In the case of Byerly v. Standard Insurance Co., 984 F.3d 873 (5th Cir. 2021), the United States Court of Appeals for the Fifth Circuit addressed what happens when a minor injury combines with a serious underlying illness to cause a catastrophic loss.

Gregory Byerly was an employee at Fidelity National Information Services and a participant in a workplace accidental death and dismemberment (AD&D) plan issued by Standard Insurance Company. As is typical for employer-sponsored benefits, this policy was governed by the Employee Retirement Income Security Act of 1974 (ERISA). This federal statute regulates the vast majority of private-sector disability, life, and accident insurance plans.

The chain of events began with an incredibly common accident: Byerly stubbed his toe at home. Byerly suffered from several significant health issues, including diabetes, peripheral neuropathy, and peripheral arterial disease, and these conditions severely compromised the circulation and nerve sensation in his feet.

Medical records from the days following the incident showed that the small wound quickly turned into cellulitis. A podiatrist eventually diagnosed a diabetic foot ulcer that led to bone necrosis. Because his blood flow was so poor, the wound could not heal. Infection turned to gangrene, eventually leaving doctors with no choice but to perform a below-the-knee amputation.

When Byerly submitted a claim for policy proceeds through his employer, Standard Insurance Company denied it. The policy promised a payout if an insured person lost a limb “as the result of an accident,” but it also included a standard “sole cause” provision. This clause required the loss to be caused “solely and directly by an accident” and excluded any loss contributed to by a “sickness or disease.”

Standard argued that the amputation was not the sole result of the stubbed toe. Instead, the insurer maintained that the pre-existing diabetes and vascular disease were the primary drivers behind the infection and the eventual loss of the leg. Medical experts hired by the insurer concluded that the trauma of stubbing a toe would not have necessitated an amputation in a healthy individual. In their view, the underlying disease was a necessary link in the chain of events.

Byerly followed the mandatory administrative appeal process required by ERISA, but the insurer stood by its denial. The case then moved into federal court. During the litigation, Gregory Byerly passed away due to unrelated causes, and his wife continued the suit as the executor of his estate.

The federal district court granted summary judgment for the insurance company, finding that the medical evidence showed Byerly’s pre-existing conditions “materially contributed” to the amputation. The estate then appealed to the United States Court of Appeals for the Fifth Circuit, which handles federal cases from Louisiana, Mississippi, and Texas.

On appeal, the estate argued for a “but-for” causation theory: because the stubbed toe set the entire sequence in motion, it should be viewed as the true cause of the loss. The Fifth Circuit disagreed. The court pointed out that the policy language focused on the cause of the “loss” (the amputation) rather than the cause of the initial “accident” (the stubbed toe). Since the diabetes and neuropathy were instrumental in the gangrene that led to the surgery, the court held that the “independent of all other causes” requirement was not met. The Fifth Circuit affirmed the judgment in favor of the insurer.

The Byerly decision highlights a recurring obstacle for claimants. Many individuals with AD&D coverage have some form of underlying health issue. Insurers frequently use “sole cause” or “exclusionary” language to deny claims when a pre-existing condition plays any role in the outcome.

However, results in these cases can vary. Outcomes often hinge on the specific wording of the policy, how the medical evidence is documented within the administrative record, and the degree to which the accident can be isolated as the primary catalyst. In different jurisdictions or under different policy language, courts have sometimes found coverage when an accident was the predominant cause, even if underlying health issues were present.

The ruling in Byerly v. Standard Insurance Co. serves as a clear example of how insurance companies frame their defenses and how federal courts interpret restrictive policy language. It is a reminder that the success of a dismemberment claim often depends on the intersection of specific medical facts and the precise “fine print” of the insurance contract.

The Pellegrin Firm is a Metairie, Louisiana law firm that represents long-term disability claimants in ERISA cases involving wrongful denials (including Accidental Death and Dismemberment cases), benefit terminations, and procedural violations by insurance companies. The Pellegrin Firm represents clients throughout the New Orleans area and across Louisiana and can be reached at (504) 405-3245 or by email at info@pellegrinfirm.com.