Danny DeVito on why insurance companies lack character

You see, to develop character you need to understand and acknowledge to yourself your mistakes; you “wish you had it to do over but you know you can’t, because it’s too late”:



In ERISAworld insurance companies get do-overs all the time. So of course they lack character.

Consider, for example, Leger v. Tribune Company Long Term Disability Benefit Plan, a 2009 case out of the Seventh Circuit. According to the court, Lisa Leger “suffers from a debilitating condition and must expend a great deal of effort to cope with her condition. She has had seventeen surgeries and procedures over the last twenty years.” The ERISA insurer on the case, MetLife, nonetheless terminated her disability insurance benefits, basing its decision on opinions rendered by its paid file-review physicians that Ms. Leger could work despite what the Seventh Circuit found to be a “debilitating condition.” Ms. Leger argued MetLife “cherry-picked the statements from her medical history that supported the decision to terminate her benefits, while ignoring a wealth of evidence to support her claim that she was totally disabled,” and the court agreed, finding MetLife “acted in an arbitrary and capricious manner in terminating Ms. Leger’s benefits.”

So Ms. Leger won her case and was able to recover the stingy benefits ERISA allows, right?

Wrong! It may be true that in life there are no do-overs, but that doesn’t apply to an ERISA insurer. The court sent Ms. Leger’s file back to MetLife so it could have a second chance to terminate her benefits, this time with knowledge of where it had gone wrong in the court’s view. Did Ms. Leger get her past-due benefits? That was left up to MetLife, the same company which had already “cherry-picked the statements from her medical history” and ignored “a wealth of evidence to support her claim that she was totally disabled.”

So are we to take from this the lesson that the appropriate punishment for bank robbery is to give the robber another chance to walk past the bank without robbing it, as if the original crime had never occurred? Apparently, in ERISAworld, that’s how it works.

So ERISA insurers have no regrets. And no character.