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HomeMy WebLinkAbout08-2812RAY M. DOURTE, Plaintiff vs. AMERICAN FIDELITY ASSURANCE COMPANY, Defendant NOTICE TO DEFENDANT NAMED HEREIN: IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW NO. Ljo', ?-gjd ctw I fer JURY TRIAL DEMANDED YOU HAVE BEEN SUED IN COURT. IF YOU WISH TO DEFEND AGAINST THE CLAIMS SET FORTH IN THE FOLLOWING PAGES, YOU MUST TAKE ACTION WITHIN TWENTY (20) DAYS AFTER THIS COMPLAINT AND NOTICE ARE SERVED, BY ENTERING A WRITTEN APPEARANCE PERSONALLY OR BY ATTORNEY AND FILING IN WRITING WITH THE COURT YOUR DEFENSES OR OBJECTIONS TO THE CLAIMS SET FORTH AGAINST YOU. YOU ARE WARNED THAT IF YOU FAIL TO DO SO, THE CASE MAY PROCEED WITHOUT YOU, AND A JUDGMENT MAY BE ENTERED AGAINST YOU BY THE COURT WITHOUT FURTHER NOTICE FOR ANY MONEY CLAIMED IN THE COMPLAINT OR FOR ANY OTHER CLAIM OR RELIEF REQUESTED BY THE PLAINTIFF. YOU MAY LOSE MONEY OR PROPERTY OR OTHER RIGHTS IMPORTANT TO YOU. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. CUMBERLAND COUNTY BAR ASSOCIATION 32 SOUTH BEDFORD STREET CARLISLE, PA 17013 TELEPHONE: (717) 249-3166 RAY M. DOURTE, Plaintiff vs. AMERICAN FIDELITY ASSURANCE COMPANY, Defendant IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW NO. 6 ff- a?'11 ?Nl feC- JURY TRIAL DEMANDED COMPLAINT AND NOW comes the above-named Plaintiff by his attorney, Samuel L. Andes, and filed the following Complaint in this matter: 1. The Plaintiff is Ray M. Dourte an adult individual who resides at 12 Oakwood Drive in Dillsburg, Pennsylvania 17019. 2. The Defendant is American Fidelity Assurance Company, which Plaintiff believes to be a corporation and part of the American Fidelity Group, which maintains offices at 2000 N. Classen, P.O. Box 268898, Oklahoma City, Oklahoma 73126-8898. 3. The Defendant is, and at all times relevant to this action was, engaged in the business, inter alia of providing group plans and policies of disability income insurance to employers and their workers. 4. Sometime prior to September of 2002, while Plaintiff was employed by Cumberland Valley Motors in Mechanicsburg, Cumberland County, Pennsylvania, in a group disability income insurance program or policy issued by the Defendant. Plaintiff does not have a copy of the group policy itself, but he was provided with, and attaches and marks as Exhibit A, a certificate of insurance issued by the Defendant which describes, or purports to describe, the group policy and its benefits and conditions. 5. Plaintiff was enrolled in the group policy issued by the Defendant at a meeting at his place of employment in Mechanicsburg, Cumberland County, Pennsylvania. 6. In September of 2002, Plaintiff underwent interior cervical disectomy and fusion of vertebrae C3 through C6 for degenerative disc disease that apparently resulted from an injury to his neck during his birth. The surgery was performed by Steven B. Wolfe, M.D. 7. Following the surgery, Plaintiff experienced new and extreme symptoms involving extreme headaches and debilitating pain in his head and other regions and parts of his body. As a result of these problems, Plaintiff was rendered totally disabled and unable to perform any meaningful or gainful employment. 8. As a result of his disability following the 2002 surgery, Plaintiff applied for, and was granted, full benefits under the group disability income policy issued by Defendant. Defendant, and in fact both parties, initially treated the application for benefits as one resulting from Plaintiff's degenerative disc disease and not from the surgery itself. 9. Defendant continued to pay benefits to Plaintiff under the policy for a period of five years, in accordance with the terms of the policy. 10. In early 2008, Defendant advised Plaintiff that it would no longer pay benefits under the policy because the five year maximum benefit period for disability resulting from sickness had expired. 11. Plaintiff's disability does not result from sickness, as that term is defined by Defendant's policy. 12. Plaintiff's disability results from an accident. 13. Defendant's policy defines "accident" as follows: ACCIDENT means an injury You sustain: (a) that is independent of any Sickness; (b) over which You have no control; (c) that takes place while Your coverage is in force; and (d) and is a direct cause of a disability. 14. Plaintiff's present disability resulted from an injury to his C2-C3 disc during the surgery performed by Dr. Wolfe. 15. The policy of insurance issued by Defendant provides a maximum disability period, for disability caused by accident, to "age 65 or five years, whichever is greater, but not beyond age 70." 16. Plaintiff was born on December 1, 1947 and is currently 60 years of age. Accordingly, because his present disability resulted from an accident, not sickness, he is entitled to continuing monthly benefits through his age 65. 17. Defendant has wrongfully and improperly terminated Plaintiff's disability payments under the policy issued by Defendant. 18. Plaintiff's monthly benefits, at the time Defendant improperly terminated those benefits, were $1,409.44 per month. 19. Defendant, by its conduct, has injured Plaintiff in the amount of $1,409.44 per month, from February 2008 until Plaintiff's 65t' birthday. WHEREFORE, Plaintiff demands judgment against Defendant in the amount of $80,338.08, plus interest from February of 2008, plus costs of suit. ?iuel L. Andes Attorney for Plaintiff Supreme Court ID # 17225 525 North 12th Street Lemoyne, Pa 17043 (717) 761-5361 I verify that the statements made in this document are true and correct. I understand that any false statements in this document are subject to the penalties of 18 Pa. C.S. 4904 (unworn falsification to authorities). Datel?i?i? TE American Fidelity sm, Assurance Company A member of the American Fidelity Group 2000 N. Classen Boulevard Oklahoma City, Oklahoma 73106 CERTIFICATE OF INSURANCE American Fidelity Assurance Company (We, Us, Our) hereby certifies that it has issued and delivered to the Policyholder a group Policy, described on the Schedule of Benefits page. The group Policy covers certain eligible persons as described in the Policy. This booklet describes the benefits and provisions of the group Policy. This booklet becomes Your Certificate of insurance only if. 1) You are eligible for the insurance; 2) You are on Active Service on the date it is to take effect; and 3) You become insured and remain insured in accordance with all the provisions of the Policy. The insurance is to be effective only if the required premium payments are made by You or on Your behalf to Us. (See Section 2, Eligibility and Effective Date.) No agent may change the Policy or waive any of its provisions. This Certificate takes the place of any other Certificate previously issued to You under the group Policy. It should be kept in a safe place. IN WITNESS WHEREOF, We have caused this Certificate to take effect on the Effective Date. (A... - /P, President NON-PARTICIPATING GROUP DISABILITY INCOME INSURANCE POLICY WARNING: Any person who knowingly, and with intent to injure, defraud or deceive any insurance company or other person, files an application for insurance or statement of a claim containing any materially false information or conceals for the purpose of misleading, information concerning any fact material thereto commits a fraudulent insurance act, which is a crime and subjects such person to criminal and civil penalties. CG-108-FP(PA) TABLE OF CONTENTS Schedule of Benefits Section 1 Definitions Eligibility and Effective Date Section 2 Section 3 Disability Benefits Adjustments and/or Limitations Section 4 Section 5 Exclusions Section 6 Termination of Insurance Premium Calculation and Payment Section 7 Section 8 General Provisions CG-108-TC SCHEDULE OF BENEFITS PLAN: D1 POLICYHOLDER: Pennsylvania Automotive Association Insurance Trust POLICY NUMBER: G-108-100 EFFECTIVE DATE: Refer to your individual application or enrollment form, if applicable ELIGIBILITY: All active full-time members and employees of members working 25 hours or more per week. DISABILITY BENEFIT: Monthly Disability Benefit amounts available from $300.00 to $6,000.00 in $50.00 increments. Refer to your individual application or enrollment form for your Disability Benefit. MINIMUM DISABILITY BENEFIT: $100.00 ACCIDENTAL DEATH BENEFIT: One times the Monthly Disability Benefit. MAXIMUM DISABILITY PERIOD: Accident: To age 65 or 5 years, whichever is greater, but not beyond age 70. Sickness: 5 years or to age 70, whichever first occurs. Note: See Section 6 for any applicable reduction of the Maximum Disability Period. MAXIMUM MENTAL ILLNESS PERIOD: Up to 24 months or to age 70, whichever first occurs, including Hospital confinement. Note: See Section 6 for any applicable reduction of the Maximum Mental Illness Period. ELIMINATION PERIOD: Accident: 180 days Sickness: 180 days ADJUSTMENT WITH ANY SALARY OR WAGE CONTINUANCE PLAN (See Section 4) EXTENDING BEYOND THE FOLLOWING NUMBER OF CALENDAR DAYS OF TOTAL DISABILITY: 180 COVERED PERCENT OF MONTHLY COMPENSATION: 60% PRE-EXISTING CONDITION PERIOD: 90 days prior to the effective date of coverage SUCCESSIVE DISABILITIES PERIOD: 3 months TOTAL DISABILITY (or Totally Disabled): 24 months (Note: Work-related injuries and illnesses are excluded from coverage - see Section 5.) CG-108-SB SECTION 1 DEFINITIONS ACCIDENT means an injury you sustain: (a) that is independent of any Sickness; (b) over which You have no control; (c) that takes place while Your coverage is in force; and (d) that is a direct cause of a disability. ACTIVE SERVICE means that You are: . (a) doing in the usual manner all of the regular duties of Your employment on a full-time basis on a scheduled work day; and sends You business where You normally do such duties or a (b) these duties are being done at one of the some location to which Your employment y if You would You will be said to be on Active Service on a duties that is not a schedule work ay of Your employmentif it were a sclheduled work day able to perform in the usual manner all of the regular CERTIFICATE means the individual Certificate issued to You. It describes Your coverage under the Policy. DISABILITY BENEFIT means the Monthly Disability Benefit (prior to the application of Adjustments and/or Limitations) for which You are eligible and paying premium. Cert icate Dthe ate Policy. will EFFECTIVE DATE means the date described in will start at 12101 a m Hat the main'placelof bus Hess of the Your Effective Date of coverage. The Effects Policyholder. ELIMINATION PERIOD means that period of time that starts after Your Effective Date of coverage, during which: (a) You are Totally Disabled; and (b) no Disability Benefits are payable. HOSPITAL means a licensed institution that: (a) has on its premises: I erati (1) laboratory, X-ray equipment and operating rooms where major surgica opons may be performed by licensed physicians; for the care of overnight resident bed patients under the (2) permanent and full-time facilities supervision of a licensed Physician; (3) 24-hour-a-day nursing service by graduate registered nurses; and (4) the patient's written history and medical records; or (b) is accredited by the Joint Commission on Accreditation of Hospitals. The term Hospital shall not include any institution used by You as: (a) a place for rest or for the aged; (b) a nursing or convalescent home; (c) a long-term nursing unit or geriatrics ward; or (d) an extended care facility for the care of convalescent, rehabilitative or ambulatory patients. CG-108-DEFM1(PA) INSURED (You, Your) means a person whose coverage has been applied for and is in force under the terms of the Policy. MONTHLY COMPENSATION means: (a) Your monthly salary at the time of disability, exclusive of overtime or bonus earnings; or (b) if Your salary is solely or partially based on commissioned sales, one-twelfth (1/12th) of the preceding 12 months' salary, exclusive of overtime or bonus earnings. If any monthly benefit is to be paid for less than a full month, the amount of benefit will be reduced pro rata on the basis that one day's benefit equals one-thirtieth (1/30th) of the Disability Benefit. PHYSICIAN means a practitioner of the healing arts who: (a) is practicing within the scope of his or her license in the state where so licensed; and (b) is not related to You. POLICY means the Policy issued to the Policyholder that covers You. POLICYHOLDER means the association, employer or trustee who holds the Policy. PRE-EXISTING CONDITION means a disease, Accident or Sickness for which You: (a) had treatment; (b) incurred expense; (c) took medication; or (d) received a diagnosis or advice from a Physician, during the Pre-Existing Condition Period indicated in the Schedule of Benefits, immediately before the Effective Date of Your coverage; or, for an increase in coverage, immediately before the Effective Date of the. increase. The term Pre-Existing Condition will also include conditions that are related to such disease, Accident or Sickness. SCHEDULE OF BENEFITS (or Schedule) means the benefit schedule set forth in the Policy or Certificate. SICKNESS means illness or disease that starts while Your coverage is in force and is the direct cause of a disability. SUCCESSIVE DISABILITIES means those disabilities which result from the same or related causes for which benefits are payable under the Policy. Successive Disabilities will be considered one period of disability unless separated by Your return to: (a) Active Service; or (b) any other occupation, for at least the Successive Disabilities Period stated in the Schedule of Benefits. A disability due to a different or unrelated cause will be considered a new period of disability. Any disability that begins after termination of coverage will: (a) not be considered a Successive Disability; and (b) not be covered under the Policy. _!/ TOTAL DISABILITY (or Totally Disabled) means that for the Total Disability Period stated in the Schedule of Benefits, during which Disability Benefits are payable, You are unable to perform the material and substantial duties of Your employment as the result of a covered Accident or Sickness. After that, Total Disability means You are unable to perform the material and substantial duties of any occupation for wage or profit for which You are reasonably qualified by training, education, or experience. CG-108-DEFM2(PA) SECTION 2 ELIGIBILITY AND EFFECTIVE DATE ELIGIBILITY All persons who: (a) are on Active Service as employees of the Policyholder or members or employees of a member of the Policyholder; (b) qualify as eligible Insureds as defined in the Policyholder's application; and (c) meet the definition of Eligibility as stated in the Schedule, are eligible to be insured under the Policy. Evidence of insurability acceptable to Us may be required. EFFECTIVE DATE Your insurance will take effect on the Effective Date of the Policy if You: (a) apply in writing on or before said Effective Date; (b) meet Our underwriting rules; (c) are on Active Service, as defined in Section 1; and (d) have paid all applicable premiums due. After the Effective Date of the Policy, Your insurance will take effect on the later of the requested effective date or the date We approve the written application (subject to Our underwriting rules), if You are on Active Service and premium has been paid. Employees/members who want to apply for this insurance must apply for coverage that will provide benefits according to the applicable class set out in the Policyholder's application. If You are not on Active Service, due to an Accident or Sickness when Your coverage would otherwise take effect, it will take effect on the next premium due date after the date You return to Active Service. If You are not on Active Service when Your coverage would otherwise take effect, coverage will take effect on the first day of the calendar month after the date You return to Active Service, provided that You return to Active Service within 30 days of the proposed Effective Date. If the absence from Active Service extends beyond 30 calendar days, You must complete a new application for coverage. A change in the amount of benefits will take effect on the first of the next month following written notice to Us if: (a) such change is approved by Us; (b) You are on Active Service on the date such change is to take effect; and (c) You have paid all applicable premiums due. Any change in the Policy will apply only to new periods of disability that begin after such date, subject to all the provisions of the Policy. CG-108-EFF SECTION 3 DISABILITY BENEFITS Disability Benefits will be paid if You become Totally Disabled as defined in the Policy. Total Disability must: (a) be due to a covered Accident or Sickness; and (b) begin while Your coverage is in force. Benefits will be paid for each period of Total Disability that continues beyond the Elimination Period. No such benefits will be paid beyond the Maximum Disability Period stated in the Schedule. No Disability Benefit will be paid for any period in which You are not under the Regular Care and Attendance of a Physician. Regular Care and Attendance means attended by a Physician at least once a month or until the Physician determines You: (a) have reached a state where continuous medical care is unnecessary; and (b) are still Totally Disabled, as defined in Section 1. No benefits will be paid if You should fail to follow the medical treatment advice of Your Physician as it pertains to Your disabling condition. Disability Benefits will be paid for only one disability when: (a) more than one disability exists at the same time; or (b) a disability results from two or more causes. Total Disability will be considered to have started on the date You first receive personal treatment from a Physician following continuous cessation of work. CG-108-BEN MENTAL ILLNESS LIMITED BENEFIT If You are Totally Disabled due to a Mental Illness without demonstrable organic origin, regardless of the cause, Disability Benefits will be paid for the period of disability shown in the Schedule as the Maximum Mental Illness Period provided You are under the regular care and attendance of a Physician. Mental Illness means Total Disability due to or resulting from psychiatric or psychological conditions, regardless of cause, including but not limited to: (a) schizophrenia; (b) depression; (c) manic depressive or bipolar illness; (d) anxiety; (e) personality disorders; and/or (f) adjustment disorders or other conditions, usually treated by a mental health provider or other qualified provider using psychotherapy, psychotropic drugs or other similar modalities used in the treatment of the above conditions. The term Mental Illness does not apply to dementia, if due to: (a) stroke; (b) trauma; (c) viral infection; (d) Alzheimer's disease; or (e) other such conditions not listed above which are not usually treated by a mental health provider using psychotherapy, psychotropic drags, or other similar modalities. CG-108-BEN-MI ALCOHOLISM AND NARCOTIC ADDICTION LIMITED BENEFIT When, as a result of alcoholism or narcotic addiction You are Totally Disabled, We will pay a limited Disability Benefit up to fifteen (15) days of disability in any twelve (12) month period. CG-108-BEN-ALCOHOL PARTIAL DISABILITY BENEFIT A Partial Disability Benefit will be paid if You become Partially Disabled following a period of Total Disability due to a covered Accident or Sickness. Payment of the Partial Disability Benefit is subject to the following conditions: (a) The Elimination Period for Total Disability must be satisfied and Total Disability Benefits payable. (b) Partial Disability Benefits will be payable beginning the first day following the date Total Disability ends. (c) The Partial Disability must be the result of the same Accident or Sickness which caused Total Disability. (d) The Partial Disability Benefit will be payable for a maximum period of three (3) months; however, the combined period of time for which benefits are payable for Total Disability and Partial Disability may not exceed the Maximum Disability Period stated in the Schedule. (e) The Partial Disability Benefit will be equal to 50% of the Disability Benefit; however, the sum of the Partial Disability Benefit, the salary earned while receiving Partial Disability Benefits, and income from all other sources listed in Section 4 may not exceed 60% of Your pre-disability salary. In this event, the Minimum Disability Benefit, if any, stated on the Schedule will not be payable. "Partial Disability" or "Partially Disabled" means You must be able to perform one or more, but not all, of the material and substantial duties of Your occupation on a full-time or part-time basis; or be able to perform some or all of the duties of another occupation on a full-time or part-time basis. CG-108-BEN-PARTIAL WAIVER OF PREMIUM If You become Totally Disabled due to a covered Accident or Sickness, Your insurance will be continued without payment of premium. Waiver of Premium will begin the first of the calendar month following the later of: (a) Your satisfaction of the Elimination Period; (b) ninety (90) days of continuous Total Disability; or (c) the first date Total Disability Benefits are payable, provided premium has been paid from the beginning of Total Disability to the date Waiver of Premium begins. Waiver of Premium will continue until the earliest of: (a) the end of Your Total Disability; (b) the end of the Maximum Benefit Period; (c) the end of the period for which benefits would otherwise be payable; (d) the date the Policy terminates; or (e) the date Your employment with the Policyholder or subscribing employer unit ends, as determined by your employer. CG-108-BEN-WP ACCIDENTAL DEATH BENEFIT The Accidental Death Benefit stated in the Schedule will be paid in accordance with the Payment of Benefits provision in the General Provisions Section if. (a) You die as the direct result of an injury caused by an Accident; and (b) death occurs within 180 days after the date of the Accident. If You die and the Accidental Death Benefit applies, such benefit will be increased 1% for each full month that Your Certificate was continuously in force just prior to death. The total increase shall not be more than 60%. CG-108-BEN-AD SURVIVOR BENEFIT If You: (a) die while receiving Disability Benefits; and (b) have been Totally Disabled for at least 90 consecutive days, a Survivor Benefit will be paid to Your beneficiary or estate. The Survivor Benefit will be paid in a lump sum and will be equal to three (3) times the Disability Benefit for which You are eligible during the calendar month preceding death, not to exceed Your Disability Benefit, excluding any other benefits payable under this Policy. CG-108-BEN-SURV SECTION 4 LIMITATIONS The sum of the Disability Benefits paid to You, and the payments You and Your dependents are entitled to receive from the sources described below, may not exceed the Covered Percent of Compensation shown in the Schedule. (a) group insurance coverage or like coverage for persons in a group; (b) Federal Social Security Act (this includes benefits paid to You and Your dependents on account of Your disability); (c) state or federal government disability or retirement plan or increases thereof which begin on or after the date of Total Disability (with respect to military benefits which become payable prior to the commencement of disability, only the amount, if any, by which Your military retirement benefits are increased due to the same disabling condition for which benefits are payable under the Policy will be used to adjust the Disability Benefit); (d) pension plan to which the Policyholder or Your employer contributes or makes payroll deductions; (e) salary or wage continuance plans such as accrued sick leave or paid personal time used as sick leave, paid for by the Policyholder or Your employer which extend beyond the period stated in the Schedule; and (f) Federal Old Age Benefits under the Federal Social Security Act on Your own behalf. If it appears that You are entitled to any of the above income sources (this includes benefits payable to You and to Your dependents), unless You show proof to Us that payments under these applicable programs or acts have been applied for, but will not be paid, We: (a) will assume You are receiving such payments; and (b) may require You to reapply (but not more frequently than annually) once a denial of benefits has been received from any of the above sources, and appeals have been pursued. Failure to reapply for benefits when required by Us will result in Our estimation of payment by those sources. Benefits will not be reduced due to a cost of living increase in Social Security if the increase takes place while benefits are payable under the Policy. After application or reapplication has been made for the above applicable income sources, in lieu of Our estimating other income, You may complete a Reimbursement Agreement provided by Us. The agreement shall allow Us to provide benefits without estimation of other income and require You to reimburse Us for any overpayment as the result of retroactive awards. With respect to any and all of the above sources, if lump sum payment is received by You or Your dependents for a period previously paid by Us, any resulting overpayment by Us will be due Us on a lump sum basis. If You have the option of taking retirement benefits on a monthly basis, but choose to receive retirement benefits on a lump sum basis, We may assume You are receiving retirement benefits based upon the lowest monthly retirement plan benefit available to You prior to lump sum withdrawal. Unless stated otherwise, the Disability Benefit payable will be no less than the Minimum Disability Benefit amount set out in the Schedule. CG-108-LIMIT-NonOcc(PA) PRE-EXISTING CONDITION LIMITATION There will be no Disability Benefit payable for Total Disability resulting from a Pre-Existing Condition commencing before the Insured has been continuously covered under the Policy for one (1) year. Any increase in the amount of the Insured's monthly Disability Benefit will be subject to this Pre-Existing Condition limitation, beginning on the Effective Date of the increase. No consideration will be given to prior group disability income coverage in determining the effect of Pre-Existing Conditions on benefits payable. CG-108-A/L-PE5 SECTION 5 EXCLUSIONS The Policy does not cover any loss, fatal or non-fatal, that results from: (a) intentionally self-inflicted injury while sane or insane; (b) an act of war, declared or undeclared; (c) Accident sustained or Sickness contracted while in the service of the armed forces of any country; (d) committing a felony; (e) acting as a pilot or crew member or for performing any duty of Your occupation connected with such flight; or (f) Accident or Sickness arising out of and in the course of any occupation for wage or profit. No benefits are payable during any period in which You are incarcerated. CG-108-EXC-NonOcc SECTION 6 TERMINATION OF INSURANCE Your coverage will end on the earliest of: (a) the date You do not qualify as an Insured; (b) the date You retire; (c) the date You cease to be on Active Service as defined in Section 1: (d) the end of the last period for which premium has been paid; (e) the date the Policy is discontinued; or If: (a) Your coverage ends as a result of Your termination of Active Service; (b) such termination is caused by an Accident or Sickness for which Disability Benefits would be payable; and (c) Total Disability is established prior to the termination of Active Service, then Disability Benefits will be paid as if such termination had not occurred Termination of the Policy will have no affect on payment of benefits for a Total Disability which begins before the Policy is terminated. We or the Policyholder may end the Policy on any premium due date. Thirty-one (31) days advance written notice of such termination must be given. We may end the coverage of a subscribing employer unit if fewer persons are insured than required by the Policyholder's application. The period of time for which benefits may be payable under the Policy (herein referred to as the Maximum Benefit Period) is stated in the Schedule. For purposes of this Section, the Maximum Benefit Period will include the following referenced benefit periods: (a) Maximum Disability Period; (b) Maximum Mental Illness Period; (c) Maximum Hospital Confinement Period; and (d) Maximum Alcohol and Drug Benefit Period. For a Maximum Benefit Period payable for up to a specified number of years, of more than one year, the Maximum Benefit Period will be based on Your age as of the date benefits begin, as follows: Subtract the Maximum Benefit Period (number of years) from 70 years, then: (a) If You are younger than this age, benefits will be payable for up to the number of years stated as the Maximum Benefit Period. (b) If You are older than this age, but younger than age 69, benefits will be payable until You attain age 70. (c) If You are age 69 or older, benefits will be payable for up to one year. CG-108-TERM1(PA) For a Maximum Benefit Period of `to age 65,' benefits will be payable for up to the period of time specified below, based on Your age as of the date benefits begin: Aqe Maximum Benefit Period 59 or younger to age 65 60 through 64 5 years 65 through 68 to age 70 69 or older 1 year The monthly premium and benefit amount will not change due to a change in the Maximum Benefit Period. CG-108-TERM2(PA) SECTION 7 PREMIUM CALCULATION AND PAYMENT Premiums will be figured on the basis stated in the Policyholder's application. The first premium is due on or before the Effective Date of Your coverage. Subsequent premiums are due on or before the premium due date stated in the Policyholder's application. Premiums may be paid to: (a) Our Home Office; or (b) Our authorized agent. The premium may be changed based on experience at the first anniversary date of the Policy or any premium due date after that. No such increase in rate will be made unless thirty-one (31) days prior notice is given to the Policyholder. If a change in benefit increases Our liability, premium rates may be changed on the date the liability is increased. CG-108-PREM SECTION 8 GENERAL PROVISIONS ENTIRE CONTRACT-CHANGES: The entire contract shall include: (a) the Policy; (b) the application of the Policyholder; (c) Your application, if any, attached to the Certificate; and (d) all endorsements and amendments. Statements made by the Policyholder or by You are representations and not warranties, if fraud was not intended. No such statements will be used to avoid the insurance, reduce benefits, or defend a claim under the Policy unless: (a) the statement is in writing; and (b) a copy of that statement is given to You. The terms of the Policy can be changed only by endorsement or amendment signed by an executive officer of the Company. Any amendment that reduces or eliminates coverage must be requested in writing or signed by the Policyholder. No agent may change the Policy or waive its provisions. TIME LIMIT ON CERTAIN DEFENSES: After three (3) years from the Effective Date of Your coverage, no statements in the application, except fraudulent misstatements, can be used to: (a) avoid the coverage; or (b) deny a claim for loss incurred or disability (as defined in the policy) that starts after such two-year period. GRACE PERIOD: A grace period of thirty-one (31) days will be allowed for each premium payment after the first premium. Coverage will stay in force during this time. The coverage under the Policy will terminate at the end of the grace period if the premium has not been paid. The Policyholder or subscribing employer unit must still pay all unpaid premium. This includes the premium due for the grace period. The Policyholder or subscribing employer unit may, by writing to Us, cancel the coverage under the Policy: (a) on any future premium due date; or (b) on any date during the grace period. If coverage is canceled on a premium due date, the grace period will not apply. If cancellation is during the grace period, the policyholder or subscribing employer unit will be liable for any unpaid premium including the pro rata premium for that part of the grace period coverage was in force. NOTICE OF CLAIM: Written notice of claim must be given to Us at 2000 N. Classen Boulevard, Oklahoma City, Oklahoma, 73106, or to Our agent. Such notice should be made within thirty (30) days after any loss covered by the Policy. If it is not reasonably possible to give notice within that time, the claim may not be denied or reduced due to the delay. CLAIM FORMS: Claim forms should be used for filing proof of loss. They will be sent to You within fifteen (15) days of receipt of notice of claim. If claim forms are not supplied within fifteen (15) days, You can give proof as follows: (a) in writing; (b) setting forth the nature and extent of the loss; and (c) within the time stated in the Proof of Loss Provision. CG-108-GenProv1(PA) PROOF OF LOSS: Proof of loss must be given to Us within 90 days after the termination of the period for which We are liable. Late proof may be accepted if: (a) it was not reasonably possible to give proof in that time; and (b) the proof is given within one year from the date of loss. This one year limit will not apply in the absence of legal capacity. TIME OF PAYMENT OF CLAIMS: All accrued benefits for loss for which the Policy provides periodic payment will be paid each month, subject to written proof of loss. Any balance not paid when liability ends will be paid immediately upon receipt of written proof. Benefits for any other covered loss will be paid as soon as We receive written proof of such loss. PAYMENT OF BENEFITS: All benefits will be paid to You. Accrued benefits that are not paid at Your death will be paid to Your beneficiary or estate. If a benefit is to be paid to Your estate, or to You and You are not competent to give a valid release, We may pay up to $1,000 of such benefit to one of Your relatives who is deemed by Us to be justly entitled to it. Such payment, made in good faith, fully discharges Us to the extent of the payment. PHYSICAL EXAMINATION: We have the right to have You examined as often as is reasonably necessary while a claim is pending. We will pay for such examination. LEGAL ACTION: No legal action may be brought to recover under the Policy: (a) within sixty (60) days after written proof of loss has been furnished as required; or (b) more than three years from the time written proof of loss is required to be furnished. CERTIFICATES: An individual Certificate will be issued for delivery to You. The Certificate will describe: (a) the benefits under the Policy; (b) to whom benefits will be paid; and (c) the limitations and terms of the Policy. If more than one Certificate is issued under the Policy to You, only the last one issued will be in effect MISSTATEMENT OF AGE: If Your age has been misstated, Your true age will be used to determine all amounts to be paid for loss incurred by You. CONFORMITY WITH STATE LAWS: A provision of the Policy that conflicts with a law of the state in which You reside is hereby changed to meet the minimum standards of that law. REIMBURSEMENT OF OVERPAYMENT: The benefits payable under this Policy will be adjusted by other sources of income listed in the Adjustments and/or Limitations Section. If any income from a source stated in the Adjustments and/or Limitations Section is received or granted retroactively, You will be responsible for reimbursing Us for any resulting overpayment. Reimbursement will be only to the extent of the overpayment involved, and such reimbursement will be required in one lump sum payment at the time You receive the award. REINSTATEMENT: If any renewal premium be not paid within the time granted the insured for payment, a subsequent acceptance of premium by the insurer or by any agent duly authorized by the insurer to accept premium, without requiring in connection therewith an application for reinstatement, shall reinstate the policy: provided, however, that if the insurer or such agent requires an application for reinstatement and issues a conditional receipt for the premium tendered, the policy will be reinstated upon approval of such application by the insurer or, lacking such approval, upon the forty-fifth day following the date of such conditional receipt unless the insurer has previously notified the insured in writing of its disapproval of such application. The reinstated policy shall cover only loss resulting from such accidental injury as may be sustained after the date of reinstatement and loss due to such sickness as may begin more than ten days after such date. In all other respects, the insured and insurer shall have the same rights thereunder as they had under the policy immediately before the due date of the defaulted premium, subject to any provisions endorsed hereon or attached hereto in connection with reinstatement. Any CG-108-GenProv2(PA) premium accepted in connection with a reinstatement shall be applied to a period for which premium has not been previously paid, but not to any period more than sixty days prior to the date of reinstatement. UNPAID PREMIUM: Upon the payment of a claim under this Policy, any premium then due and unpaid or covered by any note or written order may be deducted therefrom. CG-108-GENPROV3(PA) STATEMENT OF ERISA RIGHTS As a participant in the Plan, you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all Plan participants shall be entitled to: (a) examine, without charge, at the Plan Administrator's office and at other specified locations, such as worksites and union halls, all Plan documents, including insurance contracts and copies of all documents filed by the Plan with the U.S. Department of Labor, such as detailed annual reports and Plan descriptions. (b) obtain copies of all Plan documents and other Plan information upon written request to the Plan Administrator. The Plan Administrator may make a reasonable charge for the copies. (c) receive a summary of the Plan's annual financial report. The Plan Administrator is required by law to furnish each participant with a copy of this summary annual report. In addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the Employee Benefit Plan. The people who operate your Plan, called "fiduciaries" of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants and beneficiaries. No one, including your employer, your union, or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a pension benefit or exercising your rights under ERISA. If your claim for a pension benefit is denied in whole or in part, you must receive a written explanation of the reason for the denial. You have the right to have the Plan review and reconsider your claim. Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request materials from the Plan and do not receive them within 30 days, you may file suit in federal court. In such case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day (indexed for inflation) until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Administrator. If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or federal court. If it should happen that Plan fiduciaries misuse the Plan's money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these court costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous. If you have any questions about this statement or about your rights under ERISA, you should contact the nearest Office of the Pension and Welfare Benefits Administration, U.S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Pension and Welfare Benefit Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C., 20210. NOTICE OF THE RIGHT TO APPEAL Any denial of a claim for benefits will be explained in writing and the explanation will include: (a) the specific reason for the denial, (b) reference to the Plan provision upon which the denial was based, (c) a description of any additional information you might be required to provide and an explanation of why it is needed, and (d) an explanation of the Plan's claim review procedure. You, your beneficiary, or a duly authorized representative may appeal any denial of a claim for benefits by filing a written request to American Fidelity Assurance Company. In connection with such a request, documents pertinent to the administration of the Plan may be reviewed, and issues outlining the basis of the appeal may be submitted. You may have representation throughout this review procedure. Your request for review must be filed within 90 days after receipt of the written notice of denial of a claim. A decision will be rendered by American Fidelity Assurance Company, no later than 90 days after receipt of your request for review. If there are special circumstances, the decision shall be rendered as soon as possible, but no later than 120 days after receipt of the request for review The decision, after the review, shall be in writing and shall include specific reasons for the decision. This decision shall also include specific references to the pertinent plan provisions on which the decision was based. CG-108-ERISA 2000 N. Classen Boulevard American Fidelity Assurance Company A member of the American Fidelity Group Oklahoma City, Oklahoma 73106 Effective Date: (If Different from the Policy or Certificate) The Policy or Certificate to which this Rider is attached is hereby amended as follows: When this Policy replaces a prior Policy issued by Us: (a) a Pre-Existing Condition limitation may apply, which would be the lesser of: (1) the balance of the Pre-Existing Condition remaining under the prior policy; or (2) the Pre-Existing Condition limitation defined under this Policy. (b) under which there were accrued accumulations, the period of time which was the basis of such accumulations under the prior policy will be included in calculating the accumulations in this Policy. The accumulations payable under the Policy will not exceed [60%] to any one insured, regardless of the amount earned under any prior policy. This Rider is subject to all of the provisions of the Policy as long as this Rider does not amend them. This Rider will terminate on the same date as the Policy or Certificate to which it is attached. AMD-2053 GROUP APPLICATION AMERICAN FIDELITY ASSURANCE COMPANY 2000 Classen Blvd Oklahoma City, Oklahoma 73106 -? Last Name rn%orlwoCU 1"Ouricu (maiden name) First Name Full Middle Name Suffi DOURTE RAY M x Age Date of Birth Mo Day Yr Sex Soc Sec Number MN FE] Requested Eff Date Date of Employment 53 12101/1947 Numbe 549-72-0555 Mo Day Yr 05/01/2001 Mo Day Yr 09/01/1978 r an ree 12 0AKWOOD DR ( 717) one 697-9448 ome one city _ ( 717) 432-2426 DILLSBURG I-1N State of Bird PA 17019 PA Employer MCP # Salary $ 80,000.00 Occupation CUMBERLAND VALLEY MOTORS 06346 Annual Monthl Sales Do you now have or have you ever had any other coverage with us? Yes No If so, write the existing Customer Number in the box in the upper right comer. ^rr••?? • tel. cmpioyee tmployer Total Product A/C' MCH # Payor # HMC2 Plan Amt Mode Prem Prem Prem DISAB [N 0106 STND © 017630-D13100..gTppp-.M DISAB 99 0106 STND ® 017180-133 3 M "?' .00 57 35-68.48, ?? ? use- .00 S a(o.74.= ? o ? ? 'A=Add C=Change Totals: .43248- .00 _ 2Household members covered {z=lndividual} {y=Individual & Spouse} {t=Child(ren)} {s=Spouse} {x=Individual, Spouse & Child(ren)} {w=lndividual & Child} {v=Individual & Children} {u=Spouse & Child(ren)} Is the coverage applied for intended to replace or be in addition to any coverage you now have? Yes No If "yes", please explain: INCREASE CURRENT COVERAGE Have you had a: a) heart attack; b) heart bypass; c) coronary artery disease; d) stroke; e) cancer (other than basal or squamous cell skin cancer); and/or f) test results indicating HIV disease? Yes ? No Have you been hospitalized in the last 90 days (for any reason) or been recommended to seek: a) medical 21 advice; b) treatment; c) care; and/or d) counseling that has not yet been performed? Yes ? No BENEFICIARY - First Name Full Middle Name Last Name umx Relationship to Insured BENJAMIN M DOURTE SON I hereby enroll, add or change, as checked above, coverages of group insurance for which I am eligible. I authorize my employer to deduct my contributions, if any, from my pay. I have decided, after understanding and careful thought, not to take advantage of the other unchecked coverages for which 1 am eligible. I understand that proof of good health will be required for me and/or my dependents if I decide to apply for any available coverage 31 days after the date of eligibility. Such proof will be at my own expense. ANY CHANGE REQUIRES WRITTEN NOTICE. To the best of my knowledge and belief, the statements and answers shown in this application (first page and, if applicable, the second page) are true and complete. 1 understand and agree: a) that the Company may rely upon such answers as the basis of my contract; and b) that no coverage will take effect until a Policy or Certificate is issued. I authorize any person or organization having records or knowledge of me or my family or of our health to give American Fidelity Assurance Company or its reinsurers such information. Those so authorized include: a) licensed physicians or practitioners; b) hospitals, clinics or medically related facilities; c) Veteran's Administration; d) past or present employers; e) consumer reporting agencies; f) insurance companies or their reinsurers; or g) the Medical Information Bureau. I also acknowledge by my signature below, receipt of one MIB Notice. A photographic copy of this authorization shall be as valid as the original. This authorization will expire two years from the date shown below. I understand that the information collected will be used to determine my eligibility for insurance (this includes information about drugs, alcoholism or mental illness). I understand that: "pre-existing conditions" are generally not covered under the c overage(s) applied for, coverage for matemity benefits may not be provided; and I should read my Cert'if'icate for a more detailed explanation of the pre-existing exclusion and maternity coverage, if any. If applying fFA lit erage, I understand that: other income I am entitled to receive may affect my coverage and I should read ifi t r re detailed information regarding the effect other income may have on my benefit. AGENT (where required by law) Date 04/06/200 Agent # 19295A A-1033PA L SIGNATUR (A i AG D 19295A04/06/0109:25:09 AMERICAN FIDELITY ASSURANCE COMPANY 2000 N. Classen Oklahoma City, OK 73106 Acknowledgment Thank you for considering American Fidelity in planning for your financial security. We appreciate the opportunity you have given us to present our products to you. In order for you to make an informed decision regarding application for coverage(s), we have developed a detailed brochure(s) that outline(s) the provisions of the insurance plan(s). Please read the brochure(s) carefully and ask a Company representative any questions you may have regarding information contained in the brochure(s). Our Company will rely on answers given on your application(s) for coverage(s) in order to determine if coverage(s) can be issued. Please remember some coverage(s) may require you to be on Active Service on that date in order for your coverage(s) to begin. The coverage(s) for which you are applying may have wording that may limit benefits for a preexisting medical condition for which you had treatment, took medication, received a diagnosis, or incurred expense. It may also have wording that could limit or reduce your benefits. PLEASE ACKNOWLEDGE THAT BROCHURE (S)# SB8170T, SB8107T 1000 HASMAVE BEEN EXPLAINED TO YOU AND YOU HAVE RECEIVED A COPY OF THE BROCHURE(S) BY SIGNING BELOW. A COPY OF THIS FORM WILL BE ENCLOSED WITH YOUR CERTIFICATE AND/OR POLICY. Signed Dated 4/6101 549-72-0555 Social Security Number M-2195(3/99) 3 ?3 4 - c°ti) c: C.? RAY M. DOURTE, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PA Plaintiff V. AMERICAN FIDELITY ASSURANCE COMPANY, CIVIL ACTION - LAW NO. 08-2812 CIVIL TERM Defendant JURY TRIAL DEMANDED NOTICE OF FILING OF NOTICE OF REMOVAL TO: Samuel L. Andes, Esquire 525 North Twelfth Street P.O. Box 168 Lemoyne, PA 17043 Prothonotary of Cumberland County Cumberland County Courhouse One Courthouse Square Carlisle, PA 17013-3387 PLEASE TAKE NOTICE that, pursuant to 28 U.S.C. sections 1331, 1332, 1441, and 1446, defendant American Fidelity Assurance Company has filed the accompanying Notice of Removal of this action from the Court of Common Pleas, Cumberland County, Pennsylvania, to the United States District Court for the Middle District of Pennsylvania. Dated: 6 - 2? - 0 PETERS & WASILEFSKI Attorneys for American Fidelity Assurance Company Stephen F. Moore, Esquire Atty. ID#PA62077 Charles E. Wasilefski Atty. ID#PA21027 2931 North Front Street Harrisburg, Pennsylvania 17110 (717) 238-7555, extension 116 (717) 238-7750 facsimile sfmgpwle ag 1_com cew@pwlegal.com R 16 CERTIFICATE OF SERVICE I, Stephen F. Moore, Esquire, attorney with the firm of Peters & Wasilefski, hereby states that a true and correct copy of the foregoing document was served upon all counsel of record in the manner and on the date set forth below: BY REGULAR U.S. MAIL: Samuel L. Andes, Esquire 525 North Twelfth Street P.O. Box 168 Lemoyne, PA 17043 PETERS & WASILEFSKI By: Stephen F. oore, Esquire Atty. ID#PA62077 Charles E. Wasilefski Atty. ID#PA21027 2931 North Front Street Harrisburg, Pennsylvania 17110 (717) 238-7555, extension 116 (717) 238-7750 facsimile sfmgpwle ag l.com cew@pwlegal.com Attorney for Defendant, American Fidelity Assurance Company Date: 6 - Z6 6y CIN s?