In Sellers v. Zurich American Insurance Company, No. 10-1448 (7th Cir. 2010), on November 16, 2006, the plaintiff’s husband had surgery to remove a broken wire from his knee. The husband died nine days after this surgery (November 25, 2006) from a heart attack, which was caused by his immobilization following the surgery. The wire had been inserted in the husband’s knee over a year earlier (on September 29, 2005), during an operation to repair his patella tendon, which he tore while performing training exercises at work (the accident occurring on September 15, 2005). The issue faced by the Court in this case, which arises under ERISA, is whether the plaintiff is entitled to a death benefit from the accidental death and dismemberment insurance policy (the “Policy”) in a welfare plan maintained by the husband’s employer. The Policy was administered by the defendant, Zurich American Insurance Company (“Zurich”). Zurich determined that the plaintiff is not entitled to a death benefit from the Policy. The Policy covers accidental deaths occurring within 365 days of the accident. The question became whether the husband’s death can be traced to an accident that occurred within a year of his death.
The Court reviewed Zurich’s decision to deny the death benefit under the arbitrary and capricious standard, since the Policy gave Zurich the authority to construe policy terms and determine benefit eligibility. Zurich denied the death benefit on the basis that there was no accident within one year of the plaintiff’s husband’s death. It had concluded that the broken wire was not an accident, because it was expected by the husband’s doctor. The Court said that this conclusion was not reasonable-it is the expectation of an average person-not a doctor- that matters. By itself, this conclusion would not pass the arbitrary and capricious test. However, the wire breakage was a complication from the original surgery, and surgery, and any complications resulting from the surgery, cannot be an accident within the meaning of the Policy. The accident is the activity that led to the surgery-here the patella tendon tear. Therefore, the accident occurred more than one year before the husband’s death, and Zurich’s denial of the death benefit could not be overturned. As such, the Court concluded that no death benefit is payable to the plaintiff under the Policy.