Court Opinion

ID: 3033604
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:49:45.468415+00
Date Added: 2024-06-11T11:48:24.868386
License: Public Domain

FOR PUBLICATION
  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

KARLA H. ABATIE,                       
                Plaintiff-Appellant,
                v.                           No. 03-55601
ALTA HEALTH & LIFE INSURANCE
COMPANY, a Delaware corporation,              D.C. No.
                                           CV-01-06699-JFW
f/k/a Anthem Home Life Insurance
                                              OPINION
Company, f/k/a Home Life
Financial Assurance Company,
               Defendant-Appellee.
                                       
        Appeal from the United States District Court
           for the Central District of California
         John F. Walter, District Judge, Presiding

                   Argued and Submitted
          February 11, 2005—Pasadena, California

                   Filed August 31, 2005

      Before: Harry Pregerson, Robert R. Beezer, and
           Richard C. Tallman, Circuit Judges.

                Opinion by Judge Beezer;
                Dissent by Judge Pregerson

                            11819
              ABATIE v. ALTA HEALTH & LIFE INS.          11823

                         COUNSEL

Craig Price, Griffith & Thornburgh, LLP, Santa Barbara, Cal-
ifornia, for the appellant.

R. Daniel Lindahl, Bullivant Houser Bailey, P.C., Portland,
Oregon, for the appellee.

                         OPINION

BEEZER, Circuit Judge:

   Appellee Alta Health & Life Insurance Company (“Alta”),
administrator of an ERISA-regulated employee welfare bene-
fit plan, denied appellant Karla H. Abatie’s claim for life
insurance benefits for the death of her husband, Dr. Joseph
Abatie (“Dr. Abatie”). After conducting a bench trial, the dis-
trict court held that Alta did not abuse its discretion. Abatie
appeals. We have jurisdiction pursuant to 28 U.S.C. § 1291,
and we AFFIRM.

                               I

  Dr. Abatie was employed by the Santa Barbara Medical
Foundation Clinic (“Clinic”) until November 1992, when he
took a medical leave of absence and applied for disability
benefits. In early 1993, when Dr. Abatie was suffering from
11824            ABATIE v. ALTA HEALTH & LIFE INS.
both lymphoma and anemia, the Clinic classified him as a
retiree. Dr. Abatie’s health improved following a successful
splenectomy in 1998, but he died in June 2000 from a combi-
nation of conditions. We turn to discuss the terms of the insur-
ance policy and sketch the events leading to this dispute.

                                    A

   The life insurance policy at issue was part of an employee
welfare benefit plan provided by the Clinic. The Clinic’s plan
is subject to the provisions of the Employee Retirement
Income Security Act of 1974 (“ERISA”), 29 U.S.C. §§ 1001-
1461. The group life insurance plan was originally issued by
Home Life Financial Assurance Company (“HLFAC”). Alta
is a successor in interest to HLFAC’s rights and responsibili-
ties under the plan. The policy provides that, in order for
insurance coverage to start, “you must be at active full-time
work for your Employer.” Coverage ends, according to the
policy, when “employment ends . . . unless the Policy pro-
vides otherwise.”

   The policy further provides that in the event an insured
becomes totally disabled while he is covered, life insurance
coverage may be continued even without a premium charge,
upon approval of what is commonly referred to as a “waiver
of premium application.”1 As defined in the policy, a total dis-
ability occurs when the insured is “not able to work at all at
any job or business for pay or profit due to injury or sick-
ness.” One of the conditions of such continued life insurance
coverage in the event of total disability requires that the
insurer “receive proof of [the insured’s] total disability within
12 months after the date [the insured] become[s] totally dis-
abled.”2 “This proof must be sent to [Alta’s] Home Office.”
  1
     Under the policy, a former employee may also retain coverage in
retiree status so long as the required premiums are paid. There is no evi-
dence that such premiums were paid, nor does Appellant argue that Dr.
Abatie was covered by this mechanism.
   2
     The policy allows, “Even if we do not receive [ ] proof within the time
required, we will not deny the claim if we receive the proof as soon as it
is reasonably possible.”
                 ABATIE v. ALTA HEALTH & LIFE INS.                  11825
Even if a waiver of premium application is granted, this cov-
erage ends when the insured is “no longer totally disabled” or
fails to provide “proof of continued disability.”

                                    B

   Several months after Dr. Abatie’s death, the Clinic wrote to
Alta requesting the payment of life insurance benefits. The
Clinic admitted that “[w]hen Dr. Abatie’s disability began in
late 1992, the benefits coordinator failed to initiate the paper-
work for waiver of premium to which he was entitled.” Even
so, the Clinic sought “retroactive” qualification of Dr. Abatie
for insurance coverage. A letter from the Clinic’s insurance
broker to Alta also noted that “due to administrative error, the
waiver of premium application was not filed.”

   Alta denied the claim for life insurance benefits because,
according to its records, a waiver of premium application was
not filed within twelve months of the date Dr. Abatie became
totally disabled. Alta also relied on the Clinic’s insurance bro-
ker’s written admission that a waiver of premium was never
filed as “further confirm[ation]” that the mandatory applica-
tion was never filed. As a result, Alta wrote, coverage was no
longer in force when Dr. Abatie died. The notice of denial,
sent in March 2001, permitted Abatie to appeal Alta’s deter-
mination within 60 days. Rather than proceed with the admin-
istrative review process, however, Abatie decided to file a
lawsuit against Alta in June 2001.

   After Abatie filed this lawsuit, the parties conducted addi-
tional discovery, supplementing the administrative record.
The parties then agreed to permit Alta to conduct an addi-
tional review and render a final determination of the claim.3
  3
    Abatie’s decision to file this action before exhausting her administra-
tive remedies may have run afoul of ERISA’s exhaustion requirements.
See Amato v. Bernard, 618 F.2d 559, 566-68 (9th Cir. 1980). Because Alta
does not argue that Abatie breached this requirement, presumably because
Alta believes that Abatie cured this violation by stipulating to further
administrative review, we do not reach the issue.
11826          ABATIE v. ALTA HEALTH & LIFE INS.
After reviewing the supplemented administrative record, Alta
issued its final determination on the life insurance claim. Alta
again denied coverage, repeating its observation that Dr. Aba-
tie failed to submit a waiver of premium application, as evi-
denced by the clinic’s admission that a waiver application was
never filed, the lack of records in Alta’s files and computer
systems, and the paucity of documentation in the Clinic’s
files. Alta noted that it was prejudiced by Dr. Abatie’s failure
to file a claim because of the importance of setting aside
reserves, managing the claim, and periodically verifying the
continuance of the alleged disability. In addition, Alta con-
cluded that there was insufficient proof that Dr. Abatie was
totally disabled from all occupations until his death; it cited
this conclusion as a second, additional reason for denying the
claim.

   After a bench trial, the district court held that abuse of dis-
cretion review applied and that Alta did not abuse its discre-
tion in denying Abatie’s claim.

                                II

   When a plan administrator’s denial of benefits is chal-
lenged under ERISA, the default rule holds that courts review
the administrator’s denial de novo, “unless the benefit plan
gives the administrator or fiduciary discretionary authority to
determine eligibility for benefits or to construe the terms of
the plan.” Firestone Tire & Rubber Co. v. Bruch, 489 U.S.
101, 115 (1989). Abatie vigorously argues that we must
review Alta’s denial of benefits de novo because the Plan does
not adequately grant discretion to Alta. Abatie also argues that
even if the Plan does effectively grant Alta discretion, Alta’s
behavior manifested a serious conflict of interest which
demands heightened review. We address, and reject, each
contention.

                                A

  [1] Only if a plan unambiguously grants discretion to the
administrator to determine eligibility will we review an
               ABATIE v. ALTA HEALTH & LIFE INS.           11827
administrator’s denial of benefits for an abuse of discretion.
Id.; Kearney v. Standard Ins. Co., 175 F.3d 1084, 1088-89
(9th Cir. 1999) (en banc).

   [2] The standard of review depends on whether the “plan
documents unambiguously say in sum or substance that the
Plan Administrator or fiduciary has authority, power, or dis-
cretion to determine eligibility or to construe the terms of the
Plan[.]” Sandy v. Reliance Standard Life Ins. Co., 222 F.3d
1202, 1207 (9th Cir. 2000). Although the plan must effec-
tively grant the administrator discretion in interpreting the
plan or determining eligibility, there is no requirement that the
word “discretion” be used. Id. (observing that “there is no
magic to the words ‘discretion’ or ‘authority’ ”).

  Alta’s plan provides:

    The responsibility for full and final determinations
    of eligibility for benefits; interpretation of terms;
    determinations of claims; and appeals of claims
    denied in whole or in part under the HLFAC Group
    Policy rests exclusively with HLFAC.

   It is readily evident that the Alta plan grants such authority
to Alta—a successor in interests and responsibilities to
HLFAC—in conveying to Alta the “exclusive[ ]” “responsi-
bility for full and final” determinations as to eligibility and
plan interpretations. See Bergt v. Ret. Plan for Pilots
Employed by MarkAir, Inc., 293 F.3d 1139, 1142 (9th Cir.
2002) (applying the abuse of discretion standard where the
policy grants the administrator “the ‘power’ and ‘duty’ to
‘interpret the plan and to resolve ambiguities, inconsistencies
and omissions’ and to ‘decide on questions concerning the
plan and the eligibility of any Employee . . . .’ ”) (citing
Sandy, 222 F.3d at 1207); Bendixen v. Standard Ins. Co., 185
F.3d 939, 943, 943 n.1 (9th Cir. 1999) (holding that a plan
that gave “ ‘full and exclusive authority’ ” to the administrator
“ ‘to determine . . . eligibility for insurance [and a policyhold-
11828          ABATIE v. ALTA HEALTH & LIFE INS.
er’s] entitlement to benefits’ ” “clearly confer[red]” discretion
to the plan administrator).

   A side-by-side comparison reveals that the Alta plan more
clearly conveys discretion than those plans which we have
held to fall short of granting discretionary authority. See
Kearney, 175 F.3d at 1089-90 (holding that language provid-
ing that the insurer will pay disability benefits “upon receipt
of satisfactory written proof that you have become disabled”
does not unambiguously confer discretion upon the adminis-
trator). In Ingram v. Martin Marietta Long Term Disability
Income Plan, 244 F.3d 1109, 1112-13 (9th Cir. 2001), the
plan provided that “[t]he carrier solely is responsible for pro-
viding the benefits under this Plan”; (2) “[t]he carrier will
make all decisions on claims”; and (3) “[a]ccordingly, . . . the
review and payment or denial of claims and the provision of
full and fair review of claim denial pursuant to [ERISA] shall
be vested in the carrier.” We concluded that such language
was insufficient to convey discretion and therefore failed to
give rise to abuse of discretion review. Id. at 1113-14. We
held that the statements simply identified the carrier as the
entity that paid benefits and administered the plan. Id. at
1112-13. The bare allocation of decision-making authority
was insufficient to give rise to “a grant of discretionary
authority in making those decisions.” Id. By contrast, the Alta
plan explicitly grants to Alta, and “exclusively” to Alta, “[t]he
responsibility for full and final determinations” of claims,
plan interpretation, plan eligibility, and appeals.

  [3] We hold that Alta’s plan explicitly grants discretion to
Alta to interpret the plan and determine eligibility, so that,
barring other justifications for removing deference, we must
review Alta’s denial of benefits for an abuse of discretion.

                                B

  [4] Alta’s dual role as administrator and funding source
gives rise to an apparent conflict of interest, but that “does not
              ABATIE v. ALTA HEALTH & LIFE INS.            11829
automatically remove the deference” normally accorded to
ERISA administrators. Lang v. Long-Term Disability Plan of
Sponsor Applied Remote Tech., Inc., 125 F.3d 794, 797 (9th
Cir. 1997); see also Jordan v. Northrop Grumman Corp. Wel-
fare Benefit Plan, 370 F.3d 869, 876 (9th Cir. 2003) (“[W]hile
the plan has a financial interest in keeping [the money], that
alone cannot establish [a] conflict of interest in the adminis-
trator, because it would leave no cases in the class receiving
deferential review . . . .”); Doyle v. Paul Revere Life Ins. Co.,
144 F.3d 181, 184 (1st Cir. 1998) (observing that where a
plan administrator is also the payor, “[t]he conflict is not as
serious as might appear at first blush,” because of incentives
upon the insurer to refrain from being overly eager to deny
claims).

   Where a plan grants discretion to the plan administrator,
abuse of discretion is our prevailing standard of review
because the parties themselves have contracted for it. Jordan,
370 F.3d at 875 (“When we review for abuse of discretion, it
is because the plan has put the locus for decision in the plan
administrator, not in the courts, so we cannot substitute our
judgment for the administrator’s.”). To minimize costs of
employee benefit plans, ERISA allows for administrative res-
olution of claims, which we review in a deferential manner.
See Amato v. Bernard, 618 F.2d 559, 567 (9th Cir. 1980) (not-
ing that the key goals of ERISA, in allowing for administra-
tive resolution of claims, were to “help reduce the number of
frivolous lawsuits,” “provide a nonadversarial method of
claims settlement,” and “minimize the costs of claims settle-
ment for all concerned.”).

   [5] It is only when a serious conflict of interest exists that
our standard of review changes. Jordan, 370 F.3d at 875. To
prove that a serious conflict of interest exists, and to override
a plan’s unambiguous conferral of discretion to the plan
administrator, the plaintiff must “provide[ ] material, proba-
tive evidence, beyond the mere fact of the apparent conflict,
tending to show that the fiduciary’s self-interest caused a
11830         ABATIE v. ALTA HEALTH & LIFE INS.
breach of [its] fiduciary obligations to the beneficiary.”
Atwood v. Newmont Gold Co., 45 F.3d 1317, 1323 (9th Cir.
1995). If plaintiff satisfies this burden, de novo review is
appropriate if the administrator fails to “produc[e] evidence to
show that the conflict of interest did not affect the decision to
deny benefits.” Id.

   The district court’s choice and application of the standard
of review is itself reviewed de novo. Lang, 125 F.3d at 797.
Underlying findings of fact are reviewed for clear error. Frie-
drich v. Intel Corp., 181 F.3d 1105, 1109 (9th Cir. 1999). The
district court concluded that Abatie “failed to meet her burden
of producing material, probative evidence that the apparent
conflict has ripened into an actual conflict sufficient to alter
the standard of review.” We agree.

                               1

   Abatie argues that an actual conflict of interest is evident
because Alta offered different reasons for denying the claim
at different stages of review. In its initial decision denying
benefits, Alta explained that it was denying the claim because
a waiver of premium had never been requested. In Alta’s sec-
ond decision letter, which was written after this lawsuit was
filed and with a newly supplemented administrative record,
Alta again relied on the failure of Dr. Abatie and the Clinic
to file a waiver of premium. This final administrative determi-
nation added, as an additional reason for denial, that there was
insufficient proof that Dr. Abatie remained totally disabled
until his death.

   We have found an actual conflict to exist where an admin-
istrator has presented inconsistent reasons for denial that
emerged after the administrator’s first ground for denial was
rebutted by clear evidence. Lang, 125 F.3d 794 at 799. Lang
does not govern the instant case, however, because Alta
merely offered an additional reason for denying benefits. We
have never held that an ERISA administrator’s assertion of a
               ABATIE v. ALTA HEALTH & LIFE INS.           11831
supplemental reason for denying a claim subsequent to the
initial denial is sufficient evidence to demonstrate that a plan
administrator has breached its fiduciary duties to the benefi-
ciary.

   The context of the administrative process in this case
emphasizes the appropriateness of Alta’s decision-making
process. Alta’s final determination was the only decision that
Alta rendered based on the entire administrative record. To be
sure, a plan administrator could not be expected to articulate
all reasons for denial until the administrative record was com-
plete. Further, Alta’s invocation of the additional reason for
denial on appeal did not procedurally prejudice Abatie. Since
the initiation of her appeal, Abatie has known that even if she
were successful in persuading the appellate body that the ini-
tial benefit determination that her husband was no longer cov-
ered under the Plan was incorrect, she would still need to
demonstrate that her husband remained totally disabled until
his death.

   [6] There is no rule that an ERISA administrator, after fail-
ing to raise a denial reason in the initial benefit determination,
is estopped from invoking that reason for denial upon appeal.
The Act simply provides that at the initial stage of review the
administrator must, upon denying a claim, and “[i]n accor-
dance with regulations of the Secretary” of Labor, provide
adequate, understandable notice that “set[s] forth the specific
reasons for such denial.” 29 U.S.C. § 1133(1). The Act
requires that there be a “reasonable opportunity” to appeal a
denial of a claim “for a full and fair review by the appropriate
named fiduciary.” 29 U.S.C. § 1133(2) (emphasis added). The
statute’s dictate that the appellate body’s review be “full and
fair” suggests that the appellate administrative body is not
limited to a review of the reasons articulated by the adminis-
trator who initially denied the claim.

   [7] The regulations in effect at the time Abatie filed her
claim reiterate the requirement that the appellate body con-
11832           ABATIE v. ALTA HEALTH & LIFE INS.
duct a “full and fair” review of a denied claim. Those regula-
tions require the appellate body to set forth its decision in
writing, with no indication that the decision be limited to the
reasons for denial as articulated by the initial decision-maker.
See 29 C.F.R. § 2560.503-1 (1999) (regulations in effect at
the time Abatie filed her claim).4 We hold that an ERISA
administrator’s articulation of a new reason for denying a
claim on appeal after the initial benefit determination has
been rendered is permissible and so does not constitute mate-
rial, probative evidence that the administrator’s conflict of
interest manifested itself into an actual breach of its fiduciary
obligations.

                                   2

   Abatie alleges that Alta’s failure to discuss certain pieces
of evidence in its decisions denying Abatie’s claim illustrates
her contention that Alta’s conflict of interest led to a breach
in its fiduciary duty. For guidance in assessing Abatie’s claim,
we again refer to Atwood, which states that “material, proba-
tive evidence . . . tending to show that the fiduciary’s self-
interest caused a breach of [its] fiduciary obligations” must be
set forth in order to dislodge our deferential standard of
review. Atwood, 45 F.3d at 1323. Applying Atwood, we hold
that a plan administrator’s failure to discuss non-dispositive
evidence does not constitute material, probative evidence that
the fiduciary’s self-interest has led to a breach of its fiduciary
obligations.
  4
    The current regulations, while not governing Abatie’s claim, further
the notion that new reasons for denial may, and perhaps even should, be
invoked by the fiduciary subsequent to the initial benefit determination.
These regulations require that, on appeal, the fiduciary “[p]rovide for a
review that takes into account all comments, documents, records, and
other information submitted by the clamant relating to the claim, without
regard to whether such information was submitted or considered in the
initial benefit determination.” 29 C.F.R. § 2560.503-1(h)(2)(iv) (2004)
(emphasis added).
                ABATIE v. ALTA HEALTH & LIFE INS.                  11833
                                    i

   Abatie first points to deposition testimony of an employee
of the Clinic, who testified that she contacted someone who
worked for the insurer to request a waiver of premium for Dr.
Abatie. Abatie argues that Alta’s failure to mention this depo-
sition testimony in its final decision denying benefits demon-
strates a serious conflict of interest that demands heightened
review. We disagree.

   Alta’s final determination was set forth in a detailed,
eleven-page letter, which contains a significant discussion of
the policy and the pertinent issues relating to insurance cover-
age on the life of Dr. Abatie. Therein, Alta engages in a care-
ful and thorough four-page, single-spaced analysis as to
whether Dr. Abatie had successfully obtained a waiver of pre-
mium. Alta explicitly noted that it “based [its] determination
on an examination of the Administrative Record as a whole,
as well as on an examination of its own business records and
computer systems relating to disability waiver of premium
claims.” The final determination contained a detailed analysis
of the typical documentary evidence that would exist in the
Clinic’s and the insurers’ files if a waiver of premium had
been granted. In its discussion, Alta considered several
undated documents prepared by a Clinic employee which sug-
gested that the employee had filed a waiver of premium appli-
cation, with a handwritten note stating that “waiver was
granted 2/94.”5 Alta allowed that these brief documents and
handwritten note “provide some inferential evidence that a
waiver claim was submitted,” but emphasized that the docu-
ments “do not specifically state to whom the claim was alleg-
edly submitted, what specific information was provided, who
  5
   These handwritten, undated, and vague documents were allegedly dis-
covered by the Clinic after this litigation was commenced and may well
have been falsified for the purpose of either enhancing Abatie’s claim or
deflecting blame from the Clinic for its apparent failure to file a waiver
of premium application.
11834          ABATIE v. ALTA HEALTH & LIFE INS.
evaluated and approved the claim, and the specific grounds on
which the claim was approved.” Alta concluded that the “lack
of critically important information, combined with the
absence of any documentation from [the insurer] concerning
this claim . . . , substantially outweighs any inference that can
be drawn that a waiver claim was submitted on behalf of Dr.
Abatie.”

   [8] Although the deposition testimony was not discussed in
Alta’s final denial letter, the record does not support the prop-
osition that the testimony was either “ignored” or “disregard-
ed.” Alta explicitly noted in its final denial that it “based [its]
determination on an examination of the Administrative
Record as a whole,” revealing that Alta did consider the depo-
sition testimony, which was part of the amended administra-
tive record. Given our deferential stance toward decisions of
ERISA administrators, where an ERISA administrator states
that it considered the record “as a whole,” we must assume
that it did so, in the absence of clear and convincing evidence
to the contrary.

   [9] We conclude that Alta was under no obligation to dis-
cuss deposition testimony about the alleged waiver of pre-
mium application. The plan requires that proof of an insured’s
total disability “be sent to [the insurer’s] Home Office,” indi-
cating that the application and corresponding proof must be in
writing. In assessing whether the waiver of premium applica-
tion and accompanying proof of disability was ever filed, we
hold that a plan administrator is entitled to rely exclusively on
the written documentation in the administrative record, a
record to which both sides of this case had an opportunity to
contribute. This proposition derives from the plan itself, a
document to which both parties agreed, which requires that a
written waiver of premium application be submitted. Alta was
not required to delve into a he-said, she-said debate as to
whether a waiver of premium application was ever filed.
Because a plan administrator is entitled to rely exclusively on
documentary evidence to determine whether the plan-required
               ABATIE v. ALTA HEALTH & LIFE INS.           11835
paperwork was filed, Alta was under no obligation to discuss
the deposition testimony. In its discretion as the plan adminis-
trator, Alta can certainly consider oral testimony if it wishes,
but the plan’s requirement for a written waiver of premium
application along with written proof of total disability allows
it to solely consider documentary evidence to ascertain
whether the documents were filed. With no obligation on Alta
to consider the evidence in the first instance, it follows that
the failure to discuss the deposition cannot constitute “mate-
rial, probative evidence” that Alta breached its fiduciary obli-
gations.

   Moreover, the unreliable and inconclusive nature of the
deposition testimony at issue is evident. It was only in
response to leading questions from Abatie’s attorney that
Melissa Peter, a former employee of the Clinic, testified in the
deposition that she had contact with an individual at the
insurer to “process” Dr. Abatie’s waiver of premium. Peter
does not remember the name of the individual with whom she
allegedly spoke. She alleges that the insurer granted the
waiver of premium, but does not remember from whom she
learned the information, nor does she recollect whether such
notification was oral or written. Peter testified that in a case
such as Dr. Abatie’s, a disabled employee would typically be
sent a form to complete and return to the Clinic’s Human
Resources office. The Clinic, in turn, would submit the waiver
of premium application to the insurer. The record does not
demonstrate that Dr. Abatie completed the application form.
In her deposition, Peter did not testify that she either received
the completed form from Dr. Abatie or submitted it to the
insurer. Peter’s testimony spoke to possibilities, not to actuali-
ties: “I believe Dr. Abatie would have completed the form, I
would have received it, it would have been submitted.” More
generally, Peter testified that when she dealt with an insurance
company and received oral confirmation, there would be
follow-up in writing to obtain written confirmation from the
insurer. The record contains no evidence of any such official
written confirmation that the insurer had granted Dr. Abatie
11836         ABATIE v. ALTA HEALTH & LIFE INS.
a waiver of premium. This ambiguous deposition testimony
comes against the backdrop of a written admission both by the
Clinic and its insurance broker that the waiver of premium
application was never filed. See Part I.B., supra.

   A further problem with the Peter deposition is the high
probability that the Peter testimony was self-serving. Peter
may well have been motivated by sympathy for Abatie and a
desire to cover up the Clinic’s, and possibly her own, failure
to properly file Dr. Abatie’s waiver of premium application.

   [10] In sum, the deposition hardly clears the air on the sub-
ject, and so it is not a piece of evidence that an administrator
must discuss. The category of evidence that an administrator
must discuss is extremely limited in light of our deferential
review of decisions of ERISA administrators who are granted
discretion to adjudicate claims by their plan. Because of the
discretion granted to the administrator by the ERISA plan, we
are unable to interject ourselves as a micromanager in the
plan’s affairs. We hold that a “full and fair review,” 29 U.S.C.
§ 1133(2), does not demand that an ERISA administrator
recite every piece of evidence somehow relevant to its deci-
sion or write a treatise as to every claim that comes before it.

   [11] We further hold that a mere failure of an administrator
to discuss evidence does not violate ERISA principles where
the evidence is non-dispositive in the first instance. We have
recognized that when an “administrator ‘arbitrarily refuse[s]
to credit a claimant’s reliable evidence,’ ” heightened review
may be called for, Jordan, 370 F.3d at 879 (quoting Black &
Decker Disability Plan v. Nord, 538 U.S. 822, 834 (2003)
(emphasis added)), but only if the administrator’s decision as
a whole is without “a reasonable basis.” Id. at 879 (“But as
long as the record demonstrates that there is a reasonable
basis [for the administrator’s decision], the decision cannot be
characterized as arbitrary, and we must defer to the decision
of the plan administrator.”). A necessary predicate to launch
such an inquiry is to ask whether the piece of evidence at
               ABATIE v. ALTA HEALTH & LIFE INS.            11837
issue is highly reliable, and even if it were, the decision’s fail-
ure to mention that evidence must be arbitrary, all of which
led to a decision that was without a reasonable basis. Further,
because we are dealing with an alleged procedural violation
of ERISA’s requirement for “full and fair review,” heightened
review would be called for only if the violation was “so fla-
grant as to alter the substantive relationship between the
employer and the employee, thereby causing the beneficiary
substantive harm.” Gatti v. Reliance Standard Life Ins. Co.,
415 F.3d 978, 985 (9th Cir. 2005).

   We need not linger over the application of these principles
to the case at hand. There was good reason for the administra-
tor not to discuss the deposition testimony, because the Peter
deposition would not have affected the outcome, and it was
both ambiguous and unreliable. The deposition testimony is
non-dispositive for these three independent reasons, removing
it from any possible class of evidence that an administrator
must discuss.

                                ii

  Abatie argues that Alta’s failure to discuss the clerical error
provision in the policy also qualifies as material and probative
evidence of an actual conflict of interest. We disagree. The
policy’s clerical error provision reads:

    A clerical error on the part of the Policyholder or us
    will not:

    1) deprive a person of the insurance he or she is
    entitled to under this Policy; or

    2) cause insurance to continue beyond the date on
    which it would reduce or end.

    If such an error is discovered, a fair adjustment of
    premiums will be made.
11838         ABATIE v. ALTA HEALTH & LIFE INS.
   [12] We have previously concluded that similar policy lan-
guage could not excuse the failure to submit a timely proof of
a claim, because doing so would render “proof-of-claim pro-
visions [ ] meaningless.” Cisneros v. UNUM Life Ins. Co. of
America, 134 F.3d 939, 943 n.2 (9th Cir. 1998). Because Dr.
Abatie’s failure to submit a timely claim could not be excused
by a “clerical error” provision, Alta’s failure to discuss it is
not evidence of an actual conflict of interest. It would be
costly and unworkable to require a plan administrator to dis-
cuss terms of a plan that are totally irrelevant to the adminis-
trator’s final decision. Because the clerical error provision
was non-dispositive, it was perfectly permissible for Alta’s
decision to omit discussion of the plan’s clerical error provi-
sion.

                               3

   We reject Abatie’s contention that Alta manifested a seri-
ous conflict of interest by intentionally misrepresenting Dr.
Abatie’s medical records. As we explain, the misrepresenta-
tions that Abatie alleges are actually not misrepresentations at
all.

   We must be careful in evaluating claims that an administra-
tor intentionally misrepresented the record in the first
instance. Although we can conceive of circumstances where
an administrator intentionally misrepresents the record such
that it is clear that it was bent on wrongly denying a claim,
where a plan grants discretion to the plan administrator we
must be loath to second-guess the conclusions of the plan
administrator. Because Alta’s discussion and interpretation of
the administrative record is reasonable, we do not even begin
to approach the point at which heightened review would be
appropriate.

  Alta, in explaining that the record provides insufficient
proof that Dr. Abatie was totally disabled, noted that “on
August 11, 1998, Dr. Abatie’s treating physician concluded
              ABATIE v. ALTA HEALTH & LIFE INS.            11839
that his medical condition was ‘better than it has been at any
time over the last 9 years.’ ” This notation follows a discus-
sion of Dr. Abatie’s lymphoma and related hematological
complications, so it is clear in context that Alta’s reference to
Dr. Abatie’s “medical condition” is a reference to his anemia
and related problems. In this context, Alta’s characterization
of the treating physician’s report is accurate because Dr. Aba-
tie was anemic, and the better hemoglobin level indicated that
his anemia was improving.

   Alta also fairly noted Dr. Abatie’s “absence of regular
[doctor’s] office visits” during the 18-month period following
his treating physician’s positive report. The record reveals
that Alta did visit the doctor five times during that period, but
that these visits were for medical issues that had arisen (i.e.,
ear wax buildup, sudden sweats and shortness of breath) and
were not for scheduled visits related to either his lymphoma
or anemia, the two related conditions that led to Dr. Abatie’s
disability in the first instance. Alta’s characterization of Dr.
Abatie’s lack of scheduled office visits is a reasonable inter-
pretation of the administrative record.

                               4

   [13] We conclude that Abatie has failed to present material
and probative evidence sufficient to show that a serious con-
flict of interest exists. Consequently, heightened review of
Alta’s denial of benefits is improper.

                               III

   Because the ERISA plan effectively grants discretion to the
plan administrator and there is no serious conflict of interest
demanding a heightened standard of review, we review Alta’s
denial of benefits for an abuse of discretion. An administrator
abuses its discretion if it renders “a decision without any
explanation, or in a way that conflicts with the plain language
of the plan, or that is based on clearly erroneous findings of
11840          ABATIE v. ALTA HEALTH & LIFE INS.
fact.” Atwood, 45 F.3d at 1323-24. Alta’s decision to deny
benefits “should be upheld if it is based upon a reasonable
interpretation of the plan’s terms and was made in good
faith.” Estate of Shockley v. Alyeska Pipeline Serv. Co., 130
F.3d 403, 405 (9th Cir. 1997) (internal quotations omitted).

   The plan administrator’s decision comes to us on appeal for
review of the decision of the district court. We will set aside
a district court’s findings of fact only in the event of clear
error. Fed. R. Civ. P. 52(a). “Clear error review also applies
to the results of ‘essentially factual’ inquiries applying the law
to the facts.” Saltarelli v. Bob Baker Group Med. Trust, 35
F.3d 382, 384 (9th Cir. 1994). The district court’s conclusions
of law are reviewed de novo. Id. at 385.

   The district court concluded that there was insufficient evi-
dence to support Abatie’s claim that a waiver of premium was
ever requested or approved. In support, the district court
found that “neither Alta’s nor the Clinic’s records had any of
the customary and usual documentation that would establish
that a waiver of premium application was requested and
approved.”

   The district court also held that Alta did not abuse its dis-
cretion in denying benefits on the additional, independent
ground that there was insufficient evidence to establish that
Dr. Abatie was totally and continuously disabled from 1992
until his death. Whether Dr. Abatie remained totally and con-
tinuously disabled “is a medical and administrative judgment
committed to the discretion of the plan administrator based on
a fair review of the evidence.” Jordan, 370 F.3d at 880. The
improvement of the anemia provides support for the ERISA
administrator’s conclusion that there was insufficient evi-
dence that Dr. Abatie remained totally and continuously dis-
abled. In addition, Dr. Abatie’s treating physician also noted
in the August 1998 report that Dr. Abatie’s “appetite is good
and weight is stable” and that Dr. Abatie denied having “any
fever, infection, bleeding, adenopathy, shortness of breath,
              ABATIE v. ALTA HEALTH & LIFE INS.          11841
abdominal pain, bone pain, change in bowel habits, or diffi-
culty with urination.”

  [14] We conclude that Alta did not abuse its discretion in
denying Abatie’s claim for life insurance benefits.

  AFFIRMED.

PREGERSON, Circuit Judge, dissenting:

   I dissent. Unlike my colleagues, I do not think that Alta’s
decision to deny life insurance benefits to Mrs. Karla Abatie,
Dr. Joseph Abatie’s widow, should have been reviewed by the
district court for an abuse of discretion. Rather, the district
court should have conducted a de novo review of Alta’s deci-
sion.

   Where a plan administrator flagrantly violates ERISA’s
procedural protections causing the beneficiary to suffer sub-
stantive harm, a district court should conduct a de novo
review of the plan administrator’s benefits decision. See Gatti
v. Reliance Standard Life Ins. Co., 415 F.3d 978, 985 (9th Cir.
2005) (“[P]rocedural violations of ERISA do not alter the
standard of review unless those violations are so flagrant as
to alter the substantive relationship between the employer and
employee, thereby causing the beneficiary substantive
harm.”). I think this is such a case for two reasons. When Alta
rendered its final decision denying coverage to Mrs. Abatie in
June 2002, it ignored deposition testimony in the administra-
tive record that strongly favored Mrs. Abatie’s claim. Further-
more, Alta waited until its final decision denying coverage to
give an additional reason for denying Mrs. Abatie’s claim,
thereby precluding her from seeking a full and fair review of
its decision to deny benefits. For both of these reasons, Alta
failed to comply with ERISA’s notice and full and fair review
requirements in assessing Mrs. Abatie’s claim for benefits.
11842           ABATIE v. ALTA HEALTH & LIFE INS.
See 29 U.S.C. § 1133; 29 C.F.R. § 2560.503-1 (1999).
Because I believe that these violations were flagrant and
caused Mrs. Abatie substantive harm, I would remand this
case to the district court for de novo review of Mrs. Abatie’s
claim for life insurance benefits.

  I.    The Denial of Mrs. Abatie’s Claim

   Dr. Joseph Abatie, M.D., was a participant in an employee
benefit plan covered by ERISA. In 1989, Dr. Abatie was diag-
nosed with hemolytic anemia. Because of his worsening con-
dition, Dr. Abatie took a leave of absence from his position
as a radiologist with the Santa Barbara Foundation Clinic
(“Clinic”) in November 1992. Additional testing in February
1993 determined that Dr. Abatie had non-Hodgkin’s lym-
phoma, a type of cancer affecting the lymphatic system. Dr.
Abatie’s condition continued to deteriorate. In mid-1993, it
was determined that Dr. Abatie would be unable to return to
the Clinic to work. As a result, Dr. Abatie was classified as
a retiree.

   Nearly five years later, Dr. Abatie’s spleen was removed.
Several months after the surgery, on August 11, 1998, Dr.
Abatie’s treating physician, Dr. Mark S. Abate, M.D.,1 indi-
cated that the splenectomy was successful and that “[t]he
patient’s current hemoglobin level is better than it has been at
any time over the past 9 years. At present no further treatment
is indicated.” Nevertheless, in June 2000 Dr. Abatie died from
a combination of conditions caused by his illness.

   Mrs. Abatie submitted a claim for life insurance benefits to
Alta, the successor in interest to the group insurance policy
issued to the Clinic. Home Life Financial Assurance Co.
(“Home Life”) was the original issuer of the group policy
involved in this claim. Home Life assigned its rights and
  1
  Despite the similarity in their names, Dr. Joseph Abatie and Dr. Mark
Abate were not related.
                 ABATIE v. ALTA HEALTH & LIFE INS.                   11843
responsibilities under the group policy to Anthem Health &
Life Ins. Co. In July 1998, Alta became the successor in inter-
est to Anthem Health & Life Ins. Co.’s rights and responsibil-
ities.

   In a letter dated March 15, 2001, Alta issued its initial
denial of Mrs. Abatie’s claim for life insurance benefits. Alta
stated that its records did not indicate that a waiver of pre-
mium claim was filed within twelve months of the date that
Dr. Abatie became totally disabled, as required under the pol-
icy.2 As a result, Alta concluded that coverage was not in
force when Dr. Abatie died. Alta did, however, notify Mrs.
Abatie of her ability to appeal its decision.

  II.    The Administrative Appeal and Present Lawsuit

   Seeking to overturn Alta’s determination, Mrs. Abatie filed
this lawsuit in district court to enforce her rights as a benefi-
ciary under the plan. See 29 U.S.C. § 1132(a)(1)(B). Mrs.
Abatie also filed an administrative appeal of Alta’s denial of
coverage. In connection with her lawsuit, Mrs. Abatie con-
ducted additional discovery and supplemented the administra-
tive record with the deposition testimony of Melissa Peter, a
former Clinic employee, and with several documents from the
Clinic’s records.

   Ms. Peter testified in her deposition that she requested a
waiver of premium from Alta’s predecessor, Home Life, and
that Home Life granted the waiver. Ms. Peter testified in per-
tinent part as follows:
  2
    The policy provided that if an insured becomes totally disabled, life
insurance coverage continues under the policy without premium charge if
the insured meets several conditions: (1) the total disability must start
before the insured reaches age 60; (2) the total disability must begin before
coverage ends; and (3) the insurer must receive proof of total disability
within twelve months of the date the insured becomes totally disabled. The
last provision regarding notice of disability is the “waiver of premium
claim” referred to by Alta.
11844           ABATIE v. ALTA HEALTH & LIFE INS.
    Q.   Is one of the things that you did for Dr. Abatie
         to process a waiver of the life insurance pre-
         mium with Home Life?

    A.   Yes.

    Q.   And did you personally have contact with the
         Home Life Insurance Company in order to carry
         that out?

    A.   Yes.

    Q.   In fact, did you have a communication from
         Home Life Financial Assurance Company that
         the requested waiver of premium had been
         granted in regard to Dr. Abatie?

    A.   Yes.

   In addition to the deposition testimony of Ms. Peter, Mrs.
Abatie submitted several documents from the Clinic’s records
indicating that Dr. Abatie’s waiver of premium claim had
been granted by Home Life. One of the submitted records
describing the status of insurance coverage for several former
Clinic employees contained the following type-written entry
for Dr. Abatie’s life insurance: “Premiums waiver requested
in January, 1994. Should be receiving confirmation any day.
Premiums are $170.34.” Directly following that entry is a
handwritten note stating, “Waiver was granted 2/94.” Ms.
Peter testified in her deposition that she wrote that note on the
record around the time the waiver of premium was granted by
Home Life.

  Another document contained in the Clinic’s records was a
handwritten memorandum from Ms. Peter which stated, in
part, “We still have Dr. Abatie, his wife and his son on our
health plan, we have him and his wife on our dental plan and
                 ABATIE v. ALTA HEALTH & LIFE INS.                   11845
the life insurance premium is waived.” Ms. Peter testified in
her deposition that she wrote that memo in August 1994.

   After reviewing the newly supplemented administrative
record, Alta sent Mrs. Abatie a letter, dated June 6, 2002,
denying for the second time coverage on Mrs. Abatie’s life
insurance claim. In its second denial, Alta again concluded
that the waiver of premium claim was never received by
Home Life. But Alta’s letter failed to discuss Ms. Peter’s
deposition testimony, as quoted above, which established that
Home Life had granted the waiver of premium claim for Dr.
Abatie. Instead, Alta referred only to the Clinic records with
Ms. Peter’s handwritten notes indicating that a waiver of pre-
mium claim had been granted. Alta ignored Ms. Peter’s depo-
sition testimony.

   In brushing aside the weight of Ms. Peter’s handwritten
notes, Alta commented in its denial letter that the notes did
not “specifically state to whom the claim was allegedly sub-
mitted, what specific information was provided, who evalu-
ated and approved the claim, and the specific grounds on
which the claim was approved.” As further reason for dis-
counting the weight of the newly discovered Clinic records,
Alta cited the lack of any record of a waiver of premium
claim in the files of Alta’s predecessor, Home Life.3

   In the same letter, Alta provided, for the first time, an addi-
tional reason for denying Mrs. Abatie’s claim. Alta claimed
that there was insufficient proof in the administrative record
that Dr. Abatie remained totally disabled between the onset of
his disability and his death.4 Alta cited a report from one of
  3
     There is nothing in the record, however, indicating that Home Life or
its successors notified Dr. Abatie that his life insurance coverage would
be cancelled for non-payment of premiums.
   4
     The policy at issue provided that the insurer would not pay life insur-
ance proceeds in the case of total disability unless it received (1) proof of
death, and (2) proof that the insured remained totally disabled until the
time of death.
11846         ABATIE v. ALTA HEALTH & LIFE INS.
its examining physicians, Dr. Peter Karakusis, M.D., who
reviewed Dr. Abatie’s medical records during Alta’s initial
evaluation of Mrs. Abatie’s claim. Dr. Karakusis concluded
that, because Dr. Abatie “enjoyed both prolonged partial
remission of his lymphoma and quiescence of secondary
hematological complications,” there was insufficient proof of
an inability “to perform sedentary work.” Alta also cited the
August 11, 1998 report from Dr. Mark Abate, claiming that
“Dr. [Joseph] Abatie’s treating physician concluded that his
medical condition was ‘better than it has been at any time
over the last 9 years.’ ” Contrary to Alta’s assertion, Dr.
Abate’s report actually stated that Dr. Abatie’s “current
hemoglobin level [not his medical condition] is better than it
has been at any time over the past 9 years.”

  III.   De Novo Review of Alta’s Decision to Deny Benefits
         is Warranted

   Where a plan administrator flagrantly violates ERISA’s
procedural protections, and thereby causes the claimant sub-
stantive harm, de novo review is warranted. See Gatti, 415
F.3d at 985; see also Jebian v. Hewlett-Packard Co.
Employee Benefits Org. Income Prot. Plan, 349 F.3d 1098,
1105 (9th Cir. 2003) (“When decisions are not in compliance
with regulatory and plan procedures, deference may not be
warranted.”); Friedrich v. Intel Corp., 181 F.3d 1105, 1110
(9th Cir. 1999) (concluding that de novo review was war-
ranted where “procedural irregularities in the initial claims
process and an unfair appeals process” tainted plan adminis-
trator’s benefits decision). I believe that de novo review is
warranted in this case. Alta failed to comply with ERISA’s
notice and full and fair review requirements, as required by 29
U.S.C. § 1133 and its implementing regulations.

   The first reason that I believe de novo review is warranted
is that Alta totally ignored Ms. Peter’s deposition testimony
in its June 2002 letter explaining its final decision to deny
coverage. As shown above, Ms. Peter’s deposition testimony
              ABATIE v. ALTA HEALTH & LIFE INS.            11847
was part of the administrative record and clearly supported
Mrs. Abatie’s assertion that a waiver of premium claim was
submitted to and granted by Alta’s predecessor, Home Life.
Ms. Peter testified that she personally received oral confirma-
tion from Home Life that a waiver of premium had been
granted for Dr. Abatie. While ignoring Ms. Peter’s deposition
testimony, Alta stated that the Clinic’s notes regarding the
waiver of premium claim for Dr. Abatie were inconclusive.
Alta also referred to the absence of any documentary evidence
of the waiver of premium in Home Life’s files. Rather than
weigh the absence of documentary evidence against Ms.
Peter’s deposition testimony that a waiver of premium was
requested and granted, Alta ignored Ms. Peter’s deposition
testimony altogether.

   The majority minimizes Alta’s failure to consider Ms.
Peter’s deposition testimony by concluding that “Alta was not
required to delve into a he-said, she-said debate” about
whether the waiver of premium was granted by Home Life.
Maj. Op. at 11834. Instead, the majority holds that “[i]n
assessing whether the waiver of premium application and
accompanying proof of disability was ever filed, we hold that
a plan administrator is entitled to rely exclusively on the writ-
ten documentation in the administrative record . . . .” Maj. Op.
at 11834. That holding finds no support in the statute, its
implementing regulations, or caselaw.

   ERISA and its implementing regulations require a plan
administrator to conduct “a full and fair review . . . of the
decision denying the claim.” 29 U.S.C. § 1133(2); see also 29
C.F.R. § 2560.503-1(g) (1999); 29 C.F.R. § 2560.503-1.
Thus, while a plan administrator is free to weigh conflicting
evidence in the administrative record in favor of the plan, see,
e.g., Jordan v. Northrop Grumman Corp. Welfare Benefit
Plan, 370 F.3d 869, 880 (9th Cir. 2004), “[p]lan administra-
tors, of course, may not arbitrarily refuse to credit a claim-
ant’s reliable evidence,” Black & Decker Disability Plan v.
Nord, 538 U.S. 822, 834 (2003). Indeed, we have stated that
11848          ABATIE v. ALTA HEALTH & LIFE INS.
“where the administrator ‘arbitrarily refuse[s] to credit a
claimant’s reliable evidence,’ the administrator’s decision
fails the ‘fair review’ requirement of the statute.” Jordan, 370
F.3d at 879 (quoting Black & Decker Disability Plan, 538
U.S. at 834); see also Grossmuller v. Int’l Union, UAW, 715
F.2d 853, 857 (3rd Cir. 1983) (“To afford a plan participant
whose claim has been denied a reasonable opportunity for full
and fair review, the plan’s fiduciary must consider any and all
pertinent information reasonably available to him.”) (empha-
sis added). Current ERISA regulations similarly make clear
that the obligation to conduct a “full and fair review” requires
a plan administrator to “[p]rovide for a review that takes into
account all comments, documents, records, and other infor-
mation submitted by the claimant relating to the claim, with-
out regard to whether such information was submitted or
considered in the initial benefit determination.” 29 C.F.R.
§ 2560.503-1(h)(2)(iv) (emphasis added).

   As these authorities illustrate, plan administrators may not
cherry-pick evidence when reviewing a denial of a claim for
benefits. Thus, I think the majority errs by allowing Alta to
disregard Ms. Peter’s deposition testimony. Here that error is
pronounced because Alta has an inherent conflict of interest
as both the funding source and the administrator of the bene-
fits plan at issue in this case. See Lang v. Long-Term Disabil-
ity Plan of Sponsor Applied Remote Tech., Inc., 125 F.3d 794,
797 (9th Cir. 1997) (“Given Standard’s dual role as both the
funding source and the administrator of the Plan, we are faced
with an inherent conflict of interest situation . . . .”); see also
Brown v. Blue Cross and Blue Shield of Ala., Inc., 898 F.2d
1556, 1561 (11th Cir. 1990) (“Because an insurance company
pays out to beneficiaries from its own assets rather than the
assets of a trust, its fiduciary role lies in perpetual conflict
with its profit-making role as a business.”).

  There is a second reason that I believe de novo review of
Alta’s decision to deny coverage is warranted. Once it
decided to deny Mrs. Abatie’s claim for coverage, Alta was
               ABATIE v. ALTA HEALTH & LIFE INS.           11849
obligated under ERISA to provide her with “adequate notice
in writing . . . setting forth the specific reasons for such deni-
al.” 29 U.S.C. § 1133(1) (emphasis added); see also 29 C.F.R.
§ 2560.503-1(f)(1) (1999); 29 C.F.R. § 2560.503-1(g)(1).
When Mrs. Abatie made her claim for benefits, Alta was also
required to provide her “[s]pecific reference to the pertinent
plan provisions on which the denial is based,” and “[a]
description of any additional material or information neces-
sary for the claimant to perfect the claim and an explanation
of why such material or information is necessary.” 29 C.F.R.
§ 2560.503-1(f)(2) & (3) (1999); see also Booton v. Lockheed
Med. Benefit Plan, 110 F.3d 1461, 1463 (9th Cir. 1997) (“If
benefits are denied in whole or in part, the reason for the
denial must be stated in reasonably clear language, with spe-
cific reference to the plan provisions that form the basis for
the denial . . . .”).

   In its first denial of Mrs. Abatie’s claim in March 2001,
Alta relied solely on the absence of evidence in Home Life’s
files that a timely waiver of premium was granted by Home
Life. It was not until Mrs. Abatie came forward with evidence
establishing that a waiver of premium had been granted by
Home Life that Alta provided an additional reason for deny-
ing coverage — insufficient proof in the administrative record
that Dr. Abatie remained totally disabled between the onset of
his disability and his death. By failing to reveal this reason
until its final decision to deny coverage in June 2002, Alta
basically “sandbagged” Mrs. Abatie by preventing her from
challenging its conclusion in the course of Alta’s administra-
tive review. See Marolt v. Alliant Techsystems, Inc., 146 F.3d
617, 620 (8th Cir. 1998) (determining ERISA claimants are
entitled to “timely and specific” explanations of any denial of
benefits and are not to be “sandbagged” by later justifications
of the decisions); see also Abram v. Cargill, Inc., 395 F.3d
882, 886 (8th Cir. 2005) (concluding that the claimant was
denied an opportunity to “meaningfully participate in the
appeals process” where he was not provided information “that
11850         ABATIE v. ALTA HEALTH & LIFE INS.
served as the basis for the Plan’s denial of benefits until after
the Plan’s decision”).

   The majority is mistaken insofar as it defends Alta’s delay
on the basis that there was an incomplete administrative
record in March 2001 when Alta initially denied Mrs. Abatie
life insurance benefits. See Maj. Op. at 11831 (“To be sure,
a plan administrator could not be expected to articulate all
reasons for denial until the administrative record was com-
plete.”). In February 2001, Alta had requested its own exam-
ining doctor to review Dr. Abatie’s medical records to
determine if Dr. Abatie remained totally disabled until the
time of his death. Alta therefore could have revealed this
additional reason during its initial denial of Mrs. Abatie’s
claim for benefits in March 2001.

   The majority asserts that Mrs. Abatie was not prejudiced by
Alta’s failure to articulate its additional reason for denying
benefits. It states that “[s]ince the initiation of her appeal,
Abatie has known that even if she were successful in persuad-
ing the appellate body that the initial benefit determination
that her husband was no longer covered under the Plan was
incorrect, she would still need to demonstrate that her hus-
band remained totally disabled until his death.” Maj. Op. at
11831. This reasoning, however, overlooks the basic purpose
of ERISA’s notice requirements.

   The purpose of ERISA’s notice requirements is to provide
the claimant “with information necessary for him or her to
know what he or she must do to obtain the benefit,” and to
“enable the [claimant] effectively to protest” if a plan persists
in its denial of benefits. Juliano v. Health Maint. Org. of New
Jersey, Inc., 221 F.3d 279, 287 (2d Cir. 2000); see also
DuMond v. Centex Corp., 172 F.3d 618, 622 (8th Cir. 1999)
(“The purpose of [the ‘full and fair review’] requirement is to
provide claimants with enough information to prepare ade-
quately for further administrative review or an appeal to the
federal courts.”) (alterations in original); Grossmuller, 715
              ABATIE v. ALTA HEALTH & LIFE INS. 11851
F.2d at 858 n. 5 (“[T]he persistent core requirements” of full
and fair review include “knowing what evidence the decision-
maker relied upon, [and] having an opportunity to address the
accuracy and reliability of that evidence”).

   Mrs. Abatie had no reason to think that Alta would deny
her claim on the basis that her husband did not remain totally
disabled until his death, because Alta failed to articulate this
reason in its initial denial of benefits. Accordingly, Mrs. Aba-
tie was entitled to assume that if she could demonstrate that
Home Life granted the waiver of premium, she would be eli-
gible for life insurance benefits. She therefore reasonably
focused her administrative appeal on establishing that a
waiver of premium was granted by Alta’s predecessor, Home
Life. Furthermore, without notice of this additional justifica-
tion for denying her claim, Mrs. Abatie did not have an
opportunity to challenge the evidence on which Alta relied to
reach its final conclusion. Under the majority’s reasoning,
Mrs. Abatie would have to divine all the possible reasons for
the denial of her benefits, and then prepare to rebut them.
That is obviously not the “meaningful dialogue between
ERISA plan administrators and their beneficiaries” that the
statute, regulations, and our caselaw require. Booton, 110
F.3d at 1463.

   For the reasons stated above, I think that Alta’s decision to
deny benefits to Mrs. Abatie is undeserving of the deference
granted it by the majority. ERISA was established in order to
“protect . . . the interests of participants in employee benefit
plans and their beneficiaries,” 29 U.S.C. § 1001(b) (congres-
sional findings and declaration of ERISA policy), and its
notice and full and fair review requirements reflect that basic
purpose, see 29 U.S.C. § 1133; 29 C.F.R. § 2560.503-1(g),
(h). These requirements are fundamental procedural protec-
tions designed for the benefit of plan beneficiaries. Where, as
here, those requirements are not met by a plan administrator
with an inherent conflict of interest, we should not insulate its
decision from adequate judicial review.
11852         ABATIE v. ALTA HEALTH & LIFE INS.
   Accordingly, I would remand this case to the district court
so that it could conduct a de novo review of Alta’s decision
to deny life insurance benefits to Mrs. Karla Abatie.