Campbell v. Hartford Life & Accident Co.

• Decision Date: 08 June 2021
• Docket Number: Civil No. 5:18-cv-194-JMH
• Parties: DANA CAMPBELL, Plaintiff, v. HARTFORD LIFE AND ACCIDENT COMPANY, d/b/a THE HARTFORD, Defendant.
• Court: U.S. District Court — Eastern District of Kentucky

DANA CAMPBELL, Plaintiff, v. HARTFORD LIFE AND ACCIDENT COMPANY,d/b/a THE HARTFORD, Defendant.

Civil No. 5:18-cv-194-JMH

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF KENTUCKY CENTRAL DIVISION at LEXINGTON

June 8, 2021

MEMORANDUM OPIONION AND ORDER

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Plaintiff Dana Campbell brings this action pursuant to the Employment Retirement Security Act ("ERISA"), 29 U.S.C. § 1132(a)(1)(B), against Defendant Hartford Life and Accident Insurance Company, doing business as The Hartford ("Hartford"). Mrs. Campbell seeks to recover supplemental benefits under her spouse Gary Campbell's group life insurance policy (the "Policy"), which Hartford issued to Mrs. Campbell's employer, AECOM. Following Mr. Campbell's death on December 20, 2016, Hartford paid a $10,000.00 basic life insurance benefit to Mrs. Campbell, Mr. Campbell's sole beneficiary, but Hartford denied supplemental dependent life insurance benefits in the amount of $190,000.00 on the basis that Mr. Campbell allegedly made a misrepresentation on his life insurance application. Presently before the Court are Mrs. Campbell's Memorandum in Opposition to Administrator's Decision [DE 21], Hartford's Response [DE 24], and Mrs. Campbell's Reply [DE 25]. Accordingly, this matter is fully briefed and ripe for review. Having reviewed the Administrative Record ("AR") [DE 18-2] and the Parties' Briefs [DE 21; DE 24; DE 25], and being otherwise sufficiently advised, the Court will reverse Hartford's decision to deny Mrs. Campbell's claim for her husband's supplemental life insurance benefit and rescind coverage and order Hartford to remit the $190,000.00 supplemental life insurance benefit to Mrs. Campbell.

I. BACKGROUND

A. DECEDENT'S MEDICAL HISTORY AND TREATMENT FOR ALCOHOL USE

Prior to moving from Utah to Kentucky in September 2013, Mr. Campbell had been sober for four (4) years. [AR 716]. However, when Mr. Campbell was first living in Kentucky, he was not working and had an episode of heavy drinking in which he drank six (6) shots of alcohol per day. Id. at 734. In August 15, 2014, while seeking treatment for his hypertension, Mr. Campbell reported his alcohol use to his physician, Dr. Sandra Dionisio, at White House Clinics. Id.

On March 10, 2015, Mr. Campbell visited Dr. Dionisio again, and shared more information about his alcohol use. Id. at 716. In the few weeks that preceded the visit, Mr. Campbell had gotten "drunk several times" and "really drunk over the weekend." Id. His last drink had been two (2) days prior to his March 10, 2015,doctor's visit. Id. Mr. Campbell had been attending Alcoholics Anonymous ("AA") meetings, but he "stopped going when he started drinking." Id. Both Mrs. Campbell and Mr. Campbell's AA sponsor advised Mr. Campbell to detox, but he "resisted," fearing "he might lose his spot in [his] PhD program." Id. Also, Mr. Campbell reported that "[h]is wife told him to stop o[r] she wants a divorce," and he felt that if that happened "he [would] lose everything." Id. Mr. Campbell requested that Dr. Dionisio prescribe Mr. Campbell Antabuse, but instead of just prescribing medication, Dr. Dionisio "[d]iscussed that [she] would rather he be part of a comprehensive program to help with alcohol dependence" and stated, "He is planning to attend AA consistently from here on." Id. at 716-18. Finding Mr. Campbell's hypertension was "[u]ncontrolled due to excessive alcohol use," Dr. Dionisio diagnosed Mr. Campbell with "Alcohol dependence (303.90)" and referred him to a psychiatrist. Id. at 718.

On May 9, 2015, Mr. Campbell returned to White House Clinics and met with Dr. Brad Williams. Id. at 712. Mr. Campbell reported that "he had a day [the previous] week when he 'went on a tear'" and "can control urges to drink for 2-2 we[e]ks and then will try to have '[j]ust a couple of drinks' but can't limit it to that." Id. At the time of his visit with Dr. Williams, Mr. Campbell was going to "AA at least a couple of times a week" and "seeing a counselor every 2 weeks." Id. Also, Mr. Campbell shared that hewas working nights and only drinking during the day. Id. Again, Mr. Campbell expressed fear that he "'may lose [his] marriage over this.'" Id. After relaying Dr. Dionisio's treatment plan to Dr. Williams, including Mr. Campbell's requests that he be prescribed Antabuse, Mr. Campbell reported that "he has been on the internet and has learned that there are possibly other meds he could take" and mentioned Topamax. Id. Like Dr. Dionisio, Dr. Williams diagnosed Mr. Campbell with "Alcohol Dependence (303.90)," but unlike Dr. Dionisio, Dr. Williams prescribed Mr. Campbell a "low dose of [T]opamax for 1 month." Id. at 714. In addition to prescribing Topamax, Dr. Williams ordered Mr. Campbell to follow up with Dr. Dionisio in one (1) month and continue going to AA and seeing a counselor. Id.

B. RELEVANT POLICY PROVISIONS

As an employee of AECOM, Mrs. Campbell was covered under AECOM's benefit plan (the "Plan"), which included the Policy Hartford issued to AECOM, the Policyholder. Under the Policy, in addition to basic life insurance, Mrs. Campbell could elect to have both supplemental life insurance and supplemental dependent life insurance coverage. Id. at 13-16. Mrs. Campbell elected to have supplemental dependent life insurance coverage for her husband, Mr. Campbell, which included a "Guaranteed Issue Amount" of $10,000.00 and an additional "Maximum Amount" of $190,000.00. Id. at 839. While the "Guaranteed Issue Amount" did not requireevidence of insurability, the additional "Maximum Amount" did, including the completion of a Personal Health Application. Id. at 839-40. The additional coverage amount was based on the information provided in the Personal Health Application and was approved on November 10, 2015. Id. at 847.

The Personal Health Application asked several questions regarding Mr. Campbell's medical information, including Question No. 4, which asked the following:

Within the past 5 years, have you used any controlled substances, with the exception of those taken as prescribed by your physician, been diagnosed or treated for drug or alcohol abuse (excluding support groups), or been convicted of operating a motor vehicle while under the influence of drugs or alcohol?

Id. at 839-40. In response to Question No. 4, the Campbells checked "No." Id. at 840.

The Policy included an "Incontestability" provision that started the following:

Except for non-payment of premiums, Your or Your Dependent's Life Insurance Benefit cannot be contested after two years from its effective date.

In the absence of fraud, no statement made by You or Your Spouse relating to Your or Your Spouse's insurability will be used to contest Your insurance for which the statement was made after Your insurance has been in force for two years. In order to be used, the statement must be in writing and signed by You and Your Spouse.

No statement made relating to Your Dependents being insurable will be used to contest their insurance for which the statement was made after their insurance has been in force for two years. In order to be used, thestatement must be in writing and signed by You or Your representative.

All statements made by the Policyholder, the Employer or You or Your Spouse under The Policy will be deemed representations and not warranties. No statement made to affect this insurance will be used in any contest unless it is in writing and a copy of it is given to the person who made it, or to his or her beneficiary or Your representative.

Id. at 29. Additionally, the Policy stated, "[Hartford has] full discretion and authority to determine eligibility for benefits and to construe and interpret all terms and provisions of The Policy. This provision applies where the interpretation of The Policy is governed by the Employee Retirement Income Security Act of 1974, as amended (ERISA)." Id.

C. DECEDENT'S DEATH AND PLAINTIFF'S LIFE INSURANCE CLAIM

On April 13, 2016, Mr. Campbell was diagnosed with esophageal cancer. Id. at 468. On April 12, 2016, April 18, 2016, and April 21, 2016, Mr. Campbell's oncologists noted "prior alcohol abuse" and that Mr. Campbell had a "[h]istory of alcohol abuse." Id. at 465, 479, 483. On December 20, 2016, Mr. Campbell died of esophageal cancer. Id. at 812. Mrs. Campbell submitted a claim for life insurance benefits under the Policy, and Hartford paid the non-contestable $10,000.00 basic life insurance benefit to Mrs. Campbell. Id. at 80, 119-20, 828-35. However, pursuant to the incontestability provision of the Policy and because Mr. Campbell's death occurred within the two (2) years of the effectivedate of the supplemental dependent life insurance coverage, before paying the remaining $190,000.00 under the Policy, Hartford conducted a review of the Campbells' answers on the Personal Health Application and cross-referenced those answers with Mr. Campbell's medical records. Id. at 80, 119-20.

Once Hartford received Mr. Campbell's medical records, its Claim Office referred the matter to Hartford's Medical Underwriting unit, which determined that had Hartford had access to Mr. Campbell's medical records, supplemental dependent life insurance coverage would not have been approved. Id. at 449. Specifically, on March 21, 2017, the Medical Underwriter decided that due to Mr. Campbell's Alcohol Dependence diagnosis, which the Medical Underwriter found pertained to Question No. 4 on the Personal Health Application, Hartford would have declined coverage. Id. at 65, 449. On April 3, 2017, Hartford's Claim Analyst, Cheryl LeFort, wrote Mrs. Campbell to inform her that her claim for benefits had been denied, coverage had been rescinded, and Mrs. Campbell had sixty (60) days to provide Hartford additional information or appeal. Id. at 95-98. Ms. LeFort asserted that Hartford's decision was based on the Campbells' answers on the Personal Health Application and Mr. Campbell's medical records from his May 2015 visit at White House Clinics, which allegedly indicate Mr. Campbell ...