In Shah v. Metropolitan Life Ins. Co., 2019 U.S. Dist. LEXIS 25695 (S.D. Ohio Feb. 19, 2019), the U.S. District Court for the Southern District of Ohio dismissed a plaintiff insured's bad faith and punitive damages claims where there was a genuine dispute as to his right to benefits in light of the policy's coverage for disability caused by accident, but not by injury.
An interventional cardiologist—who was covered by an individual disability policy—claimed to suffer from neck, shoulder, and back pain, which worsened over time and was apparently caused by cervical disc disease and radiculopathy. The claimant ("Shah") took the position that he qualified for benefits under the portion of his policy providing benefits for disability caused by "accident."
Defendant Metropolitan Life Insurance Company ("MetLife") denied the claim, asserting the development of the insured's chronic condition over time constituted a sickness, as opposed to an acute, traumatic event that would qualify as an accident under the policy.
After Shah sued for breach of contract, bad faith, and punitive damages, MetLife filed a motion for partial summary judgment, seeking dismissal of the bad faith and punitive damages portions of the complaint. MetLife argued the "genuine dispute" doctrine required dismissal of these requests, even if the court assumed the denial was a breach of contract, based on case law holding that unless it appears the claim denial was arbitrary or capricious, extra-contractual relief should be dismissed.
The court found MetLife had considered all the information provided to them, and that a jury could not reasonably find the carrier lacked good faith in its processing of the claim.
Accordingly, the court granted MetLife's motion for partial summary judgment.