An insurer cannot change the basis for a denial of benefits without offering an opportunity for appeal, because ERISA requires that claimants have the opportunity for "full and fair review" of all determinative reasons for the denial of benefits claims.
When an insurer changes the basis for its denial during the appeal process - whether during administrative review or judicial review - that opportunity is lost. See Thompson v. Life Ins. Co. of N. America, 30 Fed. Appx. 160, 163 64, 2002 U.S. App. LEXIS 3390 (4th Cir. 2002) (unpublished) (remanding to district court where insurance company changed reason for its denial of benefits during judicial appeal because allowing insurer "to raise a new basis for denial would deprive (the claimant] of the procedural fairness guaranteed to claimants under ERISA"). Also Glista v. Unum Life Ins. Co. of America, 378 F.3d 113, 130 (1st Cir. 2004) (remanding to the district court with instructions that the insurer be held to the reason articulated during its internal claims review process since the insurer "violated ERISA and its regulations by relying on a reason in court that had not been articulated to the claimant during its internal review").