The First Circuit recently affirmed the position that when a policy or plan is ambiguous, it should be interpreted in favor of the insured. The case that gave rise to the question is Ministeri v. Reliance Standard Life Insurance Company. The facts of the case concern a denial by the Defendant (“Reliance”) for life insurance benefits due to the widow of a Plan member, Renee Ministeri (“Plaintiff”). Reliance argued that the Plaintiff’s late husband, Anthony (the member of the plan at issue), did not have coverage under the policy because it had lapsed due to his absence from work caused by a severe medical condition. Anthony passed away in 2015, with Reliance claiming that the policy lapsed during the time he was not working.

The dispute revolved around unclear language in the policy regarding the definitions of “actively” working in the role of “corporate vice president.” Further, the facts were unclear about the amount of hours Anthony had worked during the relevant period. The Court held that “under a reasonable construction of the phrase, Ministeri could be regarded as an ‘Active … Corporate Vice President’ as long as he was a non-retired employee holding a job title matching the rank of Corporate Vice President.” Further, the Court’s ruling stated that no dispute existed as to whether Ministeri’s status as a current employee was terminated prior to his formal announcement of leave in 2014. Thus, the Court rejected Reliance’s argument concerning the interpretation of the ambiguous terms in this section of the policy.

Reliance proffered a second argument, opining that $500,000 in supplemental coverage was not available to Renee Ministeri in addition to the $592,000 in basic coverage provided by the policy. Reliance argues that Renee failed to apply for the portability provision of the policy, though it was noted during oral arguments that she had applied for supplemental coverage. Applying for supplemental coverage was the Plaintiff’s avenue to enacting the portability provision, against which Reliance did not argue. Judge Bruce M. Selya stated in his opinion that Reliance delayed their defenses to the Plaintiff’s claims in violation of ERISA; his opinion read, “[Reliance] chose to keep quiet about its discovered basis for denial until litigation ensued … that is precisely the sort of delayed reaction ERISA forbids.”

Reliance attempted a final argument to defend their denial of coverage, stating that since Anthony had stopped working a minimum of 20 hours per week as a result of his illness, a vital condition of the plan (required for coverage) was not met. It further argued that Anthony could have been eligible for benefits under the policy for one year if premiums had been paid, but since he passed 15 months after he stopped working, coverage was still unavailable. This argument was also rejected by the Court for the same ambiguity in the policy referenced in the denial of Reliance’s first argument. Judge Selya wrote, “The eligibility provision requiring Ministeri to work at least twenty hours ‘during [his] regularly scheduled work week’ could reasonably refer to his typical weekly workload before the chaos introduced by his medical condition.” Thus, due to the room for interpretation in the policy language, the policy must be interpreted in favor of the insured and Reliance’s argument denied.

The Court held that Renee was covered by the policy and entitled to $1 million, strengthening the insured’s right to coverage in circumstances of ambiguity.

Yosaun Smith v. CommonSpirit Health et al. concerns the Plaintiff’s, Yosaun Smith (“Smith”), action against the administrators of her ERISA retirement plan, Defendants CommonSpirit (“CommonSpirit”) and Catholic Health Initiatives Retirement Plans Subcommittee (“Subcommittee”) alleging that the Defendants violated ERISA when they did not replace “actively managed mutual funds with passively managed mutual funds.” The Court of Appeals for the Sixth Circuit upheld the decision from the district court, affirming that ERISA does “not give the federal courts a broad license to second-guess the investment decisions of retirement plans,” and that remedies are only available under ERISA when a fiduciary duty has been violated. Thus, the Plaintiff in this case alleged no facts supporting the conclusion that the Defendants had violated any fiduciary duties under ERISA.

Over the last few decades, employer provided retirement funds have commonly been structured as defined-contribution 401(k) plans. These plans allow participants to contribute pre-tax income to accounts, the amount often matched by employers. Therefore, the value of the assets in the account is the determining factor of the amount participants will receive in their payout; “A beneficiary’s payout thus may ‘turn on the plan fiduciaries’ particular investment decisions.’” ERISA provides that under a defined-contribution plan, participants may bring an action for breach of fiduciary duty against the plan administrators if the fund is imprudently managed. Until recent years, plans were actively managed by plan fiduciaries where “the portfolio manager actively makes investment decisions and initiates buying and selling of securities in an effort to maximize return.” However, more recent trends have enabled investors to use index funds, creating a “fixed portfolio structured to match the overall market or a preselected part of it.” This option means that there is “little to no judgment” involved in the management of the plan.

The Plaintiff in this case is an employee of Catholic Health Initiatives (otherwise known as CommonSpirit Health) and has been a participant in its defined-contribution 401(k) plan (“Plan”) since 2016. The Plan is administered by an appointed administrative committee and serves more than 105,000 participants with more than $3 billion in assets. Options available to participants include index funds with low management fees (0.02%) as well as funds that are actively managed with management fees up to 0.82%. If employees do not select a fund, they are placed by default into the Fidelity Freedom Funds, which are actively managed. These are a group of “target date fund[s]” meaning that “managers change the allocation of the underlying investments that they hold over time, say by selling funds that hold stocks to buy a greater proportion of funds that hold bonds or cash.” The purpose of this management is the “reallocation of asset types [allowing] managers to protect an employee’s investment gains and spare her the unpredictability of market fluctuations as she approaches retirement.”

The Plaintiff alleged that CommonSpirit breached its fiduciary duty of prudence under ERISA when it offered multiple actively managed investment funds despite the availability of index funds with “higher returns and lower fees.” The Plaintiff specifically referenced three actively managed funds (the Fidelity Freedom Funds, American Beacon Fund, and AllianzGI Fund) that demonstrated worse performance than relative available index funds. It is further alleged that fees associated with the recordkeeping and management of the Plan were excessive.

The Defendants’ motion to dismiss the complaint was granted by the district court. The court held that the Plaintiff “failed to allege facts from which it could plausibly infer that CommonSpirit had acted imprudently in violation of ERISA.” In analyzing the case on appeal, the Court states that in an examination of a dismissal based on the “sufficiency of a complaint,” dismissal is appropriate under Federal Rule of Civil Procedure 12(b)(6) when a complaint “fails to state a claim upon which relief can be granted.” Combined with Federal Rule of Civil Procedure 8 (requiring a “short and plain statement of the claim showing that the pleader is entitled to relief”), a plaintiff must provide sufficient “facts to state a claim to relief that is plausible on its face.”

The Court concludes that the Plaintiff has not met the requirements of Rule 12(b)(6) and Rule 8, and that she did not “plausibly [plead] that this ERISA plan acted imprudently merely by offering actively managed funds in its mix of investment options.” The Plaintiff opines that “investors should be very skeptical of an actively managed fund’s ability to consistently outperform its index,” and that the Freedom Funds plan “[chases] returns by taking levels of risk that render [them] unsuitable for the average retirement investor.” The Court rejects this argument, stating that “there is nothing wrong with permitting employees to choose [plans] in hopes of realizing above-average returns over the course of the long lifespan of a retirement account – sometimes through high-growth investment strategies, sometimes through highly defensive investment strategies.” Further, the Court states that if plan managers refused to provide this option to participants, that action would constitute imprudent management. The Court additionally highlights that the Plaintiff (as well as any participant in the Plan) could choose to participate in an index fund offered by the Defendants. It is concluded that “[o]ffering actively managed funds in addition to passively managed funds was merely a reasonable response to customer behavior.” The Court cites several cases from other circuits stating that the offering of both actively and passively managed funds does not violate any fiduciary duty under ERISA. Therefore, the Defendants did not act imprudently in the management of the Plan.

The Court also addressed whether it is imprudent for administrators to offer actively managed plans at all, deciding that as long as the company does not imprudently offer “specific actively managed funds,” it has not violated its fiduciary duties. Put simply, the court states that ERISA “does not allow fiduciaries merely to offer a broad range of options and call it a day.” Thus, so long as the options offered by the fiduciaries are prudent, there has been no violation under ERISA. The Court states that the Plaintiff in this case has also not alleged facts showing that the Defendants violated ERISA in this manner. Rather, she only compared the performance of the Fidelity Freedom Funds to its passively managed counterpart, the Fidelity Freedom Index Funds. Though the Index Funds trailed the Freedom Funds by up to 0.63 percentage points annually, this does make other funds imprudent. Therefore, “a showing of imprudence [does] [not] come down to simply pointing to a fund with better performance.” Further, “claims require evidence that an investment was imprudent from the moment the administrator selected it, that the investment became imprudent over time, or that the investment was otherwise clearly unsuitable for the goals of the fund based on ongoing performance.”

The Plaintiff brings other facts forward alleging imprudent actions on the part of the plan managers, calling certain decisions “red flags.” She includes the “discretion that fund managers had in choosing investment, net outflows from these funds to other investments, and outside analysts’ critical evaluations of the funds” as indicators that the managers were acting imprudently. The Court again disagrees, stating then when “[viewed] with the proper foresight-over-hindsight perspective, [these] [facts] do not make a cognizable claim of imprudence.”

Regarding the Plaintiff’s allegation that the Plan charged excessive fees for recordkeeping and administration, she alleged that the Plan charged between $30 and $34 per person compared to $35 charged for both recordkeeping and administration by smaller plans. She further opines that investment management fees associated with the Plan were excessive, as they amount to “around 0.55% of total assets annually.” Regarding allegations of excessive recordkeeping fees, the Court holds that “Smith fails to give the kind of context that could move this claim from possibility to plausibility.” This failure stems from her failure to “[plead] that the services that CommonSpirit’s fee covers are equivalent to those provided by the plans comprising the average in the industry publication that she cites.”

In addressing Smith’s allegations that management fees were excessive, the Court states that it is rejected for the same reason as Smith’s base allegations of imprudence: the Defendants offer multiple plan options with a variety of costs and the existence of one that is more expensive than others alone is not proof of mismanagement. They state, “An average plan-wide management fee of 0.55% is merely evidence that CommonSpirit offers a number of actively managed funds, and an imprudence claim based on this fee alone fails for the same reason that Smith’s more general attack on active investment fails.” The Court further states that the rejection of claims for excessive fees when “it is clear those fees are set by market forces” is common in appellate courts and therefore the appropriate decision.

Therefore, the Court of Appeals affirmed the district court, dismissing the Plaintiff’s claims.

The Eleventh Circuit Court of Appeals in Gimeno v. NichMD, Inc. analyzed whether Section 1132(a)(3) of ERISA provides authorization for a beneficiary of a plan governed by ERISA to sue for ‘”appropriate equitable relief’” due to violations of the plan or relevant statute. Thus, the question presented to the court is whether “Section 1132(a)(3) create[s] a cause of action for an ERISA beneficiary to recover monetary benefits lost due to a fiduciary’s breach of fiduciary duty in the plan enrollment process[.]” The Court answers this question in the affirmative, stating that a court “may order typical forms of equitable relief under Section 1132(a)(3).”

This decision reverses that of the district court, which had held that “such a claim would be futile.” The basis for this reversal is the common practice of awarding “equitable surcharge” in cases where a fiduciary’s breach of duty caused a beneficiary to sustain losses. The facts of the case center around the plan holder, Justin Polga, and his spouse, Raniero Gimeno (“Plaintiff”). Polga was an M.D. and an employee of NCHMD, Inc., a subsidiary of NCH Healthcare System Inc. (“Defendants”). When initially hired by the Defendants, the HR department assisted Polga in filling out the relevant paperwork. Gimeno was listed as the primary beneficiary under the relevant plan (“Plan”) and NCH Healthcare the administrator. Polga decided to elect to pay for $350,000 in “supplemental life insurance coverage on top of $150,000 in employer-paid coverage.” In order to receive this coverage, it was required that Polga submit “an evidence of insurability form,” however this form was not provided in his enrollment paperwork nor did the HR department attempt to rectify the error. Therefore, Polga was never properly enrolled on the program according to the insurance company. Despite this fact, the Plan “deducted premiums corresponding to $500,000 in life insurance coverage from Polga’s paychecks.” Further, Polga was provided with benefits statements that included the $500,000 in coverage.

When Polga passed away, the Plaintiff filed a claim with the Plan’s insurance company for benefits as the named beneficiary. The claim was partially denied, as the company approved the claim for the amount of benefits excluding the supplemental amount. Subsequent to this denial, the Plaintiff filed suit to recover the supplemental benefits, alleging that “by failing to notify Polga of the need for the form and misleading him about the nature of his coverage, the defendants breached their fiduciary duty to administer the plan fairly and properly, to inform Polga of his rights and benefits, and to ensure that all application forms were correctly completed and submitted.” As a remedy, the Plaintiff also sought that the Defendants be required by order to pay the benefits that would have been received if not for the breach – “the unpaid $350,000.”

In response, the Defendants moved to dismiss the case “for failure to state a claim.” This argument was based on the Defendants’ belief that, unlike the insurance company, they “had no obligation to award the benefits at issue” and thus were the “improper defendants.” The Plaintiff replied with a motion to amend his complaint to only a cause for “appropriate equitable relief” under Section 1132(a)(3). The district court agreed with the Defendants, granting the motion to dismiss and denying the motion to amend. The Plaintiff timely appealed.

The Plaintiff argued that the district court’s decision to deny his motion to amend was incorrect as the relief sought is appropriate under Section 1132(a)(3). The Court of Appeals agreed. Section 1132(a)(3) delineates that a beneficiary may sue a plan for “appropriate equitable relief” upon a breach of the statute or the plan’s terms. Equitable relief applies to “’categories of relief that were typically available in equity’ before the fusion of courts of equity and courts of law.” Though courts do not typically allow monetary damages to be granted under Section 1132(a)(3), when equity demands monetary relief, it may be interpreted under ERISA. Under equitable principles, courts are permitted to award “restitution of ‘particular funds or property in the defendant’s possession.’” Further, when the remedy at issue stems from a relationship between a trustee and a beneficiary, “’[t]he trustee’s personal liability to make compensation for the loss occasioned by a breach of trust is a simple contract equitable debt.’” Therefore, “[t]his remedy – as between a trust beneficiary and a trust fiduciary – is ‘equitable in character and enforceable against [a] trustee[] in a court exercising equity powers.’” Supreme Court precedent supports the conclusion that equitable surcharge is an appropriate equitable remedy “between beneficiaries and fiduciaries.” The Court of Appeals furthered reasoned that every district court that has addressed the issue of equitable surcharge has followed the Supreme Court’s line of reasoning and considered monetary relief appropriate. Thus, the Court of Appeals rejects the Defendants’ arguments that Section 1132(a)(3) does not provide “a comparable remedy.”

The Court determined that both NCHMD and NCH Healthcare are fiduciaries; they provide that “[a]n entity is a fiduciary under ERISA if it ‘exercises any discretionary authority or discretionary control respecting management’ or ‘administration’ of the plan.” In order to prove that an entity is a fiduciary, a party may show evidence from the “plan document” but may also provide evidence from the “factual circumstances surrounding the administration of the plan, even if these factual circumstances contradict the designation in the plan document.” In the case at hand, NCHMD opines that it is not a fiduciary of the Plan because it was not listed as an administrator in the plan documents. However, the Court reasoned that since NCHMD’s HR department assisted Polga with the relevant paperwork at the time he enrolled in the Plan as well as provided him with a benefits summary, these circumstances provided adequate evidence to consider NCHMD a fiduciary. Therefore, the Court held that the Plaintiff may pursue a cause of action for lost benefits pursuant to Section 1132(a)(3).

The Court also rejects the Defendants’ argument that the Plaintiff sought to violate precedent by asserting claims under multiple sections of ERISA. It is concluded that since the Plaintiff “’must rely on’ Section 1132(a)(3) or he would have ‘no remedy at all’ … his claim may proceed under Section 1132(a)(3).” Thus, the Eleventh Circuit Court of Appeals reversed the district court’s ruling and remanded the case for the Plaintiff to properly bring a claim under 1132(a)(3) for breach of fiduciary duty.

Mehr Fairbanks Trial Lawyers has a strong record of closing life insurance cases and earning positive judgments for you or your family. If you or someone you know has had a life insurance claim denied, contact Mehr Fairbanks Trial Lawyers today.

Life insurance can be purchased one of two ways, either through your employer, in which case ERISA applies, or from a private life insurance company. ​Our experienced bad faith insurance and ERISA lawyers can assist you when either types of these claims have been denied.

For more information on life insurance claims, read the FAQs below:

• Why would an insurer deny my life insurance claim? There are many reasons given by insurers for denying a life insurance claim. Most denials arise from the language in the actual policy . The insurer may deny payment because of the particular cause of death, or because a death occurs within a certain period of time after the policy is issued. A claim may be denied based upon alleged misrepresentations in the application- such as a statement that the deceased person was of “good health”.. Typically, the insurer doesn’t double check on the accuracy of such statement until after someone dies, when they look through the medical records with a fine-tooth comb.
• Can a spouse contest a life insurance beneficiary? It is difficult to contest a beneficiary designated by a spouse on a life insurance policy, but it is not impossible. There are many factors which could lead a court to invalidating or rewriting a policy to more accurately reflect what an insured intended or to canceling a policy which was issued inappropriately.
• Can a beneficiary claim on a lapsed policy? Even if a life insurance policy is lapsed, there may be opportunities to make a claim under it. The terms of the policy will be a major factor in making that determination.
• Can a last-minute insurance beneficiary change be contested? A court can undo a last-minute change in the beneficiary of a life insurance policy in some situations where it appears that the change was improper.
• Who can change the beneficiary of a life insurance policy? Generally, the owner of the life insurance policy can change the beneficiary of a life insurance policy. The owner may not be the insured. The owner is designated by the policy and is generally, but not always, the person who pays the premiums.
• How do you find out if a deceased person had life insurance? It is important to review the papers, documents, and records of a deceased person to determine whether there may be any life insurance on their life. It is also a good idea to check with their insurance agents, bankers, employers, and any associations or organizations in which there were a member. Whether the deceased had a safe deposit box is also an important determination to make.
• How do you find out if a life insurance policy was paid out? The insurance company is the best source of information on whether a life insurance policy was paid out. Bear in mind, the insurance company may not disclose that information to just anyone. You might have to show them why you need to know.
• What happens to life insurance policies with no beneficiary? Generally, life insurance policies with no designated beneficiary or no surviving beneficiary will be paid in accordance with their terms, usually to the estate of the deceased.
• How does money get split between beneficiaries? Generally, the proceeds of a life insurance policy are paid amongst the beneficiaries as designated by the insured or the owner of the policy. Otherwise, it is split equally amongst the beneficiaries unless the policy provides otherwise.
• Can a life insurance beneficiary be changed after death? The beneficiary of a life insurance policy cannot generally be changed after the death of the insured, except by court order or, if allowed by the policy, by the direction of some other document, or by virtue of the beneficiary being a trust or some other entity who can re-direct the proceeds.
• Can I share life insurance benefits with my siblings? The beneficiary of a life insurance policy can do whatever they want with the benefits that they receive, unless restricted by some other document, such as if they are the trustee of a trust.
• The insurer claims the deceased committed suicide, but they did not. Can I make them pay? This happens sometimes and suicide “exclusions” are not enforcable generally if the policy has been in force for a certain number of years. And certainly the circumstances of what caused the death can be challenged by a lawyer.
• The insurer denied the payment of the claim but sent the premiums paid back to the family. Should I cash the check? No. Do not cash the check until you discuss with a lawyer experienced in life insurance law.
• The insurer claims the application contains mistakes, but it was the agent’s mistake. Do they have to pay? Sometimes they will have to be bound by what the agent wrote down if the agent’s answers to questions aren’t what the deceased person actually told them.

Life insurance claims should be paid within 30 days of a proper claim being submitted to the insurance company. If the claim is not paid within 30 days, it is considered delayed. Any delay of benefits will put a strain on the survivors. Claims can be denied for any number of reasons. Most of the time when claims are denied, they are not denied for good cause. They are denied for minor technicalities or for missing information on the claim or in the policy application. A delay does not necessarily mean that your claim will be denied but a delay of more than a month or two is just unreasonable.

If your life insurance claim has been denied of delayed, call us. We know how to force the insurance company to pay your claim.

Reason why life insurance claims are delayed:

• A beneficiary is a minor. When a minor child is a beneficiary, life insurance claims may be delayed until the insurance company receives information on the minor’s guardian. Make sure that the guardian of the minor is included with your claim.
• A spouse not named as a beneficiary in a community-property state. In community-property states, spouses may claim at least half of the proceeds of the life insurance policy.
• The beneficiaries were not updated after a major life change. When people divorce, marry, have children, etc., they usually change beneficiaries on their life insurance policies. If they do not, a claim can be delayed.
• No beneficiary named. When no beneficiary named, an insurance company will pay the proceeds either according to the law of the state. This may cause your life insurance claim to be delayed.
• Avoid life insurance claim delays and denials. The best way to avoid delays and denials of life insurance claims is to retain an experienced life insurance attorney to help you with the claim. Your life insurance attorney will make sure that all of correct information is included with the claim. They will also let the insurance company know that they mean business. When insurance companies know that our life insurance attorneys are helping you, they are less likely to deny your claim over frivolous details.

Here are some ways to avoid delays and denials:

• Provide correct information. From start to finish, provide the correct information to the insurance company. Any wrong or missing information can cause a delay or denial of the claim.
• Designate a beneficiary. Always designate a beneficiary and make sure that correct beneficiaries are named. Remember to update beneficiaries after any major life change.
• Pay premiums on time. Don’t let your policy lapse for non-payment. Make sure that you have made arrangements for someone else to receive the invoices for premiums so that they will be paid in the event of your incapacitation.
• Provide required documentation. Your insurance company will provide you with what they require prior to paying benefits. Make sure that you provide everything they require with the initial claim.

Contact Us Today

At the law firm of Mehr Fairbanks Trial Lawyers we understand the many difficulties a denied life insurance claim can be. If your key man life insurance claim has been denied, call our life insurance attorneys for help. We are prepared to fight for your right to the life insurance benefits you deserve. Call Mehr Fairbanks Trial Lawyers without delay, for a free evaluation of your claim: 800-249-3731.

People obtain life insurance policies as part of financial planning for their loved ones’ future. Life insurance protects those who rely on the insured’s ongoing financial support and will suffer in the event that this support is withdrawn. Ideally, the life insurance company will pay the full policy amount after the insured’s death.

Unfortunately, this does not always happen. Life insurance claims get routinely denied by large insurance companies for various reasons. Here’s what you need to know regarding the process to appeal and win a denied life insurance claim.

Reasons Behind Life Insurance Claim Denials

Reasons behind denied life insurance claims vary depending on the policy provisions, state and federal laws and specific circumstances of an individual whose claim is denied. Below we have outlined the most common excuses life insurance companies use in denying claims:

• Denial for failure to reinstate
• Life insurance lapse / policy cancellation due to a missed payment
• Denial for failure to provide complete information on application
• Denial for failure to disclose immaterial pre-existing medical condition
• Denial for failure to disclose a regular medical check-up
• Denial for misrepresentation on the life insurance application
• Denial for misrepresentation regarding age, employment and/or income
• Denial for misrepresentation regarding weight
• Denial based on alcohol use
• Denial based on drug use
• Denial due to a sickness / medical treatment exclusion
• Denial for omitting information on the life insurance application
• Denial for misrepresentation regarding criminal history
• Denial of accidental death claim based on independent medical condition
• Denial of accidental death claim based on death not occurring within specific time/date
• Denial based on an exclusion in the policy
• Denial based on suicide
• Denial based on self-inflicted injury
• Denial based on presumption of death due to disappearance
• Denial based on death in a foreign country
• Denial for failure to provide evidence of insurability
• Denial based on prescription drug misuse
• Denial based on termination of employment
• Denial based on change in employment status
• Denial based on employer’s change of insurance providers
• Denial based on failure to convert employment coverage to individual policy
• Denial based on failure to port coverage
• Denial based on employer’s failure to maintain or forward documents to the appropriate department
• Beneficiary dispute
• Beneficiary contest

If you’re looking for more information on life insurance claim denials, read our in-depth article: Reasons Life Insurance Companies Can Use To Deny Your Claim.

Life Insurance Claim Process

• Approved claims: Generally, the insurance company should pay a claim within thirty days from the time all the required documents are submitted. If you file a claim for life insurance or accidental death benefits, the insurer will need such documents as a copy of the death certificate, medical examiner’s report, autopsy report, police report, toxicology report, authorizations to release medical records, etc. Once all the records are received the insurer will pay a claim within the next 30 (thirty) days.
• Delayed claims: A claim that is not paid within 30 (thirty) days from the time all the necessary documents are submitted is delayed. A claim delay may last from several months to several years depending on the reasons behind the delay. It is not unusual for an insurance company to delay paying a claim for several years. Fighting a delayed life insurance claim should not be a do-it-yourself project and should always involve the assistance of a life insurance attorney. If a claim is not paid, you need to inquire into the reasons behind the delay. It usually means there is a problem with processing the claim and you may need legal counsel to make sure your claim is not eventually wrongfully denied.
• Denied claims: When the insurance company makes a determination to deny a claim, it will send a denial letter to the beneficiary or the person who filed the claim. The denial letter needs to be specific and outline the exact reasons for denial. Unfortunately, far too often, insurance companies send vague denial letters that simply state that the claim is not going to be paid without giving specific reasons for denial. In some cases, the denial letter may refer to a certain statute or a legal theory which renders the claim not payable. If this is the case, a life insurance lawyer will evaluate whether the referenced law is applicable. Once you receive the denial letter, the next step is to contact a life insurance attorney who will assist in contesting the denial.

How To Appeal and Dispute A Life Insurance Claim That Has Been Denied

In order to successfully appeal a denied life insurance claim, you need to work with an attorney who specializes in this area of law. A life insurance lawyer working on your case will know what law controls your claim and how to appeal the denial legally.

Disputing a denied life insurance claim involves claim denial investigation, gathering supporting documents, conducting legal research and filing an appeal. This process is controlled by a set or regulations that must be followed strictly.

For example, an ERISA claim denial requires that an administrative appeal be filed within a certain period following the denial letter. Since the documents gathered and the issues raised on appeal will subsequently be reviewed during litigation, it is important to conduct thorough investigation and legal research before filing an appeal.

Further, many life insurance claims may involve interplay of several state and federal laws, various policy provisions and court documents. In such cases, a life insurance lawyer will help design a successful appeal strategy and sort out possible outcomes of the case.

Many insurance companies allow an administrative appeal before the person whose claim was denied files a lawsuit. To file a successful administrative appeal, your life insurance lawyer will present a convincing argument based on the facts of the case supported by the laws governing it. It is a crucial step in getting a denied claim paid.

Contact Us Today

At the law firm of Mehr Fairbanks Trial Lawyers we understand the many difficulties a denied life insurance claim can be. If your life insurance claim has been denied, call our life insurance attorneys for help. We are prepared to fight for your right to the life insurance benefits you deserve. Call Mehr Fairbanks Trial Lawyers without delay, for a free evaluation of your claim: 800-249-3731.

An accidental death policy offers protection when the insured dies as a result of an accident. Accidental death benefits may be found as part of a regular life insurance policy or as a separate contract.

What Does Accidental Death And Dismemberment Insurance Cover?

Accidental death and dismemberment coverage provides protection if the insured dies in an accident or suffers a loss of limb/vision/hearing as a result of an accident.

Does Life Insurance Cover Accidental Death?

Life insurance policies cover accidental death as well as death to natural causes.

Accidental death policies usually offer extra benefits when the insured dies in an accident. If the insured had both a regular life insurance policy and an accidental death and dismemberment policy and died in an accident, the insurance company is obligated to pay both claims as long as none of the exclusions apply.

When Does Accidental Death And Dismemberment Coverage Pay?

The insurance company must pay your accidental death and dismemberment claim when it has all the records necessary to prove that the death was an accident. The insurance company needs to conduct an investigation. Since ADD policies pay only for accidental death, the insurance company will require all documents or records surrounding the death. Usually, they are police reports, medical examiner reports, toxicology report, etc. Once the documents are submitted and liability becomes clear, the insurance company must pay the claim promptly.

However, many accidental death claims are delayed for months and even years. The reason for the delay is usually an ongoing investigation. Even though most insurance companies need to pay claims within 30-60 days from the date of death, many insurers delay payment on the ground that they do not have sufficient evidence proving that the death was due to an accident.

How Does Accidental Death Insurance Work?

If the insured died in an accident, the beneficiary of an accidental death policy will file a claim with the insurance company. The insurance company will assign a claims examiner who will contact the beneficiary requesting documents proving that the death was accidental and not due to natural causes. A death certificate will generally classify the death as natural or accidental. However, insurance companies rarely rely on this classification alone. They will usually conduct an independent investigation into the cause of the death. Such records as toxicology reports and coroner’s reports are examined and become part of the record.

Proving that the death was accidental is not the only hurdle. Another common reason for ADD claim denial is the application of various ADD exclusions. An exclusion is a provision in a contract describing a situation when ADD benefits will not be payable. Almost all ADD policies have such exclusions. Many ADD policies will not pay ADD benefits if the death resulted from:

• intentionally self-inflicted Injury, suicide or attempted suicide, whether sane or insane;
• sickness or mental infirmity;
• war or act of war, whether declared or undeclared;
• Injury sustained while full-time in the armed forces of any country or international authority.
• Injury sustained while riding on any aircraft: a) as a pilot, crew member or student pilot; b) as a flight instructor or examiner;
• Injury sustained while voluntarily taking drugs which federal law prohibits dispensing without a prescription, including sedatives, narcotics, barbiturates, amphetamines, or hallucinogens, unless the drug is taken as prescribed or administered by a licensed physician;
• Injury sustained while committing or attempting to commit a felony;
• Injury sustained as a result of being legally intoxicated from the use of alcohol.
• Injury sustained while operating a motor vehicle while legally intoxicated from the use of alcohol.

Thus, even if the insured died in an accident, your ADD claim may be denied if the insurance company claims that the death is excluded from coverage for any of the reasons.

To avoid a claim delay and a potential denial of your ADD benefits, work with an experienced life insurance attorney. Our life insurance lawyers will work relentlessly on protecting your rights to the benefits you deserve.

How to Appeal a Denied Accidental Death Claim

We are here to provide assistance in handling denied accidental death claims. At our law firm, our accidental death claim attorneys have handled ADD claims denied because:

The insured’s death was not accidental;

• A policy exclusion applied and cancelled coverage;
• The insured was intoxicated at the time of death;
• The insured took prescription medications that were not prescribed by a doctor;
• The insured died during a medical procedure, a surgery or post-surgical recovery;
• The insured was violating a law/participating in a felony/misdemeanor at the time of his/her death;
• The insured died due to a prescription medication overdose;
• The insured died of a sickness;
• The insured died in an accident, but his/her death was contributed to by a sickness;
• The insured died as a result of medical malpractice;
• The cause of death is unknown;
• The insured disappeared and was announced dead by disappearance;
• The insured died due to autoerotic asphyxiation;
• The insured was poisoned;
• The insured was murdered;
• The insured involuntarily ingested illicit drugs.

All of these reasons for denial are very common. It is true that every Accidental Death and Dismemberment Policy has several exclusions in it. A problem arises, however, when such exclusions get misinterpreted by the insurance company and based on them, your claim gets denied.

Insurance companies draft their policies using complex language that can sometimes be ambiguous and may have two or even more possible meanings. You may read it to mean that the coverage should exist while the insurance company claims that the same language denies coverage. If that happens, you need an experienced attorney to review your case.

For example, if a drug exclusion or a sickness exclusion applies, you need a life insurance attorney who also understands the medical aspect of the claim.

Our attorneys work with medical experts who review a toxicology report, a coroner’s report, a medical examiner’s report and a police report to determine whether the insurance company’s denial can be disputed. In many cases, medical experts’ opinions differ and the denial of benefits will be reviewed in court.

Under the law, courts look at the plain and ordinary language of the policy and use ambiguous language against the drafter of the documents – the insurance company. Our life insurance attorneys are skilled at reading insurance contracts.

We also have the experience needed to litigate ADD claim denials in state and federal courts. If your ADD claim has been denied for any reason, we are here to help. We will work with you through this difficult process so you do not have to face insurance companies alone.

Our life insurance law firm offers free consultations. We may ask you to provide us with copies of the documents that will help us evaluate your case. We work on a contingent fee basis and will zealously fight for your recovery.

Contact Us Today

At the law firm of Mehr Fairbanks Trial Lawyers we understand the many difficulties a denied life insurance claim can be. If your accidental death insurance claim has been denied, call our life insurance attorneys for help. We are prepared to fight for your right to the life insurance benefits you deserve. Call Mehr Fairbanks Trial Lawyers without delay, for a free evaluation of your claim: 800-249-3731.