Widow of Scuba Diving Accident Victim Awarded $785K Life Insurance Settlement After Wrongful Denial

Consumers purchase life insurance so that in the unlikely event of their death, their family is taken care of financially. Simply put, life insurance provides both the decedent and the surviving family members peace of mind that they are financially secure should the unthinkable happen. That is what makes the denial of a life insurance claim so devastating. Not only is the family dealing with the untimely loss of a beloved family member, but that loss is now compounded by the refusal of the insurance company to pay the money that the family was relying on. Certain Accidental Death & Dismemberment (“AD&D”) insurance policies function like life insurance in that they promise to pay money—but only if the individual’s death was caused by an accident.

Recently, Donahue & Horrow LLP was approached by the widow of a well-respected doctor whose claim for AD&D benefits was denied. Our client’s husband was scuba diving when he suddenly died. Under the terms of the ERISA-governed AD&D coverage provided by his employer, his wife was entitled to a large lump sum payment if the cause of death was accidental. Initially, the coroner listed the cause of death as “accidental drowning.”  However, the cause of death was later changed to a “cardiac event.” But not only were there no written documents to support the finding that the death was caused by a cardiac event, but the decedent’s primary physician disagreed that the medical records suggested that a cardiac event contributed to the cause of death.

Based on these incorrect conclusions, the insurance company denied the claim. Our client then contacted Donahue & Horrow LLP for help with her appeal of that decision. That was a smart decision because ERISA litigation is different from other litigation in that no new facts developed or discovered during the litigation can be used at the trial. Rather, the Court is only allowed to review the information and documents that were submitted to the insurance company during the processing of the claim and the appeal. It is therefore vitally important that the appeal be managed by someone—like the team at Donahue & Horrow LLP—who are intimately familiar with ERISA and what evidence can be relied on to support the claim.

As part of the appeal, Donahue & Horrow LLP helped our client work with an expert who reviewed the relevant records and determined that the decedent did not suffer from a cardiac event and thus—his death was accidental. This expert prepared a report that was provided to the insurer.

Despite the report, the insurer again denied the claim, after which Donahue & Horrow LLP promptly filed a lawsuit in Federal Court.  Shortly after the start of the lawsuit, the parties engaged in mediation and came to an agreement ending the litigation and our client’s fight with the insurance company.

If you believe that your claim for life insurance or AD&D benefits was improperly denied, call Donahue & Horrow, LLP at (877) 664-5407 for a free consultation.