Widow Loses Drunk Driving Life Insurance Case

October 17, 2003 (PLANSPONSOR.com) - The widow of a Michigan man killed in a 2000 car accident when police said he was drunk has lost a legal battle in her attempt to collect on her husband's employer-provided life-insurance policy.

>US District Judge David Lawson of the US District Court for the Eastern District of Michigan turned away the lawsuit by plaintiff Sheryl Bullard, ruling that the administrator of the life insurance plan provided by her husband’s employer didn’t act arbitrarily in denying her request for benefits.

“(I) cannot say that the plan administrator’s decision was not supported by substantial evidence,” wrote Lawson. “The plan administrator’s decision was reasonable in light of the available evidence on the administrative record and the plan provisions.”

>According to Lawson’s ruling, Timothy Bullard was covered by a group insurance policy by his employer, Blue Lake Charters were Bullard was a mechanic. AIG Life Insurance provided the policy through the Daughters of Charity National Health Systems, Inc.

>Bullard died in July 2000 in Genesse County, Michigan when he lost control of his car while trying to pass another vehicle that was turning in front of him. After hitting the second car, Bullard’s vehicle crossed the centerline and hit a tree, killing both he and a passenger instantly, according to the Lawson opinion. At the time, Bullard’s blood alcohol level was 0.27% – far above the 0.10% threshold for being considered drunk in Michigan.

>After the accident, Sheryl Bullard attempted to collect on the policy, but AIG denied the claim on the grounds that Timothy Bullard had caused the fatal crash by being drunk. An administrative review committee later agreed with the initial claims denial, despite Sheryl Bullard’s assertion that the notion her husband was responsible for the accident “(was) nothing more than speculation.”

Sheryl Bullard sued over the claims dispute in Michigan state court, but the insurance company successfully had the case transferred to federal court. In arguments to Lawson, the defendants claimed that death benefits denial was backed up by “ample evidence.”