At McKennon Law, we frequently see insurers improperly deny claims under accidental death and dismemberment (AD&D) policies, especially when toxicology results or policy exclusions are involved. Fortunately, ERISA provides policyholders with powerful appeal rights when these denials are unfounded. In a recent success story, our firm secured full payment of a $680,000 AD&D benefit from Metropolitan Life Insurance Company (MetLife) after an initial denial—without having to file a lawsuit.

Background: Denial Based on Intoxication Exclusion

Our client filed a claim for AD&D benefits after the tragic death of a loved one who was covered under a group policy issued by MetLife. The cause of death was complications of multiple drug toxicity involving prescribed medications, including amphetamine and benzodiazepines. However, MetLife denied the claim based on the policy’s intoxication exclusion, alleging that the presence of cocaine in the decedent’s system excluded the claim from coverage.

This conclusion was not only legally wrong, but medically unsound. The presence of cocaine metabolites did not mean the drug caused the death. The denial failed to account for the full toxicology report and other relevant medical records.

Our Strategic ERISA Appeal

Understanding the complexity of the issues at hand, the client engaged McKennon Law to handle the ERISA appeal. Our attorneys immediately launched a comprehensive review of the record and retained a leading medical expert—a board-certified pathologist with over 50 years of experience. The expert reviewed the autopsy, toxicology, medical records, and police reports and issued an opinion to a reasonable degree of medical certainty: the death was substantially caused by prescribed medications, and the amounts of cocaine had no-to-little causal connection.

We then submitted an extensive appeal letter that included the expert report, relevant medical literature, and persuasive legal arguments supported by ERISA case law. We demonstrated that the exclusion MetLife relied on was inapplicable and that the medical evidence overwhelmingly supported coverage.

The Result: Full Payment of the $680,000 Claim with Interest

Faced with the thorough appeal and compelling evidence, MetLife reversed its position. It agreed with our analysis and paid the entire $680,000 claim, including interest, without requiring our client to litigate the matter in federal court. This victory not only spared the client the stress, delay, and cost of litigation—it vindicated their rightful claim under the policy.

Key Takeaways for Policyholders

This case highlights several important lessons for beneficiaries and policyholders under ERISA-governed AD&D insurance policies:

• Intoxication exclusions are not absolute: Insurers frequently misapply these exclusions. Medical causation matters, and trace substances do not always invalidate a claim. If California law applies, there is a statute that controls the language of these exclusions and insurers always ignore this.
• Appeals matter: A well-supported appeal supported by solid expert evidence under ERISA can result in a full reversal without litigation.
• Expert support is often essential: Independent medical opinions can make or break a claim, especially when cause of death is disputed.
• Experienced ERISA attorneys are key: Navigating the administrative appeal process requires deep knowledge of the law, policy language, and the insurance industry’s practices.

Conclusion

At McKennon Law, we are proud to fight on behalf of individuals and families who are wrongly denied benefits by insurers. This case is a testament to the power of a well-crafted ERISA appeal and the importance of hiring experienced insurance attorneys. If your accidental death or disability claim has been denied, contact us for a consultation—we may be able to achieve the same success for you.

When Insurers Confirm Coverage That Doesn’t Exist: A Fiduciary Duty Trap Under ERISA

When dealing with ERISA-regulated benefit plans, both employers and insurers must tread carefully when communicating with plan participants. Misleading or incorrect statements about benefits—especially those repeated over time—can result in liability, even if the actual plan terms don’t support coverage. A recent federal decision in Fleming et al. v. Minnesota Life Insurance Co. et al., 2025 WL 2165947 (E.D. Pa. July 29, 2025), illustrates how an insurer’s repeated assurances of life insurance coverage can trigger ERISA claims for breach of fiduciary duty and equitable estoppel, despite the insured’s technical ineligibility under the plan terms.

Background: A Life Policy Denied After Assurances of Coverage

Kim DiNicola, a longtime Vanguard employee, became disabled from colorectal cancer and qualified for waiver of premium coverage under her group life insurance policy with Minnesota Life. She later resigned due to her illness. After her resignation, Minnesota Life issued her a conversion policy for $100,000. However, a year later, the insurer rescinded that policy and repeatedly confirmed that her original group life policy—worth over $1.6 million—remained in force under the waiver of premium provision.

From April through July 2021, Minnesota Life communicated several times—both in writing and over the phone—that DiNicola’s group coverage was active. They even requested updated medical documentation to support continued coverage. DiNicola, relying on these statements, told her family that coverage remained intact. She died in October 2021. Her beneficiaries later submitted a claim, only to have it denied. Minnesota Life stated that DiNicola’s group coverage ended upon her resignation and that the prior confirmations were merely clerical errors.

Court’s Ruling: Fiduciary Duty and Estoppel Claims Survive

The court dismissed claims for benefits under the policy and for breach of contract as preempted or unsupported under ERISA. However, two critical ERISA claims survived: breach of fiduciary duty and equitable estoppel. The court noted that “To establish a breach of fiduciary duty under ERISA, the plaintiff must demonstrate that: (1) the defendant was acting in a fiduciary capacity; (2) the defendant made affirmative misrepresentations or failed to adequately inform plan participants and beneficiaries; (3) the misrepresentation or inadequate disclosure was material; and (4) the plaintiff detrimentally relied on the misrepresentation or inadequate disclosure.” Id. at *4.

 

The court found that Minnesota Life acted as a fiduciary when it repeatedly confirmed the validity of the group policy after DiNicola’s resignation. These repeated statements, over several months, were not one-off errors but a pattern of misrepresentations. The court held that a reasonable participant could have relied on those confirmations and that DiNicola’s reliance was not unreasonable merely because the plan documents said otherwise. The communications involved direct, repeated, and consistent confirmations from the insurer itself. In addressing the materiality and detrimental reliance issues, the court stated:

In addition, Minnesota Life separately argued that the misrepresentations were not material because they did not prevent her from making an adequately informed retirement decision. Minnesota Life noted that Kim’s Group Policy coverage ceased as soon as she resigned on January 22, 2020, and the post-resignation misrepresentations from April 2021-July 2021 had nothing to do with Kim losing the Group Policy. ECF No. 16 at 6-8 [hereinafter “Minnesota Life Reply”]. Yet, since the time of Minnesota Life’s misrepresentations beginning in April 2021, Kim may have refrained from making other retirement decisions unrelated to the Group Policy—such as finding employment elsewhere to enroll in a different employee-sponsored life insurance policy or seeking supplemental insurance. See Curcio v. John Hancock Mut. Life Ins. Co., 33 F.3d 226, 237 (3d Cir. 1994) (“we conclude that the [plaintiffs] have suffered an injury in giving up an opportunity to accommodate their insurance needs through an independent insurance carrier because of their reasonable reliance on [employer’s] [mis]representations.”). On the other hand, Minnesota Life argued that Kim could not have received alternative coverage in 2021 given her medical condition, and cited Smith v. Hartford Ins. Group for the proposition that a plaintiff’s conclusory allegation that they could have obtained alternative coverage, without more, was insufficient to withstand summary judgment. 6 F.3d 131, 137 (3d Cir. 1993); Minnesota Life Reply at 5; Hearing Transcript at 32, 43. However, Smith was decided on a motion for summary judgment, a different posture than present here. At the motion to dismiss phase, discovery has not yet born out whether it would have been achievable for Kim to pursue alternative policies or other retirement options after her resignation and Minnesota Life’s misrepresentations. This is an issue better suited for disposition after discovery, not at the motion to dismiss phase.

Last, Kim detrimentally relied on Minnesota Life’s misrepresentations in making a retirement decision. Detrimental reliance may include “decisions to decline other employment opportunities, to forego the opportunity to purchase supplemental health insurance, or other important financial decisions pertaining to retirement.” In re Unisys Corp., 579 F.3d. at 229. As discussed above, Kim did detrimentally rely on Minnesota Life’s misrepresentations. As a result of Kim’s reliance, she communicated to Plaintiffs before she died that the Group Policy was still in effect. Plaintiffs consequently made several financial decisions in reliance on that information. Compl. ¶¶ 35-45; Curcio, 33 F.3d at 237 (finding that the beneficiary plaintiff and the insured decedent gave up opportunities to accommodate their insurance needs in detrimental reliance on the employer’s misrepresentations).

Id. at *5–6. Thus, the court determined that plaintiff adequately plead materiality and detrimental reliance.

Equitable Estoppel Under ERISA: Extraordinary Circumstances Established

The court also allowed the plaintiffs’ equitable estoppel claim to proceed. To succeed on such a claim under ERISA, plaintiffs must show (1) a material misrepresentation, (2) reasonable and detrimental reliance, and (3) extraordinary circumstances. The court found all three. Minnesota Life’s communications were material, repeated, and formed a “network of misrepresentations” over an extended period. These facts supported a finding of extraordinary circumstances, even at the motion to dismiss stage.

Claims Against the Employer: Vague Allegations Do Not Survive

While the court allowed claims against Minnesota Life to proceed, it dismissed claims against Vanguard, DiNicola’s former employer. The plaintiffs alleged that Vanguard also misled DiNicola, but failed to provide specific facts showing any misleading statements attributable to the employer. The court granted leave to amend these claims, but underscored the need for more than generalized assertions of wrongdoing.

Key Takeaways for Plan Participants and Fiduciaries

This case is an important reminder that even when the written plan terms seem clear, an insurer or employer can still be liable for misleading communications. Courts will not allow plan fiduciaries to hide behind the plan document if they repeatedly and materially mislead participants to their detriment.

Key takeaways:

• Insurers and plan administrators who repeatedly confirm coverage—even erroneously—may face liability under ERISA.
• Plaintiffs can prevail on breach of fiduciary duty or equitable estoppel claims even where benefit denial claims fail, if they show detrimental reliance on false assurances.
• The “clerical error” defense is not always sufficient, especially when misstatements are repeated and form a pattern.

The ruling in Fleming reinforces that fiduciary duties under ERISA are not to be taken lightly. Repeated, affirmative misstatements—especially during sensitive periods such as disability or resignation—can open the door to litigation, regardless of what the plan documents say. If you believe you may be a victim of misrepresentations by your employer or insurer regarding your employee benefits, contact McKennon Law today.

Understanding Settlements in Long-Term Disability Insurance

Disability insurance offers essential protection, providing financial support to people who are unable to work due to illness or injury. For many, disability insurance may serve as a lifeline, ensuring that basic living expenses can be met even when their ability to work is suddenly eliminated by the onset of a serious medical condition or something as sudden as a car accident. One question people often have of disability insurance is whether insurance companies will settle a claim for disability benefits that are or may be payable in the future.

What Does It Mean to Settle for Future Disability Benefits?

Typically, when an insurer pays disability benefits, they are paid on an ongoing, monthly basis. However, at times it may be better for you as a claimant to receive a lump-sum payment now that covers all your future disability benefit payments. By accepting a settlement, you give up your right to receive ongoing monthly disability benefits in exchange for a one-time, negotiated payment intended to represent the present value of the benefits they would have otherwise received. This can allow you to  plan for the future by investing the funds as you see fit. The tradeoff is that you will not be able to rely on having the benefits paid to you each month and typically, there is a discount associated with a lump-sum payment.

These settlements are most common in long-term disability (LTD) claims, but they can also occur in short-term disability claims or other types of disability-related policies. The decision to settle, and the timing of such settlements, depends several factors, including your medical situation, the policy terms, the insurer’s assessment of ongoing liability, and broader strategic considerations.

Why Do Disability Insurers Offer Settlements?

Insurers offer these settlements in situations where they gain something from the settlement based on different factors, including:

• Risk Management: By settling now, insurers can limit their exposure to long-term risks associated with your condition; the alternative may be that the insurer is required to pay you monthly benefits for several years or even decades.
• Administrative Efficiency: Ongoing claim management is resource-intensive. Settlements eliminate the need for regular medical reviews, documentation requests, and communications.
• Financial Predictability: Lump-sum settlements offer insurers the ability to close out reserves on their books, making their financial liabilities more predictable and reducing the uncertainty associated with the claim.
• Litigation Avoidance: Settlements can help insurers avoid the costs, uncertainties, and public scrutiny associated with litigation, especially in disputed or complex cases.

For these reasons, insurers have an interest in settling claims that they expect to be expensive, last a long time, or pose legal or reputational risks.

When Are Insurers Likely to Consider a Settlement?

There is no standard or universal situation that results in this type of settlement, as every case is unique. However, there are some common scenarios:

Stability of Disability

If there is any chance that your condition will improve and you may eventually be able to return to work, it is unlikely that the insurer will be willing to negotiate a lump-sum settlement. However, if your condition is permanent and your medical evidence indicates that you will not be able to return to work, the insurer will be much more likely to negotiate a settlement, as this provides them the advantages discussed above.

Disputed/Litigated Claims

When you and your disability insurer are in significant disagreement as to the validity, extent, or duration of your disability, settlement may be a practical way to resolve the matter, especially if there is pending litigation over the disability claim.  In fact, once there is litigation of your claim, it is much more likely that you will reach a lump-sum settlement.

High-Value or Long-Term Claims

Insurers are more likely to settle claims with substantial potential payouts. For example, if you become disabled at a young age and are going to be receiving benefits for several years, or if your monthly benefit amount is large, the insurer may be interested in settling in order to minimize the overall amount they pay you. This can help the insurer limit long-term exposure while at the same time giving you a lump-sum payment that you can use to plan for the future, so both parties may benefit from a settlement in such a case.

Change in the Insured’s Circumstances

If your condition, prognosis, or life situation changes significantly – such as a worsening of the disability or reaching a certain age – the insurer may accept that your condition is not going to improve and you are not going to return to work, and therefore may be interested in settling now for a sum that represents future benefits, for the reasons discussed above.

How Is the Settlement Amount Calculated?

Determining the settlement value for future disability benefits can be complex and involve negotiation. Key factors include:

• Present Value of Future Benefits: The core of the calculation is determining the total value of future payments the insurer would have to make if your claim continued as expected, then discounting that amount to reflect the fact that it will be paid in a lump-sum now (usually at a discount rate to account for interest and investment returns).
• Life Expectancy and Duration of Disability: Your age, health, and the prognosis of your condition play a crucial role. A younger claimant or someone expected to remain disabled for a long time will receive a higher offer than someone nearing retirement or expected to recover soon.
• Policy Limitations and Offsets: Most policies contain limitations on benefit duration, cost-of-living adjustments, offsets for other income (such as Social Security Disability), and other factors that affect the value of future payments. These factors will need to be accounted for in a negotiation.
• Strength of the Claim: If the insurer believes their case for denial or termination is strong, they will likely offer a lower settlement. On the other hand, if you have strong medical evidence and legal support, the settlement amount will likely go higher.
• Legal and Administrative Costs: Both parties will consider the potential costs and delays of continued litigation or administration of the claim.

Key Considerations for Disability Claimants

Settling a disability claim is a significant decision that you should approach with caution. Some essential points to consider include:

• Financial Planning: A lump-sum settlement can mean putting a substantial amount of money in your hands at once, which is likely meant to provide for you for a long time to come. Lump-sum settlements therefore require careful management to ensure that the funds last as long as needed. You may want to consult with a financial advisor.
• Tax Implications: Depending on how premiums were paid and the nature of the settlement, there may be tax consequences. You should seek advice from a tax professional before accepting a settlement.
• Impact on Other Benefits: Accepting a settlement may affect your eligibility for other benefits, such as Social Security Disability, Medicaid, or other income-based programs. You will want to have a compete understanding of the implications of your settlement on any other benefits you may receive or be eligible for.
• Release of Claims: Most settlements require you to sign a release, permanently giving up any right to future benefits or to reopen the claim. It is crucial to fully understand the implications of this release.

Pros and Cons of Settling Future Disability Benefits

Some of the pros of taking a lump-sum settlement are:

• Immediate access to a large sum of money, which you can invest or use for major expenses.
• It eliminates ongoing dealings with the insurer, including periodic reviews of your claim and medical exams.
• It gives you certainty and control over future planning.
• It ends the stress of your disputed claim and having to deal with the insurer.
• If you feel that you can to return to work in the future, you can do so without the stress of how an insurer will treat an attempted return to work.

Cons:

• There is a risk that the lump-sum may not last as long as periodic payments would have.
• If your disability lasts longer than anticipated or worsens, you risk a loss of future benefits.
• Once settled, the decision is final; you typically have no recourse if your circumstances change.
• Having a lump-sum large amount of money at once increases the risk of over-spending and not having sufficient funds to live on in the future.

Conclusion: Is a Lump-Sum Settlement the Right Choice?

Deciding whether to settle a disability claim for an amount representing future benefits is a personal and complex decision. For some, a lump-sum provides flexibility, financial independence, and peace of mind. Others may prefer the guaranteed security of ongoing payments, especially when future needs are uncertain.

You should weigh the pros and cons, seek professional advice, and ensure you fully understand the implications of any settlement offer. Ultimately, whether, when, and how to settle is best determined by a careful assessment of your circumstances, consultation with trusted advisors, and a clear-eyed appraisal of future needs and risks. If you are in a situation in which a settlement may be an option, reach out to the McKennon Law today for a consultation.  We have significant experience handling negotiations for lump-sum benefits.

 

In an important decision reaffirming the procedural protections afforded to claimants under ERISA, the Ninth Circuit, in an unpublished opinion, recently vacated a district court judgment in Solis v. UnitedHealthcare Insurance Co., No. 24-2412, and remanded the matter due to UnitedHealthcare Insurance Company’s (“United”) multiple procedural deficiencies in the claims denial process. The decision highlights the critical importance of clarity and specificity in benefit denial notices in ERISA plan matters and reinforces long-standing precedent requiring ERISA plan administrators to provide meaningful notice to their insureds/plan participants when denying their claims so that claimants can adequately respond during the administrative review process.

The case arose from UnitedHealthcare’s denial of medical benefit claims related to hiatal hernia repairs performed in the same surgical session as gastric sleeve procedures. Plaintiffs Jannet Solis and Michael Ortega challenged the denials under ERISA, arguing that United failed to provide adequate reasons for the denials during the administrative process. The Ninth Circuit agreed, finding that United’s denial letters did not cite specific plan provisions nor explain with sufficient detail the basis for the claim denial—both clear violations of ERISA’s procedural requirements under 29 U.S.C. § 1133 and its implementing regulations.

The panel first addressed the standard of review and ruled that the district court correctly found that it had to review United’s claims denial for abuse of discretion because United’s plan agreement granted United full discretionary authority to adjudicate claims.

The panel then addressed whether United committed procedural violations under ERISA and found that it did. As the court explained, ERISA requires that plan administrators give claimants the “specific reasons for such denial” and cite the “specific plan provisions” on which the decision is based. See 29 U.S.C. § 1133(1); 29 C.F.R. § 2560.503–1(g)(i). In this case, United’s initial denial and appeal letters failed to meet that standard, merely stating that the procedure “may be considered included” within another billed code, and therefore “cannot be separately reimbursed.” The Ninth Circuit found these statements conclusory and vague, noting that “[United’s] explanatory deficiencies during the administrative process failed to provide meaningful engagement and denied Plaintiffs the opportunity to address the specific bases for United’s denials. This violated ERISA’s requirements.”

The panel explained that if, for example, “United’s denial of the appeal had specified that the administrator determined the hernia repair was incidental to the gastric sleeve procedure because there was only a single incision point, then Plaintiffs could have responded by providing additional evidence of different incision points. But United, by failing to provide such specificity, denied claimants the opportunity to adequately respond during the administrative claims process.”

The court emphasized that administrators cannot shift their justification for denial during litigation. Citing Harlick v. Blue Shield of California, 686 F.3d 699, 719–20 (9th Cir. 2012), the panel wrote: “A court will not allow an ERISA plan administrator to assert a reason for denial of benefits that it had not given during the administrative process.” United’s attempts to justify its denials during litigation—by referencing surgical techniques and procedural overlap—were unavailing because these explanations were never shared with the Plaintiffs during their administrative appeal.

Although the district court correctly identified United’s procedural irregularities and found them troubling, it erred by refusing to allow Plaintiffs to augment the administrative record to respond to the new justifications United presented during litigation. Under the Ninth Circuit’s en banc decision in Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955, 973–74 (9th Cir. 2006), procedural irregularities trigger the need to allow claimants to submit supplemental evidence to “recreate what the administrative record would have been had [the insurer’s] procedure been correct.” By denying this opportunity, the district court effectively insulated United’s deficient denial process from proper review.

In vacating the district court’s judgment, the Ninth Circuit clarified that although the district court was not required to enter judgment in favor of Plaintiffs, it was obligated to permit appropriate record supplementation or remand to the plan administrator for reconsideration. “[F]urther factfinding is necessary before the district court can decide,” the court concluded, remanding the case for proceedings consistent with Abatie and Demer v. IBM Corp. LTD Plan, 835 F.3d 893, 907 (9th Cir. 2016).

This case serves as a reminder to ERISA plan administrators that procedural compliance is not a mere formality. The denial of benefits must be accompanied by a clear explanation grounded in the actual terms of the plan. As this case illustrates, failure to meet ERISA’s procedural standards may ultimately invalidate an otherwise discretionary claim determination. Plan participants and providers alike should be vigilant in holding insurers to these statutory obligations, and experienced ERISA counsel can play a crucial role in identifying and challenging such violations.

In a notable decision for disability insurance claimants, the Ninth Circuit Court of Appeals, in an unpublished decision, recently reversed in part a summary judgment ruling in Osborn v. The Paul Revere Life Insurance Company, No. 24-1819, finding that triable issues of fact precluded judgment as a matter of law on whether the insured was totally disabled. The case underscores that factual disputes related to complex medical issues in disability cases should be determined by a jury rather than through summary judgment.

Dr. Gordon R. Osborn (“Osborn”), a dentist specializing in oral and maxillofacial surgery, purchased both an individual disability income (“IDI”) policy and a business overhead expense (“BOE”) policy from Paul Revere Life Insurance Company. During the early months of the COVID-19 pandemic, Dr. Osborn ceased patient care due to serious health conditions that heightened his vulnerability to COVID-19 complications, ultimately closing his practice by June 2020. Paul Revere denied his claims for both policies, prompting Osborn to sue for breach of contract and insurance bad faith. The district court granted summary judgment for Pau Revere, entering judgment for Paul Revere on the breach of contract and bad faith claims, including his punitive damages claim. On appeal, the Ninth Circuit reversed in part.

The central legal issue was whether Osborn was “totally disabled” under the terms of his disability policies. The Ninth Circuit emphasized that this was a “factual question” and that the lower court improperly resolved conflicting evidence in favor of the insurer. “Courts may not resolve genuine disputes of fact in favor of the party seeking summary judgment,” the panel wrote. The Court held that “a reasonable jury could credit the testimony of Osborn’s physicians … that Osborn’s underlying conditions prevented him from safely practicing oral surgery as early as March 2020.”

In support of its holding, the Court pointed to several pieces of disputed evidence. First, it noted that Osborn’s physicians—along with certain documents maintained by Paul Revere itself—corroborated that Osborn’s medical conditions made it unsafe for him to continue practicing. This evidence alone could lead a reasonable jury to find that he met the policy’s definition of total disability. The Court was not persuaded by Paul Revere’s argument that Osborn’s inability to recall exactly what his doctors told him undermined his claim. “That Osborn could not recall what advice his physicians gave him … does not preclude a finding that Osborn was unable to perform his occupational duties because of injury or sickness as of March 2020,” the Court reasoned.

Second, the panel emphasized that a reasonable jury could find that Osborn’s inability to obtain sufficient personal protective equipment (PPE) in the early pandemic months rendered it unsafe for him to return to work—even if he otherwise wished to do so. The Court cited staff and expert testimony indicating that Osborn made diligent efforts to acquire PPE but was unable to obtain all the necessary supplies. Notably, the Court rejected the insurer’s reliance on Osborn’s own testimony that he “[a]bsolutely” would have resumed work in June 2020 had PPE been available. The panel clarified that this did not negate total disability—particularly given that Osborn suffered a pulmonary embolism in August 2020, which further exacerbated his COVID-19 risk profile.

Third, the Court noted that Osborn’s physicians testified that, even if PPE had been available, it would have been unsafe for him to resume clinical practice after the embolism. This testimony, viewed in combination with the early medical advice and the PPE shortages, presented a triable factual issue regarding whether Osborn was continuously disabled from at least March 2020 onward.

The Ninth Circuit also revived Osborn’s claim under the BOE policy, which reimbursed fixed monthly business expenses if the insured became totally disabled. While it affirmed that expenses incurred after Osborn permanently closed his practice in June 2020 were not “necessary,” the Court found there was a genuine dispute as to whether expenses incurred between March and June 2020—such as staff salaries and office costs—were “ordinary” and “necessary.” The panel concluded: “a reasonable jury could find that certain expenses that Osborn incurred during this period were ‘ordinary’ and ‘necessary’ to the operation of his business.”

In contrast, the Court affirmed the district court’s dismissal of Osborn’s claim for breach of the implied covenant of good faith and fair dealing, noting that Paul Revere had conducted a detailed investigation and that no evidence supported a finding of unreasonableness or bad faith. Likewise, the panel found that the district court properly dismissed the punitive damages claim.

This case serves as a cautionary tale for insurers relying on summary judgment in disability disputes where medical facts are contested. The Ninth Circuit made clear that when “evidence is genuinely disputed on a particular issue—such as by conflicting testimony—that issue is inappropriate for resolution on summary judgment.”

In sum, Osborn is a win for policyholders seeking to enforce their disability coverage in the face of ambiguous medical and factual circumstances. The decision reinforces the principle that juries—not judges—must resolve factual disputes regarding an insured’s ability to work, particularly where expert testimony and credibility assessments are involved. If you need expert advice from the top disability insurance attorneys in California, call McKennon Law today.