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Do You Know About Your ERISA Life Insurance Exclusions?

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The California Bay Area workforce is booming and employers are competing with each other to attract the best pool of candidates.  Many employers offer prospects generous employee benefits, including long-term disability insurance, life insurance, and accidental death & dismemberment coverage.  If you have enrolled in your employer’s life insurance plan, it is likely governed by the Employee Retirement Income Security Act of 1974 (“ERISA”).  This is a federal law that governs most employee benefits provided by private-sector employers.

Unfortunately, many people are not aware about what their policies offer until they need benefits or their beneficiaries need to file a claim.  Life insurance and accidental death & dismemberment policies have several exclusions and it’s important to understand those exclusions when you are deciding about coverage or are about to submit a claim.

One common exclusion in life insurance policies is a “suicide exclusion.”  In a recent case, Hansen v. Metropolitan Life Insurance Company, No. 3:15-CV-00880, 2016 WL 4417292 (M.D. Tenn. Aug. 19, 2016), the court determined that MetLife’s denial of supplemental life insurance benefits on the basis of the policy’s “suicide exclusion provision” was not arbitrary and capricious because the insured committed suicide less than two years after coverage took effect.  In this case, the insured submitted an application for coverage sometime before January 31, 2013, but his application was incomplete because it was not dated or signed.  MetLife returned the application and the insured signed, dated it for February 7, 2013, and returned it to the company.  Coverage took effect on March 1, 2013, which was the first of the month following receipt of the complete application.  The insured committed suicide on January 31, 2015.  The beneficiary argued that the two-year period of time should be calculated as of the date that the insured initially applied.  MetLife took the position that the two-year period of time started March 1, 2013 and the death was an excluded loss.  The court agreed with MetLife because its decision was based on a reasonable interpretation of the terms of the plan.

If you have a denied life insurance benefit claim and want to know whether you have a case for benefits, it’s important that you consult with an experienced ERISA benefits claims attorney.  Otherwise, you may be giving up valuable benefits otherwise available to you.

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