BAD FAITH CLAIM SURVIVES WHERE FACTUAL DISPUTE EXISTS OVER REASONABLENESS OF CARRIER’S POSITION IN DENYING LONG TERM DISABILITY BENEFITS TO INSURED WITH MULTIPLE SCLEROSIS (Philadelphia Federal)
The insurer denied long term disability benefits to an insured with multiple sclerosis. She sued for breach of contract and bad faith, and the insurer sought summary judgment on the bad faith claim. Eastern District Judge Tucker denied the motion, as factual disputes on the reasonableness of the carrier’s position remained undetermined.
Judge Tucker states that :
[1] [The insured] provided evidence that: (1) she has significant family history of multiple sclerosis (maternal grandmother, maternal aunt, and maternal aunt’s son), (2) that she went through documented, extensive testing and evaluation with neurological specialists and had a well-developed record of positive test results and symptoms indicating a long-term disability, and (3) was even approved for a multiple sclerosis medication.
[2][The insurer] then made insurance policy payment decisions based on internal reports and an independent medical examination where [it] did not provide the examiner with her extensive records and the doctor did not review them before directly contradicting her primary care team.
[3] Further, [the insured’s] initial claims were accepted, and [the insurer’s] claim evaluators approved her symptoms and the initial diagnoses by her doctors as falling within their definition of disability.
[4] Once [the insured] officially qualified for long-term disability, [the insurer] began routinely rejecting her claims and apparently became uncertain about a formal multiple sclerosis diagnosis.
[5] With this in mind, [the insured] puts forth sufficient facts to allow a jury to conclude that [the insurer] acted unreasonably, and accordingly, the Motion to Dismiss Plaintiff’s bad faith claims is denied.
