Death by Self-Administered Dialysis is Excluded
Post 5173
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Clear & Unambiguous Exclusion Effective
Dana Kleinsteuber died while administering her own dialysis at home. MetLife now agrees that tragedy was an accident but refused to pay because of an exclusion for losses caused or contributed to by the treatment of a physical illness.
In Charles M. Kleinsteuber v. Metropolitan Life Insurance Company, CIVIL No. 23-3494 (JRT/DTS), United States District Court, D. Minnesota (August 19, 2025) the USDC was faced with the interpretation of an exclusion in an ERISA plan.
KEY FACTS:
Dana Kleinsteuber’s Death:
Dana Kleinsteuber, diagnosed with end-stage renal disease (ESRD), was self-administering dialysis at home when she suffered acute blood loss and died. The cause of death was listed as ESRD and natural causes.
Insurance Claims:
Charles Kleinsteuber, Dana’s husband, filed claims for both life insurance and accidental death and dismemberment (AD&D) insurance. MetLife approved the life insurance claim but denied the AD&D claim, stating that the death was not accidental and was caused by the treatment of ESRD.
Legal Action:
Charles Kleinsteuber filed an ERISA action to recover the AD&D benefit, arguing that Dana’s death was accidental.
LEGAL POINTS:
Policy Exclusion:
The AD&D policy excluded coverage for losses caused or contributed to by the treatment of a physical illness. MetLife argued that Dana’s death fell under this exclusion because it was related to her dialysis treatment.
Court’s Analysis:
The court applied the abuse of discretion standard to determine if MetLife’s interpretation of the policy exclusion was reasonable. The court considered several factors, including whether MetLife’s interpretation was consistent with the goals of the plan, whether it rendered any language in the plan meaningless, and whether it conflicted with ERISA’s substantive or procedural requirements.
To determine whether MetLife abused its discretion in denying the claim, the Court performed a two-step analysis, asking (1) whether the insurer’s interpretation of the Plan language is reasonable, and (2) whether application of that interpretation to the facts is supported by substantial evidence.
The Policy excludes coverage when “treatment” of a physical illness “contributed to” the insured’s “loss.” MetLife interprets that language to mean that a person who accidentally bleeds out from an open port during self-administered dialysis is excluded from coverage.
When determining reasonableness of an ERISA policy interpretation, courts will interpret consistently with the goals of the Plan. When an administrator has offered a reasonable interpretation, courts may not insert their own interpretation because under an abuse of discretion review, courts are not tasked with determining the best or preferable interpretation.
The primary goal of an AD&D plan is to provide an employees’ benefit and welfare plan for its members. When paired with life insurance the goal is to increase the amount of recovery over the face amount of the policy when death is from an accident.
MetLife adequately explained the specific reasons for the denial in its initial denial letter. In that letter, MetLife explained that the death was not accidental because Dana’s Death Certificate listed her death as resulting from ESRD and natural causes. It also stated that even if the death were an accident, the policy exclusion applied because the police report showed that Dana passed away from a medical emergency involving a dialysis machine.
MetLife, therefore, complied with the regulation requirements in issuing its initial denial.As long as there is substantial evidence to show that Dana’s dialysis treatment contributed to her death, MetLife did not abuse its discretion in denying Kleinsteuber’s claim.
CONCLUSION
The USDC found that MetLife did not abuse its discretion in determining that the dialysis treatment contributed to Dana’s death, which triggered a policy exclusion. Therefore, the Court denied Kleinsteuber’s Motion for Summary Judgment and granted MetLife’s Motion for Summary Judgment.
The court found that MetLife did not abuse its discretion in denying the AD&D claim, as there was substantial evidence that Dana’s dialysis treatment contributed to her death.
ZALMA OPINION
ERISA is a program created by federal law and is interpreted by federal courts. When there is a legitimate, clear and unambiguous requirement that the Accidental Death policy required that the death is accidental and the loss was not caused or contributed to by the treatment of a physical illness. Since dialysis is the treatment of an illness and contributed to the death the exclusion applied.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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Not Wise to Attempt Rescission Without Evidence
Post 5173
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Desiree Durga and Justin Durga v. Memberselect Insurance Company, No. 371891, Court of Appeals of Michigan (August 13, 2025) Desiree Durga and Justin Durga (plaintiffs) claimed the insurer wrongfully attempted to rescind an auto policy.
THE ALLEGATIONS
MemberSelect claimed that Desiree Durga’s application for insurance contained a material misrepresentation, it did not produce a copy of the application. In fact defendant admitted the application for insurance no longer exists.
Trial Court Decision
The trial court granted the plaintiffs’ motion for summary disposition on their breach of contract claim and denied the defendant’s cross-motion for summary disposition, which argued that it was entitled to rescind the policy. The court found that the defendant failed to provide clear and convincing evidence of fraud
The court ...
Improper Joinder of Multiple Party Criminal Fraud Case With Co-Defendants Charged with Murder
Post 5172
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Murder Defendants Must be Tried Separately from Fraud Defendants
A case that involved allegations of a years-long scheme by over a dozen individuals to stage fake automobile collisions in the New Orleans metropolitan area and file fraudulent insurance claims and lawsuits based on the staged collisions. The key individuals involved included Cornelius Garrison, who began cooperating with the federal government in 2019 and was subsequently murdered on September 22, 2020.
FACTS
In United States Of America v. Ryan Harris, et al., CRIMINAL ACTION No. 24-105, United States District Court, E.D. Louisiana (July 25, 2025) the USCA dealt with motions to sever some defendants from the massive and admittedly complex case. There are 11 defendants charged with a multi-year conspiracy involving ...
Additional Insureds Can Intervene to Try to Defeat Suit to Rescind Policy
Post 5170
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Posted on August 18, 2025 by Barry Zalma
The case involves Accelerant Specialty Insurance Company (“Accelerant”) seeking a declaratory judgment against Big Apple Designers, Inc. (“Big Apple”), declaring that the insurance policies issued by Accelerant to Big Apple are invalid and do not create a duty to defend or indemnify Big Apple in several personal injury actions currently pending in New York State Supreme Court. M&R Construction Group, Inc. (“M&R”) and Continental Indemnity Company (“Continental”) filed a motion to intervene, asserting that M&R is entitled to coverage from Accelerant as an additional insured.
In Accelerant Specialty Insurance Company v. Big Apple Designers, Inc., No. 24-CV-7793 (ARR) (RML), United States District Court, E.D. New York (August 6, 2025) the USDC ruled to ...
Is Injury in the Course of Self-Defense an Occurrence?
Post 5171
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When There is no Accident the Intentional Acts Exclusion is Irrelevant
The case involves a tragic incident where Kimberly Mollicone was killed during a gunfight between her husband, Matthew Mollicone, and Daniele Giannone. The central issue is whether Giannone’s actions, taken in self-defense, are covered under his State Farm homeowner’s insurance policy.
In State Farm Fire And Casualty Company v. Daniele Giuseppe Giannone; Heidi C. Aull, personal representative for the estate of Kimberly Ann Mollicone, Nos. 24-1264, 24-1265, United States Court of Appeals, Sixth Circuit (August 5, 2025) resolved the dispute.
THE INSURANCE COVERAGE
Although rare in insurance contracts the policy in question provides coverage for the insured’s liability to third parties who are injured ...
Rulings on Motions Reduced the Issues to be Presented at Trial
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CASE OVERVIEW
In Richard Bernier v. State Farm Mutual Automobile Insurance Company, No. 4:24-cv-00002-GMS, USDC, D. Alaska (May 28, 2025) Richard Bernier made claim under the underinsured motorist (UIM) coverage provided in his State Farm policy, was not satisfied with State Farm's offer and sued. Both parties tried to win by filing motions for summary judgment.
FACTS
Bernier was involved in an auto accident on November 18, 2020, and sought the maximum available UIM coverage under his policy, which was $50,000. State Farm initially offered him $31,342.36, which did not include prejudgment interest or attorney fees.
Prior to trial Bernier had three remaining claims against State Farm:
1. negligent and reckless claims handling;
2. violation of covenant of good faith and fair dealing; and
3. award of punitive damages.
Both Bernier and State Farm dispositive motions before ...
ZIFL Volume 29, Issue 10
The Source for the Insurance Fraud Professional
See the full video at https://lnkd.in/gK_P4-BK and at https://lnkd.in/g2Q7BHBu, and at https://zalma.com/blog and at https://lnkd.in/gjyMWHff.
Zalma’s Insurance Fraud Letter (ZIFL) continues its 29th year of publication dedicated to those involved in reducing the effect of insurance fraud. ZIFL is published 24 times a year by ClaimSchool and is written by Barry Zalma. It is provided FREE to anyone who visits the site at http://zalma.com/zalmas-insurance-fraud-letter-2/ You can read the full issue of the May 15, 2025 issue at http://zalma.com/blog/wp-content/uploads/2025/05/ZIFL-05-15-2025.pdf
This issue contains the following articles about insurance fraud:
Health Care Fraud Trial Results in Murder for Hire of Witness
To Avoid Conviction for Insurance Fraud Defendants Murder Witness
In United States of America v. Louis Age, Jr.; Stanton Guillory; Louis Age, III; Ronald Wilson, Jr., No. 22-30656, United States Court of Appeals, Fifth Circuit (April 25, 2025) the Fifth Circuit dealt with the ...
