Fifth Circuit Upholds Denial of Accidental Death Benefits Due to Policy Exclusion of Deaths Resulting from Aircraft Flight

In Krishna v. Life Insurance Company of North America, et al., No. 22-20516, 2023 WL 4676822 (5th Cir. July 21, 2023), Plaintiff-Appellant Deepa Krishna sued Defendant-Appellee Life Insurance Company of North America (“LINA”) and various Honeywell International defendants under ERISA for accidental death and dismemberment (“AD&D”) benefits after Krishna’s husband died in a small private airplane crash and LINA denied payment of benefits due to a policy exclusion. The district court ruled in favor of the defendants and Krishna appealed. In an unpublished opinion, the Fifth Circuit Court of Appeals affirmed the decision of the district court.

First, the court addressed the issue of the governing plan documents and whether the documents granted LINA discretionary authority to decide claims. Plaintiff relied on a 2003 Summary Plan Description that is silent regarding discretion to decide claims. Plaintiff alleges that this 2003 SPD is the operative document because it was the document defendants produced to her during the claims process and the one her husband received after starting work with Honeywell. LINA contends that a 2019 SPD is the operative “Wrap Plan Document,” and together with the Group Accident Policy No. OK 980358 (“the Policy”), the 2019 SPD and the Policy are the governing plan documents. The 2019 SPD clearly gives LINA discretionary authority to decide claims, which requires the court to conduct an abuse of discretion review of the claim denial. The court agreed with LINA.

Second, the court addressed whether LINA’s interpretation of a Policy exclusion was an abuse of discretion. LINA relied on Exclusion 6 in the Policy:

“In addition to any benefit-specific exclusions, benefits will not be paid for any Covered Injury or Covered Loss which, directly or indirectly, … is caused by or results from any of the following …:

* * *

6. flight in, boarding or alighting from an Aircraft or any craft designed to fly above the Earth’s surface:

 a. except as a passenger on a regularly scheduled commercial airline;

b. being used for: . . . .[omitted]

c. designed for flight above or beyond the earth’s atmosphere;

d. an ultra-light or glider;

e. being used for the purpose of parachuting or skydiving;

f. being used by any military authority …”

LINA interprets Exclusion 6 as excluding “AD&D benefits for a death caused by flight in, boarding, or alighting from an aircraft in general unless the insured was a passenger on a regularly scheduled commercial airline.” Applying ordinary rules of contract construction, the court found that LINA’s interpretation was legally correct and consistent with a fair reading of the plan. The court also noted that at least two other courts upheld LINA’s interpretation of substantially similar flight exclusions. See Weber v. Life Ins. Co. of N.A., 836 F. Supp. 2d 427 (W.D. Va. 2011), aff’d, 492 F. App’x 444 (4th Cir. 2012); Toohey v. Wyndham Worldwide Corp. Health & Welfare Plan, 727 F. Supp. 2d 978 (D. Or. 2010).

Lastly, the court rejected Plaintiff’s arguments that Honeywell and LINA violated ERISA’s procedural regulations by supplying a deficient 2019 SPD and by withholding various documents during the claims process. The court found that the above exclusion is unambiguous, and Krishna waived her claims regarding deficiencies in the 2019 SPD and the claims regarding production of documents during the claims process. Krishna had voluntarily dismissed her ERISA § 502(a)(3) claim and only moved for summary judgment on the § 502(a)(1)(B) claim. The court declined to consider evidence or arguments that were not presented to the district court. For these reasons, the court affirmed judgment in favor of defendants and dismissed the appeal.