First Circuit Rejects “Presumption in Favor of Accident” in Accidental Death Benefit Disputes

The First Circuit recently held that it is inappropriate to apply any kind of “presumption in favor of accident” in cases involving claims under accidental death and dismemberment (AD&D) policies, even in cases transferred from a jurisdiction that would apply such a rule, affirming an insurer’s denial of benefits based on an exclusion for suicide or intentional injury. Alexandre v. Nat’l Union Fire Ins. Co. of Pittsburgh, Pa., --- F. 4th ---, 2022 WL 18778 (1st Cir. 2022).

Marzuq Muhammad was a beneficiary of an AD&D policy that did not define the term “accident” and that also contained an exclusion for “losses, disability, or death caused by” “suicide or any attempt at suicide or intentionally self-inflicted injury or any attempt at intentionally self-inflicted injury.” His wife submitted a claim under the AD&D policy after his death. A medical examiner investigated the circumstances of his death, and the final death certificate issued by the medical examiner listed his death as a suicide. His wife disputed the medical examiner’s finding, though, and submitted sworn evidence to the contrary with her claim. The insurer weighed the competing evidence and denied the claim based on the exclusion in the AD&D policy for suicide and intentional injury.

Courts are frequently called on to interpret the term “accident” in AD&D policies when it is undefined and have adopted a series of rules and presumptions for doing so. In the First Circuit, an insured’s death is an “accident” if the beneficiary can demonstrate that “the insured did not expect an injury similar in type or kind and that the suppositions underlying this expectation were reasonable.” If there is no evidence of the insured’s subjective expectation, the “fact-finder should then engage in an objective analysis of the insured’s expectations.”

The case was only in the First Circuit, though, after the insurer successfully moved to transfer it to the District of Massachusetts from the Southern District of Florida, where it was originally filed. And in Florida, the Eleventh Circuit applies a “legal presumption[] against suicide and in favor of accidental death” whenever the evidence is “inconclusive” as to whether an insured “died by accidental or intentional means.” The plaintiff argued that the court should apply the Eleventh Circuit’s rule instead and that the insurer’s denial of benefits was arbitrary and capricious in light of that presumption and the conflicting evidence as to the cause of Muhammad’s death.

The First Circuit rejected the Eleventh Circuit’s “presumption in favor of accident,” applying its own well-settled precedent that the transferee court — here, the federal court in Massachusetts — should apply its own precedent on questions of federal law rather than any law of the transferor court — here, the federal court in Florida. With no presumption in favor of accidental death, the First Circuit affirmed the district court’s grant of summary judgment for the insurer, holding that it was not arbitrary and capricious for the insurer to weigh the competing evidence and to determine that Muhammad’s death was not accidental.

The case is an important reminder of the importance of forum in cases involving AD&D claims. Different jurisdictions apply different rules to the interpretation of AD&D policies. Defendants should carefully consider the implication of transfer on the substantive law that will apply to the claims in the case in any AD&D case in which moving to transfer venue is an option.