HomeNewsWhy You Must Closely Read the Reasons an Insurer Gives for Denying Your Life Insurance Claim

Why You Must Closely Read the Reasons an Insurer Gives for Denying Your Life Insurance Claim

Individuals in Chicago and around the rest of Illinois who are beneficiaries of life insurance plans and whose claims were denied frequently skim the letters denying their claims. They find it more important the claim was denied than understanding the reasons the claim was denied. But there is a great deal of importance to the reasoning for denying the claim, as plan administrators are required to communicate the reasons for the denial in order to provide a full and fair review of a benefit claim under ERISA. The stated reasons for denying the claim also can lock the administrator into a set of rationales that it cannot supplement later, as one recent case demonstrates.

In Dindinger v. Hartford Life & Accident Insurance Co., No. CV-22-00508-TUC-EJM, 2023 WL 5723401 (D. Ariz. Sept. 5, 2023), Jacob Dindinger was killed while working as an EMT in an ambulance. After his death, his family members, the beneficiaries, submitted a claim for life insurance and accidental death insurance benefits under Jacob’s employer sponsored life/AD&D plan, insured by Hartford. Hartford denied the claim, asserting the accident and loss did not meet the definition of traveling while on business of the policy holder, and cited the policy’s definition. The family members appealed. In the appeal denial, Hartford reiterated he did not meet the definition of traveling for business of the policyholder (the employer), but did not explain why the death did not meet that definition. The family members then sued for benefits under ERISA § 502(a).

After litigation started, Hartford sought to include in the record additional documents and rationales for why it denied the claim, including that Dindinger was at his regular place of employment at the time of death. The family members filed a motion to preclude Hartford from advancing new rationales for the denial. The United States District Court for District of Arizona granted the family members’ motion. It explained “It is well established law ‘that a plan administrator undermines ERISA and its implementing regulations when it presents a new rationale to the district court that was not presented to the claimant as a specific reason for denying benefits during the administrative process.’” (citing Collier v. Lincoln Life Assurance Co. of Boston, 53 F.4th 1180, 1185 (9th Cir. 2022)). The same has been the law in Chicago and the remainder of the Seventh Judicial Circuit for quite some time. See Reich v. Ladish Co., 306 F.3d 519, 524 n.1 (7th Cir. 2002); Halpin v. W.W. Grainger, Inc., 962 F.2d 685, 696 (7th Cir. 1992). The lesson to be learned is always closely read the reasons for the denial, as the insurer cannot supplement them later.

If you have a claim for life insurance or accidental death insurance benefits, contact an experienced ERISA life insurance lawyer today.

Share Post on:



Recent Posts:

How can we help you?

We’d Like to Learn About Your Case and
Determine How We Can Execute Our Strategy for Success©