The case of Sunil Srinivasan, DDS v. Continental Assurance Company and Trustmark Insurance Company (Trustmark) presents one issue: Did Trustmark deny Plaintiff’s claim for total disability or has it yet to make a final decision.
Plaintiff was a self-employed endodontist when he developed back and leg pain so severe, he quit work. He had a disability insurance benefit through Trustmark that would provide him total disability income if, according to the terms of the policy, he proved he was unable to perform the substantial and material duties of his own occupation.
The policy also allowed for a claim for residual disability which applied if the insured was gainfully employed at [his] own occupation, but because of injury or sickness, the person was working less and the “Loss of Earnings Rations is 20% or more.”
Plaintiff filed a lawsuit against Trustmark, asserting that Trustmark denied his claim for Total Disability and by doing so, it breached the insurance contract and that it also breached the implied duty of good faith and fair dealing. He based his lawsuit on a letter he received on May 2, 2018, which he alleged denied his claim.
Trustmark answered by arguing that it never denied Plaintiff’s claim, and that the May 2 letter was not a denial letter, but a status report which clearly stated the claim for disability was still pending.
The sole issue in the case was whether the May 2, 2018, letter was the equivalent of a denied disability claim. After evaluating all the undisputed evidence, The United States District Court for the Northern District of California found in favor of Trustmark. The Court concluded that “what is plainly stated on the face of the May 2018 letters – i.e., that a final review was still pending.”
Therefore, Plaintiff’s lawsuit was filed prematurely and the Court denied his motion for partial summary judgment.
Trustmark’s Review of Plaintiff’s Claim
Plaintiff submitted a claim for disability to Trustmark on November 17, 2017. Between that date and the May 2, 2018, letter that is the subject of the lawsuit, Trustmark sent Plaintiff many letters. The letters generally were status reports and often asked for more information. Some status updates and information that was requested of Plaintiff included:
- Tax returns.
- The need for more substantiating medical information.
- Informing him his requested information had not yet been received.
- Repeated status reports informing him that Trustmark was still waiting for requested information.
Trustmark set up a personal interview with Plaintiff with its representative, Jon Cipro that took place on April 11, 2018. Plaintiff recorded the interview and the recording and transcript became part of the record the Court evaluated in making its decision on Plaintiff’s motion for partial summary judgment.
Mr. Cipro informed Plaintiff that its medical consultant felt that he could still work at least on a part-time basis, so Trustmark may determine he was “partially disabled versus totally disabled” so might qualify for residual disability.
Mr. Cipro noted that Plaintiff had another “MRI coming up” and that might “change the way the company looks at the condition…” Mr. Cipro also stated, “as far as I know, there’s been no determination that’s been made at this time.” In the administrative record, Mr. Cipro noted that the “insured requests the company’s position in writing before he could consider any next steps on his behalf.”
On May 2, 2018, Trustmark sent Plaintiff a letter which stated, inter alia, “We are writing to update you regarding your claim.” The letter mentioned other information that it had recently obtained, and added, “At this time the information on hand does not support a claim for Total Disability under your policy. Prior to a final review, we request that you submit any additional medical information in support of your claim. Be sure to include any recent MRI reports and actual studies. Any information you wish to submit should be remitted within 30 days of this letter.”
The letter also included a standard provision telling Plaintiff how long he had to file legal action and his right to request a review by the California Department of Insurance.
In early June, Trustmark paid a private investigator to conduct surveillance on Plaintiff. On June 13, 2018, Trustmark sent a request to the exam coordinators for Plaintiff to undergo an independent medical exam (IME). On that same date, Plaintiff filed this lawsuit. Trustmark was not served with the complaint until June 20, 2018. On June 21, 2018, a letter was sent to Plaintiff telling him that “Prior to a final review of your claim, we will be arranging for an Independent Medical Exam (IME).”
Reasons the Court Ruled the Letter was Not a Denial of Total Disability Benefits
The Court carefully reviewed the May 2 letter and concluded “The letter expressly states that ‘final review’ was still pending – and hence no final decision had taken place.” That view was supported by subsequent letters telling Plaintiff he had 14 days to submit more information.
Finally, the court agreed that Trustmark would not have spent money on an IME, and on surveillance conducted on Plaintiff, if it had already denied his claim.
The Court also found that the “boilerplate” language in the May 2 letter advising the Plaintiff of his right to request review “does not negate the clear and unequivocal language in the letter specifically stating a ‘final review’ was still pending.
Contact Attorneys at Dell & Schaefer
This case was not handled by our office, but it may provide claimants guidance in their pursuit of obtaining a final decision from their disability insurance company that is reviewing the disability claim. If you need assistance with a similar matter, please contact a disability attorney at Dell & Schaefer for a free consultation.