Court favors plain and ordinary meaning of policy terms when insured claims policy language is ambiguous
Two of Barger & Wolen's lawyers -- Martin Rosen and Ophir Johna -- received a victory from the Ninth Circuit Court of Appeal earlier this week in Glassman v. Crown Life Ins. Co., 2013 U.S. App. LEXIS 21312 (9th Cir. 2013).
In Glassman, the plaintiff insured sued his disability insurer, Crown Life, claiming that while Crown Life had been paying his disability claim for well over two decades, it had failed to increase his benefits each year due to a cost of living adjustment rider that he had purchased with the policy. With well over 20 years of purported policy benefit increases at issue, the amount at stake exceeded $1.5 million.
Crown Life brought a motion to dismiss the action based on both policy interpretation and statute of limitation grounds.
Although the United States District Court for the Central District of California (Judge Steven V. Wilson) permitted the insured to conduct discovery, the court eventually granted Crown Life's motion to dismiss.
It ruled (as Crown Life had argued) that the language of the rider served to increase a potential residual disability benefit, but did not increase the amount of total disability benefits payable in any month. The insured appealed the district court's ruling.
On appeal, the Ninth Circuit sided with Crown Life and affirmed the district court's ruling, finding that "The language of the Rider unambiguously applies only to partial or 'residual' disability benefits, rather than total disability benefits." Id. at *1-2.
The opinion, while unpublished, is a reminder to insureds and their lawyers that simply contending that policy language is ambiguous does not make it so, and that courts will construe policy language in its plain and ordinary meaning.
To listen to the Ninth Circuit arguments, click here.