It is a well-known life insurance policy exclusion in a majority of states that an insurance company can deny coverage for an injury that was sustained as a result of alcohol impairment. These cases can be easy to prove if there are medical records or police reports that show what the insured's blood-alcohol content was at the time of the incident.
Although alcohol exclusions are often referenced in denial letters, there is also contained in many policies language that excludes coverage for impairment by the consumption of non-prescribed drugs. Although this language is usually located in the same section as the alcohol impairment exclusion, the standard in relying on drug impairment in denying coverage can be significantly more complicated for an insurer to prove.
Each state has different laws on what the definition of drug impairment is. A conventional analysis requires that the fact-finder prove that 1) the suspect consumed the illegal drug and 2) at the time of the incident, the drug was impairing the individual's ability to maintain control of their mental and physical facilities.
Despite significant lobbying from the National Highway Traffic Safety Association (NHTSA), there is still no universal understanding of what constitutes drug impairment. There is no .08 standard as is customary in alcohol, and there is no comprehensive understanding of the varying effects certain drugs can have on consumers. The difficulty in establishing sufficient proof has been well documented in the criminal justice system, as prosecutors often struggle to prove drug intoxication in criminal cases, especially those involving driving based offenses.
With these challenges in mind, it is a vital part of the denial appeal process to understand that if prosecutors can struggle with presenting sufficient proof, insurance adjusters and investigators will have similar problems.
In preparing a defense to a drug exclusion based denial, a step-by-step review may shed enough light on the strength of the insured's case to be effective in bringing a legal challenge.
An insurer cannot merely cite the drug exclusion as a basis for a denial. They must point to specific facts that support their assertion that denial is warranted. Often these facts will be in the form of a law enforcement report or medical records. However, there are times when a significant amount of this information is missing or incomplete.
Despite the incomplete record, insurers will still issue denials, claiming that a reasonable follow up on the initial evidence will further support their position. You mustn't let an insurer off the hook based on their failure to present reliable information at the time of denial.
As is the case with criminal cases and the constitutional right to a presumption of innocence before trial, it can be argued that you should also be afforded similar considerations when an allegation of drug impairment has been levied, but not adjudicated.
An insurer cannot use a broad definition of drug impairment without articulating what drug they claim caused the impairment. If they cannot provide a nexus between impairment and the drug that caused the impairment, the basis for denial may have significant challenges in being sustained.
With the evolution of marijuana legalization laws becoming more prevalent across the country, this can play a substantial role in whether or not an insurer can now rely on marijuana as a basis for a drug use exclusion. Throwing additional wrinkles into the mix is the potential that the injured party was granted a medical marijuana card to treat specific physical or mental ailments. Although there are still laws that prohibit someone from driving under the influence of marijuana, this alone cannot be a basis for denying coverage if the individual sought and received approval from a medical provider to consume cannabis as part of their treatment.
By the time you have been issued a denial of coverage, it is likely that some care has been provided or will be scheduled. An essential first step in preparing an appeal is to ensure that you have a complete record of the evidence. Whatever evidence the insurer has to support their denial, you also have a right to that same evidence.
Do not go into an appeal with any blind spots. Ensure that all reports, records, and testimony are provided. When the file is complete, the next step is to ensure you and your counsel have sufficient time to review and digest this information to determine the denial's viability and what potential responses you can issue to contest this finding.
Facts are only as good as the law that goes to support them. Understanding what the definition of drug impairment is and how this is being applied in your case, will allow you to validate or refute an insurer's claim. Alleging a violation of an insurance policy is not as simple as pointing to the policy itself. This policy must also be supported by both the presentation of the facts and the application of relevant law. Do not assume that because the insurer says so, that they have completed their due diligence before issuing their denial.
Insurers know it; drug exclusions are hard to justify and even more challenging to prove. Despite these challenges, insurance companies every day base their denials of coverage on little more than speculation. If this occurs to you, do not take the insured's word as final. Instead, ally yourself with the right professionals who can guide you through the appeal process to maximize your potential for receiving a favorable result regardless of what the drug exclusion policy attempts to achieve in maximizing the profits of the companies who attempt to utilize them.