On April 15, 2013, the United States Supreme Court agreed to review a case involving the question of when the statute of limitations accrues for judicial review of an adverse benefits determination under an ERISA long-term disability plan.
On November 18, 2010, Julie Heimeshoff (“Heimeshoff”) filed suit against Hartford Life & Accident Insurance Company (“Hartford”) and her former employer, Walmart Inc., after Hartford denied her claim for benefits under a long-term disability plan established by Walmart (the “Plan”). See Heimeshoff v. Hartford Life & Accid. Ins. Co, et al., 2012 U.S. Dist. LEXIS 6882 (D. Conn. 2012).
Hartford filed a motion to dismiss on the ground that Heimeshoff’s claim was barred by the three-year contractual limitations period in the Plan, which provided as follows: “Legal action cannot be taken against The Hartford . . . 3 years after the time written proof of loss is required to be furnished according to the terms of the policy.” As to proof of loss, the Plan required that “[w]ritten proof of loss must be sent to The Hartford within 90 days after the start of the period for which The Hartford owes payment.”
The district court granted Hartford’s motion to dismiss because Heimeshoff filed her complaint more than three years after proof of loss was required to be furnished under the Plan. In doing so, the district court rejected Heimeshoff’s argument that the Plan provision was ambiguous and that the limitations period did not begin to run until the final denial latter. The Court also rejected her argument that Hartford could not rely on the limitations period because it failed to advise Heimeshoff of the limitations period in the denial letter.
The Court of Appeal for the Second Circuit affirmed, holding that, under Connecticut law, parties to an insurance contract may shorten the limitations period and that the “policy language is unambiguous and it does not offend the statute to have the limitations period begin to run before the claim accrues.”
Heimeshoff filed a petition for writ of certiorari, which the Supreme Court granted on April 15, 2012, as to the following question: “When should a statute of limitations accrue for judicial review of an ERISA disability adverse benefit determination?” Heimeshoff v. Hartford Life & Accid. Ins. Co, et al., Case No. 12-729.
The Supreme Court’s decision will be important because ERISA does not provide a limitations period for actions for plan benefits under 29 U.S.C. § 1132. As a result, federal courts apply the applicable state statute of limitations period that is most analogous or, if permitted, federal courts will apply the contractual limitations period, which may be shorter than the state statute. Thus, the Court’s decision will provide uniformity on the accrual of benefit claims under contractual limitations periods in ERISA group policies.