Roebuck v. USAble Life, No. 19-1855 (8th Cir. 2021)
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The Eighth Circuit affirmed the district court's order holding USAble Life did not abuse its discretion in denying plaintiff's claim for disability benefits under the Employee Retirement Income Security Act. The court rejected plaintiff's claim that the court cannot use an abuse of discretion standard in reviewing the denial of her claim because an Arkansas regulation (Rule 101) prohibits the inclusion of discretionary clauses in insurance contracts. Rather, the court concluded that an abuse of discretion is the appropriate standard of review or USAble Life's denial of plaintiff's claim.
The court also rejected plaintiff's arguments that the insurer had a conflict of interest or breached its fiduciary duty. The court concluded that USAble Life did not abuse its discretion in its interpretation of the policy or use of an in-house nurse to review, and that substantial evidence supports USAble Life's denial of plaintiff's claim. Finally, there is no support in the record for plaintiff's position that a radiculopathy diagnosis, absent a finding of disability, entitles her to benefits under the policy.
Court Description: [Grasz, Author, with Colloton and Gruender, Circuit Judges] Civil case - ERISA. The policy in question was not renewed after the effective date of Arkansas's Rule 101 which invalidates discretionary clauses in policies when an insurer responsible for providing disability income benefits also decides what benefits are due; as a result, the district court did not err in applying an abuse of discretion standard in reviewing the decision to deny benefits rather than the less deferential de novo standard of review; arguments that insurer had a conflict of interest or breached its fiduciary duty rejected; defendant's use of an in-house nurse to review her claim was consistent with the goals of the policy and was not an abuse of defendant's discretion in its interpretation of the policy; the decision to deny benefits was reasonable and supported by substantial evidence; there is no support in the record for plaintiff's claim that a radiculopathy diagnosis, absent a finding of disability, entitled her to benefits.
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