Accidental Death & Dismemberment Insurance Exclusions

If you have an ERISA-governed life insurance benefit plan that contains an AD&D rider, the insurance policy likely contains a number of exclusions for coverage of an accidental death or dismemberment (loss of the use of certain body parts including eyesight or limbs).  For example, many policies do not pay for dismemberment caused by or contributed to by a disease of the body.  Some policies may also exclude payment for an amputation that occurs beyond a year from the precipitating accident.  Although in many cases these exclusions produce unfair results, courts will enforce ERISA plan terms as written, and in some cases, give deference to the insurance company’s decision.

In a recent decision, Collins v. Unum Life Insurance Company of America, No. 15-CV-2229 (N.D. Ohio July 14, 2016), the court upheld Unum’s decision to not pay benefits to a claimant who underwent a below-the-knee amputation.  Plaintiff Collins was covered by a policy that pays for accidental dismemberment.  But, the policy does not pay benefits for dismemberment “caused by, contributed to by, or resulting from…disease of the body.” Additionally, the AD&D policy does not cover losses after 365 days from the accident.  Like many policies provided by insurance companies, this policy gave Unum the “discretion” to process claims under the policy and to interpret its terms.

Unfortunately for Collins, on January 6, 2012, he slipped and fell in a parking lot and caught his leg in a sewer grate. He fractured his ankle and underwent several operations.  These operations did not work and Collins developed a Charcot ankle (syndrome in patients who have neuropathy or loss of sensation).  Over a year later, on February 8, 2013, Collins underwent an amputation on the same leg that had been caught in the sewer grate.

Collins submitted a claim to Unum for accidental dismemberment benefits, but Unum denied the claim because it took the position that Collins’ ankle complications resulted from his diabetes.  Unum did not deny the claim because the amputation occurred after 365 days, but the court noted this fact in its opinion.  The court upheld Unum’s decision because there was some evidence supporting its position, including one of its own doctors who opined that Collins would not have developed Charcot ankle if he did not have diabetes.  Because Unum’s denial had some support, the court determined that its decision was not arbitrary and capricious.

If you have a denied claim for accidental dismemberment benefits, you should contact a knowledgeable ERISA attorney as soon as you receive the claim denial letter.  The attorneys of Roberts Disability Law, P.C. regularly get insurance companies to overturn their initial benefit claim denials.  We represent individuals in the East Bay and the San Francisco Bay Area.