In this series of articles, we are examining the law governing Accidental Death & Dismemberment (AD&D) cases with an emphasis on case law within the Eleventh Circuit. This Federal focus is in large part due to the fact that the majority of AD&D cases involve employer-sponsored plans thus triggering the applicability of ERISA.
At the center of any AD&D case is the question of whether an “accident” occurred. Most of us will intuitively define fact patterns as fitting the definition of an “accident” and move on to the question of whether or not a policy exclusion applies. Such approach sometimes works but often doesn’t. Many courts construe fact patterns narrowly to find that there was no “accident’ and thus no case.
At the heart of AD&D cases is determining whether an “accident” occurred and, if so, whether one or more policy exclusions apply. Before we can even get to that point in the analytical framework, we first must address several threshold considerations. Chronologically these would typically be considered at the outset before pursuing a pre-suit appeal and certainly before commencing litigation.
At the outset, a practitioner should address the “who”, “what”, and “when” issues that will guide a case. First, one must determine whether a full copy of the AD&D policy is in hand. Important to this review is whether the policy contains ERISA language e.g. stating that ERISA governs and informing the reader of ERISA rights. (We’ll look at ERISA issues in depth in a later article). Second, the reader should determine the named beneficiaries and the benefit amount. If the beneficiaries are minor children adequate time needs to be in place for appointment of a guardian. The benefit determination is equally important: it makes little sense to pursue a nominal benefit claim.
If the case is governed by ERISA, a critical issue is whether the decedent was employed on the date of death. Usually, coverage is lost upon termination of employment unless conversion rights are provided. Note that unlike health insurance, there is no statutorily mandated right to convert AD&D coverage (or life insurance for that matter) to individual coverage. This is purely a matter of contractual grace. That being said if a contractual right to conversion exists and an employer fails to inform the employee, courts within the Eleventh Circuit have held that a cause of action against the employer for breach of fiduciary duty to impose a surcharge ready may exist, e.g. Urscheler v. Adventist Health Systems, Case No.: 8:16-cv-224-T-27-TBM (M.D. Fla. 2016).
Finally, one must keep in mind that the pre-suit appeal deadline in an ERISA AD&D case is different than more common long-term disability (LTD) cases. In LTD cases, the claimant has 180 days from the claim denial or benefit termination date to appeal. In an AD&D case, the appeal period is only 60 days. This begs the most important threshold question: Is there enough time to do a thorough investigation that will unearth facts in alignment with case law that could lead your client to victory? Sometimes the answer will clearly be “no”. If the answer is anything other than that make sure you are committed to first mastering the law. In our next article, we will turn our attention to the core of AD&D cases: answering the question of whether or not an “accident” occurred.