20 Fla. L. Weekly Supp. 1201a
Online Reference: FLWSUPP 2012MANNInsurance — Long-term care — Where clear and unambiguous language of policies provides that controlling law is that of state where insureds reside on effective date, and it is undisputed that insureds who have since relocated to Florida resided in Connecticut on effective date, Connecticut premium rate rather than rate set by Florida Department of Insurance controls — Connecticut law is also controlling under rule of lex loci contractus — If Florida law did control, action would be time-barred under statute providing that each long-term care policy shall be incontestable after it has been in force for two years — Complaint dismissed
DOUGLASS MANN and STEPHANIE MANN, individually and on behalf of all others similarly situated, Plaintiffs, v. UNUM LIFE INSURANCE COMPANY OF AMERICA, Defendant. Circuit Court, 12th Judicial Circuit in and for Manatee County. Case No. 2012-CA-003133. August 29, 2013. Diana Moreland, Judge. Counsel: Steven T. Simmons, Brian W. Warwick, and Janet R. Varnell, Varnell & Warwick, P.A., The Villages, for Plaintiffs. James F. Jorden, Jorden Burt LLP, Washington, D.C.; Raul A. Cuervo and Jason Patrick Kairalla, Jorden Burt LLP, Miami, for Defendant.
ORDER DISMISSING COMPLAINT
This matter is before the Court on Defendant’s Motion to Dismiss Complaint with Prejudice and Memorandum of Law in Support Thereof, filed March 11, 2013; as well as Plaintiff’s Response in Opposition to Defendant’s Dispositive Motion to Dismiss Complaint and Memorandum of Law, filed March 11, 2013; Defendant’s Reply in Support of Its Motion to Dismiss and Alternative Motion to Suspend or Stay Proceedings, filed July 26, 2013; and Plaintiff’s Supplemental Opposition to Motion to Dismiss in Response to Court’s Question at the August 1, 2013 Hearing, filed August 2, 2013. A hearing was held on the Motion to Dismiss on August 1, 2013. After hearing testimony, the parties’ arguments, reviewing the court file and applicable law, and being otherwise duly advised in the premises, the Court finds and rules as follows:History
1. Plaintiffs, Mr. Douglass Mann and Mrs. Stephanie Mann, reside in Manatee County, Florida.
2. Defendant, UNUM Life Insurance Company of America (“UNUM”), is a Maine corporation that is headquartered in Chattanooga, Tennessee.
3. Plaintiffs purchased Long Term Care Policies (“Policies”) from UNUM while they were both residents of Connecticut.
4. On December 3, 1998, Plaintiffs applied for and purchased the Policies. The Policies bear the “Effective Date” of December 3, 1998.
5. The Policies were accepted and approved by UNUM, and were issued for delivery to Plaintiffs on January 1, 1999.
6. In early 2005, Plaintiffs relocated and became permanent residents of Florida.
7. The Policies are “Guaranteed Renewable.” A standard term of these policies gives UNUM the ability to increase premiums for the next renewal period, as long as the premium increase is approved by the state Office of Insurance Regulation.
8. Each year, on the Anniversary Date of the Policy, UNUM can increase premiums up to the amount approved by each state’s Department of Insurance. For the first 10 years that Plaintiffs had their Policies, UNUM did not increase premiums. Plaintiffs renewed their Policies for each of the seven years since becoming permanent Florida residents in 2005.
9. The Policies state: “ ‘Effective Date’ is the date shown in the Policy Schedule. Coverage takes effect on the Effective Date provided the first Modal Premium is paid.” See Policy, page 5.
10. Under the heading “Conformity with State Statutes,” the Policies read: “If any provision of this policy conflicts with the statutes of the state where you reside on the Effective Date of that provision, it is amended to conform with the minimum requirements of those statutes. Premiums may be changed to reflect these policy requirements.” See Policy, page 18.
11. Plaintiffs argue that the issue is that when a policy is obtained out of state but then renewed in Florida, the Court must determine which state’s premium rate is to be applied.
12. Defendant contests Plaintiff’s argument that when they moved to Florida and exercised their unilateral renewal rights to continue the Policies in force until the Policies’ next Anniversary Date, their Policies automatically became “Florida” policies, subject to Florida law and the rate-approving authority and general oversight of the Florida OIR.
13. Defendant argues that Connecticut law applies because Plaintiffs resided in Connecticut on the Effective Date. Further, Defendant argues that the contract provides that if there is a conflict with the state statutes, then the law of the state where you reside on the Effective Date is controlling.Legal Standard
Before the Court is Defendant’s Motion to Dismiss, for which the Court is required to treat all factual allegations of the complaint as true and to consider the allegations in the light most favorable to the plaintiffs. See Siegle v. Progressive Consumers Ins. Co., 819 So. 2d 732 (Fla. 2002) [27 Fla. L. Weekly S492a]. Further,
[t]he purpose of a complaint is to advise the defendant of the nature of the cause of action asserted by the plaintiff. The function of a motion to dismiss a complaint is to raise as a question of law the sufficiency of the facts alleged to state a cause of action. For the purpose of passing upon a motion to dismiss, the court must assume all the facts alleged in the complaint to be true. Consequently, a motion to dismiss a complaint must be decided on questions of law and questions of law only. The purpose of a motion to dismiss is to ascertain if the plaintiff has alleged a good cause of action, and the court when faced with a motion to dismiss a complaint for failure to state a cause of action must confine itself strictly to the allegations within the four corners of the complaint.
See Kest v. Nathanson, 216 So. 2d 233, 235 (Fla. 4th DCA 1968) (emphasis added). Also, when considering a motion to dismiss, the Court will uphold the rules found in Rigel v. National Cas. Co., 76 So. 2d 285, 286 (Fla. 1954), “if the language is plan and unambiguous, there is no occasion for the Court to construe it, . . . if uncertainty is present, the policy should be construed against the insurer, . . . that the Court should not extend strictness in construction to the point of adding a meaning to language that is clear, . . . and that the Court should construe the contract of insurance to give effect to the intent of the parties. Therefore, if the language does not lack for interpretation, then the Court may dismiss the cause of action based on the contractual provisions.
Moreover, according to § 627.94076, Florida Statutes (2013), under the category of “insurance rates and contracts,” the law provides that “each long-term care policy shall provide that the policy shall be incontestable after it has been in force during the lifetime of the insured for a period of 2 years after its date of issue except for nonpayment of premiums.”Analysis
In reviewing the complaint and attachments, the Court first assessed the plain language of the Policies. The Policy reads: “If any provision of this policy conflicts with the statutes of the state where you reside on the Effective Date of that provision, it is amended to conform with the minimum requirements of those statutes. Premiums may be changed to reflect these policy requirements.” See Policy, page 18. Of note, the parties stipulate that the Effective Date is December 3, 1998, and that Plaintiffs resided in Connecticut on the Effective Date.
First, the Court finds that the Policies’ language clearly and unambiguously provides that the controlling law is that of the state where the insured resides on the Effective Date. The Court need not add meaning to the language to make it more apparent. The contract plainly gives effect to the intent of the parties. Therefore, Connecticut law would be controlling in this case.
In the alternative, the Court considered lex loci contractus — a rule used to determine which state’s law applies in contract cases. “That rule, as applied to insurance contracts, provides that the law of the jurisdiction where the contract was executed governs the rights and liabilities of the parties in determining an issue of insurance coverage.” State Farm Mut. Auto. Ins. Co. v. Roach, 945 So. 2d 1160, 1163 (Fla. 2006) [31 Fla. L. Weekly S840b]. Therefore, also under lex loci contractus, the law of Connecticut applies in this case.1
Further, the Court relies on § 627.94076, Florida Statutes (2013), which again instructs “each long-term care policy shall provide that the policy shall be incontestable after it has been in force during the lifetime of the insured for a period of 2 years after its date of issue except for nonpayment of premiums.” The Policies in question were originally issued on December 3, 1998, and each “renewal” was considered as a continuation of the policy, not as a re-issuance, as evidenced by the contract’s language regarding the policy as “guaranteed renewable;” as well as the conditions for termination. See Policy, page 1 & 14.
Finally, the Court finds even if the above is incorrect and Florida law prevailed, Plaintiffs’ cause of action would be time barred under the plain meaning of Florida Statute § 627.94076.
Accordingly, it is
ORDERED AND ADJUDGED that Plaintiffs’ Complaint is DISMISSED.
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1There are a few narrow exceptions to the lex loci rule, but the Court considered and determined that these do not apply in this case.
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