In some states, denial of health insurance coverage can be issued due to an injury sustained by an individual while under the influence of alcohol. Currently, 25 states in the United States explicitly allow insurance companies to add an alcohol exclusion to their policy. These policies are often difficult to identify and even harder to understand fully.
What States Allow For Alcohol Exclusions?
According to the National Institute of Alcohol Abuse and Alcoholism, the following states allow insurance companies to instill alcohol exclusion clauses into their policies:
If your home state falls into this list and you are a consumer of alcohol, it is an essential step in understanding your insurance policy to review the policy's language to see what type, if any, alcohol exclusion is contained within.
If you do identify such an exclusion, you should look further into the details, as it is unlikely that an insurer can deny coverage simply because it is found that the insured had some alcohol in their system. However, many exclusions located within insurance policies explicitly state that health providers will not be paid to treat injuries that result from alcohol or drug abuse. This representation can make it more difficult for medical providers to fully assess the degree of alcohol abuse to issue treatment recommendations, which may counter a denial based on the alcohol exclusion policy.
According to the recommendation of the National Association of Insurance Commissioners, the common language found in alcohol exclusion policies is as follows:
“The insurer shall not be liable for any loss sustained or contracted in consequence of the insured’s being intoxicated or under the influence of any narcotic unless administered on the advice of a physician.”
It is easy to see how it can be challenging to understand what this exclusion covers in reviewing the proposed language. Questions such as what intoxication means, and who makes this determination are but a few of the issues that are often raised when you challenge a denial of coverage based on an alcohol exclusion policy.
The bottom line of these exclusions is that there is a large degree of potential legal challenges that can be issued if they are done so effectively.
Most insurance policies will begin with a definition section. In this section, the policy will attempt to define specific key terms such as alcohol abuse, intoxication, and alcohol-based injury. Although these definitions are meant to clarify the policy, they often offer more ambiguity that leads to further grounds to challenge a denial.
If the insurance policy contains the standardized exclusion language issued by the National Association of Insurance Commissioners, breaking down the definitions of the keywords is an important step. This analysis will allow you to see just how solid of ground insurers stand on in their denial and what arguments and evidence you may be able to present to successfully reverse their decision.
The first step in analyzing an alcohol exclusion claim is to review the consequence definition. A typical example of a denial based on a consequence is proving that were the insured not intoxicated; the injury would not have happened. This insurer's position is a common denial tactic in car accidents where it is found that a driver was intoxicated at the time of the collision by law enforcement.
What if the non-intoxicated driver was found to be at fault? In these cases where there are questions as to material fact, there is a window for the insured to provide their narrative that may put into doubt the insurer’s position that the consequence was the result of intoxication.
Just because you have a drink and then are injured, does allow an insurer the right to deny coverage. There must be further evidence to support that you were, in fact, intoxicated or under the influence at the time the injury occurred. Intoxication definitions are often conflated to meet insurance policy objectives and cast a wide net that allows a basis to deny coverage. However, no insurance company can rely solely on the fact that some alcohol or drug level was consumed. They must actually show that alcohol or drugs impaired the individual's mental and physical facilities.
In evaluating whether a challenge can be raised based on the finding of intoxication, it is essential to find the prevailing legal definition of intoxication to determine whether the facts alleged fit the definition.
From a criminal and civil perspective, intoxication can be defined as "a person who is incapable of acting as an ordinarily prudent and cautious person would act under similar conditions."
In proving that an individual is under the influence, the legal definition is similar to intoxication. However, under the influence requires a showing that the individual was "affected," which is different from the "incapable" language found in the definition of intoxication.
This different language is a crucial reason to read carefully the basis for a denial based on the alcohol exclusion. If it shows that the insurer used two opposing reasons for the refusal and utilized two separate definitions that hold different evidentiary grounds in proving, you may just have the window you need to challenge this finding successfully.
Alcohol exclusions were drafted to give insurance companies a wide range of reasons to issue a denial of coverage. The drafting of the commonly accepted exclusion language is no accident. It was meant to provide insurance companies cover in their denial letters and, in the process, attempt to give consumers minimal cover in attempting to challenge these findings.
It is vital that you do not buy into this effort and, instead, look at each detail of the policy to find any basis you can to challenge the insurer's findings. By analyzing each part of the language critically and presenting evidence that contradicts the policy's reading, you may be able to convince the insurer that you have a right to be covered regardless of whether an alcohol exclusion is present or not.