-- The Impostor
After a one-week trial, Pohls & Associates obtained a defense verdict in a case involving breach of contract and bad faith claims against a life insurer and a negligence claim against its agent.
The life insurer had denied the plaintiffs’ claim for benefits because the application misrepresented material facts about the proposed insured’s health and psychiatric history. Although there was no evidence that any of those facts were known to the life insurer’s underwriters, the plaintiffs alleged that the life insurer should be estopped from denying their claim for benefits because some (but not all) facts about the proposed insured’s health history had been communicated to the agent. They also alleged that the agent never asked any of the application’s questions but, instead, filled out the application himself, forged all of the signatures and improperly responded to underwriting inquiries without consulting the proposed insured.
The plaintiffs also insisted that their mother (the applicant) and the proposed insured both were present at the time of the application. However, when confronted with evidence that the proposed insured actually was in another state (and in a psychiatric hospital) on the date of the application, the plaintiffs argued that the application had been completed weeks earlier and post-dated by the agent.
The court described as “irrefutable” the defendants’ proof that an impostor had accompanied the applicant to the agent’s office when the application was completed. After finding that the applicant had, in fact, signed the application, the court explained that, “[w]hen she signed the application, she took full responsibility for all of the information contained therein.” The court also reasoned that communicating some, but not all, facts material to the risk would not excuse the applicant from her failure to communicate other facts that were material. It, therefore, rejected the plaintiffs’ claim of estoppel, held that their claim for benefits had been properly denied and concluded that the life insurer was entitled to prevail on the breach of contract claim, as well as the plaintiffs’ claim for bad faith.
The court also concluded that, because the proposed insured was not insurable, the agent’s conduct caused the plaintiffs no harm. To the contrary, the agent’s efforts were sufficient to get a policy issued, and the life insurer had denied the plaintiffs’ claim for benefits for reasons unrelated to any of his allegedly negligent acts. The court therefore entered a judgment in favor of both the life insurer and the agent.