Sick Woman Wins $34 Million Bad Faith Lawsuit

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A 90-year-old Montana woman suffering from Alzheimer’s disease has won a $34 million bad faith insurance lawsuit against her insurer that unfairly cut her benefits in 2010.

Arlene Hull and her daughter brought the insurance denial lawsuit against Ability Insurance Co. in a U.S. District Court. Hull and her husband had taken out a long-term-care insurance policy with Mutual Protective Insurance in 1997. One decade later, she was diagnosed with dementia and moved into St. John’s Lutheran Home to receive long-term care, which the insurance company covered.

Meanwhile, Ability Mutual Protective sold its long-term-care policies to Ability Insurance in 2007. The new insurance company reviewed Hull’s policy and ultimately decided in January 2010 to cut off her assisted-living benefits to the nursing home. Ability claimed that Hull no longer qualified for her policy, and cited medical staff who said Hull did not need “continual supervision due to a severe cognitive impairment” and was not “severely” impaired.

While a doctor that was hired by Ability later decided that Hull needed the nursing home care, the insurance company reinstated her benefits in October 2011 but refused to reimburse her for the time she was unfairly denied coverage.

In the bad faith lawsuit that followed, the jury sided with Hull and awarder her $250,000 for breach of contract, $2 million for Ability’s violation of the Unfair Trade Practices law in Montana, and $32 million in punitive damages. It is among the largest jury awards in Montana’s history, according to Billings Gazette.

Have you been unfairly denied insurance coverage because a company did not properly honor its contract with you? Call Sokolove Law today to learn more about pursuing a bad faith insurance lawsuit.