Bjelopetrovich v. UNUM Life Insurance Company of America

Filing 36

MEMORANDUM Opinion and Order Signed by the Honorable Elaine E. Bucklo on 5/17/2017. Mailed notice. (mgh, )

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

Janice Bjelopetrovich,
Plaintiff,

v.
UNUM life Insurance Company of
America
Defendant.

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No. 16 C 4393

Memorandum Opinion and Order
In this action, plaintiff Janice Bjelopetrovich seeks ERISA
review of defendant’s denial of life insurance benefits to which
she claims she is entitled under her deceased husband Bozidar’s
employer-sponsored benefits plan.1 Before me are the parties’
cross-motions

for

summary

judgment,

which

turn,

the

parties

agree, on the resolution of a single dispositive issue: whether
the terms of the plan required Bozidar to submit for defendant’s
approval

an

coverage

promising

conclude,
1

in

“evidence

light

the
of

of

insurability”

benefits
the

form

plaintiff

undisputed

to

obtain

seeks.

facts,

that

the

Because
the

I

only

Plaintiff’s complaint also includes counts for declaratory
relief, breach of fiduciary duty, and state law breach of
contract. She does not dispute that the state law claim is
preempted by ERISA, however, and the remaining claims—which are
based on the same allegations as her claim for benefits—do not
survive summary judgment for the same reasons.
1

reasonable

construction

of

the

plan

compels

an

affirmative

answer to that question, I resolve the motions in defendant’s
favor.
I.
Plaintiff is the widow of Bozidar Bjelopetrovich, who was
employed by Specialty Promotions from October 21, 2013, until
his death on July 18, 2015. As a Specialty employee, Bozidar was
eligible for coverage under the “Select Group Insurance Trust
Policy No. 292000” (the “Group Plan”), issued by defendant. AR
47, 193.
The

Group

Plan

encompasses,

among

other

coverages,

two

distinct life insurance modalities, each of which is captioned
“Life Insurance Plan.” The terms and conditions of the first are
set

forth

in

a

document

titled

Group

Insurance

Summary

of

Benefits Non-Participating (for ease of reference, the “Summary
of

Benefits”)

and

identified

by

Identification

Number

294386

001. See AR 47-94. The terms and conditions of the second are
set

forth

Insurance
“Summary

in

a

separate

Summary
of

of

document

Benefits),

Benefits
but

is

that

is

also

Non-Participating
identified

by

titled
(again,

Group
the

Identification

Number 294387 001. See AR 192-256.2 Defendant refers to the first
component as the “Basic Life” policy and to the second as the
2

Technically, the terms of the latter are contained in Amendment
No. 1 to Group Identification No. 294387 001, which replaced,
effective April 1, 2013. I note this merely for the sake of
precision, and not because it has no bearing on the issues.
2

“Voluntary Life” policy. Plaintiff disputes this nomenclature,
noting that the terms “Basic Life” and “Voluntary Life” do not
appear in either Summary of Benefits, and further observing that
both components are part of a single policy: the Group Plan.
Terminology aside, however, it is clear from the face of the
documents that the Group Plan establishes two distinct “Life
Insurance

Plan”

conditions

as

coverages,

summarized

in

each

with

its

their

own

respective

terms

“Benefits

and
at

a

Glance” sections.3
The
component

Benefits

at

describes

a

Glance

the

terms

section

of

of

coverage

the

for

Basic

Life

employees

who

satisfy a certain minimum hours threshold and have completed a
60-day

waiting

period.

coverage,

which

$15,000.4

AR

The

promises

49.

The

a

employer
fixed

Benefits

at

pays

benefit
a

the
in

Glance

cost
the

of

this

amount

section

of

of
the

Voluntary Life component describes similar threshold eligibility
criteria (i.e., a minimum hours requirement and 60-day waiting
period),

3

but

sets

forth

significantly

different

terms

and

For ease of reference, because defendant’s nomenclature is
consistent with other documents in the record, see, e.g., AR 25
(“Voluntary Term Life/AD&D Insurance Enrollment Form”), and
because I conclude, as explained below, that the nomenclature
has no bearing on the substance of plaintiff’s claim, I follow
defendant’s lead and refer to the two coverage modalities as
“Basic Life” and “Voluntary Life.”
4
The fixed amount is decreased by specified percentages if the
employee becomes insured at certain ages or reaches certain ages
while insured, but these variations in benefit amounts are not
relevant to any issue here.
3

conditions for coverage. See AR 195-96. First, the employee—not
the

employer—pays

benefit

amount

for

is

Voluntary

variable,

not

Life

coverage.

fixed,

and

Second,

is

defined

the
as

“[a]mounts in $10,000 benefit units as applied for by you and
approved by Unum. All amounts are rounded to the next higher
multiple of $10,000, if not already an exact multiple thereof.”
Id. at 196. Third, the employee can change the benefit amount at
any time after the initial election. The Benefits at a Glance
section further provides, “EVIDENCE OF INSURABILITY IS REQUIRED
FOR THE AMOUNT OF YOUR INSURANCE OVER: $140,000.”
The

section

captioned

Coverage

Begin?”

reiterates

“When
that

Does

Your

evidence

of

Life

Insurance

insurability

is

required for benefits that exceed that amount, and it further
provides

that

when

evidence

of

insurability

is

required,

coverage begins only after defendant has approved the employee’s
evidence of insurability form:
This plan provides benefit units that you can choose.
When you first become eligible for coverage, you may
apply for any number of benefit units, however, you
cannot be covered for more than the maximum benefit
available under the plan.
Evidence of insurability is required for any amount of
life insurance over the amount shown in the LIFE
INSURANCE ‘BENEFITS AT A GLANCE” page.
You pay 100% of the cost yourself for any benefit
unit. You will be covered at 12:01 a.m. on the later
of:
 the first of the month coincident with or next following
the date you are eligible for coverage, if you apply for
4

insurance on or before that date, for any amount of
insurance that is not subject to evidence of insurability
requirements; or
 the first of the month coincident with or next following
the date you apply for insurance, if you apply within 31
days after your eligibility date, for any amount of
insurance that is not subject to evidence of insurability
requirements; and
 the first of the month coincident with or next following
the date Unum approves your evidence of insurability form,
if you apply for insurance on or before your eligibility
date or within 31 days after your eligibility date, for any
amount of insurance that is subject to evidence of
insurability requirements.
AR

213.

Immediately

following

these

provisions

is

a

section

captioned “When Can You Apply for Life Insurance Coverage if You
Apply More Than 31 Days After Your Eligibility Date?”, which
sets

forth

the

specific

coverage

requirements

that

apply

in

these circumstances. It provides:
You can apply for coverage only during an annual
enrollment
period.
Evidence
of
insurability
is
required for any amount of insurance.
Unum and your Employer determine when the annual
enrollment period begins and ends. Coverage will begin
at 12:01 a.m. on the first of the month coincident
with or next following the date Unum approves your
evidence of insurability form.
Id. (bold in original)
The next provision is captioned “When Can You Change Your
Life Insurance Coverage?” It provides:
You
can
change
your
coverage
by
applying
for
additional benefit units at anytime (sic) during the
plan year. You can increase your coverage any number
of benefit units up to the maximum benefit available
under the plan. Evidence of insurability is required
for any amount of life insurance applied for during
the plan year. ...
5

You can also change your coverage by applying for
additional benefit units during an annual enrollment
period. You can increase your coverage any number of
benefit units up to the maximum benefit available
under the plan.
Evidence of insurability is required for any amount of
life insurance over the amount shown in the LIFE
INSURANCE “BENEFITS AT A GLANCE” page.
AR 214.
The

parties

agree

that

Bozidar

began

his

employment

at

Specialty on October 21, 2013. By the terms of the Basic Life
provisions of the Group Plan, Bozidar’s coverage in the amount
of $15,000 began on the “[f]irst of the month coincident with or
next following 60 days of continuous active employment,” which
in this case was January 1, 2014.5 AR 49. By the terms of the
Voluntary Life provisions of the Group Plan, Bozidar also became
eligible to elect Voluntary Life coverage on that date. See AR
195, 213. Bozidar did not apply for Voluntary Life coverage
during his initial enrollment period, i.e., on or within thirtyone days of that date.6 Indeed, plaintiff admits that he did not

5

Plaintiff disputes defendant’s characterization of Bozidar’s
enrollment in the Basic Life plan as “automatic,” but she agrees
that Bozidar was “initially” covered in the amount of $15,000.
6
Plaintiff denies and objects to defendant’s statement that
Bozidar waived Voluntary Life coverage, but her response
essentially reiterates her general denial “that there is such a
thing as ‘Voluntary Life’ coverage.” As explained above,
however, while plaintiff is correct that the Group Policy does
not use that term, her assertion that “the Group Policy makes no
distinction
between
anything
which
could
be
considered
‘Voluntary Life’ coverage and $15,000 of coverage is at odds
with the face of the Group Plan documents.
6

seek coverage beyond the $15,000 fixed benefit in the Basic Life
provisions at any time prior to the annual enrollment period of
2015.
On March 16, 2015, Bozidar executed the form “Voluntary
Term Life/AD&D Insurance Enrollment Form” (the “Voluntary Life
Enrollment Form”). AR 25. At the top of that form, under the
heading “Application Type,” he checked the box labeled, “Initial
Enrollment: To make initial elections.” He did not check the box
marked,

“Annual

Enrollment:

To

make

changes

to

existing

elections and/or information.” Id. Bozidar indicated that he was
selecting $100,000 of coverage. Id. The enrollment form states:
“If you DO NOT APPLY FOR coverage for you or your dependent(s)
during your or their initial enrollment period, you will need to
complete an Evidence of Insurability form for all amounts of
coverage.” Id. The parties agree that Bozidar did not submit
evidence

of

insurability.

Nevertheless,

in

April

of

2015,

Specialty deducted life insurance premiums for Voluntary Term
Life/AD&D Insurance Coverage from Bozidar’s bi-weekly paychecks.
See Stipulation at ¶ 4 (DN 15).7

7

The parties stipulate: “premiums were deducted from the
decedent’s bi-weekly paychecks in April 2015 for Voluntary Term
Life/ADD&D Insurance coverage.” I take this to mean that
premiums were deducted only from Bozidar’s April 2015 paychecks,
and not from any other paychecks he may have received after
April of 2015. If there is evidence suggesting otherwise,
plaintiff has not pointed to it.
7

Bozidar died on July 18, 2015. On August 6, 2015, plaintiff
submitted a claim for life insurance benefits under the Group
Plan. Defendant approved her claim for $15,000 but denied her
claim

for

$100,000,

stating:

“Since

[Bozidar]

enrolled

for

coverage more than 31 days after his eligibility date, he was
required to submit an evidence of insurability form. He did not
submit the form and coverage was not approved. As he was not
covered under the policy at the time of his death, no benefits
are

payable.”

appeals,

AR

plaintiff

289.

After

filed

exhausting

this

action

her

pursuant

administrative
to

29

U.S.C.

§ 1132(a)(1)(B).
II.
Summary judgment is appropriate if the evidence of record
shows that there is no genuine issue as to any material fact and
that

the

matter

moving

of

law.

party
Fed.

is
R.

entitled
Civ.

P.

to

summary

56(c).

I

judgment

must

as

examine

a

the

admissible evidence in the light most favorable to the nonmoving party and draw all reasonable inferences in that party’s
favor.

Anderson

v.

Liberty

Lobby,

Inc.,

477

U.S.

242,

255

(1986).
“As
contract

a

general

rule,

interpretation

federal

govern

the

common

law

principles

interpretation

of

of

ERISA

plans.” Frye v. Thompson Steel Co., Inc., 657 F.3d 488, 493 (7th
Cir. 2011) (quotation marks and citation omitted). Where the
8

language of an ERISA plan “gives the employee adequate notice of
the

administrator’s

discretion

to

shape

the

application,

interpretation, and content of the plan’s rules,” the court will
set aside the administrator’s decision “only if it is arbitrary
and capricious.” Black v. Long Term Disability Ins., 582 F.3d
738, 743-44 (7th Cir. 2009).
Plaintiff

does

not

dispute

that

the

“arbitrary

and

capricious” standard applies here.8 She observes, however, that
even under this deferential standard, the plan administrator is
nevertheless “bound by the terms of the document.” Pl.’s Opp. at
6 (citing Cozzie v. Metropolitan Life Ins. Co., 140 F.3d 1104,
1108 (7th Cir. 1998) (granting summary judgment in insurer’s
favor). In her view, the administrator’s interpretation of the
Group Plan is unreasonable because “there is no basis in the
Policy for distinguishing between ‘Basic’ and ‘Voluntary’ life
insurance.” Id. But it is plaintiff’s construction that is at
odds with the documents, as the respective Summaries of Benefits
clearly define two distinct life insurance components. Contrary
to plaintiff’s argument, defendant’s use of the terms “Basic
Life” and “Voluntary Life” to describe and differentiate between
8

The “Discretionary Acts” provision in the Voluntary Life
Summary of Benefits “delegates to UNUM and its affiliate Unum
Group discretionary authority to make benefit determinations
under the Plan.” AR 252. This provision further states that
“[b]enefit determinations include determining eligibility for
benefits and the amount of any benefits, resolving factual
disputes, and interpreting and enforcing the provisions of the
Plan.” Id.
9

the two life insurance components the Group Plan comprises does
not rewrite the policy.
Moreover,
Voluntary
evidence

the

Life
of

administrator’s

provisions

as

insurability

is

interpretation

requiring
entirely

Bozidar

of
to

reasonable.

the

submit

Plaintiff

argues that when Bozidar submitted the Voluntary Life Enrollment
Form,

he

was

simply

effectuating

a

change

in

his

previous

coverage in accordance with the provisions captioned, “When Can
You Change Your Life Insurance Coverage?” In her view, employees
seeking additional benefits during an annual enrollment period
were

required

to

provide

evidence

of

insurability

only

when

their total benefits exceeded $140,000, which was not Bozidar’s
case. But when the Group Plan documents are read as a whole, it
is clear that these change-of-coverage provisions apply only to
employees who have previously elected Voluntary Life coverage.
Indeed,

plaintiff’s

characterization

of

Bozidar’s

submission of the Voluntary Life Enrollment Form as seeking to
effectuate a “change” in his Basic Life coverage is at odds with
the

documents

in

several

respects.

First,

the

Basic

Life

modality, which covered Bozidar in the fixed amount of $15,000
starting

January

provide

for

generally

AR

1,

2014,

does

employee-initiated
47-94.

Only

the

not

authorize

changes

Voluntary

in
Life

or

otherwise

coverage.
modality,

See
which

defines a variable benefit and allows employees to select—and
10

later to change—their benefit amount by pre-set “benefit units”
(a concept unique to the Voluntary Life provisions) contemplates
such changes. Because Bozidar had only Basic Life coverage at
the time he submitted the Voluntary Life Enrollment Form, there
simply was nothing for him to “change.”
Second,

applying

the

change-of-coverage

provisions

to

Bozidar’s application for initial enrollment in Voluntary Life
coverage would render superfluous the section captioned, “When
Can You Apply For Life Insurance Coverage If You Apply More Than
31

Days

After

Your

Eligibility

Date?”

Yet

general

contract

principles require that “[a]ll language of a plan should be
given effect without rendering any term superfluous.” Schultz v.
Aviall, Inc. Long Term Disability Plan, 670 F.3d 834, 838 (7th
Cir.

2012).

In

the

absence

of

preexisting

Voluntary

Life

coverage, the only thing Bozidar could do during the 2015 annual
enrollment period was to apply, in the first instance, for that
coverage. Because by that point, his 31-day initial enrollment
period had long since expired, the initial-enrollment provisions
applied, and “[e]vidence of insurability [was] required for any
amount of insurance.” AR 213. Because Bozidar did not submit an
evidence

of

insurability

form,

the

administrator

correctly

determined that his coverage under the Voluntary Life component
was never triggered.

11

III.
For the foregoing reasons, defendant’s motion for summary
judgment is granted and plaintiff’s motion for summary judgment
is denied.
ENTER ORDER:

Elaine E. Bucklo
United States District Judge
Dated: May 17, 2017

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