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Ross v. Metropolitan Life Insurance Co.

November 14, 2007


The opinion of the court was delivered by: Ambrose, Chief District Judge



In this civil action, Plaintiffs allege that Defendant issued insurance policies insuring Plaintiff's minor children or grandchildren, based on policy applications indicating that the proposed insureds did not use tobacco products. Plaintiffs allege, inter alia, that in breach of an agreement between the parties, Defendant treated the policies as "smoker-based," in terms of calculating the premiums charged and dividends issued.

Pending before the Court are the parties' Cross-Motions for Summary Judgment, which both seek judgment on the breach of contract claim, as well as other claims. Also pending is Plaintiffs' Motion for class certification of the breach of contract claim. Because the Motion for class certification hinges on the breach of contract claim alone, and trial is relatively near, this Opinion and Order deals with the parties' Motions as to that claim alone. I will issue an Order relating to the remainder of the Motions for Summary Judgment in due course.

For the following reasons, Plaintiff's Motion for Summary Judgment will be denied in part, and Defendant's Motion for Summary Judgment granted in part, to the extent that they relate to the claim for breach of contract. The Motion for Class Certification will therefore be denied as moot.


Unless otherwise stated, the following facts are undisputed.

Plaintiffs are the owners of whole life insurance policies on the lives of their children and grandchildren, ages thirteen, eight, three, and six months at the time the policies were issued. Prior to purchasing policies, Plaintiffs completed applications for each policy. These applications were standard forms, and are not unique to juveniles. The applications asked various informational and medical questions about the insured. For instance, the application asks for the current employer of the proposed insured; another question asks whether the proposed insured engaged in motor sports, scuba diving, or mountain climbing. Question No. 13 of the application asked about the proposed insured's tobacco use. The Plaintiffs were not actually asked this question; instead, the sales representative simply checked "never" with respect to the subparts of that question. The answer to that question is not taken into account at all when underwriting and pricing policies issued to juveniles. Met Life offers only one, non smoker-distinct rating classification for insureds in the pertinent age group. It does offer smoker-distinct ratings for adults. Defendant would have issued the policies in the same class in which they were issued, regardless of the answer to Question No. 13. Defendant uses a blend of smoker and non-smoker mortality in creating aggregate rates for juvenile policies.*fn1

The parties agree that the application is part of the policy contract. Plaintiffs had no discussion with the sales representative regarding how Defendant calculated the premium amounts for the policies.

The policies' "Premium Schedule" sets forth the amount of the premium due each month and the length of time the premiums are payable. The "Policy Specifications" page of the policies states the age and sex of the insured, and provides that the "policy classification" is "standard." No language in either the applications or the policies promises "non-smoking" policies, or discusses a non-smoking rate; nor do the policies indicate that there will be a smoker-based premium. At the time the applications were completed, Defendant provided Plaintiffs with Consumer Privacy Notices. The Notices stated that Defendant would notify the policyholder if it could only provide coverage on a modified basis.

Plaintiff Jeanette admits that she did not pay a penny more in premiums than set forth in the premium schedules for the policies. Plaintiff Artralia similarly provided no evidence that she paid any additional premiums than the amounts set forth in her policies.

The parties agree that the express terms of the contracts between them include the policies and attached applications. The agreements provide that the "statements in the application will be representations and not warranties." T h e applications contain a statement, to be checked by applicants, agreeing that "My statements are the basis of any policy issued." Illustrations presented to Plaintiffs at the time of their applications stated the insured's risk classes as "nonsmoker standard." Several of Defendants' internal documents, such as underwriting and customer relations documents, identified the juvenile insureds as non-smoking. Plaintiffs did not see these internal documents at the time of contracting.


Summary judgment shall be granted if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). In considering a motion for summary judgment, the Court must examine the facts in a light most favorable to the party opposing the motion. International Raw Materials, Ltd. V. Stauffer Chem. Co., 898 F. 2d 946, 949 (3d Cir. 1990). The moving party bears the burden of demonstrating the absence of any genuine issues of material fact. United States v. Onmicare, Inc., 382 F. 3d 432 (3d Cir. 2004). Rule 56, however, mandates the entry of judgment against a party who fails to make a showing sufficient to ...

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