetts Bay Commuter Railroad Company (“MBCR”) in February 2005. A few years later, she attempted to enroll for Supplemental Life Benefits in the amount of two times her salary. Because she was a late entrant, she also submitted to MBCR evidence of insurability, which MBCR forwarded to Unum. Unum denied her request due to her history of myelopathy.
Continue Reading No Remedy for Breach of Fiduciary Duty Related to Group Life Insurance Enrollment