Claim Denied Because Policy Expired

Fort Worth lawyers and those in Grand Prairie, Arlington, Benbrook, Lake Worth, Saginaw, Keller, and other places in Tarrant County need to know about this insurance case.
The case is an opinion issued by the Fort Worth Court of Appeals in 2010. The style of the case is, Glenda and Larry Rice v. Metropolitan Life Insurance Company. Here are some of the relevant facts:
Glenda purchased group life insurance for herself and her husband, as her dependent, through a plan offered by her employer. Larry’s rider provided $50,000 in coverage. Glenda retired in March 2003.
The insurer, MetLife, sent a letter dated May 10, 2003, addressed to Glenda describing her insurance options upon retirement. The letter contained information under the title of “Coverage Information as of 5/10/2003.” The coverage was specifically described as $50,000.
Various options were provided and she was told to check the option she desired, sign where indicated, and return to MetLife.
She chose to continue the current coverage and spoke with a MetLife employee who assured her that the coverage had neither lapsed nor been cancelled.
The certificate of insurance on Glenda’s group life insurance plan stated that the term life insurance for dependents ended on the date of the employee’s retirement. However, for two and a half years after her retirement, MetLife continued to bill and accept quarterly premium payments for both Glenda’s and Larry’s coverage.
She even received a report in late 2005, mentioning Larry’s coverage of $50,000.
In July of 2005 MetLife quit billing for Larry without any notice to Glenda. When she noticed she was not being billed, she called MetLife and was told that coverage for Larry ceased when she retired.
Glenda hired an attorney and filed a lawsuit. Her attorney argued waiver and estoppel and lost on that theory of law based on Texas contract law.
But here is where it becomes very important to have an experienced Insurance Law Attorney involved.
While the denial of coverage based on the original contract which clearly said that coverage for dependents ceased when the covered employee retired, that was not the end of the story. The waiver and estoppel claim was based on MetLife accepting the premiums for over two years, thus Glenda’s attorney argued that MetLife had waived the automatic cessation of coverage because MetLife continued to take money from Glenda’s account and so MetLife should be estopped from claiming the policy had expired.
The attorney also argued that a new contract had been formed. That MetLife had created a new contract with the papers they had mailed to Glenda and by her signing those papers and then MetLife taking premium payments from her account.
On this theory of law, Glenda had a case that passed muster as it relates to the motion for summary judgement filed by MetLife. MetLife won on the waiver and estoppel theory but not the latter theory, thus the case was able to proceed to trial.
This case is a very good example how an experienced Insurance Law Attorney can help in a rough situation.