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| Disposition:
(Settlement/Arbitration/Trial) |
Settlement |
Date: |
8/26/1997 |
Type of Case: |
Insurance |
Allegation(s): |
Insurance bad faith: accidental death policy |
Result: |
$455,000 |
Case Name: |
Ryan v. S.D. Hospital Assoc. dba Sharp HealthCare
and AIG Life Ins Co. |
Facts: |
2/19/94: Decedent, a 36-year-old medical records clerk, died after elective surgery at Sharp Memorial Hospital. At the time of her death, decedent had an Accidental Death and Dismemberment (AD&D) policy, which she obtained through her employer, Sharp HealthCare. This policy named her husband as her beneficiary. The coverage was provided through an ERISA plan and provided for $500,000 in benefits payable upon decedent's accidental death. San Diego Hospital Association, dba Sharp HealthCare, was the plan administrator. The AD&D policy was funded by AIG Life Insurance Company.
Following Mrs. Ryan's death, an autopsy performed in-house at Sharp Memorial Hospital revealed no physical/physiological reason for decedent's death. Evidence and information collected suggested that her death may have been related to respiratory arrest caused by an overdose of narcotic pain medication.
Decedent's beneficiary submitted a claim to AIG for benefits under the AD&D policy, which was denied. At the same time, the husband and children pursued a claim for medical negligence against Sharp Memorial Hospital and one of decedent's physicians. The medical negligence/wrongful death case was settled by Sharp Memorial Hospital during the trial.
After following the appellate process required by AIG and after a final denial of the claim, decedent's beneficiaries brought suit against AIG and Sharp in an attempt to recover the $500,000 in benefits due.
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| Injury/Injuries: |
Death, female, age 36, survived by husband and two daughters. $500,000 insurance policy.
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| Contentions: |
Plaintiff claimed the policy was an accidental death benefit policy. California law applied despite the fact that it was an ERISA policy. Decedent's death had to be considered accidental and unforeseen, unexpected and not caused by her own hand.
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| Special Notes: |
In June
1997, defendants made a motion for summary
judgment asking the court to rule as a
matter of law that there was no coverage
under the policy and that California law
was preempted by federal law because the
policy in question was part of an ERISA
plan. Defendants' motion for summary judgment
was denied.
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