Attorneys Who Handle Accidental Death and Dismemberment Claims Will Tell You to File an Appeal if the Insurance Company Denies Your Claim
To those stuck in an ERISA accidental death and dismemberment insurance claim denial battle – persevere, and you can win these claims!
It’s a terrible feeling – you’re handling a family crisis and the emotional and financial distress that comes with your loss. Then you’re likely shocked by the insurance company’s unfair denial of the Accidental Death Insurance benefits you paid for, need and deserve. For more information, reach out to our accidental death and dismemberment insurance lawyer.
The insurance company is claiming a technical policy exclusion applies or giving some other reason that doesn’t make sense or seem fair. Your denial letter most likely recites one of the following common excuses for not paying:
- Intoxication caused or contributed to death
- Alcohol caused or contributed to death
- DUI or DWI caused or contributed to the death
- Illegal narcotic or drug overdose
- Illegal narcotic or drug caused or contributed to death
- Prescription drug overdose
- Prescription drug not prescribed or taken as prescribed by physician caused or contributed to death
- Death was during the commission of a felony
- Death was during the commission of a misdemeanor
- Death was during the commission of a crime
- Death was not “accidental”
- Death was “natural” or due to natural causes
- Death certificate says “natural” death even though truly caused by an accident
- Sickness, illness or disease caused or contributed to death
- Death was suicide
- A policy exclusion applies
- The policy was not in effect at the time of death
- You aren’t the listed beneficiary
- Someone else is claiming to be beneficiary, even though you are the listed beneficiary
- Failure to disclose a medical condition on insurance application, or non-disclosure
- The insurance company files an interpleader lawsuit so the court can declare the right beneficiary
Whatever excuse they’re giving you, you’re thrown into the confusing legal world of insurance policy definitions, administrative appeals, and federal “ERISA” law. You’re anxious to get the next step right without guessing and unless someone’s been in your shoes, they can’t truly understand. But persevere – the insurance companies are often WRONG or BREAKING THE LAW, and if so you CAN overturn a denial. This article will help show you how.
The Three Phases of an ERISA Accidental Death Insurance Claim
An ERISA Accidental Death Insurance claim has three important phases:
- The initial application phase,
- The administrative appeal phase, and
- The litigation/court phase.
Each phase has complexities of its own.
This article focuses on the administrative appeal phase. The administrative appeal phase, more than anything else, determines the outcome of an ERISA insurance benefit claim. It’s also where most people make tactical mistakes. You can avoid these mistakes by better understanding the ERISA process.
This article explains to the unfamiliar claimant (or attorney), step-by-step, how to properly handle the critical administrative appeal of an ERISA claim denial. Getting it right is crucial to best chances for success, not only on administrative appeal, but also in federal court if the insurer denies your administrative appeal.
Why Does Federal ERISA Law Apply to Most Accidental Death Insurance Claims Filed in the U.S., and Why Does it Matter?
The federal ERISA (Employee Retirement Income Security Act of 1974) statute governs the majority of accidental death insurance claims in the U.S. With a few exceptions, ERISA governs all accidental death insurance claims involving insurance policies or plans which form part of an employee benefits package.
Yet handling an ERISA accidental death insurance claim, from the administrative appeal to the federal court lawsuit, is a complex minefield for the unfamiliar. Everything about it is different. Insurance companies and their attorneys know and understand how to use ERISA’s complexities to their advantage. But claimants, and often their attorneys, typically do not until it’s too late.
Unfortunately, most claimants file ERISA administrative appeals unrepresented or represented by attorneys unfamiliar with ERISA law. The result is often the permanent loss of a benefits claim that could and should have succeeded. Understanding the following will help to avoid unnecessary losses.
What Makes the Administrative Appeal in an ERISA Accidental Death Insurance Claim so Critical?
“Can’t I Always File Suit and Get Serious About Building a Case Later if the Insurer Denies the Administrative Appeal?”
The simple answer is “no,” and that comes as a surprise to many after it’s too late.
What makes the administrative appeal so critical is that the federal judge in the ERISA lawsuit that follows cannot consider any evidence that was not made part of the administrative record during the administrative appeal. So the administrative appeal is the only chance to gather, create, and build the best evidence to support your case later in court. The evidence you submit during the administrative appeal becomes part of that record that the court can later consider. Whatever case you build (or don’t build) is carved in stone before you ever file suit.
The fact that the administrative appeal makes or breaks your case cannot be overstated. During this process, before you can file a lawsuit, most claimants lose without realizing it.
A brief overview of the life of an ERISA Accidental Death Insurance claim, and how it’s so different, underscores the importance of the administrative appeal for its success.
What Is so Different About an ERISA Accidental Death Insurance Case?
The Administrative Appeal…
The process starts when someone files an initial application or claim for accidental death insurance benefits (usually without attorney assistance) and receives a written denial of their claim by the insurance company.
ERISA does not govern accidental death and dismemberment insurance policies purchased by individuals on their own, independent of their employment. For individual accidental death insurance policies not governed by ERISA, if the insurer denies the claim, the claimant can go directly to state court and file a lawsuit. No administrative appeal to the insurance company is required, and there is no requirement to file the lawsuit in federal court. Normal state court procedure, including all typical discovery methods, are available. The claimant has the right to a jury trial, and all parties can introduce traditional evidence, including live witness testimony. Bad faith penalty remedies are available under state law that federal ERISA law makes unavailable.
However, if ERISA governs the claim, as it will in most cases, a claimant must complete a mandatory administrative appeal before filing suit to challenge a denial of benefits. The claimant must file the administrative appeal with the same insurance company that denied the claim. Then that same insurance company, which also must pay benefits if it reverses itself, decides whether or not to reverse itself and pay benefits – crazy but true.
WARNING 1: The deadline for filing an administrative appeal on a denied accidental death insurance claim is 60 days from the date of the written denial. Missing an administrative appeal deadline is as fatal to a claim as the passing of a statute of limitations with very few exceptions. Missing it means the claim is over, and you cannot challenge the denial.
If the accidental death insurance company again denies benefits following a timely administrative appeal (a very common outcome), the claimant can only then file a lawsuit, and must do so in federal court. State court lacks jurisdiction.
The Federal Court Lawsuit…
While beyond the scope of this guide, which focuses on the critical administrative appeal of a claim denial, a bit about the lawsuit that follows helps highlight the importance of the administrative appeal. An ERISA insurance claim lawsuit in federal court differs from others. It doesn’t follow the typical federal procedural path. Most federal district courts use special scheduling orders tailored specifically to the unique way ERISA cases reach court resolution.
ERISA has its own statutory venue rules. It restricts discovery, and really makes it almost nonexistent. The parties have no right to a jury trial. They cannot present witness testimony. The only “trial” at all is a trial on briefs referencing the administrative record filed with the court, either on cross-motions for summary judgment or simply motions for judgment on the administrative record.
The court reviews a denial under an “abuse of discretion” standard, requiring it to give great deference to the financially conflicted insurance company’s decision. Courts have even upheld the insurance company’s administrative appeal decision while expressly stating that it contradicts how the court would have ruled independently on the evidence.
Choice of venue and choice of law considerations are critical because they can affect the standard of review, as some states have laws prohibiting “abuse of discretion” review, and such laws apply in ERISA cases. Most of the governing substantive law, however, is either ERISA-specific or federal common law jurisprudence, with much disagreement on many issues among and even within federal court jurisdictions.
WARNING 2: But most important, and most pertinent to the impact of the administrative appeal, the federal judge in an ERISA case cannot consider any evidence that was not made part of the administrative record, during the administrative appeal, before suit is filed.
The insurance companies and their attorneys know this. So they load the administrative record with evidence and reports of their own consulting “experts” favorable to their position in denying the claim.
Most claimants and many attorneys don’t know this. So most claimants and many attorneys file “administrative appeals”, but submit no supporting evidence beyond medical records. They basically argue how unfair the denial is after they paid policy premiums for years. The arguments may be true, but they are not evidence that the insurance company or the court must consider.
Filing an administrative appeal this way does absolutely nothing to help the claim, and it’s exactly what the insurance company hopes a claimant will do. It wastes the claimant’s best and only opportunity to build the best case for reversal, either on administrative appeal, or in court if the insurer denies the claim again.
But you won’t make that mistake. Instead, you’re going to BUILD a great appeal systematically as follows.
A Step-by-Step Process to Build a Strong Appeal for an Accidental Death and Dismemberment Insurance Claim Denial
Building the best administrative appeal for an accidental death insurance claim denial requires following a process. Beginning with the potential end in mind (federal court), you’ll want to use the administrative appeal process to gather, create and introduce ALL available supporting evidence into the administrative record. Any evidence you submit to the insurance company in the process becomes part of that record. That record is ultimately filed into the court record if you must file a lawsuit, and it forms the only evidence the court can consider.
So where to start?
The process described below will help guide you to develop the nuts and bolts of a strong, well-supported administrative appeal.
1. Analyze The Accidental Death Insurance Company’s Denial Letters
Analyze the written reasons given by the accidental death insurance company for denying the claim. This serves as the primary roadmap for what and where your focus needs to be.
2. Analyze The Accidental Death Insurance Company’s Claim File or Administrative Record
The insurance company is required to provide, upon written request, and free of charge, its entire claim file/administrative record. It’s often over 1,000 pages long. Review every page of the file for information helpful to the case. It consists of all medical, investigative, and other evidence the insurance company gathered, and the insurance company’s own consulting medical and other expert opinions and reports. Sometimes this information contradicts the insurance company’s reasons for denial, which can help your case. Other times the evidence on which it based the denial is purely speculative.
The claim file also includes internal insurance company personnel emails discussing the claim. Sometimes these communications indicate disagreement among insurance company personnel on whether to deny or approve the claim.
The insurance company must include all documents and evidence generated in connection with the claim whether or not the insurance company relied on it to support the denial.
The administrative record contains much more than the insurance company’s denial letters mentions. We often find evidence that directly contradicts the insurance company’s denial, or a lack of evidence to support reasons it gave to support the denial of a claim.
We have even found evidence that the insurance company’s own expert consultant directly contradicted a denial of benefits. In fact, the court found in one client’s case that the insurance company illegally withheld from my client its own expert’s report, which directly contradicted the denial of benefits. Without reviewing every page of that 1,000-plus page record to find the buried report, our client would not have received the benefits she needed and deserved.
(You can Google White v. Life Insurance Company of North America (CIGNA), 892 F.3d 762 (5th Cir. 2018), as revised (Jun 14, 2018) to read the full court opinion. If interested, you can also listen to CIGNA counsel’s and my oral arguments, and the court’s vocal suspicions, by clicking this link. You might find it an eye-opener on how far an accidental death insurance company will go to avoid a big payout by arguing an intoxication exclusion.)
You will also need to determine what supportive medical or other available evidence is not in the record, so you can obtain and include any such evidence as part of your appeal. That way it becomes part of the administrative record, which the court can later consider if the insurer denies the claim on administrative appeal.
3. Analyze the Accidental Death Insurance Policy, Plan, and Summary Plan Description
You can request these documents directly from the insurance company, the ERISA plan administrator, or the employer’s human resources department. The law requires them to give you these documents or face a stiff fine if they refuse or ignore you.
We analyze all policy language, especially any exclusions the insurance company relies on to support its denial. The exact wording of the policy language exclusions can vary from policy to policy, and subtle variations can determine the outcome. The policy language also drives exactly what evidence the claimant should gather, present, and add to the administrative record to support entitlement to benefits under the policy.
We sometimes find that the insurance company wrongfully denies a claim based on policy language or exclusions of an older or newer version of the policy favors the insurance company, but doesn’t even apply to your case. Or, we may find that the insurance company seeks to use an unfavorable (to you) policy amendment that doesn’t apply to the case to wrongfully deny the claim.
In other cases we find that the insurance company uses a policy provision to deny a claim that is ambiguous or contradicted by other insurance policy provisions, making the denial legally unenforceable.
The entire policy should be read carefully to determine any provisions that undermine the insurance company’s claim denial.
4. Think About Basic Information You May Know to Support the Claim
We interview the client to determine relevant details about the claim. This lets us get to know them better and gives us our foundation to build on. Think about all relevant information you know, as well as what relevant factual knowledge family members, coworkers, or friends can provide in affidavits to support the claim, or refute the insurance company’s reason for denial.
For any first-responders or witnesses to the accident in question, what might they know that would help support the claim? Contact them and question them and ask for a written statement if they have helpful information.
Also important is to determine what medical or other records may support the claim that the insurance company didn’t consider during the initial claim process. This may include medical records, autopsy reports, toxicology reports, accident investigation reports, or other documents, depending on the reason for the denial.
Exactly what information is relevant and important to a successful accidental death insurance claim will vary based on the reasons the insurance company gives for denying the claim. Remember, the insurance company doesn’t go out of its way to gather evidence it thinks will help get you paid. Just the opposite is true. These claims involve large sums of money the insurance company would rather not pay.
So you need to really focus on gathering any helpful evidence, and quickly. Remember—you have only 60 days to file the appeal.
5. Gather and Analyze Death Certificate, Medical, Toxicology, Coroner, and Autopsy Records to See if They Support the Accidental Death Insurance Claim and Supplement Where Needed
Depending on the reasons for the denial of an accidental death insurance claim, the death certificate, medical, toxicology, coroner and autopsy records are always important. Some of these may support the claim, but are missing from the insurance company’s administrative record or claim file. Others may have errors hurting your claim that require corrections, and the corrected versions re-submitted to the insurance company with your appeal.
Gather, review, study and summarize all such records. Here, we look for areas of potential strengths, weaknesses, or the absence of evidence needed for claim support. The focus is to determine where you need to build evidence that supports your claim, or contradicts, or otherwise refutes the reasons the insurance company gives to support its denial of benefits.
When physicians, coroners or other involved professionals write their reports, they are not necessarily attempting to cover all information in the kind of detail needed to support an accidental death insurance claim. They often rely on computer programs when preparing their notes that simply do not have fields concerning the evidence necessary to support a claim, or auto-fill features that generate errors.
In the case of a death certificate, the coroner simply fills in blanks on a government form, which may leave information critical to the claim unspoken. So the support needed may seem weak or absent. They often don’t state opinions or factual observations in enough detail. The insurance companies then cite “lack of evidence” to support the claim denial, or take single words from a death certificate out of context with other evidence. That evidence may in reality exist, but it’s just not stated in the records. Sometimes the death certificate, medical, or other records contain plain errors that hurt the claim. Insurance companies know all of this, and know how to exploit these inaccuracies.
Wherever you find weaknesses, the absence of important evidence, or errors in the records, you must correct the problems using a number of different approaches depending on the case at hand.
For instance, you may need to get input from treating physicians, coroners or other medical experts as needed for the particular case to provide more detailed explanations to correct critical errors. You may need to ask treating physicians to address certain issues not previously sufficiently addressed specifically and in detail in a report. In some cases, you may need to retain additional experts of various specialties to review other evidence and provide reports of their opinions to support the claim and shoot down the insurance company’s reasons for denying the claim.
Sometimes meeting face-to-face with treating physicians and other involved experts to determine their opinions on relevant details helps. Whatever the weakness or absence of evidence or error in the medical records, do everything you can to correct it.
Again, you must complete all evidence-building, supplementing, or correcting during the administrative appeal process and put it into the administrative record as part of the administrative appeal. Otherwise it’s useless, as the court can’t consider it if you introduce it later.
You must complete this process thoroughly but also rapidly due to the deadlines outlined above.
6. Decide What Additional Evidence May Help
At this point, determine what, if any, additional medical or other forms of evidence not forming part of the administrative record might support the case. This varies from case to case, but may include additional affidavits of family members, friends, or coworkers regarding any important facts or issues within their knowledge that aren’t otherwise addressed.
7. Conduct Legal Research
We conduct nationwide computer research, combing for judicial opinions factually similar or otherwise supportive of the claim and our legal arguments. We save these so we can later cite to them and quote portions of them to support our arguments to the insurance company, and later to the court if necessary.
8. Construct The Best Administrative Appeal Argument
Again analyze and dismantle the written reasons given by the insurance company for denying the claim. We do this by using everything helpful we find from all of the above efforts, and assemble it into a concise, impactful argument. It’s a blended argument of our strongest facts, woven together with our strongest legal arguments, citing relevant policy provisions, the administrative record, and your new evidence that we will now submit and as part of that record in our appeal. We construct it much like a legal brief filed in court, tailored to follow the same pattern the court will use to analyze the case. The insurance companies will know you built a solid case to take to court if they again deny the claim.
9. Final Review
Before you submit your administrative appeal argument and supporting evidence to the insurance company (which will ultimately be your argument to the court), examine your argument again in detail to determine whether it triggers new ideas for any additional evidence that may support your case.
10. Submit Your Best Administrative Appeal Argument and Await a Decision
After you feel you’ve left no stone unturned and have crafted your very best arguments in favor of the claim, submit your administrative appeal, along with all supporting documentation that was not already part of the original administrative record, to the insurance company. Send this by certified mail to avoid any argument by the insurance company that you did not send it within the legal deadline for appealing.
If the insurance company reverses its denial, great! If it doesn’t, your efforts, evidence, and arguments will still prove useful in the lawsuit that follows. Be sure to request an updated copy of the administrative record and make sure that it includes all of the evidence you submitted with your appeal. This will help you avoid a later argument in court about the completeness of the administrative record that the judge will consider Contact a trusted law firm for a free case evaluation to learn more about how an attorney can help you. You need legal help from the beginning of the process or immediately after learning of a denial.
Following graduation from Loyola Law School in New Orleans in 1990, Price McNamara served as a Federal Judicial Law Clerk to the Honorable John M Shaw, Chief Judge, United States District Court Western District of Louisiana.
Mr. McNamara founded J. Price McNamara ERISA Insurance Claim Attorney, and began putting his past experience to work for the injured and disabled clients he now represents against the insurance companies in personal injury and long term disability and other insurance disputes in both federal and state courts