District Court Finds ERISA Insurer Properly Stopped Life Insurance Premium Waiver Because Claimant Was No Longer Disabled

In Wilcox v. Dearborn Life Insurance Company, et al., No. 2:21-CV-04605-JLS/JCX, 2023 WL 424256 (C.D. Cal. Jan. 26, 2023), District Judge Josephine L. Staton granted Dearborn Life Insurance Company’s (“Dearborn”) motion for judgment under the Employee Retirement Income Security Act of 1974 (“ERISA”), after concluding on de novo review that Plaintiff failed to establish he continued to meet the definition of totally disabled on his life insurance waiver of premium claim, as ongoing disability was not supported by the record.

Plaintiff was the Director of Employee Benefits at Amgen Corporation when he ceased working in 2012 due to both physical and mental health conditions. Dearborn assessed and approved Plaintiff’s life insurance premium waiver claim, with frequent extensions over a period of 8 years. On February 5, 2020, Dearborn terminated Plaintiff’s premium waiver coverage finding that he no longer met the policy’s definition of “totally disabled” and noting that Plaintiff retained a level of function that would permit him to perform other less demanding work in another occupation. Dearborn’s letter noted improved neuropsychological functioning and remission of his depressive condition and anxiety.

Plaintiff retained counsel and appealed, submitting additional evidence. On appeal, Dearborn had Plaintiff’s file reviewed by both a psychiatrist and an internist. The psychiatrist opined that the medical records showed that Plaintiff had “no psychiatric diagnoses affecting [his] functional level.” Although

Plaintiff had suffered from major depressive disorder, he pointed out that a February 29, 2019 office note showed improvement in Plaintiff’s symptoms of depression, and further noted a remission of Plaintiff’s depressive disorder. The internist’s review found an absence of chart notes that would support a finding that Plaintiff suffered from debilitating diarrhea, peripheral neuropathy, and osteoarthritis to the extent that would restrict him from working. Dearborn upheld its decision on appeal, relying on the reports of its reviewing physicians and noting that Plaintiff’s claim of continuing total disability as to “any occupation” was not supported by the office notes or objective medical evidence during the relevant time period. It specifically differentiated between medical (physical) conditions and psychiatric conditions, concluding that neither supported a finding of total disability. The instant action followed.

On cross-motions for summary judgment, the Court agreed with Dearborn’s conclusions. It noted that Plaintiff bore the burden of establishing by a preponderance of the evidence his entitlement to coverage and waiver of his life insurance premium. The Court found that Dearborn’s decision to terminate Plaintiff’s coverage was consistent with the Policy language and the evidence in the record. In the initial denial letter, Dearborn expressly informed Plaintiff that a reversal of the denial and “a favorable decision” would require, “[a]t a minimum,” the submission of certain up-to-date records, including “[p]sychological reports, office notes, GAF scores from 9/1/2019 to the present[, and a] Functional Capacity Evaluation.” On appeal, Plaintiff, represented by apt counsel, failed to submit the requested materials, instead relying on other records and a personal statement from Plaintiff. In the end, notwithstanding his personal statement, the Court concluded that Plaintiff failed to support his statement with contemporaneous treatment records beyond June 2019. Thus, the Court found that Dearborn’s determination that Plaintiff failed to establish he continued to meet the definition of totally disabled, and its consequent decision to discontinue Plaintiff’s life insurance premium waiver, was correct.

As this case demonstrates, it can be difficult to navigate both disability and life insurance premium waiver claims, both during the administrative process, on appeal and through litigation. If Dearborn has denied or terminated your disability and/or life insurance premium waiver claims, contact us for assistance.

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