According to a federal lawsuit filed in California, the insurer State Farm, might be guilty of not following the rules of its contract. The plaintiff in the case claims that the company violated its life insurance policy by using factors not listed on the contract to calculate the cost of insurance. The California Judge claimed on Monday that the language in the policy was indeed ambiguous. This means that the contract must be construed to favor of the insured party. Not in favor of State Farm.
The exact wording on the policy claims that the policy cost is “based on age, sex and class rate.” Elizabeth Bally, the plaintiff, claims that the language used seems to imply that these are the only factors. State farm claims that the term “based on” doesn’t mean that the listed factors are the only ones to be used. After Bally pointed to a former case Vogt v. State Farm, the judge agreed with Bally. Vogt was a similar case involving contract language.
So far, it doesn’t seem like State Farm is going to win this argument. The idea that they can charge customers based on factors that the insurance holder is unaware of is unfair to consumers. The judge seems to agree. He stated, “Here, there is no basis to conclude that the annual policies put Bally — or any policyholder — on notice that the [cost of insurance] was calculated ‘based on’ unlisted factors,”. “Nor does State Farm offer any reason to conclude that a policyholder would have been on notice that State Farm was considering unlisted variables in [calculating the cost of insurance].”
Victim of Bad Faith Insurance?
Is your insurance provider trying to take advantage of you? Are they refusing to pay out for a claim they are contractually obligated to pay for? Are you being charged for things that are not in your contract? If so, you need an experienced attorney to fight the big insurance companies for you. Villarreal and Begum have significant experience fighting for victims of insurance companies. If you feel like you have been wronged by your insurance provider, call the Texas Law Guns. You can contact us at our office in San Antonio, or message us online to set up your free consultation.