Opinion ID: 852072
Heading Depth: 3
Heading Rank: 2

Heading: FEGLIA's Preemption Clause

Text: FEGLIA also contains a preemption clause, which states, The provisions of any contract under this chapter which relate to the nature or extent of coverage or benefits (including payments with respect to benefits) shall supersede and preempt any law of any State or political subdivision thereof, or any regulation issued thereunder, which relates to group life insurance to the extent that the law or regulation is inconsistent with the contractual provisions. 5 U.S.C. § 8709(d)(1). Mary Jo asserts that this preemption clause prevents state law from changing to whom FEGLI proceeds are paid. We agree that FEGLIA and the regulations promulgated under it control who holds legal title to the proceeds. But we see nothing in the preemption clause that precludes equitable state law claims. To interpret the preemption clause as preventing the imposition of a constructive trust extends the clause's scope beyond its plain language. The text of section 8709 reveals that it is only concerned with conflicts between state regulation of group life insurance programs and the express contractual provisions contained in FEGLIA policies. Fagan, 179 S.W.3d at 43. On the other hand, the preemption clause is not concerned with state law claims brought once the proceeds of a policy are paid out. Kidd, 821 S.W.2d at 573. Ultimately, the preemption clause's purpose is to alleviate the difficulty of interpreting state laws and regulations concerning group life insurance. Id. This purpose is consistent with the purpose underlying the provisions discussed in the previous section: the reduction of administrative and legal hassles. Id.