Patrick J. Schiltz, United States District Judge
Richard Rathman participated in an insurance plan that was established by his employer, administered and insured by defendant Union Security Insurance Company (Union Security), and governed by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1001 et seq. The plan provided benefits to Richards wife (plaintiff Denise Rathman) in the event of Richards accidental death. But after Richard died from injuries sustained in a snowmobile accident, Union Security denied Denises claim for accidental-death benefits, citing an exclusion for death arising from intoxication while operating a motor vehicle.
Denise twice appealed Union Securitys denial of her claim. She conceded that Richard was intoxicated at the time of the accident, but she argued that a snowmobile is not a motor vehicle and therefore the exclusion did not apply. Union Security continued to maintain that a snowmobile is a motor vehicle and denied Denises appeals. Denise then brought this lawsuit to challenge Union Securitys decision. Both parties now move for summary judgment.
When an ERISA plan gives the plan administrator discretion to interpret the plan and ... determine eligibility for benefits-as does the ERISA plan that covered Richard-the Court must uphold the plan administrators decision as long as it is based on a reasonable interpretation of the [plan]. Donaldson v. Natl Union Fire Ins. Co. of Pittsburgh , 863 F.3d 1036, 1039 (8th Cir. 2017) (citation omitted). Union Securitys interpretation of the phrase motor vehicle to include a snowmobile is reasonable. Therefore, the Court grants Union Securitys motion for summary judgment, denies Denises motion for summary judgment, and dismisses this action.
I. BACKGROUND
At the time of his death, Richard was participating in an insurance plan that was established by his employer. See Compl. ¶ 1; ECF No. 20 at 2; ECF No. 26-2 at 75. The plan was both administered and insured by Union Security. See ECF No. 26-2 at 1; cf. id. at 30 (requiring the policyholder to give Union Security any data needed to administer the plan). Denise was Richards sole beneficiary under the plan. See Compl. ¶ 4; ECF No. 26-2 at 68, 77-80; ECF No. 26-3 at 10.
Richard had basic term life insurance, additional contributory life insurance, and accidental death and dismemberment (AD & D) benefits through the plan. See ECF No. 26-2 at 1-34; see also id. at 67 (listing the amounts claimed for each type of insurance). Only the AD & D benefits are at issue in this lawsuit.
A. The Plan
The plan required Union Security to pay AD & D benefits to an employees designated beneficiary if the employee die[d] as the direct result of an injury.Id. at 21 (emphasis omitted). But the plan excluded AD & D benefits for any loss that result[ed] directly or indirectly from ... [an employees] intoxication while operating a motor vehicle. Id. at 21-22.
The plan defined intoxication as a blood-alcohol level that exceeds the legal limit for operating a motor vehicle in the jurisdiction in which the loss occurs. Id. at 22. But the plan did not define the term motor vehicle-even though it did define the term automobile in a section regarding automobile-accident benefits. See id. at 23.
The plan recited that it was delivered in Minnesota and governed by its laws, unless otherwise preempted by federal law. Id. at 1. The plan also gave Union Security the authority to determine eligibility for participation or benefits and to interpret the terms of the policy. Id. at 27 (emphasis omitted).
B. The Accident
On December 4, 2015, Richard collided with a tree while operating a snowmobile. Compl. ¶ 3. He was airlifted to a hospital. ECF No. 26-3 at 24, 39. Roughly 15 minutes after he arrived at the hospital, he still had a blood-alcohol level of 0.149, which is nearly double the legal limit in Minnesota. Id. at 23, 39-40; Minn. Stat. § 169A.20, subd. 1b(5) (making it a crime to operate a snowmobile with a blood-alcohol level of 0.08 or more). Richard died from his injuries the following day. ECF No. 26-3 at 2, 23-37, 39.
C. The Claims Process
After Richards death, Denise filed a claim for life-insurance and AD & D benefits. A claims specialist for Union Security reviewed and approved the life-insurance claim. See id. at 5, 10. But the claims specialist denied Denises AD & D claim on the grounds that the policy excluded AD & D benefits for injuries resulting from intoxication while operating a motor vehicle. See id. at 10-11; ECF No. 26-4 at 53-55. Denise filed two appeals of Union Securitys denial of her AD & D claim. See ECF No. 26-4 at 61-62, 81-82. Union Security denied both appeals. See id. at 69-71, 84-86.
1. The Initial Claim Determination
Before denying Denises claim for AD & D benefits, the claims specialist collected Richards medical records. ECF No. 26-3 at 12. As noted, those records showed that Richards blood-alcohol level was almost twice the legal limit when he arrived at the hospital. The claims specialist asked a consulting physician for Union Security to review Richards records and provide an opinion about Richards cause of death. The doctor determined that Richards death was due to trauma from a motor vehicle accident that was directly caused by ethanol intoxication. Id. at 39-40.
The claims specialist then asked an in-house lawyer whether a snowmobile was a motor vehicle for purposes of the plan. The lawyer responded that the term motor vehicle should be interpreted in accordance with its plain meaning because it was not defined in the plan. ECF No. 26-4 at 52. He then opined that the plain meaning of motor vehicle includes a snowmobile because a snowmobile is (1) a vehicle that is (2) propelled by a motor. Id. He also noted that his interpretation was consistent with a Minnesota Court of Appeals decision holding that snowmobiles could be considered motorized land vehicles as that term was used in a different insurance policy. Id. Union Securitys in-house lawyer conceded that some Minnesota statutes define Motor Vehicles in a way that excludes snowmobiles. Id. But, he noted, those definitions were not incorporated into the policy. Id. Therefore, he concluded, snowmobiles are motor vehicles for purposes of the policy. Id.
Relying on the interpretation of the in-house lawyer, the claims specialist denied Denises AD & D claim in a letter dated May 19, 2016. Id. at 53-55.
2. Denises First Appeal
In response, Denise hired a lawyer and appealed the denial of her AD & D claim. Id. at 61-62. Denise acknowledged that the plan did not define the term motor vehicle. Id. But she argued that the term motor vehicle should be interpreted in the same way that it is defined under Minnesota traffic regulations-specifically, Minn. Stat. § 169.011, subd. 42 (which defines motor vehicle as every vehicle which is self-propelled) and Minn. Stat. § 169.011, subd. 92 (which defines vehicle as a device in which a person is or may be transported or drawn upon a highway). Denise argued that a snowmobile could not be used to transport people upon a highway, so a snowmobile did not meet the definition of a motor vehicle. ECF No. 26-4 at 62.
Union Security assigned Denises appeal to an appeals specialist. Id. at 64-65. The appeals specialist reviewed the plan, Richards medical records, and Denises appeal letter. Id. at 64. The appeals specialist acknowledged that some of Minnesotas traffic laws define the term vehicle as a device in which a person may be transported upon a highway, but she noted that the plan did not specifically incorporate the definition of motor vehicle in the Minnesota traffic regulations. Id. Also, Merriam-Webster defined motor vehicle as a vehicle powered by a motor. Id. at 64-65. The appeals specialist therefore concluded that a snowmobile was a motor vehicle and denied Denises appeal in a letter dated July 20, 2016. Id. at 69-71.
3. Denises Second Appeal
Denise then filed a second appeal repeating the argument that she made in her first appeal-namely, that motor vehicle should be interpreted as defined in Minnesotas traffic regulations. Id. at 81-82. In response, the same appeals specialist referred to her previous reasoning and denied Denises second appeal in a letter dated August 16, 2016. Id. at 84-86. The appeals specialist also notified Denise that this denial was the final administrative remedy, leaving Denise free to pursue a lawsuit if she was dissatisfied with Union Securitys decision. Id. at 85.
D. The Lawsuit
Having exhausted her administrative remedies, Denise sued Union Security in state court. See ECF No. 1-1. Union Security removed the action to federal court under 28 U.S.C. § 1331 (because Denises claims were completely preempted by ERISA) and § 1332 (because the amount in controversy exceeded $75,000 and Denise and Union Security were citizens of different states). See ECF No. 1 at 2-3. Both parties have now moved for summary judgment.
II. ANALYSIS
The parties agree that the plan is governed by ERISA. The parties also agree that the plan gives Union Security the authority to determine eligibility for ... benefits and to interpret the terms of the policy. ECF No. 26-2 at 27 (emphasis omitted). Consequently, the question for the Court is not whether it would, as an original matter, interpret the term motor vehicle to include snowmobiles. [W]here plan fiduciaries have offered a reasonable interpretation of disputed provisions, courts may not replace [it] with an interpretation of their own. Donaldson , 863 F.3d at 1039 (quoting King v. Hartford Life & Accident Ins. Co. , 414 F.3d 994, 999 (8th Cir. 2005) (en banc) ). The Court must defer to Union Securitys interpretation as long as it is reasonable and supported by substantial evidence. Cooper v. Metro. Life Ins. Co. , 862 F.3d 654, 660 (8th Cir. 2017).
A. The Finley Test for Reasonableness
The Eighth Circuit applies a five-factor test-known as the Finley test-in determining whether an administrators interpretation of an ERISA plan is reasonable. The Finley test requires a court to consider:
[1] whether their interpretation is consistent with the goals of the Plan, [2] whether their interpretation renders any language of the Plan meaningless or internally inconsistent, [3] whether their interpretation conflicts with the substantive or procedural requirements of the ERISA statute, [4] whether they have interpreted the words at issue consistently, and [5] whether their interpretation is contrary to the clear language of the Plan.
Finley v. Special Agents Mut. Ben. Assn , 957 F.2d 617, 621 (8th Cir. 1992). The Court will address each factor in turn.
First, Union Securitys interpretation of motor vehicle is consistent with the goals of the Plan. Id. To be sure, one goal of the plan was to provide an extra measure of financial security to the beneficiaries of employees who were accidentally injured or killed. But another goal of the plan was to reduce moral hazard -that is, to avoid creating an incentive for employees to engage in risky or self-injurious behavior. To further the latter goal, the policy excluded AD & D coverage for injuries and death resulting from (among other things) taking part in a riot, a felony, suicide or attempted suicide, intentionally self-inflicted injury, the [unlawful] use of any drug-and, of course, intoxication while operating a motor vehicle. ECF No. 26-2 at 21-22.
Operating a snowmobile while intoxicated is no less risky to the employee than operating an automobile while intoxicated. (Indeed, it may be more risky, given that snowmobiles lack air bags and other safety features common in automobiles.) Therefore, interpreting the term motor vehicle to include snowmobiles is consistent with the plans goal to reduce moral hazard.
Second, Union Securitys interpretation would not make other language in the plan meaningless or internally inconsistent. Finley , 957 F.2d at 621. To the contrary, Union Securitys interpretation is consistent with other language in the plan. The plan provides a separate automobile accident benefit when a covered person dies from an automobile accident injury while wearing a seat belt. ECF No. 26-2 at 8 (emphasis omitted). The plan defines automobile
to include only a four-wheel car of the private passenger type including pick-up trucks and vans with a load capacity of one ton or less. Id. at 23. Obviously, then, the phrase motor vehicle is intended to include vehicles beyond those that are four-wheel car[s] of the private passenger type. If motor vehicle was limited to such car[s], then the plan would not separately (and narrowly) define automobile.
Third, Union Securitys interpretation does not conflict with ERISAs substantive or procedural requirements. Finley , 957 F.2d at 621. Denise does not argue otherwise.
Fourth, Union Security has consistently interpreted motor vehicle to include snowmobiles. Id. From the start, Union Security took the position that a snowmobile was a motor vehicle because it was a vehicle propelled by a motor. Union Security has maintained that position throughout the course of the administrative proceedings and this litigation. And the record does not disclose any occasion on which Union Security has interpreted the term motor vehicle differently.
Fifth, Union Securitys interpretation is not contrary to the clear language of the Plan. Id. When a plan does not define a given term, parties may consider that terms ordinary, plain meaning, consulting the ordinary, dictionary definition of that term as necessary. Spizman v. BCBSM, Inc. , 855 F.3d 924, 927 (8th Cir. 2017) (citation omitted).
In this case, both parties can cite dictionary definitions to support their preferred interpretation of the term motor vehicle. On one hand, some dictionaries define motor vehicle to refer primarily to road vehicles. For example, the American Heritage Dictionary defines motor vehicle as [a] self-propelled conveyance with wheels and a motor, such as a car or truck, for use on roads. Motor vehicle , The American Heritage Dictionary of the English Language, www.ahdictionary.com/word/search.html?q=motor+vehicle (last visited September 11, 2018). The New Oxford American Dictionary defines motor vehicle as a road vehicle powered by an internal combustion engine or an automobile. Motor vehicle , New Oxford American Dictionary (3d ed. 2010). And Websters Third New International Dictionary defines motor vehicle as an automotive vehicle not operated on rails; esp[ecially] : one with rubber tires for use on highways. Motor vehicle , Websters Third New International Dictionary (3d ed. 1993).
On the other hand, some dictionaries define motor vehicle more broadly. For example, Merriam-Websters Learners Dictionary defines motor vehicle as a vehicle (such as a car, truck, or motorcycle) that is powered by a motor. Motor vehicle , Merriam-Websters Learners Dictionary, www.learnersdictionary.com/definition/motor% 20vehicle (last visited September 11, 2018). And Random House Websters Unabridged Dictionary defines motor vehicle as an automobile, truck, bus, or similar motor-driven conveyance. Motor vehicle , Random House Websters Unabridged Dictionary (2d ed. 2001). Because the plan itself does not define motor vehicle-and because some dictionaries define that term broadly enough to include a snowmobile-the Court cannot conclude that Union Securitys interpretation is contrary to the clear language of the plan.
In sum, applying the five Finley factors, the Court finds that Union Security did not act unreasonably in interpreting the term motor vehicle to include a snowmobile.
B. Conflict of Interest
Denise argues that a conflict of interest exists because Union Security is both the administrator and insurer of the plan. It is true that when a plan administrator holds the dual role of evaluating and paying benefits claims, this conflict of interest should be considered as a factor in determining whether the plan administrator has abused its discretion. Donaldson , 863 F.3d at 1039 (citation omitted). But a conflict of interest of this type does not alter the standard of review. Cooper , 862 F.3d at 660 (Our precedent ... has consistently rejected the notion that the mere presence of a potential conflict of interest is sufficient to warrant a less deferential standard.). And a conflict of interest of this type should be given little to no weight when the administrator has taken active steps to reduce potential bias and to promote accuracy, such as by walling off claims administrators from those interested in firm finances. Green v. Union Sec. Ins. Co. , 646 F.3d 1042, 1053 (8th Cir. 2011) (citation omitted).
In this case, there is no evidence that Union Securitys dual role as both the administrator and the insurer of the plan had any impact on its decision. Union Securitys claims specialist sought guidance from two other individuals (a medical doctor and a lawyer) before denying Denises AD & D claim. Then when Denise appealed the denial of her AD & D claim, Union Security assigned a new appeals specialist to the case, and she, too, denied Denises claim. The record contains no hint that any of these individuals acted in bad faith; to the contrary, all of them supported their conclusions with careful, reasonable explanations. In addition, the Eighth Circuit has previously found no indication that Union Security has a history of biased claim decisions, and no such evidence appears in the record of this case. Id. Under these circumstances, any conflict of interest inherent in Union Security being both the administrator and insurer of the plan is entitled to little weight. Donaldson , 863 F.3d at 1039.
C. Applicability of Minnesota Law
Denise also argues that Union Securitys interpretation was unreasonable because the plan recited that it was delivered in Minnesota and governed by its laws .... ECF No. 26-2 at 1. Denise argues that, under this clause, motor vehicle must be defined as it is defined in some Minnesota statutes-definitions that are not broad enough to include a snowmobile.
There are several problems with Denises argument:
First, even if the policy provided that motor vehicle should be defined for purposes of the policy as it is defined for purposes of a Minnesota law, the policy would fail to specify which Minnesota law. Several Minnesota laws define motor vehicle, and the definitions differ in material respects. Minnesota has defined vehicle or motor vehicle relatively narrowly in the context of its vehicle-registration laws, see Minn. Stat. § 168.002, subd. 18(a) ; its vehicle-title statutes, see Minn. Stat. § 168A.01, subd. 24 ; its traffic regulations (which apply primarily to the operation of vehicles upon highways, except for certain provisions that also apply to snowmobiles), see Minn. Stat. §§ 169.011, subds. 42, 92; 169.02, subd. 1 ; and its No-Fault Automobile Insurance Act, see Minn. Stat. § 65B.43, subd. 2. If the definitions in these statutes were controlling, they would suggest that a snowmobile should not be considered a motor vehicle. But Minnesota has defined motor vehicle quite broadly in the context of its drunk-driving laws to include every vehicle that is self-propelled, including off-road recreational vehicles. Minn. Stat. § 169A.03, subd. 15. That definition would suggest that a snowmobile should be considered a motor vehicle.
Second, the policy does not, in fact, provide that motor vehicle should be defined for purposes of the policy as it is defined for purposes of a Minnesota law. It provides instead that the policy is governed by Minnesota law. That simply means that relevant Minnesota laws-i.e., laws that govern insurance policies -govern this particular policy. It does not mean that irrelevant Minnesota laws-i.e., laws that have nothing to do with insurance policies -somehow govern this insurance policy.
Thus, even assuming that Minnesota law governs Richards insurance policy, the statutes on which Denise relies are irrelevant because they dont say anything about how motor vehicle should be defined for the purpose of an AD & D policy. Instead, those statutes define the term motor vehicle for other purposes, such as for the purpose of vehicle-registration laws, see Minn. Stat. § 168.002, subd. 18 (a); or for the purpose of vehicle-title laws, see Minn. Stat. § 168A.01, subd. 24 ; or for the purpose of traffic regulations, see Minn. Stat. § § 169.011, subds. 42, 92; 169.02, subd. 1 ; or for the purpose of the No-Fault Automobile Insurance Act, see Minn. Stat. § 65B.43, subd. 2.
Finally, and most importantly, the clause upon which Denise relies provides that Minnesota law governs unless otherwise preempted by federal law. ECF No. 26-2 at 1. Under ERISAs preemption clause, ERISA preempts any and all State laws insofar as those laws relate to ERISA plans, 29 U.S.C. § 1144(a), with the exception of any state law that regulates insurance, banking, or securities, 29 U.S.C. § 1144(b)(2)(A). Not surprisingly, Denise has not pointed to any Minnesota law regulat[ing] insurance, banking, or securities that dictates a definition of motor vehicle.
Instead, Denise argues that the Minnesota doctrine of contra proferentem should apply and the ambiguous term motor vehicle should be construed against Union Security. But the Eighth Circuit has repeatedly held that a states doctrine of contra proferentem clearly affects pension plans and does not regulate the insurance industry. Brewer v. Lincoln Nat. Life Ins. Co. , 921 F.2d 150, 153 (8th Cir. 1990). Instead, this rule of construction is nothing more than a specific application of general state contract principles .... Id. Thus, the contra insurer rule ... is preempted by ERISA. Id. Under both federal law and the terms of Richards policy, then, Minnesotas doctrine of contra proferentem does not apply to the construction of the term motor vehicle.
* * *
For these reasons, the Court concludes that Union Securitys interpretation of the term motor vehicle to include a snowmobile is not unreasonable and is supported by substantial evidence. Therefore, the Court grants Union Securitys motion for summary judgment, denies Denises motion for summary judgment, and dismisses Denises complaint.
ORDER
Based on the foregoing, and on all of the files, records, and proceedings herein, IT IS HEREBY ORDERED THAT:
1. Plaintiffs motion for summary judgment [ECF No. 19] is DENIED.
2. Defendants motion for summary judgment [ECF No. 23] is GRANTED.
3. Plaintiffs complaint [ECF No. 1-1] is DISMISSED WITH PREJUDICE AND ON THE MERITS.
LET JUDGMENT BE ENTERED ACCORDINGLY.
Denises lawyer incorrectly cited this statute as § 169.01, Subd. 43. ECF No. 26-4 at 62.
See Daniel Schwarcz, Reevaluating Standardized Insurance Policies , 78 U. Chi. L. Rev. 1263, 1283 (2011) (One of the central aims of insurance policies is to reduce moral hazard, or the prospect that policyholders will take less care knowing that they are insured.).
The fact that this benefit is provided only when the driver was wearing a seat belt is yet more evidence that a central goal of the plan is to reduce moral hazard.
In Brake v. Hutchinson Tech. Inc. Grp. Disability Income Ins. Plan , 774 F.3d 1193, 1197 (8th Cir. 2014), the Eighth Circuit considered an ERISA plan that, similar to Richards, provided that it was governed by the laws of Minnesota, when applicable and not otherwise governed by federal ERISA law. The Eighth Circuits opinion made clear that a Minnesota statute (Minn. Stat. § 60A.082 ) that specifically regulated insurance was not preempted (although the Eighth Circuit found that, under the facts of the case, the statute was irrelevant). Id. When determining whether the administrators interpretation of the plan was reasonable, however, the Eighth Circuit did not apply Minnesotas doctrine of contra proferentum (or any other Minnesota law), but instead applied the Finley factors. Id. at 1197-98.