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Chase v. Principal Life Insurance Co.

United States District Court, W.D. Washington, Tacoma

February 12, 2015

STEVEN CHASE, an individual, Plaintiff,
PRINCIPAL LIFE INSURANCE COMPANY, an Iowa corporation, Defendant.


ROBERT J. BRYAN, District Judge.

This matter comes before the Court on Defendant Principal Life Insurance Company's ("Principal Life") Motion to Dismiss Plaintiff's Complaint. Dkt. 6. The Court has considered the pleadings filed in support of and in opposition to the motion and the file herein.

In this disability insurance coverage case, Plaintiff makes a single claim, seeking a declaration that the insurance policy between he and Principal Life "includes an extension of benefits for his life, " not merely benefits until age 65. Dkt. 1-1, at 4. Principal Life now moves for dismissal of the case, arguing that the application (as amended), the policy, supplements, and amendments to the policy explicitly exclude life time benefits. For the reasons stated below, Principal Life's motion should be denied.


Originally filed in Pierce County, Washington Superior Court, the Complaint alleges that on September 13, 1994, Plaintiff submitted to Principal Life an "Application for Disability Insurance, " and a "Supplemental Application for Disability Insurance." Dkt. 1-1, at 2. These documents are attached to the Complaint. Dkt. 1-1, at 6-8 and at 10-11 respectively. The "Supplemental Application for Disability Insurance" form has a section entitled "Other Benefits" and a box in that section labeled "Lifetime Extension" is marked. Dkt. 1-1, at 10.

On December 11, 1994, Principal Life issued Plaintiff the Disability Insurance Policy at issue. Dkt. 1-1, at 3. The policy is also attached to the Complaint. Dkt. 1-1, at 21-36. The policy provides, in pertinent part, that:

The policy ends on the Age 65 Policy Anniversary unless renewed. The owner may renew this policy on a year to year basis after this date for life if:
1. You are actively working outside your home full time at least 30 hours a week for at least 46 weeks a year, and
2. The policy is in force with no premium in default.

Dkt. 1-1, at 32. The "Age Policy Anniversary" is defined as the "policy anniversary on or next following the birthday designated. Example: If the policy date is June 5, 2001, and you are 65 years old on April 3, 2007, the Age 65 Policy Anniversary is June 5, 2007." Dkt. 1-1, at 25. The policy's "Data Page" indicates that "Maximum Benefit Period - to Age 65 Policy Anniversary." Dkt. 1-1, at 23. It further provides, in a section entitled "Entire Contract, " "[t]he policy, the attached applications, and any attached riders or endorsements make up the entire contract." Dkt. 1-1, at 34. The Complaint also has attached to it the policy's "Cost of Living Adjustment Rider." Dkt. 1-1, at 35-36. The rider indicates that it "ends on the first of: (1) Your Age 65 Policy Anniversary; (2) The Owner's written request to terminate it; or (3) Termination of the policy of which it is a part." Dkt. 1-1, at 36.

Plaintiff's Complaint alleges that on January 19, 1995, Plaintiff signed the "Acknowledgment of Delivery" form sent by Principal Life. Dkt. 1-1, at 2. This document, also attached to the Complaint, acknowledges receipt of the insurance contract. Dkt. 1-1, at 13. Plaintiff's alleges in the Complaint that he also received a document that outlined his coverage, and that was signed by his insurance agent on January 18, 1995. Dkt.1-1, at 2-3. Attached to the Complaint is the "Outline of Coverage for Disability Income Policy Form HH641" that Plaintiff received. Dkt. 1-1, at 14-19. The Outline of Coverage states:

READ YOUR POLICY CAREFULLY: This outline of coverage provides a very brief description of the important features of your policy. This is not the insurance contract, and only the actual policy provisions will control. The policy itself sets forth in detail the rights and obligations of both you and your insurance company. It is therefore important that you READ YOUR POLICY CAREFULLY.

Dkt. 1-1, at 14 (emphasis in original). This document also, provides, in part, "[i]f your Maximum Benefit Period is to Age 65 Policy Anniversary, ' and your loss occurs prior to that Anniversary, the Maximum Benefit Period will be extended to Lifetime' for benefits payable under the Disability Benefit section. Benefits will be paid as long as the loss continues." Dkt. 1-1, at 16. This document also has a box marked that states:

TOTAL DISABILITY LIFETIME EXTENSION RIDER. If the Maximum Benefit Period under the policy is "To Age 65 Policy Anniversary, " we will pay a proportion of the monthly benefit for Continuous Total Disability which begins before your Age 65 Policy Anniversary. Benefits ...

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