Capone v. Aetna Life Ins. Co.
(United States Court Of Appeals, Eleventh Circuit, January 5, 2010)
This action arises out of a diving accident wherein policyholder struck his head on the bottom of the ocean while diving in the Bahamas, paralyzing himself from the neck down. Policyholder sought benefits under the Accidental Death and Personal Loss provision of his employee health insurance policy administered by Aetna. Aetna denied the policyholder’s claim for benefits and the district court granted Aetna’s motion for summary judgment holding that Aetna properly applied the plan’s “accidental means” and alcohol exclusion provisions which barred recovery.
After determining the proper standard of review for guiding a district court’s review of an administrator’s benefits decision was the Williams v. BellSouth Telecomms, Inc., 373 F3d 1132 (11th Cir. 2004) methodology (as modified by Glenn in Metropolitan Life Ins. Co. v. Glenn, 128 S. Ct. 2343 (2008)), the court conducted a de novo review as the first step in ERISA’s heightened arbitrary and capricious standard.
The court noted that Georgia law distinguishes between insurance coverage for “accidental results” and coverage for injures caused by “accidental means,” and held that the policy favored an accidental means interpretation. Specifically, while Aetna argued that the plaintiff’s dive was intentional, the court noted that in order to recover under an accidental means standard, it was incumbent upon the plaintiff to show that the act preceding the injury was effected by and “unforeseen, unexpected, or unusual event” causing the result to differ from the natural or probable consequence of this voluntary action.
The court noted, here, plaintiff made the dive once without incident, other individual were diving or jumping in a contemporaneous fashion without incent, thus noting that prior occurrences of similar acts that did not result in jury was a strong indicator of changed conditions. Indeed, plaintiff contended that an unexpected wave created the shallowness that had not otherwise existed causing an unforeseen result. Moreover, the court concluded that because Aetna simply concluded that plaintiff voluntarily dove into shallow water, the resulting injury was foreseeable, but failed to conduct an adequate and thorough investigation into the circumstances behind the injury. Specifically, the court noted that the insurer failed to investigate the depth of the water at low and high tides and the tidal conditions at the time of the accident and made no attempts to locate and interview other guests at the scene. Consequently, the court held that the insurer had the responsibility to fully investigate the policyholder’s claim before denying benefits and Aetna’s failure to adequately investigate plaintiff’s contentions was wrong.
As to the applicability of the alcohol exclusion, the court held that while Aetna’ reliance on the toxicology tests was proper, it misapplied this results to the policy conditions. Specifically, the court held it was unreasonable to conclude that plaintiff’s intoxication caused his injury, as there was no mandate in the policy that “legal intoxication” shall be deemed the cause of the accident based on the plain reading of the provision, and thus did not warrant the presumption of causation outside of the motor vehicle context. Further, the court concluded that Aetna, as a fiduciary, was required to make a reasoned determination after a diligent investigation, yet failed to do so. The court noted that there was no investigation regarding the series of events leading up to the dive or the intoxication level of the other divers. As such, the record was insufficient to connect plaintiff’s decision to dive with his state of intoxication, and therefore the court held that Aetna did not present sufficient evidence suggesting that the consumption of alcohol caused or contributed to the accident and resulting injury. Thus, the denial of benefits based upon this exclusion was de novo wrong.
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Paul Steck and Dan Gerber
https://www.goldbergsegalla.com/attorneys/Steck.html
https://www.goldbergsegalla.com/attorneys/Gerber.html