SPD Deemed Inadequate for Failing to Address Divorce

Debra Frizell purchased life insurance for her husband through her employer Raytheon. But Metropolitan Life Insurance Company – the administrator of the Raytheon Group Life Insurance Plan –denied her benefits when her husband David Frizell died in 2004, because he was not her “legal spouse” at the time of his death.

According to the opinion by Chief U.S. Circuit Judge Joe Fish, the SPD did not spell out the effect that divorce would have on benefit coverage. With respect to the eligibility of dependents, the Raytheon Group Life Insurance Plan extends coverage to legal spouses and same-sex domestic partners. It goes further to say that the optional dependent coverage can be cancelled if the employee is fired and that the only disqualifying event is if the dependent commits suicide.

Frizzell did not contest Met Life’s interpretation of the plan in the certificate of insurance, but challenged, under the Employee Retirement Income Security Act (ERISA), the interpretation of the plan as summarized in the SPD. The contents of the SPD are federally regulated, the court states, and must contain “a statement clearly identifying circumstances which may result in disqualification, ineligibility, or denial, loss, forfeiture, suspension, offset, reduction, or recovery . . . of any benefits that a participant or beneficiary might otherwise reasonably expect the plan to provide.”

Both Frizell and the plan agree that a person cannot qualify as a dependent spouse (and thus cannot be enrolled in the optional dependent life insurance policy) unless that person is the legal spouse of the employee. However, “the plan is silent as to any requirements following initial enrollment in the plan,” and does not mention divorce, the opinion states.

The case is Frizzell v. Raytheon Group Life Insurance Plan,N.D. Tex., No. 3:06-CV-033-G, 2/16/07.