RECENT DEVELOPMENTS IN HEALTH INSURANCE, LIFE INSURANCE, AND DISABILITY INSURANCE LAW

• Published in: Tort trial & insurance practice law journal Vol. 52; no. 2; pp. 431 - 478
• Main Authors: Chittenden, William A., Doolin, Elizabeth G., Wall, Julie F., Jeffery, Joseph R., Terrizzi, Vittorio F.
• Format: Journal Article
• Language: English
• Published: Chicago Tort Trial & Insurance Practice Section, American Bar Association 01.01.2017; American Bar Association
• Subjects: Disability insurance; ERISA; Evaluation; Federal court decisions; Health insurance; Insurance policies; Judicial opinions; Laws, regulations and rules; Life insurance
• ISSN: 1543-3234; 1943-118X

"4 Aetna, the administrator, denied the beneficiary's claim, in part on the grounds that the insured's drunk driving crash was not an accident.5 Applying the arbitrary and capricious standard of review on crossmotions for summary judgment, the court found the administrator's benefit denial was not arbitrary and capricious.6 It referenced two lines of cases that: (1) applied a reasonably foreseeable test (i.e., death is not accidental because death is reasonably foreseeable when one drinks and drives) or (2) considered whether the insured's death "resulted from" driving while intoxicated.7 The court concluded that under either standard the administrator's decision was reasonable and supported by substantial evi- dence.8 In so holding, it emphasized the insured's extreme intoxication and excessive speed, suggesting that courts should consider the unique circumstances behind each claim, and insurers or administrators should do more than focus on intoxication alone.9 The Wilson court further noted that the administrator acted properly even under a de novo standard of review.10 A reasonable person, it found, would have viewed the resulting injury or death as substantially certain to result from the insured's conduct, given the excessive speed of travel and the insured's intoxication.11 Of course, not all alcohol-related deaths involve driving. In Wagner v. Minnesota Life Insurance Co.,12 the insured quit drinking, but then passed away after experiencing significant withdrawal symptoms over the course of several days.13 An autopsy found no evidence of any injury or suspicious circumstances, and the insured's death certificate listed hemorrhagic pancreatitis, steatosis, and chronic alcohol abuse as causes of her death.14 The beneficiary filed a claim under an ERISA-governed accidental death rider, which provided coverage when death "results, directly and independently of all other causes, from an accidental injury which is unintended, unexpected, and unforeseen.\n449 Citing to the Seventh Circuit's reasoning in Davis, however, the court required Sun Life to refund the premiums paid by Wells Fargo, an entity that became involved after the policy was issued and later sold to SLG Life Settlements, LLC.450 In so holding, the court noted that Wells Fargo, like the Davis defendant who did not participate in the conspiracy in that case, committed no fraud.