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Alane King, as Conservator and Natural Parent of Amber Lynn Schanus v. Hartford Life and Accident Insurance Company

Citations: 414 F.3d 994; 35 Employee Benefits Cas. (BNA) 1518; 2005 U.S. App. LEXIS 14935; 2005 WL 1704866Docket: 02-3934

Court: Court of Appeals for the Eighth Circuit; July 22, 2005; Federal Appellate Court

Narrative Opinion Summary

This case concerns an appeal by a conservator against Hartford Life and Accident Insurance Company's denial of accidental death benefits under an ERISA-regulated plan. The dispute arose after the death of an insured individual, who was legally intoxicated at the time of a fatal motorcycle accident. Hartford denied the claim, arguing the death was not accidental under the policy and fell under an exclusion for intentionally self-inflicted injuries. Initially ruled in Hartford's favor by the district court, the appellate court reversed the decision, remanding the case for further review, finding Hartford's definition and application of 'accidental' inconsistent. The case emphasizes the standard of review under ERISA, the definition of 'accidental injury,' and the applicability of exclusions for self-inflicted injuries. The court ruled that Hartford's interpretation was unreasonable, and remanded the case to the plan administrator to re-evaluate the claim with the proper legal standard. The court's decision highlights the importance of consistency in plan interpretations and the necessity of adequate notice in claim denials.

Legal Issues Addressed

Administrator's Discretion and Abuse of Discretion Review

Application: The plan administrator's decision is subject to abuse of discretion review because the plan grants discretionary authority over eligibility and interpretation of terms.

Reasoning: The benefit plan grants full discretion to the administrator regarding eligibility and interpretation of policy terms. This discretion subjects the administrator's decisions to abuse of discretion review under established legal frameworks.

Definition of Accidental Injury and Foreseeability

Application: The court examined Hartford's denial of accidental death benefits based on the foreseeability of injury due to intoxicated driving, applying the Wickman standard.

Reasoning: Hartford's denial of Amber Lynn's claim for an accidental death benefit is based on a definition of 'accidental' that aligns with the First Circuit's Wickman standard.

ERISA Jurisdiction and Standard of Review

Application: The case was removed to federal court under ERISA jurisdiction, and the standard of review for the denial of benefits is determined by whether the plan grants the administrator discretion.

Reasoning: Hartford removed the case to the U.S. District Court for Minnesota, asserting ERISA jurisdiction.

Exclusion for Intentionally Self-Inflicted Injuries

Application: Hartford's argument that intoxicated driving constitutes an intentionally self-inflicted injury was rejected as unreasonable.

Reasoning: This argument is rejected as unreasonable, as the exclusion clearly pertains to injuries that are intentionally self-inflicted, not those resulting from unintended actions influenced by intoxication.

Remand for Reconsideration of Denied Claim

Application: The case is remanded to the plan administrator to reevaluate the claim under the appropriate standard proposed by Hartford.

Reasoning: The proper remedy is to remand the case to the plan administrator for reevaluation of the claim under the standard suggested by Hartford.