In the case of Van Steen v. Life Insurance Company of North America ,WL 256806 (10th Cir. Jan. 2, 2018) the Tenth Circuit, affirmed the district court's decision, finding that Life Insurance Company of North America's decision to terminate Mr. Van Steen's benefits was arbitrary and capricious. Mr. Van Steen was diagnosed with mild traumatic brain injury as the result of a physical assault. Initially he was prevented from working in any capacity. However, he was eventually cleared to return to work on a part time basis; but with noted limitations including the ability to rest frequently and work from home as necessary. At the time of his disability, Mr. Van Steen was employed by Lockheed Martin Corporation which provided disability coverage under the Lockheed Martin Group Benefits Plan. The short term and long term disability plans were both administered by Life Insurance Company of North America (LINA) and controlled by the Employee Retirement Income Security Act (ERISA).
Court Ruling on Mutual of Omaha Pre-Existing Denial of Benefits
In the case of Horneland v. United of Omaha Insurance Company, the eleventh circuit reversed the United States District court for the Middle District of Florida's decision finding for the defendant. In the case, Horneland sued United of Omaha Life Insurance Company under ERISA, due to the fact that United of Omaha Life Insurance Company denied Horneland's long term disability. Horneland began to work as a real estate manager for Thornton's Inc. as part of the employment, Horneland received short term and long term disability coverage. However, per United of Omaha Insurance Company's insurance plan, long term disability coverage begins on the day following completion of 12 months of Active employment. The long term disability benefits also include a Pre-existing conditions exclusion. That exclusion states that the insurance company will not provide benefits for disability (a) caused by, contributed to by, or resulting from a Pre-existing Condition; and (b) which begins in the first 12 months after the individual is continuously insured under the policy. The eleventh circuit defines the term pre-existing as any injury or sickness for which the individual received medical treatment, advice or consultation, care or services including diagnostic measures, or had drugs or medicines prescribed or taken in the 3 months prior to the day they become insured under the policy.
