HomeMy WebLinkAbout95-04410
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CARL AMMERMAN and WENDY AMMERMAN, : IN THE COURT OF COMMON PLEAS OF
Husband and Wife, and all others : CUMBERLAND COUNTY, PENNSYLVANIA
similarly situated,
Plaintiffs
CIVIL ACTION - LAW
NO.
CLASS ACTION LAWSUIT
v.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA, and THE PRUDENTIAL
PROPERTY AND CASUALTY INS. CO.
Defendants
JURY TRIAL DEMANDED
NOTICIA
Le han demandado a usted en la corte. Si usted quiere
defenderse de estas demand as expuestas en las paginas sugnuientes,
usted tiene viente (20) dias de plazo al partir de la fecha de la
escrita 0 en persona 0 por abogado y archivar en la corte en forma
escrita sus defensas 0 sus objectiones alas demandas en contra de
su persona. See avisado que si usted no se defiende, la corte
tomara medidas y puede entrar una orden contra usted sin previa
aviso 0 notificacion y por cualquier queja 0 alivio que es pedido
en la peticion de demanda. Usted puede perder dinero 0 sus
propiedades 0 otros derechos importantes para usted.
LLEVE ESTA DEMANDA A UN ABOGADO IMMEDIATEMENTE. 81 NO TIENE
ABOGADO 0 SI NO TIENE EL DINERO SUFICIENTE DE PAGAR TAL 8ERVICIO,
VAYA EN PERSONA 0 LLAME FOR TELEFONO A LA OFICINA CUYA DIRECCION SE
ENCUENTRA ESCRITA ABAJO PARA AVERIGUAR DON DE SE PUEDE CONSEGUIR
ASISTENCIA LEGAL.
Court Administrator
cumberland County Courthouse, 4th Floor
One Courthouse Square
Carlisle, PA 17013
(717)240-6200
v, NO.
CARL AMMERMAN ancS WENDY AMMERMAN, : IN THE COURT OF COMMON PLEAS OF
HusbancS ancS Wife, ancS all others : CUMBERLAND COUNTY, PENNSYLVANIA
similarly situated, :
Plaintiffs : CIVIL ACTION - LAW
THE PRUDENTIAL INSURANCE COMPANY CLASS ACTION LAWSUIT
OF AMERICA, ancS THE PRUDENTIAL
PROPERTY AND CASUALTY INS. CO.
DefencSants JURY TRIAL DEMANDED
CLASS ~CTION COMPLAINT
1. Carl Ammerman and Wendy Ammerman, husband and wife, are
adult individuals who reside in Millerstown, Perry county,
Pennsylvania.
2. The prudential Insurance company of America and The
prudential property and casualty Ins. Co. are corporations
authorized to market insurance in the COlllDlonwealth of Pennsylvania,
regularly do business in cumberland county, and have offices in
cumberland County, Pennsylvania.
3. In September, 1989, plaintiff Carl Ammerman began
employment with American Quick Print, 823 South Cameron street,
Harrisburg, Pennsylvania 17104.
4. At that time, American Quick Print had an employee
benefits program provided by contract by the Defendants.
5. A copy of the employee benefits program Application for
Request for Plan Change dated January, 1987, is attached hereto as
Exhibit A, and identifies the group plan policy number as E5712200.
7454311JI
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6. No copy of the contract of insuranc. i. in the po.....ion
of the Plaintiff., although it is beli.v.d that it i. in the
pos....ion of the Def.ndant..
7. By application dat.d S.ptemb.r 12, 1989, Mr. Amm.rman
app1i.d for cov.rag. from the D.f.ndant.. A copy of hi. H.alth
statement - Employe. Benefits Program application i. attached
her.to a. Exhibit B.
8. By letter dated January 5, 1990, a copy of which is
attached her.to a. Exhibit c, Mr. Ammerman and hi. family w.re
denied group h.alth insurance due to hi. history of a heart murmur.
9. Because Plaintiffs felt health in.urance to be es.ential,
and because the Defendants denied them group health insurance,
Plaintiff. .ought out private health insurance for which they paid
on an individual basis when they could obtain it. A copy of a
summary of the insurance premiums paid by the Plaintiffs is
attached hereto a. Exhibit D.
10. On July 19, 1991, Mr. Ammerman reapplied for coverage
under the group health insurance plan.
11. By letter dated August 28, 1991, copy attached as Exhibit
E, the Defendants again refused to cover Mr. Ammerman, but agreed
to cover Mrs. Ammerman upon her payment of an extra premium which
the Ammermans declined to pay and therefore had no coverage from
Defendants.
12. Throughout this periOd, the Ammerman family incurred
medical bills in excess of $3,000 that were not covered by their
individually purchased health insurance but which they believe
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would have been covered by the group policy of the Defendants.
13. Moreover, for a portion of the period between 1989 and
1994, Mr. Ammerman was unable to obtain health insurance on an
individual basis.
14. In 1994, the Amlnermans applied for non-group health
insurance with Capital Blue Cross and Pennsylvania Blue Shield.
15. By letter dated August 18, 1994, attached hereto as
Exhibit F, the Ammermans learned for the first time that the
Pennsylvania Department of Insurance had disapproved denial of
group health care coverage based on an assessment of health, an
illegal practice known as "medical underwriting."
16. In August, 1994, the Plaintiffs learned that the
cOlDIDonwealth of Pennsylvania Insurance Department by Order and
Adjudication of the Pennsylvania Insurance COlDIDissioner dated April
29, 1988, specifically disallowod insurers issuing group medical
coverage to deny coverage to individuals based on this illegal
practice of medical underwriting and outlawed charging added
premiums based on previous medical history. A copy of the
cOlDIDonwealth of Pennsylvania Insurance Department Order and
Adjudication dated April 29, 1988, is attached hereto as Exhibit G.
17. Thereafter, in early September, 1994, the Ammermans filed
an Insurance Complaint Form with the cOlDIDonwealth of Pennsylvania
Insurance Department, a copy of which is attached hereto as Exhibit
H.
18. Thus, a year and one-half prior to Mr. Ammerman'. initial
application for group health care covorage, the practices of
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medical underwriting and charging additional premiums on group
health policies were outlawed in Pennsylvania by a specific ruling
of the Insurance COlDIDissioner.
19. Moreover, when the Ammermans reapplied for coverage in
1991, the practice of medical underwriting had been outlawed in
Pennsylvania for more than three years.
20. At no time did the Defendants ever contact the Ammermans
to tell them that it had made a mistake until after the Ammermans
filed a complaint with the Insurance Department.
21. Under cover letter dated October 14, 1994, the Insurance
Department forwarded to the Ammermans a letter from William H.
stafford, employee of the Defendants, acknOWledging that the
denials of group co~erage were "in error" and offering to add Mr.
Ammerman on to the group health insurance policy. Copies of that
correspondence are attached hereto as Exhibit 1-1 and 1-2.
22. Plaintiffs believe and therefore aver that the
Defendants' actions with regard to denial of their application for
group coverage were part of a policy and practice of illegal
denials to many who were entitled under Pennsylvania law to have
such coverage.
23. Plaintiffs believe and therefore aver that the
Defendants' policy and practice of illegally denying group health
insurance coverage to individuals has continued up to the present
time in clear violation of Pennsylvania law, Insurance Department
regulations, and Insurance Department decisions.
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24. Additionally, when Mrs. Ammerman applied for coverage
from the Defendants in 1991, she was charged a higher rat. based
upon her prior health history, a policy known as "rating up" that
is also illegal in Pennsylvania.
25. Plaintiffs believe and therefore aver that the
Defendants' illegally rating up policies or charging a higher
premium based upon prior health history under a group policy
represents a pattern and practice used with many.
26. Plaintiffs believe and therefore aver that this i. a
policy and practice that have continued up to the present time
despite its illegality.
27. Plaintiffs aver that the Defendants' actions after July
1, 1990, in denying group coverage and charging an additional
premium based on health history represent bad faith warranting
damages under the Pennsylvania Bad Faith Insurance statute, 42
Pa.c,S. S8371.
28. Additionally, Plaintiffs aver that the Defendants'
failure to notify them of their illegal actions at any time after
denial and request for additional premium based upon health history
represent bad faith warranting damages under the Pennsylvania Bad
Faith Insurance statute, 42 Pa.C.S. 58371.
29. Moreover, the Defendants' actions representing violations
of the Unfair Insurance Practices Act, Insurance Department
regulations, and Insurance Department decisions as well as
insurance law represent bad faith warranting damages under the
Pennsylvania Bad Faith Insurance statute, 42 Pa.C.S. 58371.
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30. Thus, in addition to the compensation the Plaintiffs seek
for the costs they incurred in obtaining alternative insurance
and/or paying medical bills that were the legitimate responsibility
of the Defendants, Plaintiffs also seek interest on their
compensatory claims, an award of punitive damages, and an
assessment of court costs and attorney's fees against the
Defendants.
WHEREFORE, Plaintiffs Carl Ammerman and Wendy Ammerman,
husband and wife, demand jUdgment against the Defendants in an
amount of compensatory damages, punitive damages and attorney's
fees in excess of $25,000.00, exclusive of interest and costs and
in excess of any jurisdictional amount requiring compulsory
arbitration.
CLASS ACTION ALLEGATIONS
31. Paragraphs 1 through 30 are incorporated herein by
reference.
32. The class of Plaintiff~ includes all persons denied group
health insurance by the Defendants because of previous medical
history, and the class of Plaintiffs includes all those who were
charged or threatened with higher premiums for group health
insurance coverage because of prior medical history, and either
paid such extra charges to get coverage or did not pay such extra
charges and were denied group coverage, in violation of Unfair
Insurance Practices Act, the insurance laws of Pennsylvania,
regulations, and Insurance Department decisions.
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33. Plaintiffs aver that the total number of all class
members is so numerous that their joinder would be impracticable.
34. Mr. and Mrs. Ammerman are aware of another person who
worked in the same location as the Ammermans, which included a
total of fewer than ten employees, who was also denied membership
by the Defendants in a group employee benefit plan on the basis of
his health history.
35. If two out of fewer than ten potential group benefit plan
members were illegally denied coverage by the Defendants, one can
only imagine the thousands of others who were similarly denied
coverage.
36. Moreover, Plaintiffs believe that the total number of
class members who were charged additional premiums for group
pOlicies, as Mrs. Ammerman was, is so numerous that their joinder
would be impracticable.
37. The questions of law and fact are cOlDIDon to all class
members in that all claims are based upon identical provisions of
Pennsylvania insurance law, insurance regulations, and Insurance
Department decisions, and the Defendants followed a policy and
practice of illegal activities in regard to class members'
legitimate rights.
38. The claims of the representative plaintiffs are typical
if not identical to the claims of all class members, grounded as
they are on identical legal provisions and regulations, and
Insurance Department decisions.
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39. Moreover, the continuing actions of the Defendants in
regard to all class members represent bad faith warranting damages
pursuant to the Pennsylvania Bad Faith Insurance statute, 42
Pa.C.S. S8371.
40. The Defendants had no reasonable basis after April, 1988,
to deny Plaintiffs membership in group health insurance plans or to
collect additional premiums from them based on their prior health
history .
41. The Defendants' actions after July 1, 1990, in continuing
to refuse group health insurance membership based on "medical
underwriting" and "rating up" group health insurance members based
upon prior medical history represents bad faith toward class
members subject to liability under 42 Pa.C.S. 58371.
42. The Defendants further failed to alert the claimants to
the fact that the 1988 Insurance Department decision, insurance
laws of Pennsylvania, and Insurance Department regulations
prohibited the Defendants from disclaiming coverage or rating up.
43. Both before and after July, 1990, the Defendants
routinely refused claimants' requests for group health insurance in
direct contravention to the laws and Insurance Department
regulations and decisions.
44. Both before and after July, 1990, the Defendants
routinely charged group health members additional premiums based
upon their prior medical history in clear violation of the laws of
Pennsylvania and Insurance Department regulations and decisions.
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45. Both before and after July, 1990, the Defendants allowed
their interests in limiting their liability and increasing their
profits to dictate their actions despite clear violations of the
Unfair Insurance Practices Act, a breach of their fiduciary duty,
and breach of their duty of good faith and fair dealing, thereby
being guilty of bad faith toward their insureds.
46. The representative Plaintiffs will fairly and adequately
represent the interests of the class in that competent counsel has
been retained, there is no potential or actual conflict of interest
with other possible class members, and the representative
Plaintiffs and their counsel have adequate financial resources to
ensure that the interests of the class will not be harmed.
47. A class action provides a fair and efficient mechanism
for the adjudication of the controversy between the Defendants and
the Plaintiff class.
48. Unless this controversy is maintained as a class action,
there is substantial risk that class members who are entitled to
recovery will be deprived of those benefits because they are
unaware of their legal rights to those benefits and/or will be
subjected to inconsistent adjudications of their claims.
49. On behalf of all class members, the representative
Plaintiffs make claim for all losses they have incurred by the
Defendants' illegal activities, together with interest, punitive
damages, costs and attorneys fees under 42 Pa.C.S. 58371.
50. Additionally, Plaintiffs request that the Defendants be
ordered to ilDlDediately extend group benefits without additional
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charge to all claimants entitled to same, refund any excess
premiums collected and be directed to cease and desist from such
policies in the future.
WHEREFORE, Plaintiffs Carl Ammerman and Wendy Ammerman,
husband and wife, and all others similarly situated, demand
judgment against the Defendants in an amount of compensatory
damages, punitive damages and attorney's fees in excess of
$25,000.00, exclusive of interest and costs and in excess of any
juriSdictional amount requiring compulsory arbitration.
Respectfully submitted,
ANGINO & ROVNER, P.C.
Pamela G. Shuman, Esquire
I. D. No. 41696
4503 North Front Street
Harrisburg, PA 17110
(717)238-6791
Counsel for Plaintiffs
DATED: August 17, 1995
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VERIFICATION
I, CARL AMMERMAN, hereby verify that the facts set forth in the
foregoing document are true and correct to the best of my knowledge,
information and belief.
I understand that any false statements therein are made subject to
the penalties of 18 Pa. C.S. 54904, relating to unsworn falsification to
authorities.
WITNESS:
~rJ.~
Carl
DATED: August l7, 1995
46660/IJI
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EXHIBIT A
'''.r:!'T:''''!:<'.~'.
''''"Th~ pr~dentlal (jI
E....'Jlay.. B~nol,t.
Program
o When luued, da nat mall to Dlstrlcl/Agenoy office. Mall To:
Name
~ "
. "'-.
.
Application for Insurance or
RequeSl for Plan Change
\ I' '''-.
~l.). I '-:r,
, Tile PI utlonliallnsurance Company 01 America
Street
Cily
Slat"
Zip Code
Instructions for completion 01 application:
1. Applicant-cmployer's name and address should be printea on page 2 wilh only one leller In a space,leavinll e blan~. ~pace
between words.
2, Companies subsidiary to or affiliated with the Applicant.employer may be Included. A subsidillrl company Is a corpQrallun
controlled by the parent company through ownership of more than 50% at the slocK. An affiliated corporation, partnership ur
proprietorship Is a company und~r the same control as the parent company,
3, For Plan Changes, compl~te this page and the Supplementary Information on page 4, On pages 2 and 3, complete those
sections which are being changed, showing the additions or changes. When 1I benefit Is 10 be removed, enter the wcrd
"Remove" In the applicable benefit section, Include employer's name, address and signature.
4, Important tho Request for Participation in an Employee Benefi:s Program Insurance Trust (EBP lA), which Is attached to
the eppllcatlon. mu~t be completed oniy whom accompanying a new business application
Writing Representative InfonnallonJl\M S 0 WJ81.
The Writing Representative (Agent, Asst/Sales Manager. Manager or Broker) should always complete the "Writing Rep:'
line and, if applicable, the Broker or Retired Representative informetlon, For Ordinary Agencies Representativ6s only,
Include your contract prefix designation wilh contract number. The Field Service Stoff will stamp the RHO, Reg!on, Office
Code and Name, .
RHOfAeglan Office Code Office Name
AI {).) -.sri! {,(.)f;.sf 0' IfoRL
Fil'lt Wrlllng Rep.
Staff I Agency I Contract No, IlllSt name
Leifer No.
G 6/'7 ,()",'J.7 is.fI;o,En1,lJll-e
ro ar-addrBSS and lelephor.e no
IlnltilllO:Title
!! ;~I j./.6/l.tJr
Iperc~t
of
,comms.
, ,.(1.6
o Retired Repre,enlal"....furni!h 18St field offloa werked In and retirement date
Print Identification 01 2nd Office II different Irom above.
RHOfAeglon \ Office Code I Office Name
Second Writing Rep.
Staff ! Agency \ Contract No. I Last name
~t""Ne.
J.-l ' ; ! I I
o Broker-ad re.. telephone no
Ilnltialsl Title
. ,
L.l :
, Percent
, I
l~omms,
i . I
o Retired Ropralentalive-furnish la&l field office worked in and mtirr.ment oale
IEBP11 E~7.ea UlnOill U,SA by PrvPl...
Plig~1
e"t *&a0Cl~
n7'21.'~~
'5'~II~ 3~1 S~~ll
SBSD
~.. .... .... -.... .. .. .... .. .. .. .... .... .. ........ .. .... .. .. .. ........ .. .... -.. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .... .. .. .. .. .. .. .. .. .. .... .. .. .. .. .... .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ..
~"n3
111:111
,........- ,
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1 Applicanl'.employer requests Prudential to:
l8Iuo an In5urance Plen
The PrUdentlQllnsurance Company 01 America
Employee Benofits Progrem
~;~~r~@#.iiJjG~O'U~~~~I~~.. .!.~ . .~
\;'W'I'J',. .,,)It'P;';~.N' "''!~'f".,;\~''.~'''''~r . ""1' .,~.~' '
,,"':I' (lsulP'nCl'e~_~,II.!1" \l.;;-~; ~,"< O\l ~ 'lO~. ~
It.. ',."', . l~.';,.,,,,\; ....,. ':" \: )!~... ~ ,.~ .' ,:
.il", i I':('~.t.~ I:.: \ ,.h.'.......'.;.':,,; ",,"'i.l't..f..~~T.~ ~ :U ,.~!"f'.:'t"~ .
1".I',....~1.<i.l';." :"e"....}""'..<),o....~......,.v:,c'.rl~, .
ChangelnsurancoPlanNo.E ,j"71:J;JOO ,\J ",,'.' ,.,,,,,,~.,,.._,,. ."" ","~" .'....';, .~ ,..,
:Complete Name and Address below and all parts where a change is requestod.)
1 Insurance Pion (called Plan bolow) Is under Group Conlroct(s) Issued by Prudenllal to II Truet set up for emplo)'ere In the
nc indu5try.
no Of Apphcant-amplayor (Prlntfull or corporate name under which bUlln... op.rat..,
j'en A-m6(!,f t.&r..I- auf ".Jr.. th/dJ.r:'.-.. ..
nbar and strtal
I
/'10C S. t/1/J1.6R{)A) J'r
/-I-;4..eJ?,1J .6/1 A4
)00; ~~~~~~;BtUrIlOf biisi~/~;;~~
soolatod oompanlesto btlncluded
350 omployers ere subsidiaries or aHlllates of the Applicant-employer and are to be included under the Plan as Associated '
mpsnies: (EmployeElS of the included Associated Companies will be conslderod employees o( the Appllcant-emplo)'ef.)
County and state
Dr;'/.( iJII//J
Zip Code
/7/0<f.
.vered clas.8I 01 employee.
a Plan Is to provide Insurance for emplo)'ees of tho Applicant-employer and any Associated Companies if the employees ere
hese Covered Classes: .
o All classes of omployoes 'i(f All classes of employees except: ~A!.i' 'lime. L~rJ r7f.~,J
lployment waItIng period (Check one box) 40 1/rH.IIU ~
~ following period of continuous full.time service with the Applicant-employor:
lil! 1 month Cl 1 month but "one for present employees 0 3 months 0 3 months but none for present employees
ntrlbutlons and effectlve date notices
~se maximums apply to the amoUnt of any contributions made by omployees toward the cost of the insurance:
An employee may not contribute the whole premium for the employee's Insurance.
For Employee Term Life Covorage, 60e (40e in Tel(8s) per month per$1,OOO of insuranca under this Coverage, or if less. the
maximumllllowed by law.
, attached Plan Information page, wlllch Is made part of the Request. shows the Coverages aud bener.ls requested or the
mges In those Covarages a"d benefits which are requested,
,dentlAl'1I Small Group Administration OHlce will inlorm the Appllcant.employer when this request Is approved or
approved, If Ihis rllquARI ill aPl'lrovad hy PrudenliaJ, the dato that the Plan, or change in the Pian, takes effect will be Inserted
jer "Effective Date" in Ihe space 1IlXlve, Prudential will Issue Group Insurance Certificales for Insured employees. The terms
:he Group Contracl(s) that mainly affect tha insurance are sumrr,srlzed In the Group Insurance Certificate, Alllnsurence Is
JJect In overy way to the Group Contract(s) which alone fnrm(s) the agroement(s) under which payment of Insurance Is
de,
Inaturee - Must ba signed by an eulhorlzed representative of the Appllcent-employer.
,11' 0 P lca~l-emp oyer (l!nl.r full or Corpor.te name undllr w c uS ness operates)
1111/SI!./lm.) Ou'nlc. fJ/J.iAJr - VAl tUol2tM)I~. fi)(,I.)J.)~1J
tad on By (S; 041 and Tille)
(}tlJAJ6.e
Page 2
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.~LT",r;;T ':i\1~n.~ . .~'g\)'!i~~lI"~'-~ - ..,-';.' ."~b~l1" r
Plln Information
Employee Weekly Disability Income
Plan Maximum
'1, Flat arnount $! '
2.1 50% uf we~kl t!smrngs
.3. 60% of weekly eall"'~ s
".4, 70% 01 weekly eernill. .
5. Position (lIection IV below mUll
0100 be compllfedl
. Earnirlg" Pia"" in Secllon I a~d II' Actual amounts 01 IMurance will approximate Ihe earnings multiple or percentage .eleclr.d and w,1I
vary by earnings class.
iliA
Major Medical 80
rn Employees only
~ Employees (,
dependent8
Calendar year
deductible
I&m $100
Lmil 200
IV
Position Plans Only - Complete for Employee Tenn Life end/or Weekly DIsability Income
(Thelllllt pol'hlnn must DC "All Otner Employ...," f"., tn.2 poSlttonplan 'mtar "All Other Emplcyeec,"ln
po.ttiOn *.2. Leavo a &pIce t)fltwHn .ach worc:a,)
mon #1
.=:L~ I I I u..J ! ' : , ; I ~..'
~2:
I I cro....:LLIIJ : . r~"-~ I I '
~#3
: !
'ebon number
Employee Term Lito'
Pllln
,:1, Flat amount
, : 1 times annual earnin
:3, t \ol: timet Mnual urnin .
.~; 2 limos annual earninga
5, position (Sect on IV belOw mUll
alia be compllled)
Maximum
3; 000
.000
,000
,000
Dontal
rn Employees only
rnl Employees (,
d~ndents
OTI
Deductible amount
r=m $ 300
tj; 1,:
11I8
PRUscrlptlon
(Cosl Conlalnmenl Plan)
Dental
~1'
~
Employee AD & D
Amounl
t 1~1:' 5amea.EmployeeT.,mLile
,2:i T w;oo Employee Term Lilt
Dependent Term Ule
Spouse amount
1. !~'l $1,000
. __ :~ 2,000
An emplayee age 65 or more will be ollglble for 60% of the Employee Term Life
Insulance Amount for the employee's class,
"
BenefllS
51cknosa
Hth dAY
Hlh clAY
8\h day
8th day
No, of we eke
13
13
26
26
Matemlty
as Illness
ill
Maternity
Standard
~ As IIIn"88
rn As Illness with
nurs, car.
supplementel
Accident
coo
State Mat option'
Statc
State variations'
--r-:
.-1-
Describe slale 6. benelil
below
rn As I'lness
~ As Illness with
nurs. care
'See Secllon VI Sales & Service M_nual
~
Maternity
Standard
COO As II!ness
State variations'
'---'
Slale Mat opllon'
State
m As iIInes.
Describe state (, benefit
below
'See Secllon VI Sales eo Service Manual
I 1
I
c:r=
i---C
Employee
Term Ure
Amount
$ m,OOO
Weekly
DIOlIblllly
Income
Amount
$1
$ [1],000
$\
sCCD
,
I
~ I ]
$: I ,000
! '
r-;-TTl---r I J . iTI ' i
L..!-L-l-..: 1 I.. ,__I. '
V~rttOtle~ificltjcn. mull be related IO,Onda.ooo 01 t.omp!oymcnl. EufT'4Jl81 o~ .:c~tlDte Cl.alld.clt~'l\\ Wt\l.11 t)(' "or.r.~'" Ilnrj \'.nagt~." "Sa""rntn," ",A.r Ottwl"
Emp{oyteJ," .Ie Aneul'tl(Jft nl ""n l.n.ltl'.l:p'l-l)Ie clIuittca\ionw;)lJld bit "J,:lnn .>>nts., \"'\I(rIJ1 .. 1....<,1" tl":II. Cl",,:t::atlOf\' inciud'ng ~t~ "AUOtnef 6,mptaytot'. rN(
bel.lMO.
Page 3
'SBSD ~OOO'
Attention Field Service Staf'.... Thlu application haa been revlowed by
InItial. Date
Supplementary Information To Bo Furnished By Writing Ropresentatlve
1, Form of Employer'a Organlzatlon - 0 Corpo..tion ~ Proprietorship
o Partnership :J Olhor
(Describe In Remarks)
2. Induutry - a, 0 Rate Class (Refer 10 Sales end Service Manual)
h, Nature 01 BusinP.Rr.: : I Retail Trade
:J Mlniflg & AO,ir.ll!tura :J TranGporlauon,
:J Construction t. COIII.nullicahons 8-
Manufacturing public utmtiec
C F'nanee. insurancp.. ':J Qthl'-r (Oescrobe III
3"'5ervi.t & real e5Ia:. Remarksl
C. Deseribe articles manufactured or sold or servicos rendered by both the po'.nt and associated compsnie. to be covered
Indlc8181ny h8~: 0
f){l1!.S /Il,...:f'i"''' Ef c.oPy'-I\JG {If- AN'! /JA.fti/2e O..e..jJ~rIVAb/~."jLZb
3, O\h"r Coverage - I-!a_e these emplai'ee5 been insured within the pllsl year With Prudential or ani' other carriei'o;~er;'ce plan la' an/-
of the coverages requested? ~ Yes :J No
(If 'Ves' complelo 0 Ironsferred Buslnosa Form EBP/GSP1S9 lor oach carrier, and Ihe lollowlng)
a, Indicate coverages: Date of Terminalio~ Date 01 TermlnatiGn
EMP DEP EMP DEP
5/1 lJ Life 0 0 Ma'ornity .
5:' Disability Income t\.'l ~ Dental
SO sa Hospital/Major Medi:al
(II ath.r coverage oot to be c.neelled, give det81ls in Rern~rks.)
b. Name 01 car~er(s) (if more than' .Ii.t coverage. provided by each)
C. Previous Plan tit' ESP 0 GSP 0 Prud~n\ial Group :J Othli:r
(If EBP, GSP, Or Prudenlllll Group show Plan/Polley Number
4, Partlolpatlon - e. Number of lUll. time employe~'(;;i't;'" entire Ilrm): _3_.._
b, Number of eligible employees who heve met tho Employment Waiting Paried . ' ,
c. Of the ~umberln 'b.'. how manyhsveenrolled? ...'......,.,.........'",.......
d. Employee Contribution percentage - 0 - 0/.
5, Employmenl Welllng Period - l(f 1 month lJ 1 monm but none for present employees
o 3 months 0 3 months but none lor presenl employees
6, Relsted Employ... - Numtlllr ot enrollea employees related to a~y owner
orolfi%flhe parent or a5Soctated companies ........'.,'......'.'. ..".."..... .......',. .-
7. Desired EHect/v. Dale for New Business or Plan Change I . I
(ConnOI be prior to date the application I. signed) Month Day
:J WhOleule Trade
fl.,il.il~A~ri(.,L-
IE S710lilD"O
.
,...,...,.......,.,.071
,.....,......".""@!L
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fs-7
Year
a. Amount elf Peyment collected wllh Iho Application $
(Make check peyabls to "Prudenllel ESP Trusts") JJo Nt:- ::-~. AM~lIlJ,/ j)/illj f!.c1~JJ' I!TfJ kR. ,
9, Remarks -
(l ""I'-.~ l~' .... ,'j' ro'. '''''''-'''')
"".1;":' ... :'. t . ,".' ;",.",-..,~~
~e'--~'''>F''!:-~~L,. ~1I~~~~t(.~;,/~{'~::.JFO
l , {rz,I;--- t'f;.... M~C:':~r::C:~'~;';~~G. PA 17055
O /.,.., 71H~:-;;264
1.s7'~I1c."" I iC....~.
10. Certification And lIeoommondetlon 01 Wrlllng Ropriii;onlallvo
1, I oortily \het on Ihis dele: (a) I IUlve ~r.aOlllly scen an officer or authorized representativa Cof :he Appllcantoemployer; (b) I ~aVG
asked each of the queatlons and IUlve \erified wilh the Applicant-emplcyer tne plan or plan change 01 'nsurilllce requested \CII
have truly and accurately rrx;orded the information suppll"d b~' the Applicantoemployer who s'gned the Apphcation In my pr.senoo
2, I also certify thai: (e) I have not guarenteed Issue 01 the plan, co'/erag. of .f1Y ."oj_,dual, 0' paymont 01 any claim; (b) I havt' nol
modified vlll'bally or In w~tlng eny plan provision. limitation (01 t.clusian, To the b.. I of my knowledge, the questions are answerea
correcUy. Allar appraisal oflhe che/aeler all(! appearance of this bu.;.,es! end .Is employees, I recommp.nd this nsk for acceptance
SlgnlltureafWritingRepresen~lative ';;''':', '.SQAQ:irsif9il1yjLi";'€.; '~i~~jg~'i.'.',
(an 9sl~se ~s Ma r, if prQSenl)~ <, ,.,.j i69~:iJ "~d~:r';ill.olfr.'l':''O", . ;,ft(;r.r' .:S: "~,,:,,.".."'~/"'!;'~ .' '; .r,'.:'
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EXHIBIT B
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'AA' A_ TO 8[ MPUTlO 8Y lMPlO'l'([ WIt(N RlQU[ltlNO INSURANCL UN SEll
I ~"M.I~ 0 h",,~ 1 0...'. O"t. ''''~~.'' ';-;'~TI---;j~'::-'~~'.':-:--_. .
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OUUf.CI<t CCJt<IlI'.'.... If O'U'''''lD !.OSI..1l
NO O(''''LS'~O OF A1'1A(J!;
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'ART' _ TO BE COMPLETED 8Y EMPLOYEE WUlN ftlO-UUTlNQ INSURANCl-ron D(P[~,!~~"
I Who ... vou'''' .bI. G.pe.o4I11nPlrl n,OI"W.... 1",...,...1. 0"'......... ...:)d.h,,,'.lIl "')."," 51."m.". I
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'ART _ TO 81 COMPLETED 8Y EMPLOYEE IN ALL lNSTANCES
t.... ........
, .,
I .......tJ, OK"" 1",1 to IN bat 01 "''1 ."',.......JQo't.oj bo:'~. I'" ~ "lit......." """ ."'...... I.. '1'Io! M)Q~ QVftI"~'1 ....
COIfIQlc.. .nd "'1' I u"""IIAl'lod It,.., .' .t,,, "".l''''''' ..",..., .,~ b' -," .. ..jl.....,. 'l "".11 t." ... .".. ,...... '11 ,t..,
CilQUC1 Poro(.V I Ilo('Nh'oItd.,. I"'l I It...,. .1"I."....j , "..<t '-"'~I""'''r1 H,..tz=', (,. .". I. ".! ~,..,,,., .... ........
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ACKNOWlEDGEMENT _I Pl,W,IUlJ .nrt '.pl ,"" IMPOR1ANI f\lOTlCfS nn Inc ...no,,,,, ,.dt' 01 "'W II'lVW
AUTHOAtZAnaH: For ,,,- R.I.... of M.dic.llnfo.m.,ion
To: Any lic.nltd phr'''14n; In"d.ul p1.".honer. ho...~.., rl,,,. ," I.....I.~.I..V _ """..nct c~p.", u... Mtlc:t".llnlOlm.ltOfI BIIOI.II.
Inc ; O' OlhtrO'O.nlUlIOn. i..tlollltOOfl 0' PlftOn
~
IMhof". yt;Iulo Oiv. Tt. "lIden1ltlln'IMIll"ComPlny 01 Amllk. .nv ol#l'u, .t><:tJllJ. 'Iou n'.~ ........bOu1 "'" Of my menl.l 0'
ptty.ca'....lIh PNd.nt,.1 n.nd. Ih,. dll. to I."" I~,I .t I q.."..tt 'OIltle 0' ""..lit> .n....."'. 11'0. .-'~ ..pptilll0 .n, dlll'nd(Ofl'
...m.d "' 110, .ppl".tOQll 4IIa
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;.
Prodentlal
Important Notice About Your
Application For Insurance
l mploy(-'o Clcneflts flI09,.I111
Before we can issue you a policy we must first underwrite your applicalion, This means thai we evaluate all the
information necessary 10 dOlormino if you qualify for Ihe insurance.
In addition 10 Ihe information on tho application. a medical examinalion may be required, We also ask you 10
authorize any doctor, hospilal or other organization or pOIson to give us any informallon which Ihey may have about
your mental or physical health,
We may ask for a report from a consumer agency, These ruports provide informatIon about a person's character.
residence, activities. general reputalion. personal characteristics and mode of living, The agency may get thIS
informal ion through inlerviews with friends, neighbors and associates. Any person on whom we ask for a report
has a righllo ask \0 be interviewed. You may also get a copy of the report from the consumer reporting agency
which compleled il. An agency may keep Ihe information il has aboul you and disclose itlo other persons, If you
would like further information, as 10 Ihe nature and scope of these reports, it will be provided upon request.
,
Any information which we obtain or have obtained about you Will be treated as conf"tenlial. However. we may give
this informalion. as necessary, 10: your doclor, if we find a serious health problem which you do nOI know about;
persons conducling mortality or morbidity studies; and affiliate companies for marketing, servicing, underwriting or
claim handling purposes. If you ask. we will describe olher circumslances when we may obtain or dIsclose or
may have oblained or disclosed informalion aboul you wilhout your prior authorization,
We may also make a brief report 10 the Medicallnformalion Bureau (MIB) which prOVIdes an information exchange
for its member insurance companies. When you apply for life or heallh Insurance or submit a claim for beneflls \0
any member company, the MIB will, on requesl. give that company the information In liS liIe. If you have any
questions aboul any reporl which MIB may have on you, you may contact MIB at Post Office Box 105. Essex
Slation, Boslon. MA 02112. (617) 426-3660.
.'
, If you have any questions concerning any of the personal information which we oblaln or report. lei us know, You
have the IIllhllO see Ihis information ond 10 correct. amend or delele on~' informotion which may be wrong. We will
tell you how to do Ihis if you ask us.
If we are unable 10 issue Ihe policy you requested, we willlell you and explain the masons,
Thank you for applying to us for insurance.
The Prudential Insurance Company of America
Small Group Administration Office
P.O. Box 2510
Jacksonville, FL 32231
---------.....--
EXHIBIT C
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ExlUBIT 0
Capital BlueCross
Agenl for Ponnsylvanla Blua Shield
I~ndenl LIe.n.... oIlhe
Blue CrOll .rId Blu. Shl.1d AllociatlOn
..
Harrisburg, PA 17177
(717) 541.7000
August 18, 1994
Mr. Carl A. Ammerman
8 North High Street, Box 54
Mlllerstown, PA 17062
Dea'r Mr. Ammerman:
We have received your application for enrollment In the Capital Blue Cross and
Pennsylvania Blue Shield nongroup programs. Unfortunately, we must Inform
you that your application has been rejected.
We have been Informed that your employer maintains group health coverage
\through another Insurer. We also understand that your employer's health Insurer)
has denied your application for group health care coverage based on an
assessment of your health. For your Information, the Pennsylvania Department
of Insurance has allowed this rac underwrltln . We
cannot offer you e men y 0 our nongroup programs as ong as your
employer continues to offer group health care coverage to Its employees.
For further Information concerning this Issue and the laws pertaining to the Issue
of medical underwriting, you may contact the Pennsylvania Insurance
Department. The address Is:
Commonwealth of Pennsylvania Insurance Department
Bureau of Consumer Affairs and Enforcement
Strawberry Square
Harrisburg, PA 17120
If our understanding as set forth above Is not correct, please let us know
Immediately In writing. A letter from your employer and another from your
employer's health Insurer would be beneficial to us In revieWing your appeal.
Thank you.
Sincerely,
...JCVl1bL~
(Mrs,) Janet Brosius
Supervisor
Account Administration
PH/smb-7/L555-ID7177
0.540
EXHIBIT G
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COMMONWEALTH OF PENNSYLVANIA
INSURANCE DEPARTMENT
STRAWBERRY SOUARE
HARRISBURG, PA 17120
Telephonl(71n '7BJ-2l26
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April 29, 19BB
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Emily Crandall
Vi6e President and Associate
Gerieral Counsel
The Guardian Life Insurance
Company of America
201 Park Avenue South
New York, NY .lOOOJ
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,
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Re: Guardian Life'insui:ance CompanY'of America
Docket No. RB7-S-J
Dear Ms. Crandall': "
I am mailing this date an Order and AdjUdication :
executed by Constance B. Foster, Insurance Commissio~er.
Very truly yours,
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/ 1/ (t1.CA.C Xl111Sc.l-1
Marcia Johnson, Docket Clerk
Administrative Hearings Office
,
cc: Steven.J. Neary
Presiding Officer
John J. Sheehy, Di~ector
Consumer Affai~s & Enforcement t
Thomas S. Buzby ,
Depu~y Insurance Commissioner
Nancy M. Baker
Of f ice loIanaget'
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BEFORE THE INSURANCE COMtUSSION
OF TilE 9
COmlONWEALTII OF PENNSYLVANIA
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IN RE:
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Pursuant to Sectl
the Insurance Company aw
1921, May l7, 1921, P.L. 6B2,
40 P.S. 5477 (b)
THE GUARDIAN LIFE INSURANCE
COMPANY OF AMERICA
" 20l Park Avenue South
I New York, NY 10003
r
Iphysical Impairment
Amendment GP-I-PIA
.
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Docket No. RB7-B-3
,
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ORDER AND ADJUDICATION
AND NO\i, this [)C,;tt day of O-fJ1.:2.;).
Constance B. Foster, Insurance Commissioner of the
, 19BB,
Commonwealth of Pennsylvania, makes the following Order and
Adjudication.
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HISTORY
'.
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Before the c~mmissioner is an appeal by Guardian Life
Insurance Company of America (Guardian) from the Insurance
Department of the Commonwealth of Pennsylvania's (Department)
July 27, 19B7 withdrawal of its approval of Guardian's "PhYSi!l
impairment amendment GP-PIA."
This matter has been presented to the Commissioner on a
stipulation of facts in lieu of an evidentiary hearin9~ Each of
DATE ~IAILED:
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the parties filed Briefs in accordance with an established
briefing schedule and this matter is now ready for adjudication.
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FINDINGS OF FACT
l. The Guardian Insurance Company of America issued an
individual waiver for group policy No. l50824 to Jimmy B's Pizza,
that excluded from coverage, the following condition: "Care or
~onfinement for, or charges for treatment of, injury to, or
.: disease
iI
or disorder of, the mandibular and maxillary joints."
.'
2. Exhibit A is a true and accurate copy of Guardian
Insurance Company of America's policy form GG-I-PIA.
,
"
3. Form GG-I-PIA was approved by the Pennsylvania
Insurance Department on January 30, 1968.
4. The Insurance Department withdrew its approval.of
Guardian Insurance Company of America's policy form GG-I-PIA on
July 27, 1987 for the reason that Guardian Insurance Company of
America issued an individual waiver for Group Policy No. 150 824
to Jimmy B's Pizza in violation of Section 626 of the Insurance
Law of 1921, P.L 682 (40 p.s. 5761).
5. Guardian Insurance Company contends Pennsylvania
Law does not prohibit it from writing individual waivers in
connection with Group Insurance plan Contracts where the
individual's coverage is subject to evidence of insurability.
.
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DISCUSSION
.
At issue is a physical impairment amendment to a group
accident and health insurance policy issued to Jimmy D's Pizza by
, .
policy, from coverage for "disease or disorder of the mandibular
,
1\
and maxillary joints." The Department initially appr~~ed
Guardian's physical impairment amendment form on January Jp, 1968
and subsequently withdrew that approval on July 7, 1987 arguing
first, that physical impairment amendments to group accident and
health policies are not authorized by statute, and second; that
Guardian's exclusion of Diane Andaloro from coverage for a
specified disorder is discriminatory in vi~lationof Section 626
of the Insurance Company Lawl.
Sections 354 and G16 of the Insurance Company Law
require prior approval of all policy forms. Article VI(b),
Sections Gl6 thru 630 'of t~e Insurance Company Law, governs
health and accident insurance. Group accident and sickness
insurance is specifically addressed in Section 621.2 of the
Insurance Company Law (40 P.S. 5756,2).
.
1
Insurance Company La~1 of 1921, I\ct of Hay 17, 1921, 40 P.S.
5761.
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The Department argues, and ~he Commissioner agrees, that
the Insurance Company Law does not authorize physical impairment
amendments to group accident and health policies which exclude
individuals insured under such policies from coverage for
disorders or disease specified by' the insurer.
Guardian contends, that although not specifically
authorized, the Legislature's intent to permit the type of
'.
amendment which has been disapproved here is implied in':
,
Sections 621,2(bl (ll and Section 622 of the Insurance compa~y
Law, and Department Regulations at 3l Pa. Code, Section 89.12.
Sections 62l,2(bl (ll and 622 of the Insurance Company
Law, relied upon by Guardian, read as follows:
(bl Each group accident and sickness policy shall
contain in substance the following provisionp:
(ll A provision that in the absence of fraud, all
statements made by any applicant or applicants or the
policyholder or by an insured person shall be deemed
representations and not warranties and that no
statement made for the purpose of effecting insurance
shall avoid such insurance or reduce benefits, unless
contained in a written instrument signed by the
policyholder or the insured person a copy of which
has been furnished to such policyholder or to such
person or his beneficiary.
* * *
The falsity of any statement in the application for
any policy.., shall not bar the right to recovery
thereunder, unless such false statement was made
with actual intent to deceive, or unless it
materially affected either the acceptance of the
risk or the hazard assumed by the insurer,
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Guardian argues that by barring recovery under group
accident and health policies to an applicant who has made a
knowingly faloe statement, the Legislature has expressed its
intent to permit an insurer to exclude individuals under such
pOlicies from coverage for specified diseases or disorders.
lihile the all-inclusive phrase "any statement" would include a
statement as to an applicant's prior medical history, it does not
i.
indicate an intent by the Legislature that such statemen~ can, or
..
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should be, a part of the application, or that individuals may be
excluded from opecified coverages as a result of the statement.
It is far more reasonable to conclude that if the
Legislature had intended to permit insurers to exclude
individuals from specified coverages, it would have said so in'a
straight forward manner rather than obliquely implying
authorization as argued by Guardian. The Legislature has clearly
indicated its intent to permit the exclusion of individuals from
group life policies:!, and could have done 00 with regard to group
accident and health had it chosen to do so, but clearly did not.
Instead, the Legislature authori:ed group accident and health
2
Section 2(2) of the Group Life Insurance Law, Act of ~ay 11,
1949, P.L. l2l0, 110. 367, 40 1',!l. :i532 ,2 (2) !,rovic1es, in part:
... A policy [group life policy issued to an employer or trustees
of employer funds] on which part of the premium is to be derived
from funds contr ibuted by the insured employeell ma~' be placed in
force only if at least 75% of the then eligible employees,
excludino any as to whom evidencp..Of individual insur~bilitv is
not 5atisfactory to the innur~r, elect to make the required
contributions. ,... (Emphasis added)
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insurers to utilize a pre-existing condition exclusion3.
Section 61(A) (2) (b) requires the following provision in
individual health and accident policies:
I.
No claim for loss incurred or disability (as
defined in the policy) commencing after three
years from the date of issue of this policy shall
be reduced or denied on the ground that a
condition or physical condition not excluded from
coveraqe bv name or scecified descriotion effective
on the date of loss had existed prior to the ,
effective date or coverage of this policy, "
"
,
On individual pOlicies, therefore, the Legislature has
authorized insurers to deny a claim within the first three years
of the policy, if the condition or disease existed prior to the
effective date of the policy, and at any time if the disease or
condition had been specifically excluded on the date of the 109s.
The authorized pre-existing condition exclusion for orouo
accident and health policies is much narrower in consideration of
the insurer's ability to "spread the risk" under group policies.
By permitting individual exclusions for group life and
individual accident and health policies, but restricting group
accident and health insurers to pre-existing condition
J
See 40 '.5. 5756,2(9) which prohibits a pre-existing
condition in a converted policy which is broader than that
contained in the group policy,
.
A pre-existing condition exclusion i~ rlefined as: "a disease
or physical condition for which medical advice or t=eat~ent has
been received within 90 days im~ediately prior to becoming
covered under the group contract, Such conditions shall be
covered after the individual has been covered for more than l2
months under the contract," 31 Pa. Code, Section 89,402.
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exclusions, the Legisl~ture h~s chosen different means of
protecting insurers from known risks in consideration of the
differing Coverages and riSks encountered in each line of
inaurance. Life comp~nies insure a9~inst the risk of the
pOlicyholder's death, and a pre-existing exclusion, such as ,that
authorized for accident and health inaurers, would have little
i practical application,
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i! individUal accident and health pOlicies would seriously,impair
the availability of such insurance.
Likewise, prohibiting exclusions for
On the other hand, the
",
pre-eXisting condition exclusion affords the accident and health
insurer substantial protection against known risks consistent
with the basic premise behind group underwriting without
permitting the insurer to exclude any individual insured under
the group policy from coverage for any disease or disorder for
any reason4,
Regulations at 31 Pa. Code, Chapter 89 contain general
guidelines for the review of individual and group life, accident
and health insurance, ~nd are equally unsupportive of Guardian's
position. Section 89.12, to which Guardian specifically cites,
is a general provision regulating applications for all policies
and forms and expliCitly authorizing the pre-existing condition
exclusion, not the individual exclusion, as the methodology for
protecting carriers against adverse risk.
4
This matter was submitted on a stipulation of facts and there
is no evidence as to why Guardian has excluded l~, Andaloro from.
coverage for "disease or disorder of the mandibular and maxillary
joints".
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As argued by the DepartrnLnt, "group underwriting
presupposes the insurers assumption of different degrees of risk
among the individuals who comprise the group, Group
underwriting is premised, in part, on the theory that the
adverse risks present in the group will be offset or minimized by
the inclusion of the remaining members of the group under the
policy.. " (Department's Brief, page 9). "Insurers who seek to
it
. derive from group policies the benefits which result fr6m
individual underwriting are afforded the opportunity to mi~~~ize
their assumption of otherwise potentially uninsurable conditions
through the use of the pre-existing condition exclusion."
(Department's Drief, page 8).
Guardian next contends that if insurers are not
permitted to employ physical impairment amendments for the
purpose of excluding individuals from coverage under small group
policies, "many would reduce or terminate the sale of insurance
to small employers" and "small employers ~Iho are now able to
provide affordable group coverage for their employees would be
left without any insurance alternatives in the marketplace."
(Guardian's Driefi pages 15, 16). This argument is refuted by
the fact that physical impairnent amendments, such as those
employed by Guardian, have been consistently dizapproved by the
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Department without any of the dire consequences predictedS.
Having found that the amendment utilized by Guardian is
'unauthorized, it is not necessary to address the Department's
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; remaining argument that it is also unfairly discriminatory.
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Guardian also argues that it has been rlenied Constitutional
guarantees of equal protection and due process of law by virtue
of the Department's disappro~al of its form and permitting other
insurers to use such amendment, Cuardian has not cited any other
insurer who has been permitted to use a physical impairment
amendment, and the Commissioner ~nows of none.
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t ~"', . -.., ,".. ,";.:_ ~~'.""~"'_"';';~_,~__.. , ~, ...:
il~"''''1' .I(:"~"j' """"';-~'''''J.-...~' ...':;....,.,.i4~tJ:s;,l,,'--.~;,!:>....I:.J<t.t'......'<<}',..~i. "
~.:.!\~:..f1."~\-,.~~.._.. .........' :..,1.,._.,\"...,,-....., _f_"~",,,. '.' ;..__.._._,._....,' . _ " ~_
'f' "~"",\,,,~,"":"J,~;,...!~.;.\:,;tH'''I'' , ':":',.':'... .\ .' , ,"",,'.. ",
. " ' .' 'It''' .
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. .
. ,
"
,
,!',.
CONCLUSIONS OF LAI'l
l. The Commissioner has jurisdiction over the parties
and the subject matter of this proceeding.
,:
"
2, The individual e~clusion of an insured under a
group aCCi8~t and health policy, from coverage for a specific
",
"
disorder is not authorized by the Insurance Company Law'~f' 1921~
May 17, 1921, P.L. 682.
.
'"
3. If'any of the foregoing Conclusions of Law should
be held to constitute Findings of Fact, the ones so found are
incorporated therein by reference.
:
.'
II
, ,
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..
-11-
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COMMONWEALTH OF PBNNSYLVANIA
INSURANCB DBPARTMBNT
INSURANCE COMPLAINT FORM
(Pl.... print or ryp.'
10 rcapo_IO your requClI (or auIIIance, WIl are aeocllDs IhIs losurance Compl.lnl Form, In order Ihlt I revlcw mlY be conducted,
pIeue complete this (onn and relurD lito the oweal reslooal office.
NNlEI
c/9~L. A, Al1hE~I1If,N
o. l{r($# $;-
11(~LeIl.S~CVN
DAYTIMB TELEPHONE ,
HOllE I r =1/1- l.t" - l' '91
(are. code)
WOIUtI ~1-111~3'" - .2110S-
(area code)
ADDIlESSI
INSURED NAKE I
(it oth.r th.n abpv.,
1. Typo o( losurance
(Pltase Cbeck Ooe)
AUTO 0 HOIlEOWNERS 0
.
LIFE 0 HEl\LTH~
COHHBRCIl\L 0
OTHER 0
(specify)
2, (A) IC your problem iDwlvcs 10 lnsurlOce company, give the run name or the company:
py.uJ-v-h~ 11... Go "*') 10. 0 JS 0
~It"lt~~ 01,'11<./ F L .):1:1. 31
(Bl With whom II thc company hive you dtall?
Nlme: _O(.,hrsC.. (rb,,'f-hlW<_11t41- J1"/~l) Pbone": fl;D 33 S'-- 6c/ft.j
3. lCyour problem involVCSln Igenl or brokcr, give hIs/ber rull OIlDC, Iddrcu and phooe":
Calm ,,:
4, Polley t1':
5, Dlle and localion or Icddeol or 10SI1
1;, Hive you previously reported Ibis problem 10 our office or any olhcr agency'l
Yel 0 No l7i't lCycs,towhom?
PLEASE CHECK THE TYPE OF PROBLEM THAT APPUES TO YOUR COMPWNT,
o Caneellllioo!Nooreoewll
o Cllims Handling
o Billing/Premium Dlspule ..
o Slles Mlsrcprcscnlltlon
~Olher(spccirY) j}.hiul. ffr-Of h~l(lfh ClJtJcr~~e
PS-4 (Rev.06/92) -continu.d on r.v.r.. dda-
OFFICE USE ONLY
CSRI
FILE II
SIGNATURE
DATE
My ~<'Y/"Y'-'; ts:..
J:l""e,.IC4" 1~."cJ, flv~J
~ ;u 5, ~jo!t'""'" ~-h
t;~;tulj :~~,~:':- tf
(;,II/'hu;f: (VI,., Va) 'v/orOhet
PLEASE SIGN AND DATE THE STA.TEMENT BELOW.
To the belt of my knowledge, the informalioD coDtained herein Is correa. ( am allaching copies of my poUcy, papers Illd OIher
correlpoDdeDce relative to this problem. J underslllld that a copy o( lhls (orm and allachmeDlS may be (orwarded to tbe insurance
complllY iovol\'ed,
HARRISBURG IUlICIOIIAL OFFICE
Room 1321 Strawberry Square
Harri8town State Office Bldq.
Harri8burq, PA 17120
(717) 787-2317
PI
Room 304 State Ottice Bldq,
300 Liberty Avenue
Pittsburqh, PA 15222
(412) 565-5020
PJD:Ll\DIl:LPIIU IUlICIOKAL OFFICB
Room 1701 State Otfice Bldq.
1400 Sprinq Garden Street
Philadelphia, PA 19130
(215) 560-2630
BlUE REGIOKAL OFFICE
Room 513 BaldWin Bldq.
Post Oft ice Box 6142
Erie, PA 16512
(814) 871-4466
.
.
EXHIBIT I-l
ltJ"
'l~/'~'
.., .
,
COMMONWEALTH OF PENNSYLVANIA
INSURANCE OEPARTMENT
STRAWBERRY SQUARE
HARRISBURG, PA 17120
October 14, 1994 TELEPHONE: 11111. 783-2164
Carl A. Ammerman
8 N. High street Box 54
Millerstown, PA l7062
RE: Department File No: 94-189-06863
Dear Mr. Ammerman:
We have just received a reply from William Stafford in reference
to your complaint.
Enclosed is a photocopy of that letter for your review which
explains the company's position.
Should the company not follow through, as agreed upon or issue
your coverage with an exclusion rider, please notify me.
Thank you for bringing this matter to the Department's attention.
We are glad to have been of assistance to you.
Sincerely yours,
~cp-~
Harold ,r. S~th, CLU
Consumer Services Representative
HRS:bjb
Enclosure
M8 B10-14-l
r:.
.
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William H. Stallard. CLU, FLMI
Underwriting Olflcer
Smell Business Services Division
The Prudentllllnsurlnce Campeny 01 AmericI
Smell Business Operltlons
p.o. Box 2510. Jlcksonville, FL 32231
(904) 391-3771
ThePrudenbal ~
September 28, 1994
, II'"'
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.,-. ,.
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"
Insuredl Carl A. Ammerman
Plan 'I E57l2200
Your ID,: 94-189-06863
~\...;....
Harold R. Smith, CLU
Consumer Services Representative
Commonwealth of Pennsylvania
Insurance Department
Strawherry Squar.e
Harrisburg, PA l7l20
Dear Mr. Smith
~ECE'VEb
Offl".. ,,-...... POI'~y I,....'.',. 'r,'
w v. r~ &;;'!.v "" '~""~\"'"
OOT 04 1994
PSi1nS'IJ\.'c''!r''!:,.,
In:;ur;:;nce Depanm.j:11
Thank you for your letter dated September 16 concerning Mr. Ammerman's
application for coverage under our Employee Benefits Program (EBP).
I appreciate the opportunity your letter has given me to review this
file in detail.
Mr. Ammerman originally applied for coverage as an on-time employee
addition to plan number E57l2200 on September l2, 1989. At that
time, all applications for EBP were subject to medical underwriting,
and coverage was not guaranteed. Mr, Ammerman's application for
coverage was declined due to his history of a heart murmur. This
decision was made in accordance with our usual underwriting
guidelines for heart murmurs. We subsequently learned that the
Guardian Decision prohibits medical underwriting for on-time
addi Hans.
On July 19, 1991 Mr. Ammerman reapplied for coverage. This
application for coverage was also declined as we incorrectly
treated Mr. Ammerman was a late-entrant.
It would appear that we did decline Mr. Ammerman's application in
error. We will be glad to add Mr. Ammerman onto the policy,
subject to receipt of a new, fully completed application form.
I have enclosed a copy of the application for Mr. Ammerman's
use. The application should be sent to Ritchie Wilson, Small
Business. Services Division, P.O. Box 2510, Jacksonville, FI.
32231-0034.' ,. ....,....
. ' -. ~
I sincerely apologize for any inconvenience that our error may'
have caused. If you have any further questions or concerns,
please do not hesitate to contact us.
d(.
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SHERIFF'S RETURN - REGULAR
CASE NOI 199~-04410 P
COMMONWEALTH OF PENNSYLVANIA:
COUNTY OF CUMBERLAND
AMMERMAN CARL ET AL
VS,
PRUDENTIAL INSURANCE CO THE ET
STEVE WHISTLER , Sheriff or Deputy Sheriff of
CUMBERLAND County, Pennsylvania, who being duly sworn according
to law, says, that he served the within COMPLAINT
upon PRUDENTIAL INS. CO. OF AMERICA THE
defendant, at 1216:00 HOURS, on the ~ day of Auaust
the
1995 at 4660 TRINDLE
CAMP HILL. PA 17011
County, Pennsylvania, by
ROAD
. CUMBERLAND
handing to GAINELLE WAGNER. RECEPTIONIST
AND ADULT IN CHARGE
a true and attested copy of the COMPLAINT
and at the same time directing Her attention to the contents thereof.
Sheriff's Costs:
Docketing
Service
Affidavit
Surcharge
18.00
6.72
.00
2,00
So answers 1,:::7 ~
H'~~:: en~~
$Z6.7~ ANGINO AND ROVNER
I' U'V 08/22/1995
) ') -t. .7:J,
by ~ W~
lJepu y~er1~~
Sworn and subscribed to before me
this 'b!!:: day of a,~
19 q'; A.D.
<.1. ,J. . (). n,,'''{I,~ ..lAc'-'.
7-, ~onotaryt
. - ... ~
SEP 8 /995
J.:,,,
CARL AMMERMAN and WENDY AMMERMAN
Husband and Wife, and all others
similarly situated,
Plaintiffs
vs.
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
qS-
No. ~-4410 CIVIL TERM
CLASS ACTION LAWSUIT
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA, and THE PRUDENTIAL
PROPERTY AND CASUALTY INS. CO.,
Defendants
JURY TRIAL DEMANDED
ORDER
AND NOW, this ~ ~day of September, 1995, the time in
which defendants The prudential Insurance Company of America and
the Prudential Property and Casualty Insurance Company may respond
to the complaint in this matter is extended to and including
Monday, October 2, 1995,
,// /
B~Z(J
Bayley, J,
/
I',:
SEP B II 39 AH '95
"~"~" c' Hie:
Of 1 "i . 0;:' HOH~TAr.Y
CllM [!"~,I n cr".!~nY
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CARL AMMERMAN and WENDY AMMERMAN
Husband and Wife, and all others
similarly situated,
Plaintiffs
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
tiS' -
No, ~-4410 CIVIL TERM
vs.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA, and THE PRUDENTIAL
PROPERTY AND CASUALTY INS. CO.,
Defendants
CLASS ACTION LAWSUIT
JURY TRIAL DEMANDED
MOTION FOR BXTENSION OF TIME
Defendants, The Prudential Insurance Company of America
and The prudential Property and Casualty Ins. Co., by thei~
counsel, Reed Smith Shaw & McClay, move for an extension of time
to October 2, 1995 to answer or otherwise plead to the complaint
in this matter and in support thereof set forth as follows:
1, The complaint in this class action lawsuit was
filed on or about August 17, 1995.
2. Service of the complaint was made on or about
August 21, 1995, making a response in the form of an answer or
preliminary objections due on or before September 11, 1995,
3. The allegations of this matter involve events
commencing in 1989 or earlier and, since the complaint contains
class action allegations, involve issues extending beyond the
named individual plaintiffs.
..
, .
4. The complaint also raises issues which may have a
relationship to the complex areas of state regulation of insurance
and federal regulation of employee benefit programs.
5. Counsel for the defendants requested an extension
of time to answer or otherwise respond to the complaint from
counsel for the plaintiff. plaintiffs' counsel advised defense
counsel that no extension of the time for filing preliminary
objections would be granted and that only a two week extension in
which to answer the complaint would be granted. A true and
correct copy of the letter from counsel to the plaintiff to
counsel for the defendant stating plaintiffs' counsel's position
on this matter is attached hereto as Exhibit "A".
6, Defendants need a modest amount of additional time
to complete the evaluation of this matter and determine whether
preliminary objections should be filed. In addition, because of
the investigation needed to file an answer to the complaint, an
extension of time for two weeks is insufficient.
7. An extension of 20 days to answer or otherwise
plead would expire on Sunday, October 1, 1995. Accordingly,
defendants seek an extension of time to answer or otherwise
respond to the complaint to and including Monday, October 2, 1995.
8. On Thursday, September 7, 1995, the undersigned
counsel for the defendants attempted to contact counsel for the
plaintiff with regard to the presentation of this motion and was
advised that counsel for the plaintiff was away from her office
and would not return until Monday, September 11, 1995.
-2-
Exhibit A
....Ult'I.......-...l" 'U,....... .t<"
"'1\~....-.....__ ".....-"'1, "
11 W. . \,. - .. :-. ~ 1~.
JOSBrll M. MJ!I,IU.O
T\lUY S, HYMAN
O"'VID L LUTZ
MICIWlL II. KOSIK
PAMI!IA O. slIUMAN
C...11lJ!aINIl M. MAllADY.SMml
RICIIAlD .... SAIlLllCtt
D...VID S. WlSmlSJU
ANGINa & ROVNER, P. C.
NUOU! C. OLSON
MICHAEL I. N"'VrTSKY
ROBINJ.M~.""".
LAW1lI!NCIl P. BARONI!
O...WN L JENNINOS
S11!PIIEN It PI!IlI!lISEN
SOLOMON Z-IUUlVSKY
IOSBrll M. 0llRIA
usret> IN
1lIE BFSI' LAWYERS
-tN-
AMERICA
RlO\ARll C. ANOINO
NEIL I. ROVNl!lt
september 1, 1995
John McN. Cramer, Esquire
Reed Smith Shaw & McClay
213 Market street
P. O. Box 11844
Harrisburg, PA 17108
Re: Ammerman v. prudential
No. 9S-4410 CCP cumberland
Dear Mr. Cramer:
This is to confirm our telephone conversation of August 31,
1995. You requested an extension to respond to the Complaint. I
informed you that we are agreeable to a two week extension to file
an Answer. If, however, it is your intention to file preliminary
Objections, we cannot grant an extension and they must be filed
within the time prescribed by our Rules of Court.
Thank you for your cooperation in this matter.
Very truly yours,
p~Jj.~
Pamela G. Shuman
PGS/bjs
75589/BJS
4503 NORTH FRONT STREET, H...RRISBURG, P'" t7110.17aB
, (7t7) 23B0e7Vt
FAX (717) 238.S81a
. '
cBRTIFICATB OF SBRVIcB
I hereby certify that a true and correct copy of the
foregoing Motion for Extension of Time has been served this 8th
day of September, 1995, by United States Mail, first-class,
postage pre-paid, upon:
Pamela G. Shuman, Esquire
Angino & Rovner, P.C,
4503 North Front Street
Harrisburg, A 17110-1708
-4-
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~~ BY:R, S. S,~. 12151851-H20; 8-:\0-95 ; 10:30~~ ;
R,S,S,:tI.~
717 Z36 3717;#40/52
,
, '.
GUardian argua. that by barring recovery under group
.ccid.nt and he.lth polici.. to .n applicant who haa ~ade a
knowingly f.la. atlte.ent, tha ~egisl.tur. ha. .~pr...ad it.
iat.nt to perait an in.urer to .xcluda indivi~uala under aUch
'Policie. from' COY.r.ge far .pecifi.d disea.es or diaordeia.
Wbile tb~ Ill-incluliv. phraa. -any atat...nt- WOUld inolud. I
atat'.ent II to an Ipplicant's prior medical hiatory, it doea not
Ii
indicate .n intant by th. L.gialature that Such etateaen~c~n, or
should b., a part of the application, or that individU.ls'may be
excludad from opecified coveragea .e a result of the state.ent.
,~.
It ie far ~or. re.sonabl. to conclude th.t if tha
LegiSlatur. had int.nded to permit inaurera to eXClude .
individuale trom .pecifi.d Coverag.., it Would bave ~aid ao in'.
.traight forward manner rather than Obliquely implYing
autbori.ation aa argUed by Guardian. ~be Legislaturi ha. clearly
indicated it. intent to p.rmit ~~. excluaion Of individual. from
group lit. POlioi.a2, and COuld have done eo with r.gard to group
accident and he.ltb had lt choe.n to do so, but clearly did not.
Inatead, the Legi.lature authori:.d 9roup'lccid.nt and healtb
~
.'
Section 2(21 ot the Group tite tn.urance 'Law, Act of May 11,
1141, P.x.. 1210, 110. 3&7, .,aD P.s. ~532.2(21 provide., in part: .
". A POlioy (group 11te poliey issued to In employer or truate.a
of e.ployer funda' on whiCh pact of tb. premiu. i. to b. d.rived
fro. fund. contributed by the inaUrad leployeee may be placed in
fore. only it It leaet 75' ot the then eligibl. employe.a,
c 'a 0 w aa evidence.ot individual inRurabilitv is
not 3at actor to t e naure, e!ect to make the required
COntri Ut an.. .... pha.. a dedI
-6-
0lY30 '$ 10:Z7
SINT BY:R.S,S.~. 12151851-H20; 6-30-95 :IO:30'\'~ ;
,
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717 236 3777;~~1/52
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in.une. to utlllz. a pre-existing condition 8llcluaion3'.
...,. ....
..
..
Section 61(11 (21(bl r.quir.s the following provilion In
. .
indlvidu.1 h..lth .nd accid.nt pOlicie.1
'.
I.
No cl.i. for lO..incurr.a or di..bi1ity (al
deCin.d In the policy) co...ncing aft.e the..
y..r. fro. the d.t. of iaau. of this policy .ha11
b. reduced or d.ni.d on the ground tbat a
condition or physic.l condition d
cove. b n..e or I ecified de.cr ut on .
on t . d.te of oaa . ex .te pr or to th.
effectlv. d.te of coverage of thia pOlicy.
"
.'
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"
On individual policie., th.refore, the Legislature has
authorized insurer. to deny a c1.im within the first three ye.e.
of the policy, if the condition or di.eas~ existed prior to tbe
effective date of tbe policy, and at any ti.. if the 121..... or !
,
condition had been .peoifically exclud.d on tb. d.te.of the 10...
. ,
Th. authorized pre-eXisting condition esclu.ion fO~ Grouo
.ccid.nt and he.1th.po1icie. ia .~cb n.rrower in conaid.ration of
th. Insurer's ability to -.pread the riak- und.r group polici...
By permitting individU.l excluaion. Cor group 1if. and
indlvldua1 accid.nt and health policle., b~t re.trlcting group
accld.nt ana h..lth in.ur.r. to pr.-exilting condition
:1
... 40 P.!. 5756.2(9) which prohibit. . pra-exiating
condition in . conv.rted policy wbich i. broader th.n that
contain.d in the group pOlicy.
.
A pre-.sl.ting condition exclu.ion 1~ defihed ~.I Ws di.....
or phy.ical condition for which Dedic.! advlc. or tr..t~ent bas
b..n r.c.iv.d within 90 day. i=cediat.ly peior to b.coming
cov.r.d 'und.r the group contr.ct. Suoh o~ndition. aball b.
cov.red aft.rth. Individual h.a b..n covered for IlIOre th.n 12
aontba und.r th~ contract.- 31 P.. Code, Section 89.402.
.
-7-
0lV30 '95 10:27
12151851-1t20: 8-30-B5 :10:31A~ :
R,S.S.M.~
717 a36 37771'42/52
.
.
....'..
.:,;".40
..... .
,
'..
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exclulions, the Legi.lature has chosen different meane of
prot.cting insur.r. from known risk. in consideration of the
.
,diff.ring cov.rag.s and rists encountered in each line of
insurance. Life compani.s insure against the ri.k of the
"
. pOlicyhOlder's d.atb, and a pr.-exiating eXClUSion, such as .th.t
,
I.
authori..d for accid.nt and health insurers, would have 1ittl.
1;~.ct~C.l applic.tion. 'LikeWise, prohibiting exclusion. foe
jlindividual accident and health policies would a.riously~~.p~ir
the availability of .uch in.urance. On the other hand, tb~'
"
pre-exi.ting condition excluaion afford. the eccident and health
insurer substantial protection again.t known ri.ks con.istent
with the basic premia. b.hind group underwriting without
. .
.
permitting the insurer to exclude any individual inaur.d und.r .
,
.
the group policy from cov.rag. for any di..... or di.order for
any r.a.on4.
RegUlations at 31 Pa. COde, Chapt.r 89 cont.in gen.ral
guid.line. for the review of individual and group lif., accident
and health inaurance, and are equally unsupportive of Guardian'.
.
POlition. Section 89.l2, t~ which Guardi~n specifically cit.l,
iw'a g.Der.l prov~.ion cQ9ulating application. foc all policiel
and fo~. and explicitly authorizing tho pre-exiating condi~ion
.sclulion, not the individu~l exclu.ion, .s the metbodo1ogy for
prot.cting carriera againlt ~dv.rs. risk.
.
4
"
!bia matt.r was submitted on a stipulation of facts and there
ia no evidence a.' to why Guardian bas excluded Ua. "ndaloro from.
Cov.rage foc -diaeas. oc disorder of th. mandibu~Ar and .axillary
jOint.-.
,
-8-
oa.-3O '95 10:27
.SENT BY:R.S:S.!II. 12151851-1420: 8-~0-85 :to:31~ ;
F' ..,
R,S,S.!II.~
717 236 3777;'43/52
. . -,. .... 'r '~'./";
.' .'
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;'.11', _ lI!
, .'
"
AI .rgue~ by the Oep.rtDant, .group underwriting
'..
pee.uppo.a. the in.ueer. ...u.ption of di~rerent degree.
aao~9 the individuals who comprl.e the group. Group
: underwriting i. pre.i..d, in p.rt, on the .theory that tbe
0'
.: .dveree ri.k. pre.ent in the group will be off.et or mini.l.ed by
I ,
. the inolu.ion of the rlasining .embar. of tbe group under the
!: pOllcy... IDepartaent'. 'Brlef, p.ge 9). "Xn.urers who .1IIk to
!lderive froD group policies the benerits' which re.ult fr~
of ri.k
.
individual underwriting are afforded the opportunity to min~ize
their ..aumptlon of otherwise potentially unin.urable conditions
through the u.. of the pre-existing condition exclusion."
IDepartmont's Brier, page 81.
Guerdian next contend. that if insurera are not
permitted to employ phy.ica1 lap.iement ...nd.ents for the
purpose of excluding individu.ls froD cover.g. under ....11
.,
:
.
,
geoup
.
po1ioie., "aeny would reduce or termin.te the .a1e of iftsuranoe
to ...11 employaes" and "..all e.p1oyer. who ace now ahle to
provide arfordable gro~p coverage for their e.ploy... would be
. "
left without .ny 1a.ar.nco Alternative. in the aarketplaoe..
IGuardian'o Brief; page. ~5, l&). Thi. .rgu.ent 1. refuted by
the f.ct th.t pbYlioa1,i.pairaent a.endmant.. .uch a. tbo..
eap1oye~ by Guardien. bavR b.en con.l.tently d1oDpproved by the
.
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COtlcLUsrONS OP Utf
!:
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1.
Tbe cOaQi5sione~ ha. ju~isdiction over the partie.
.
and the s~bject NAtter of thia proceeding,
Ii
.' 2...' The indi~idual exclusion of an inaured unde~ a
' g~oup 'acciSent and health pOlley, f~om cove~age for a s,~eclf1c
f di.o~der b notauthorlzed by the Insu~.nce Company L;1l;bf'lJ21~
ii '" "
' ~
Nay 17. 1921, P.L. 682.
3. I~'any ot the fo~egoing COnclusions of Law should
be held to constitute Findings of Fact, the ones so found, a~e
lnco~pcrated the~.ln by ~.terenc..
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INSURANCE COMPLAINT FORM
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18. .
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l'l....,...__kUldlo_.......... . ," . ,
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l.~ IWIC.
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(ana ._1
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(ar.. codel
(U Deller .CJwa ~,
1. ~puli_ ~D' "'.. . .0 ,,*III-ftYIU.D
(PlCMc CUdc OM) .... .
Wft D IIQLZII)tJ 0TIIIIl D
(tpCifJ)
2. (A) U,., JIf l' 'J ....... -....... _....,. II- dIo fltI_aI,dIa_JIMr.
~~ :Mo.re.-_ ~ -!.,A...fIIhIsA..1J t:,." ~ t9.J1t.. }O. a.1t .2.f'lo
~~"".dIo . .....,...., ":1.ac. ....ol..UC,- L: J>>.a,
"- ~nc.. (~II'r~.1It- ~r JlI..') ......-: ~ 3.3 &'- 60f~
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D~........ .
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o SaIDI~r' _~ ..~z-
r&L 0Ikr (&prell,)
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J$4(Rftll61'2)
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~plaaO..ua.""~IILo...laMall. An...-' .",_::..... . _.___"__ . '.;
J ,., t!~..h J.. L.., A~~#O Al:;~ ~''L+)" '<7;Joo':;~:1
;/ ol~''l-rf7L ~&j ~.o:J: i7t;:;~; ;Lt-r-
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", .4S1l SIGN AND lMnr J7l1l.sJ'AnuarNJ' -BLOW.
T....baul.,.... ~ ....L.
co... . nlI&hw 10 IWa pi "I
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Phila.alpbi., fA l'l~a
(3151 110-31:10
II! UlI~o.nc:a
li:l Vi" 11d9.
fo.t Ottic. loX '141
kia,'A 11512
(1141 171-""
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aoo LJ.ba~r Avonu.
'let'~b, 'A 15312
(4131 1"-1030
~30 '95 10:27
s.~ BY:R,S.S.ll, 12151851-H20: 6-30-55 ;IO:29All ;
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717 ~36 37771'35/52
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. 'fBJ: 'aUAllDIAN Lln INSURANCE
COMPAIfY 01' AKlmICA
r: 201 I'aek Av.nue' South
~: If." Yoek, Rr 10003
I! I'hyl1ca1 IlIIpairlllent
. A1aenuent G'-I-PIA
I
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I
I
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.ueeuant to Seat
the Inaueance eo.pany "
1921, Kay 17, 1921, '.L. '12,
.0 I'.s. 54771bl
::...
.J".
BEFORBTHB INSURANCB COHHISSIO
.. or 'l'RB
COMMONWBALTS or PENNSYLVANIA
~~..
.
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"
Docket No. R87-B-3
'.
.:
"
ORDER AND ADJUDICA'1'ION
AltD NOW, tbia ~/" day of O-fJ/fi./
COnetacc~ B. poater, In.ueance CoIIImi..ionee of tbe
CO.-onwealtb of Penn.y1vania, Dake. tbe fGlloving'Oedee
, 1988,
Ac1~udication.
.
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and '
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HISTORY
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Befo~e tbe ~l..loDer i. an appeal by Gu.edlan Ll~.
. In.ueance Cospany ot Alaeeic. (auaedlan), froD tbe ID.ueance
..
." ..
Depaetllent of tire COIlllOD".altb of Penn.y1vanla'. (DeputlUntl.'
July 27, 1987 "lthde."al of ita approval of Guardlan'a .~bY.l"l
.
lapal~..nt'..end..nt GI'-PIA~.
..
Tbi. '..ttee bae'b.en peeeented to.tb. Coa.i..ionec on a
.tlpula~lon of fact. 1n lieu of an eviaentiacy haaeing.. Bacb of'
...
DATa MAXLBDI.
~~
0lV30 '96 10:27
SENT BY:R.S,S.~. 12.1151851-1420: 6-30-95 :10:29A.'4
t:~... -:.~:"~....,:",'.....
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717 236 3777:;36/52
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th. partie. tiled Brief. in accordance with an e.tablilhad
brilfing lobadull and thil .att.r 11 naw r.ady tar adjudication.
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12151851-1~.20; 8-30-95 ;10;30~V
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;.,
717 236 3777:'38/52
R.S,S,!d.1
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" .
DISCUSstOt,
At issu. is a physieal i~pair.ent amendaent to a ,rouR
... accid.nt and h..lth insuranc. pOlicy is.u.d to Jimmy B's Pizza by
I.
If . .
. 'th. Guardian Life In.uranoe Compony of Amerio. (Guardian) whicb
.'
1...Olud.. Dian. And.10ro, an in.ur.d ..ploy.. und.r the group
, ,
.: pOlicy, fro. COv.r.g. for .di..... or di.order of the mandibular
.
~! and ~xillary jolnts.~ The Department initially appr~.d
Guardian's phyoical impairment amendmeDt form On January !p, 1968
. .
.nd sUbs.quently withdrew that approval on July 7, 1987 argUing
first, that physical impairment amendments to group accident and
be.lth poliei.. are not authorized by .tatut., ~nd aecondl.tbat
..
Guardlan's '.cluaion of Diane Andaloro from Coverage for a .'
,
speclfled disorder le di.criminatory ln vl~lation'of Seotion 626
of the In.urano. eompany Law1,
Seotions 354 and G16 of the Insuraaoe Company Law
require prior approval of all policy for... Artiole VI(b),
Seotions 616 tbru G3D'pf t~. InGuranee eompany taw, govern.
bealtb and accident In.urance. Group .ccid.nt and .ickne.a
In.u~ano. la .~tfioaliy addr....a In S.etion 621.2 of the
In.urane. Co.,any Law (40 P.S. ~75G.2).
,
1
Insurl:lnoe c:olllpany L",,. of 1921, Act of "'ay 17, l!l21, 4D P.S.
57&1.
-4-
0lV30 '95 10:27
.
.
.
'SENT BY:R.S.S,!4. 1215IM.1-H20: ~-~O'95 ;10:30~'4 ;
:. \ . I;.... . . .
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717 :36 3777:.38/52
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Thl Depertment argues, and the Com.i..ioner 4gree., that
~tb.. ~.urance Company taw does not authorize physical imp.ir..nt
,
a..n,dIDent. to group accident and he.lth poUchs which exclude
!ndividu.l., in'ured under .uch POlicI.. from coverage for
d~.ord.r. or di..... .pecified by tbe inaur.r.
Gu.rdi.n contend., tbat although not .pecifically
.utborized, the Legislature'. intent to permit the type of
.., to
aIDlIndllent whicb ba. been d1eapproved hen ia impUed in-':'" .
Section. 621.2(b) (1) ~nd Section 622 of the Insuranc. co;po)y
taw, and Depart..nt Ragulation. at 31 Pa. Coda, Section 89.12.
SlIctions 621.2(b) (1) and 622 of the In~uranca Company
Law, relied upon by Guardi.n, read a. follows a
.
,
.
(b) Each group accident and lickne.. policy .hal1
contain in 'abstlnce the following prOVision,.
(1) A provilion th.t in the .bsenc. of fr,ud, all
.tatenents ..de by .ny .pplicant oc applicant. or the
poUcyho14.c oc by .n lnluced penon IhlU b. deellld
rapre.eDtations and not warranties and that no
.tate..nt mad. for the purpo.e of .ffectirig 1nsurance
.b.ll .vold '~cb insuranc. oc reduce benefita, unle..
conta1D1d in a wri~ten in.tcu..nt .iined by the
pol1cyho14er or the In,uced pereon a copy of wbich
has b.en furni.hed.to .acb policyho14er oc to .uch
per.on or bil beneficiary. ,
. . .
~e falsity of any atate.ant in the applio.tion tor
any pa1icy... .h.ll not b.r the right to r.covery
thereundec, unle.a lucb f.l.. .tatan.nt v.s m.de
vith actual intent to deClive, or uoles. it
materially affectad eitber the acceptance of the
risk or the ha.ard a.au.ed by the insurer.
.
-5-
0lv.30 '95 10:27
, ..
,
....-
.
SOO BY:R,S,S.lI. t211118S1-U20: 6-~O-BlI :IO:28Al1 ;
".
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717 236 3777:'31/112
,
.
.
EllIDB1"r F
~ '95 10:2'7
-,
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R.S,S,:.t,~
717 ,236 3777:~32/32
-'
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Capital BlueCross
, "
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, ~...
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.
,
H........ 'A 171n
(71716WIGIlO'
August 18,1994
Mr. Carl A. Ammerman
8 North High StrHt, Box 54
MI,"town, PA 17062
.
Dear Mr. Ammennan:
w. have receJvec:l your appllcatlon for enrollment In the Capital BIuIilI Cross and
PennsylvanIa Blue ShIeIcl nonQlOUp programs, Unfortunatelv, we must Infonn
you that yo.... appllcatlon has been rejeCted,
w. have been Informed that your employer maintaiN group heaIIh coverage
through another I~. W. alia undellta lei that your employer's health 1nIurer)
hCIs denied yaw CIIXlIcaIIon for group heaIIh care coverage baled on an
. 8 I..-nt of your hilaIth. For your Intonnatlon, the Pen~~,.ent
~~=.~~~::..;-;~~
ernplotw conlin,*, to offer ~h:dih~ coverage to III employHs.
For fu1her .. cf...nnatlon conc:emlng this Isaue and 'the Jaws pertQlnlng to the IIIUe
of nwdIoaI ~t you may contact the Per....anIQ InlIUI'QllClt
o.p...l...ent. 1he adclUIlI:
COmmorw......II. of Pennsvlvanla INl.I'an(;e Deportment
BuMau of Conamer AtfafII and Enforcement
l.~~7'20
If 0.... Ul"*_I",,..AIg' as ... forth above Is not conct, ~ let us know
II'nrnedIatIIIv ~~, A.... from ~ ~.... ~ CX)OII... fcom yaw
empIoy.t1 heaIIh InUwwoulc:l ~ beneftclaI to ualn ~ your appeaL
1hank you.
SlncereIV,
~~
..
(MrI.) Janet BIOIIus
SUper'1Ior
...
Account AclnWWtraIIon
PH/1mb-71Ul155-lD71n'
Q.IolO
oa.-30 '95 10:27
'$00 8Y:R.S,S.~. t21S11151-H20; t1-~O-95 ;\O:2llAM ;
R.S.S,ll.~
717 236 3777:'33/52
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08/30 '95 10:27
SOO BY:R,S.S.lI. 12151831-1420; 8-:\0-93 :10:29A.~ ; R,S.~JL:.
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/' *" ..; :'1 !'~'. c'OMMO~ OF PENNSYLII'HIA
,..' ... 'r.'. .:~,,' INSUAANca DIPAftTIIENT
... . "'~ .. .. .nnJ ra.,1IIlftT .....
'.. ,I: I 1l.-......MI7111l
.',- -~" ';783-212&
.
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..
AprU 2', 1988
, .
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:
.Uy Cundall
V16.,P~..ld.nt and AaaoaLate
CeD.~al Coun.al ,
~ha GuardlaD'Llra In.uranaa
Coapany of ~rtea
201 Park Avanua South
'. .
Na" Yo~k, Nl' .10003 ' ..
.
-
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'17'2363777;'34/52
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ReI Guardian Lifa~naQkanc.'Company'of Amariea
Dockat Ho. ~B7-8-3 ,
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Dear Ha. Cr&nda11~
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x .. ..11iD9 tbi. data an Ordar'and Ad'udicatlon
a.ecuted by Coaatanea a. ~ostarr In.urance eo..l..10~ar.
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Vary t~u1y your.,
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Karcia John.on, DOCket Cla~k
Ad.iniatrative Saaring. O~fica
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~~~~~~~'.'~:~' I
!'boaaa 8. BIi.by '.
.Dap~y %aaurance,eo..i..lonar
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~f Uo.' Hanaval'
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717 236 3m:'27/152
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.!EXr BY:R.S.S,:.!. 12151851-\l20: tl-30-SS ;\0:28.\.'tI
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tHSURAHCE'PREHIt~s PAID
, '
AIlaun~ Paid
COllOany N.....
Cov.raKe Dat..
HaUollvl.do
(Wendy , Stevon)
10/26/89-11/1/90
leE tho lon-Rowland
(Cu\)
1/90 - 3/91
leEtholon-80wl&Dd 11/90 - 12/31/91
(CaEl, WaDdy' Steven)
S~a~e Fanl
(Wanlly , Stewn)
2/5/92-10/9/92
Bertholon-aoulan4
(Cad)
3/92 - 10/94
Colden aulo
(Wendy. Steven,
, Danny)
10/92 - 11/94
Al\edoen bE EDd,
(Dieability , Roap.
far Carl)
19111-1994
1990
~rieall Bu BD4.
(Carl) HajoE Hedice1
(Carl) Diftebl1lty Xna. 1990
(Cul) Hoapltaliaatlon 1990
(Carl, Wendy 'Steven Early 1992
Hoapltalbat1on)
GIWiD TOTAL OF INSUIWICB P1IDIIIlMS PAIDa
R.S.S.:.!.-
.
,
$467.73 (3 lID.)
157,15
155,90 X 8
$103,00 X 2
31.61
$469,10
947.64 X "
$325,80
108.96 X 7
$154,50 X 6
$351,28
231.113
231.83
281.12
211.12
268.24
2611,24
.268.24
253,57
$ 39.80
3'.1\0
. 56.57
106.25
56.50
10'.25
56.50
1011.25 X 3
56.50 X 3
$ 18.79 X 4
$ 50,00 X 2
$ 44.10 X 3
$ 169'.70
7\7 ~36 3717:=28/52
TYPo Pa~n1:
Initial
Monthly
Monthly Pylata,
Sam AnDual
lniUal
Qua~ca:ly
Initial
Monthly
Soal AIlnual
Initial
Quartorly
..
..
..
..
..
..
..
Sa.1 Annual
Of
Quart/Sa.l AnDI.
Quarterly
QUUl/ Saal ADDl,
Quarterly
Quart/S..s. ADDl.
QuaEurly
Qual:1:ar1y
Se.l ADDual
Quutorly
08/30 '95 10:27
!otal .
-
$ 467.73
157,15
1,2117.20
,: 1,1:12':01
$ 206,00
31,61
$ 237,61
. 4611.10
3.7110.56
$ 4,259.66
$ 325,80
761,72
$ 1,0811.52
$ 927.00
$ 351,28
231.113
2:51.113
281.12
2111.12
268.24
268,24
261,24
253,57
$ 2.435.47
.
39.110
39,110
56.57
106.25
56.50
10'.15
56.50
327.75
16lJ.50
961.9Z
,
.
75,15
, 100.00
. 132.30
S 169,70
~12,15',42
~
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-SENT 8Y:R,S.S.~. 12181851-1420; 6-~0-95 ;10:28AM ;
.
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,
.
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717 236 3777;'28/82
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Thant YOC tor Yo~r re~e.t tor COv.ra,. und.r '''lId.D~~l's ~Ploy.. "n.t~c.
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lie .re P1....4 clI&c lie can ofter YOU c:overalle Utllou," U VU: be nw:....r' to
~nclua' I tqpor.arr .IlUI prelU.lIal on ,01U' 'POU.t. lIend,", ""ltll Cl:IYer"e 411.
to lIer II1ltory of .. bact 4U..onler. carl II.. lIe.n dKlill1lll e,.. co IIJ.. nlltol'll
0' .. lIelU .araur, kJ.4rl., .tOlle. AIId e1evaud 1Il0Od. ElCUI prn:.uao. .are au,
'PP11ea co COYer lnc:r'..8d rl.t. 0' 'IItllre Cll1al. The teapor.ary .lltr.
prell1l1a trill lie .PPUIIS tor five YHrl &lid 11111 a\lt~UlcaJ.1Y be r.1IOV1l4 .t
tll.l& el...
Pl.... ,Ill "'11I'I4 tll&& .. Allie .... .\It,., tttort to iI.lI. cover.,e on &ftl un
flyorable bUl. PO,.Ull..
If )'01& have 'unaer 'IIIlniall. &Ilo1I& DIll' .~u"', pl.... 1.t lit Delli or
c:onWt &Ilt 'f1I4tlltlU Ileprel'lI~tbe vao l'rvllll' tll. PrOfr... ~POr. ....&&t."
requelt, rOil .., r'o.ive cop1., of &lI lnlo....&1011 1ft our fl1.. III1~CII r'latl.
to tile oSlOJ.lI.on. 'fII. onlV eMlp&lCft 1. "oSLc:&1 lntol'lLluoo V1l1cl1, In '_
ea.... air not be 'hln to reu IUrecu, IIIIt ..y lie 91",,, co your per.ollal
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PnJdentlsl
Important Notlc. About Your
AppllCl1Ion For IMunlnce
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Balorl WI can -- you a policy WI mulllirll undarw"ll you, 'pplicallon. Thil ma'/'IIIINII WI IValuell "Ih.
InlO'lMllon nec:....ry 10 dalarmlna II you IlUIllIy lor "'11naurInce.
In MIdIdon 10 U..InIDrmlllon on 1M appIlcIlIon. I m.dlcIIl_lIon mlY bl raquired, WI...O Ilk you 10
IUIharlaI Iny docnor. hospkll 01 amar DI1IInlullon or parlon 10 give ullny inlol"",Iion which 1IIIy mly hive abClU'l
your I1III\gj or phyIic:aI hallhh.
We mlY Ilk for S n1pon 110m a C-..net agoncy. Tha.. repOne providelnfllfllla1ion abDull Plrson'. ch.rKI....
reaidanc:a. K'lvldll, V_II repuqllon, PllIOnel chlrlcterlsUc. Ind modo 01 1Ivlng. Tho agency may VII 1m
Informallon wOUgh imlrvlewl wilh Irlanda, noillhbota Ind I..ociale.. Any person on whom _ Ilk lor a repon
hIlS a rlgh1 '0 slk 10 be Imuvlawad. You ITIIY 1110 1111 a copy ollha rlpon from 1M __ reponing 19ency
which compllllld h. An 19-='1 ITIIY keep 1M Inform'lion it hal about you and diac:lo.. h 10 olhar PIIIOnI, II you
would kke funhlr Infol111l,lon, .110 ,ha nelurl end lCOPI Ollhl" reponl, II will be provided upon rlql/lll.
Any informllion whloh W. obllin or havI obtalnld lboul you will bl tr..led '1 conlldlnllll. Ilowevlr. WI rNIy \liva
lhi. informlllon,'1 Mc:aaNry. to: your dOC'lor. "WI rond I 1.,1ou1 h..l1h problem which you do nol know lboul:
petlonl conducdng monalilY 01 morbidity .Iudiu: and Ifflllatl companlll fOl m.rklllng. lInnc1n\l, und_nlng or
cl.1m IIInc1llng purPOSI.. If you Ilk. WI wiU dllc:riba 0\11., clrcurnellnotll whan WI mlY oblaln or dilOlo.1 or
mlY haVI obtainlCl or dildo..d informalion abOUI you withou1 your prior IUlhotizlllon.
WIIIIlIY .110 mak.. brief repon '0 lha Madlcallnformlllon BUI.lu (MIBI which provIde.... Inlomunlon ..changl
for III member Insurance campanlaa. When you Ipply lor lifl or haal'h lnaurlnCl or Iubmlll claim fo, baoolltl '0
any IIlImbar comPlny. 111I MIB wi., on r.quIII, giv.lhal company 'hi informlllon on ill mI. II you hive sny
qUllllona ~ IIIIY rlpOn which MlB may hav..n you, you may COI111C1 MIB al POll omoe Box 106, Euall
SlItion, BOllon, MA 02112. (6171426-31180.
If you have any qlMlllonl concllning Iny of the plraOlllllnlormlnon which we obllln or "pOn.11I UI know. You
hava1lll1iglll'0 1ft dlI.lnforrnatlon Ind IOCOrrea,lInIndordelolo snyinformalion whiohlllllY be wrong. W. wlI
'III you how '0 do lhIa K you Ilk UL
II we.. uneble '0 Ia_ the policy you rlQUlllld, we wIU tell yeu Md Illpllin lha renons.
'!'hank you for apptilng '0 UI for lnaurlllCl.
Tho PnIcIanltat Inaure_ Company af AIMrtca
..... 0nIup AdmlnIatt.1Ion 0Iftce
,.o.IIoll1l10
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0lY30 '95 10:27
..:lENT BY:Il,S.S,ll. 12151851-U20; 6-30-85 ;\0:2:wA
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AppUo.don fOl "ISUrance or
lJequa-1!<< Plan CtIanaa
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.lif.1'Nllen1lll_~"'__ .
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1. 1\ppliCant<<npI'. IWMI/lCI ~ IIloUd be prin*' an pIQe 2 willi onlY an'llllW na .~.leaIIlng alllllnk ~
between WOlOI.
, 2. eomp.. "~II_1o or aflIllaIad wllIIl/w ~rnev be InctucIId. A .'IllIIcIIty~.a c;arpcnIIan
oan~ by tt.1*WlI alIltpIIlY IIvaugh -.hip 01 mora IIWIm 0/ IIle IIDCIC. An afIIIaI8d corponllOn, part._ .... lit
propriatllrlhlp II a oamp..,t ~ the IIl'III control u h pnrrt CDTlpIny,
3. For PlIIII CtIuIpa, ~ thla P&llllrld IIle lIuppl.menllly InIonnaIlan an pIIllfl4, On pall" 2 end 3. oornplallllho.
~WhICIh nbllng chuged."-lng IIleUIIL...atc/llngel, When a benlflllIllI be "rncl'IId.llMIrt/laWCld
'1lcmove"1n tt. A"''' ..... baMIlt IICllOn.IrQIda 1ftlIIc..... nema.1ddIWI and IiQnIlIn.
4. Impo.tant: ilia RaqualttDr P~lIarIln III EmpIayee IIcneft:I ~ Inturance TOll' (EBI' lA). willen It IllIcIled III
ilia appIloatlan.lI1UI\be OOI.itAlllodrWtwllln _.~ anewbUllNu ~olool,
WIllIntIll'Il'UllltaONlnf_ ~HI ,JAM a 0 .,=
'The WtlIlngAeptlllfitlllvtCAQlnt,.....1/SIlu MIIwger. Mr.agcror~ l/1auIdalwaVl ClWI'ClI'" N ''WrI1In\l RIP."
hand, 1I-PP'" .... lhe.... at Rotltld F\epl -1nlatift Infonnallan. For 0nSnIIy AgMcIea Repr_..uu. anIy,
Include ~ ClII\Imct PNl\Il detlgnatIon votlll CIIlllhIlt runber. The FWd SeNloc 8ta11 wilI.lImp tt. RHO, Rtglon, 0IlIca
Cod..nd NImI. ~
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:comPIII NlmlIIld AlIelmIbIlowand.. parIa vm.r.. 01\1I1OI iI IIqlll&lld.)
,-...- Plan (ClIIlelI Plan llIIaW)lall/lllll' Gtoup ConIdCI(I)1aauecl bV PNdentiel III a Trust MI up lor ~ In \he
"' indUIlIY.
ll&aI~I.,:t>.,.,PriD&I"'.""""'__IIlliCIII~""''''''
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UI "lljllo~ P ~'bo~ cnlll&l.. at \he ~1aont..mplcr,1lI' andar.1o be Included under 11II Plan.. "..;c.IICl'
I1'lpIIIiK (Emplo)_ at tI'te lnaIudaCI AdCX:ilI\ed Cclrnllanlu will be oansldelld ~ol!tll ~~aywr,l
COIInIy _1_
fJA-uJJlliJJ
ZJpc;odl
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"'INd cla.... Of emplov...
I PIIl'IIa to ptcwldIlrWlnnc8 flIr Impla)wI 0I1!la Appicanl<<nployar ard any Alloc:ialcd ~ if tI\Iemployeel III
.....Cgvarad<:l- ue. " .
C AII__atemployllM 111 Aldauelal~axcept: I'"V fin'" t...&~ '*"'"
.tnenl......pellDcI(a..ok_boll) ~o Ill/I'~~1U
a ~ paIlDd alOllll1ir IOt.M-tlInIwv\COwIlh 11III ~plClyv.
.1 monlII Cl' monIIlllutr'llClltorptlMlll....~- C 311lOll1h1 C 3 monlhl but nana lor ....t~
1'IIrIbUIIOIIe.... etr....... ftda..
3II1TlIldlTunI1pply to IIIIIIITIClIIIt al any CCllIII1llutlonl nlIde by ~.1oWlUd ltta COlt 01 \hi ilIIulInCI:
hi ..,....'"" IllIt _.tlIL ... the wIICllt prIlIlium tar tIla empIayM'llnIurIncI.
Far El,.pk!yae T.nn lilt c.,... .. GOI (401 i'I T_lparmontll PIt 11 JJ1J Of InSInnCI undar lttIa c.....-e-, <<if"'" \he
muImum~ by.....
a.1lII:tlId PlIn .....lAlIIon 1lIllI. wlictllIl'IlIlle pan altlll ReqUlll.IIhawIIIlI CovwclIQII and banelill r~ at !he
1IllI81n'" 0........ .'ld IIInMIII wIicI'll/lllq\llltld.
ldenIl6I'IllINI Btllllp AdmInIIIlIlIan ClllICa wi Worm 1M ~pp"-'It-empIcIVW WIlen tl1iI NqUII' IIl1ll1ll'CNed Of
......1:1 'lid. rlhll__" ..lpIIWloolI by I"rudInIIII, tIlIdmttat.. PlIn, 01 cIlIIlQIln lttI fIlIn. ....."'- wi be __Iwd
. ''[Ir.acNa 0.."'" "1IlICla1bcM.1'IUIIInIIII WII-. Oraup ___ c.nIllClIlII for 1nIInlI1lIlllkl\',. The tlIrmI
:he GIDIlp 0llrDI0l(el ftI malnr aIIIclllhe __ _.umr.arlad In tI'te GrIlup IrleuIIIlCI c:...1IlIoodI. All InIlnIlOIII
~ i'I.-yw.t to till Gcaup ConInIol(.) wbidllIanI tarm(e) UlIIlIV-" 01(.) undIr w\lICtI pa,1IIIM oIlnIInnI:IlI
.da.
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,:~' SUPPlementary Informetion To Be furnIShed By Wrttlng Representative
1. "_ol~..."~ - 0 Cap.n_ 1l..........llnhp
o """*"'11I :::J Otter
("eI ~rtbe In Aema.kI,
2. IlIClllnry - .. C RllaQluC"...........IICIIlIMceM_,
h. NlbnDl............, AatIlIT_ ::I l,l;".,Q&~~I'__ L:.I T... r ...-.
::J WlIoIe....TrlCll :J =:: ~'
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c:, DoICfIllo MiclIIIlIIIlu'Kllno tit IOId 0' 11lVICI. _1Cl by 110'" me P"'"I_ _lOCI """"""-10 be..,.,.,.
IntlIWIMY~ .
--1JDu IIlI..Jrr"",4.ff Copy;tJf. tl{- Ai<J-( AJAI'[,I2I! t;l~ ~'NAI1/6~~
-3. OIhto,eo"llIgI - ..... -'IIlf*o.-lII.....I"'Ich,;INn lIwtpe.l y'IIl' WIllI PlUdCiIIlII 01 Al'll'ClIIlIrc:.",. .;,-......ci&In'fDr lit,
of Ilo COVItIQI&,.quec1lod1 Jll VII iJ No
(II 'Y.' CIIlIIplIIa a uana'lIr'ICIluaIn...Fomt I!IPJQSP1U 10' ...cIIllo1mlt,1IICl1IIe 'OIlowtna'
.. 1Iw:Iicalt-.gu: DIIlIaalTennna_ OIl1ofT__
a.f' OEP EMS> OEP
III C Uf'I C C ....tlrr.ny
ilt DIMIli*Iy"-nl ~ illlenlal
jll 51 Ho~Meci'" .
~o,:.~r::;:'~::~:'''::::b~_l jJIbU'l~A.m(J l,
a. ~PIIrI <<ESP 0 GSP 0 PrudlntlllGrollll ::I Otl1ct
(lIUP,GIP,orPtlldentllloroup -P11I1/PD11"1'_...., IS. .5"" i1~,,-r,
.. r'lf7'P:rI0ll - L ~oIN1olrnecmpll.,_lallho_tm* ~-_. ... , ... . ;DiT
b. ~ofolQfbJoOlnl*'-_~"""lho~IWIi1lngP_,.,.,.... .... ..,............
Co OIthc,...... 'b.'. '-ftWIJ.....lMlIId1. ........",....... ............." ......,'........ ...~
d. ~,_Contrtbutlonpt'l_.~ _ n _ %
~ IlnpIiij_W-'1'eIlod - JlJ I men", 0 , -1luI1lOIlI1oI1lfWMft11l1l~
C a Illonh 0 a IllllllIhI but_ fIlrpl8lllll..,....._
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fJla(~oItheC*'W1lOt 1 ~l~_,...-~:.... .............................. ............ .
7, o..na I!IfICl\lwll 0. tot Mew ...In II. or Plan cr-.. -1_ I sr-7
(c.motllapotor.._lhe..,. .. .lIo1gned) Manlh DIy rut
So ""-Df"-.__r- '1IIIII1he~. bl. II'
u.w....PMbllkI"""--IlPTIIIIII' ~DNi!. - MoN-' II/UI/O,/ fJlil/J 6.1I44e.IJ; r'/IMI IDA
S. ~AJIca -
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(l~~"''-{,:L'fo(I,., tf'_~.....z ~;i(l~~~y;;;ci~ci~O~2~)
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930 ~~-i'\i:,\' !J:WJE,
Idi!CMhli:CIlI~!lG, PA 17055
O 1-_ 717-6C:.m4
IS",......,.. r~.
10.. C~AIMIIlI1 -~ OfWI'IIftg~" .':t1JW
1. IllIlti/ylhltonlltlldalr.("I'-S>-_~_lIIll11arorl&llllclriDcl~".".~ lb!~ I
.......... of 11II" L _1Ild,..,. -.....tIlI AppII<:ant4lllployw.N..... or pIIn cIlIrlQI of ___ r__; tel
... tnlylllll ~ ._.IWII" Honnation IUIlIlIiId by 11II "pj)IcIn.........,.,_1lgned Ihe ,pp'~.""'I1rl my pr...,.,."
2. I..... canllylllu:(I)l,.....nol~IMd luueollhl plan, ....__ of -.y~. Of ~"...,t allIlY_rn: CDII".... nol
- ~or~-.g..,,.,, pl'll\L., imIIIllon or _Ion. To'" _tal my "ll\tl~gI.l/lOq\MIlOIlI'" ..........
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0lY30 '95 10:27
-Soo BY:R, S, S.~. 12151851-1420: 6-:\0-95 :I0:2~AM ;
.1
R,S..s.~,"
717 236 3777:' 5/52
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CAJlL ~ and WllfDy AJIIIIaUu.N, : :or TIIB COURT 01' (XWUnv PLD.8 01'
HIIUand and Wite, and all ot:here I CIlIIBBRLAJID comrn, PIHIfSYLVUU
sWluly situat.d, :
Plaintift. I CIVIL ACTIOJf - LAW
v.
.
.
I NO.
'l'JIB PRUDBIITIAL IJr8UJWICB COMPANY
01' AllBRICA, and '1'11II I'IllJDBJITIAL
ntIl-_..n >>ID CUUAZ4'lr DB. CO.
DetMdants
.
.
I CLASS ACTION lAWSUIT
.
.
.
.
I JURY '1'RXAL D2IWfDBD
~II. ~ro. eoIlPLa%....
1. carl AImezaan and Wendy Aaenaan, husband and wit., ue
adult indlviduals who ~..ide in Kill.~etown, Perry county,
Pennsylvania.
2. Th. Prudential IIUIurance COllpany of Allerica and 'DIe
PJ:wlential Property and eaeualty Ins. Co. ara col'pOZ'atlone
authorbad b) .-rJcet insulUICle in the C_nv..lth af PenneylvaDia,
relJU.\uly do bueinees in cu.berland County, IIJlCI have aft1c:ea in
CUJlberland County, l'enneylvan1a.
3. In Septeabu:, 111811, Plaintift Carl ~nan beqan
aplayMllt with AMr1aan Quidl: Print, 823 South ~.uon street,
IfanoLUurv, Pennsylvania 1710..
.. At: that t1ae, AIIezoiaan QIl1d1: Print: had &II -.play..
benefU:. pra;r:_ provided by OOfttraClt by the Defendants.
5. A copy of the aployee beDefita provraa ApPliCl&tion tor
llequeat tor Plan ChencJe dated 07an~, 11187, is attached hereb) ..
.
Jbcb1bU: A, and identifl.. the 9J:OUp plen policy nu.hu' a. &5712200.
7QQnn
08/30 '$ 10:27
_.' ....
.'SE\'f BY:R.S.S.~. 12151851-1~20; !l-30-85 ;10:20"'...
It.S.s.~.~
717236 3777;' 6/52
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,. Ko copy ot the cont:rac~ cf inaurance 1. in the po.....ion
of tha Plaintiff., a1tboUVb i~ is balieveel that it ia in the
paa....ion of the Defenclants.
7. By application dated septellber 12, 1989, Hr. ~nan
applied for ooveraqe froa the Defendants. A copy of biB B..lth
Stat8llant - IbIployee Benefits Progrllll application is a~tacbed
hereto .. Jbdlibit 8.
8. By letter dated January 5, 1990, a copy of which is
attschacl bento a. Exhibit c, Hr. AIIunaan and hi. faa11y ven
denied qrgup bealth inaurance due to bb bb~ory of a baan: IIUZ1Iur.
9. Because Plaintifts felt health insurance to be e..ential,
and because the Defell4aDts denJ.a4 tit.. group beaJ.th inaur&DC8,
Plaintiff. .ought out private health in8urance tor: Wbich thay paiel
on an hlclivielual buis When they coulel obtsin it. A copy ot a
.uaaary ot the insurance pna!_ paiel by the Plaintiff. i.
a~taobed bwato .. Rvtothit D.
10. On July 19, 1991, Hr. ADerman reappl1ecl for: coyel'alJ8
IIJIdar the 91'DUP bealth inaur:~ plan.
11. By latt:a&' datecl August 21, 1991, ccpy attaCbecl .. bbiblt
I, the Detenclants agalD retuaecl to cover Hr. AaenI&D, but agx II~
to CGV8Z' *-. ........ upon liar: payunt of an extn prea1_ Vb1cb
the ~ declined to pay &Del thenfore bad no COY8Z'.,.e t~
Defendants.
13. ~out thi. period, the ~ :_11y incun:ed
.
Mdlcal bill. 111 -lCC:... Of $3,000 that van not COY8Z'''' by their
inclJ.vidually Purcbued health insurance but vhicb they believe
z
0lV30 '95 10:27
SENT BY:R.S.S.lI. ,2151851-H20: 6-30-95 ;10:2\;\,'4
it S,S.lI,~
717 236 3777:' 7/52
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woUld have ~.... covazoed ~y the c;roup policy of tile Dafandanta.
13. )fareover, for a portion of tile period batw.... Utt and
1111l4, Mr. AaeI:aan wa. Uft&bl. to obtain h.alth insurance on aD
individual ba.i..
14. :In 19114, the AD.naana applied far non-c;roup bea1th
insurance with Capital Blue Cro.. and P.nnaylvania Blu. 8hia1.d.
15. By letter daud ~t 18, 1994, attached bareto ..
BXbibit P, the .waanan. learned for the first tille tbAt the
pennaylvanie Department of Insurance bad di.sapprovecS denial of
group health care coverac;e ba.ed on an a.......nt of h.a1th, an
1l1epl practic. known a. -lIl84J.cal undaxwritinc;..
16. In August, 1994, the Plaintiff. loam'" t:hat the
CoIIIIanvealth of PlUU1aylvania Insurance Dapartlllent by Order and
AdjUdioation of the Ponnay1vania :r:lUlurance co.-ia.ioner dated April
at, 1988, specifioally cU.sa1lovad ins\U"erll i.auintJ qroup l18dical
coversge to d8J1y coverall. to individuals baud on this 11189a1
practice of Mdical undanritinq an4 outlawed cba&'IJinq added
prui_ baaed on previoua aadica1 hi.tory. A copy of the
,.",uo.....1th of Perlnaylvania Insurance Depan-nt ores.1t' and
AdjUl'1~tion dated April 21,' 19", i. att.child hII~ .. Exhibit G.
17. 'l'benafter, in early Sept--hu', 19'4, the ~ fi111d
aD In8uraDce CClIIplaint Fora with the ""-",wealth of Panrlaylvania
I~ DapU"blant, e capy of Vbich i. attached hare1:O .. lIxhibit:
H.
.
1.. 'fIlua,. year and one-ba1t prior 1:0 Mr. ~run'. initial
application for qrcup health oare COVaralirA, the practice. of
3
08J'30 '95 10:27
'SENT BY:R,S.S.ll, 121S18S1-1t20: 11-30-95 :10:21.\.'4 :
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717 236 3777:# 8/52
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II8Clical WldarvritinlJ and. cUrqinq additional praJ.uas on lJftNp
health policies vara ogtlaved in p.nnaylvania by . spacifio rulinq
of t.M Insvance ('......4 ..ioner.
It. Konaver, vIlen tha ~ reapplied tor covara...a in
111111, the practice of .edioal IlIIdarvritinq bad b.an ogtlaved in
1'ann8ylvani& for liars than three yeara.
20. At no t:blll diel the Dafandantll avar contaot the ~
1:0 tall thaa that it hael ..d. a .iataka until after tha "-nans
filed a cOIIplaint with the 11lllgL"IInC. Dapartaent.
n. UDder cover latter dat:a4 OCtober 14, 1994, the Insuranaa
DapaJ:t3lent forvaNad to the .baa&'IIans a letter fro1ll Willi.. R.
stattcmS, allploy.. of the Defendanta, acknovleellJinlJ tbat the
danial. of lJroup eOVualJe vere -in error- and. ofreril1lJ to adel 111".
~ on to the ~p baalth insuranaa polley. Copie. of that
COnupDl"':lIallC8 ara attached. bara1:o as lXbibit 1-1 lUllS I-2.
aa. Plaintiffs bellav. and. th.refor. avu that the
Dafandantll' actions vith r8lJarcl to clenial of their application for
lJrOUp cov81'8l)a were part of a polloy and practice of il1aqal
cSanla1a to uny who vere antitla4 IUldar Pennaylvania law to have
suc:b CIOV81'&lJ8.
23. P1a1Dtiff. bell."a and therefore avar tbat t.M
Ddeadantll' polley and. praot1ce of illogally denYinlJ CJrOup bealth
~ _a...a to illdiviclllala baa continuacl up 1:0 tha preaant:
ts... in ~aar violation of Pennsylvania lav, In.uranca Dapartaant
..
regulations, and Insur&lKlll Dapart:lleDt daci.lons.
4
oe.-3O '95 10:27
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.500 8Y:R,S,S.~. 1211518S1-1~20: 8-30-95 :10:21,\.'tI
R,S.S.~.~
717 C36 3777:' 9/52
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24. Additionally, VIIan Mrs. Aaenan appl1ed for coverave
rra. the Darendanta in U'l, .be va. chaJ:9ed a highar rata baaed
upon her prior baalth hUtory, a polic:y knavn .. "ratill9 up" 1:bat
ia alllO 111elJal in l'ennaylvan1a.
21. PlainU,rf. beUava an4 tharerore aver tbat 1:be
OafeJ\dan1:a' illaqally rat:1ng up policia. or chal'9illlJ a higher
prqia bued upon pdor baGltb history UDdar a group POl1c:y
rapra.anta a pat~ and practice u.ed with IIllIIY.
21. Plaintiff. believe and tharefore avar that th1e 18 a
pol1c:y and practice that have continued up to the pre.ant tiae
deap1te 1t11 illaqal1ty.
27. Plaintiff. avar that the D.fandlUlte' aat:iona artar JUly
1, 111'0, in danYinq 'lIZ'oup coverage amI. abaqiD9 an additlO11al
praaia hIliaed OIl healtb hl.tory rapre.ant: bad raitb varrant:1n9
~...CJ'" IIIIdar the l'ennaylvlUlia Bad Faith Inauranca 8tatuta, 42
h.C.s. .1371.
al. MditlO11ally, plaint:ltre aver that the Oarandantll'
fall\lt'e to notlfy tbea or tba1r illegal actlona at any tiaa after
cIu1al and raquaat: for additional pnaJ,ua baaed upon health b1atory
r8pl'Uant IIad faith ~ "..-g.. IIIIder 1:be hnftsylvanl8 Bad
Faith :bIaaruce Statute, 43 ".C.8. '1371.
2'. lIcIr:.avar, t:ba Dafandantll' act:1o.. rapra.antaDg vlalaUOM
Of t:ba UIlf-U X~ Pract:J.au Aat, :bIalU'anae DaputMnt
r&lJ1Ilat1ana, aJ1d ~ Dapartaent: deai.lana a. well ..
.
inaunDaa 1a. rep~ bad ralth V8Z'rant:1nq daJlag.. \U\dar 1:be
l'annaY1Vllllia Bad Faith Xnauranca 8tatuta, 42 l'a.C.S. 18371.
5
0lV30 '$ 10:27
~EN1' BY:R, S, S,~, 121SI8S1-H20: 8-30-95 ; \0:22.\.'111
R,S,S,:.I,~
717 236 3777:.10/152
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30, Tbua, in addition ta th. cOllllanaation t:ha Plaintiff. .eak
for the ooats thay incw:nd in obtaining altarnativa inauranca
aM/or: payillq ...sieal bill. that vera tha lagit:iaate ra.ponaUaiU,qr
at the Dafendanta, plaintiff. al.o aaak inter..t OIl their
oaapanaatory elata., an award at punitiv. daaag.., and an
a....PI."t of colU't co~t:a and attorney's fea. againat the
Def........r:ta.
WIIBIlEFOU, Plaintiff. carl AUI.rman and Wendy ~nan,
huaband aM vita, demand judCJIUnt againat the Defendanta in an
lIIIOunt of coapenaatory daaaqa., punitive dallaq.. and attornay'.
tee. in axc..a of $25,000.00, exclWlive at 1ntereat and coata aM
in excu. of any juriadict:ianal lIIIOunt requiring coapulao!:y
arI:litration.
~"'IlUI A.~Otl a.T.T.1tOJ.tl'YOHS
31. I'araqraphe 1 througb 30 are incorporated her.in by
refaranoa.
32. 'l'be cl... of Plaintiff. 1nolud.. all persona denied group
haalth inauranca by tha DafendanU beeau.a of pr.vio\lll JMdlcal
hiatory, and the cl... of plaintiff. 1nclud.. all thoae wbo vare
abargad or threatened with bipar praa1U1111 for vroup be8lth
J.naaranGII COVenqe becauaa of prior aadlaal biatory, and .ltbel:
pa14 aucb extra abarg" to g.t: cover:aCJ. or did not pay .uell extra
obaZ'lJM end __ 1I...4ed 'FOUl' cov.raga, in violation of unfair
Ina\IZaI1G8 Practice. ACt, the inaurance lava or l'ennaylvania,
.
regulat:iona, an4 Inaurance DapU't:llant deol.iona.
I
\
\
,
1
08130 '$ 10:27
.sENT 8Y:R,S,S,~. 12151~I-U20; 1l'~0-95 ;10:2:!.\.'t1
It,S.S,~,~
717 :36 3777;'11/52
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33. Plaintiff. aver that tha total nlDlber ot all cla..
..--....r. ia ao nuaerou. that thelr joinder would be iapraetlcable.
34. 1Ir. and 1IrtI. Aaaet'IIan are aware ot lUIotber penon vbo
worted in the _ location ae tha Amaeraan., whicb included.
total at tawer t:ban tan aaploy..., vbo wa. al.a denled ....ll1Ibip
by 1:be Datendant:a in a qroup eaplayee banatit plan on the ba.is ot
b1a health hi.tory.
35. It two out at fevar than ten potantial group benetit: plan
........n were ill"'lally clenied covaragoe by tbe Defendanta, ana can
only iaalJ1ne t:ha thalUlanda or otbara who wara a1a1larly daniacl
coverage.
31. Moraovar, plaintirr. believe that the total nWllber at
cl... ..,....ra who vera cbaqacl addltional pr_iuaa ter vroup
paliciu, .. 1IrtI. ~raan ..., i. 80 nwaeroua that: their joinder
would b. lapraot:ioabl..
:17. The quaaUana of la. aDd taat: are ~on to all ala..
........--1'8 in that all claiae ara baaed upon iclentlcal prov1aiona ot
pannaylvanla Lnaurance lav, inaurance ra91llationa, and lnaurance
DlapUtaent deci.iona, and tha Dafandanta tollowed a pol1oy and
pr:aot.1ce at lU8fJ.l actlviti.. in ng.rcl to cla.. ---n'
l8fJlt;laat:a dCJh1:a.
31. tbe olaiaa of 1:be rapra..ntatlve plaintiU. are typical
U 1101: 1den1:lca1 to the olaiaa of all cIa.. ,.-....-1:8, grounded a.
they are, OIl identical legal provi.lona and regulat:lona, and
.
InallZ'anca Dapartllant; claciaiona.
7
~30 '$ 10:27
.51::'11' BY:R.S,S,~, 121SI851-H20; 6-30-95 :10:22,\,'4
R,S,S,:.I,~
717 236 3777:#12/52
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31l. Moreover, the continuinq actlon. of the Detendant.' in
ragard to all claa. lleat1era rapre.ant bad raith warranting da_vu
pur.uant to the Pennaylvania Bad Paith Inauranca Statute, 43
I'a.c.s. 11371.
40. '1'ba Dafandanta bad no rea.anable ba.ia after April, 19",
to deny Plaintlff. lIubanhip in group health inalU'anca plan. or to
collect additional prea1U1U frail th_ baaed on their prior health
history .
41. The Defen4ant.' actiona atter July 1, 1990, in continuinV
to refuae qroup health ina\U'lUlca IIlIIIlbarllhlp baaeel an -1Iec:tical
undervrltinq- and "rating up" group health insuranca l1811bera ba.ed
UPOll prlor lIl8dical hi.to~ repraaenta bad talt:h toward claa.
~_m~ .Ubjeot: to llabillty undar 42 Pa.C.S. 18371.
42. The Detendanta further failed to alert: the cla1aante to
the ract tbat the 1988 Inaurance Depar1:Jlent electaian, ilwuranca
la_ ot l'ennaylvlUlia, and InsurlUlce Departaent r8ljJll1.at:1ona
probUaitad the Datendanta froa dbclabliD9 covarage or rat:1ng up.
43. Both before and attar July. 19'0, tho Defendanta
=ut:1nely nfluled claiaanta' raquuta tor group health inauranca in
direct cOllt:raventlon to the la_ and Inaurance Depart:llant
ngulaUona end dacidOM.
..... Both betore end aftar July, 1990, the DatlU1danta
rau~f".ly obaI:ge4 group health .........-1:8 addiUonal pruluaa baaed
upon their prlar aedical blatory in claar violation af the lawa at
.
PelUUlylvlUlia end Inaurance Departllant regulatlona and deci.lOlls.
8
08J030 '95 10:27
!EM' 8Y:R,S,S,~, 1211518S1-H20: 8-10-95 ;10:22,\,'tI
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717 206 3777:'13/52
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45. Both befo~. and after Jllly, 1"0, tha Defandanta allovecl
their intaraata in liaitin9 1:hair liability and lncnuLnlJ thair
protita ta dlctate their actiona daapita olaar violatiou. of tba
Unfair InaIlrUle. Practica. Act, a breach of their fiduciary duty,
and bnacb of their duty of lJoocl faith and tair d.alin9, thereby
baing CJU11ty of bad faith toward tha1r in.urade.
44. The rapnaantaUve Plaint:itf. vl11 fairly and aclaquately
npruant t:ba inta~a.ta of the cl... in that CapetlUlt counaal hu
bean retained, there i. na potantial ar aotual conflict or 1ntereat
'11th other po..1ble cla.. Raabare, and the rapraaentative
Plaintiff. and their COU"".1 hava adequate fJ..nancial ra.ourc.. ~o
an&\It'e that the inter..a ot the ala.. will not ba baZ'lled.
47. A cl... action prowld.. a fair and afflclant: "obani..
for 1:be adjUdlcat:ion at th. controvany betwean the DefendaDta Ud
the Plaintiff 01....
4.. Unl... thi. oantroveny ia _intainad .. . 01... actioa,
1:bera 18 auhatantial rl8Jc t:bet 01... .-....-r& Who are entitled to
racovary v11l be dapdvecl of tho.. benafita becaue tbay an
unaware of 1:belr l8lilal righta 1:0 tho.. banaflta aJld/or will be
.ubject:ed 1:0 1IIcoual.unt ad:lUdlcat10M at tbelr claiae.
4'. On behalf of .11 cla.. --"'-N, 1:be rapraaentaUve
Plaintiff. ..u claia for all 10.... thay have iDcw:rad by 1:be
DefandaDta. 111elJal ac1:iviU.., tovetber with int:ereat, punitiva
""."g.., ocata and attornay. t... WIder 42 ,..C.S. 11371.
.
50. AdditionallY, I'I.intiU. n1fi1\1B8t that: t:ba DefendaDta be
a1'dand to t~.lliataly axtlUld group benatita wlthout additional
,
0lV30 '95 10:27
,
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,
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R,S,S,:.I.~
i17 236 3777:'14/52
.
c:Jau9. to all claiaant. antitled 'l:a ...., rafund any _ce..
pr8aLaa coll.cted and be directad to ca..a and da.iat fro. auoll
POlicia. in t:ba future.
lfIIBJUII'oJul, Plaintitt. carl Auenan and W.ndy Aaenan,
hllabancl aJ1d wife, and all oth.re ai.Uarly ait:uat:ed, clUIUId
judgMnt aga1nat 1:be Defendanta in an UIOunt: of cOllpan.atory
daIIIlq.., punitive cSuag.. anel attorney'. ta.. in -ICe... of
$25,000.00, 8JfCluaive of int:er..t and coata and in .xca.. af any
juriSdictional ..aunt requiring campulaory arbitration.
Reapaotfully .Ubaitted,
AHGINO " ROVNER, P.C.
?~b.~
l'&Mla G. SbUlllUl, Bsquira
X. D. Mo. 411'1
4503 Horth Front Street:
Barriab\U"lJ, PA 17110
(717)231-17'1
COWlael for 1'1aintUf.
DA!BD. AUVU8t 17, 1"5
.
10
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IN THE COURT OF COMMON PLEAS
OF CUMBERLAND comITY, PENNSYLVANIA
CARL AMMERMAN and WENDY AMMERMAN, )
and all others similarly )
situated, )
)
)
)
)
)
)
)
)
)
)
)
Plaintiffs,
Civil Action - Law
v.
No. 95-4410 Civil Term
PRUDENTIAL INSURANCE COMPANY OF
AMERICA, and THE PRUDENTIAL
PROPERTY AND CASUALTY INSURANCE
COMPANY,
Defendants.
NOTICE OF REMOVAL
TO: OFFICE OF THE PROTHONOTARY
and
PAMELA G. SHUMAN
Angino & Rovner
4503 North Front Street
Harrisburg, PA 17110
Counsel for Plaintiffs
Please take notice that on September 20. 1995, Defendants
filed a Notice of Removal in the United States District Court for
__,.....;.~;t.,...,_,. '~-r;;.'-.'_"0-<.:.,._..-...
-~.,,: '-
~;
...
,.
,.
the Middle District of Pennsylvania at Civil Action No. 1:CV-95-
1577. A true and correct copy of the Notice of Removal is attached
hereto.
By
REED SMITH SHAW & McC
John F. Smith, III
Reed Smith Shaw & McClay
2500 One Liberty Place
Philadelphia, PA 19103
12151 851-8100
obert B. Ho fm n,
Attorney I.D. No.
213 Market Street, Floor
P. O. Box 11844
Harrisburg, PA 17 08
17171 234-5988
Counsel for The Prudential
Insurance Company of America and
The Prudential Property and Casualty
Insurance of America
-2-
,.
,
.
.
~
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF PENNSYLVANIA
CARL AMMERMAN and WENDY AMMERMAN, )
and all others similarly )
situated, )
)
Plaintiffs, )
v. l c. A. No. \'.t\\-C\~-\~\l
)
PRUDENTIAL INSURANCE COMPANY OF )
AMERICA, and THE PRUDENTIAL )
PROPERTY AND CASUALTY INSURANCE )
COMPANY, )
)
Defendants. )
NOTICE OF REMOVAL
Defendants The Prudential Insurance Company of America
and The Prudential Property and Casualty Insurance Company
("Defendants") hereby file this Notice of Removal to the United
States District Court for the Middle District of Pennsylvania,
stating as follows in support thereof:
1. On August 17, 1995, Carl Ammerman and Wendy Ammerman
("Plaintiffs"), filed Civil Action No. 95-4410 in the Court of
Common Pleas of Cumberland County,: Pennsylvania on behalf of
themselves and all others similarly situated. The Complaint was
served on defendants on or about August 21, 1995.
.
.
2. A copy of the Complaint, a subsequent Motion for
Extension of Time, and Order granting that Motion are attached
hereto as Exhibits A, S, and C, respectively.
3. This action centers on allegations that plaintiffs
were improperly denied full participation in and/or full benefits
under a health benefit plan offered by plaintiff Carl Ammerman's
employer, American Quick Print. ~ Complaint, '13-5, 7-11. The
health benefits were, in turn, underwritten by defendant
Prudential Insurance Company of America.
4. The health benefit plan referenced in the Complaint
(114-5) as the source and alleged basis of Plaintiffs' claims is
an employee welfare benefit plan as defined by Section 3(1) of the
Employee Retirement Income Security Act of 1974, 29 U.S.C. 51001
et seq., as amended ("ERISA"). Accordingly, plaintiffs' cause(s)
of action "relates to" an employee benefit plan, pursuant to ERISA
5514, 29 U.S.C. gl144, and is governed by ERISA.
5. For the reason set forth in paragraph 3 above, this
is a civil action over which this Court has original jurisdiction
under the provisions of 28 U.S.C. 51331 and ERISA 5502(e), 29
U.S.C. 51132 (e) .
6. Accordingly, this is a civil action which may be
removed to this Court by the Defendants pursuant to 28 U.S.C.
51441 in that it is a civil action founded upon a claim or right
arising under the Constitution, laws or treaties of the United
States.
-2-
'SE.'VT 8Y:R,S,S,~. 12151851-\~20; 8-30-95 :\0:20,\.'tI ;
R.S,S,:,j,-
717 C36 3777:= 3/52
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CARL N"'UKAH and WERDY AIQI1ID1lUI, I IN TIll: COURT or co.... PLIAS 01'
Huaband aJId Wif., an4 all othan I CU)rR~D COUNTY. PIHHSYLVAI!U
aWlarly altuatad,
Plaintiffs
v.
CIVIL ACTION - LAW
NO. ft'- 01"'0 ~ ~_
TBB PRtJDDrIAL INSOlWfCl COJCPIHY
OF AHlRXCA, and TBB PlDDBH'l'IAL
PROPki'lt AND CASVALTlr Dr.. CO.
Datandanta
CLASS ACTIOH lAWSUIT
JURY TRIAL "EXAHDZD
NO'l'TCP! '1'0 DlIPRND
You have been auad in court. Ir yau wiab to daraJld aCJainat
tha claba .et forth in tha folloviftCJ paq.., you aut t:aJca aotian
within 1:vanty (20) clap after thi. CCIlIlplaint and Notica are sarvad,
by entering a written appaaranca panonally or by attomay and
tl1i1\9 in vritiruJ with tha Court your dafenaaa or abject:1on.a to the
claiae .et: forth avawt you. You are warned that ir you taU 1:0
do sa 1:be oue uy proceed vlthout you and a judguut uy be
ant:aracl :?~~t you by the COIU't vitbout: turtbar not:1ae for any
IIOn&y cl in the "~laint or tor any ether claia or rali.~
raqueated by the Plailttift. You aay loaa _ay or praperi:.y or
other dght:.a iaportant to you.
YOU SJIOUI.D TAU '1'JII8 PAPa TO YOUR LUflrIR AT ONCB. II' YOU DO
HOT RAVJI A LMIYBR OR c:aJIJfCn Al'I'oaD 011II, GO '1'0 0Jl TELZPBONB 'r8B
OrrICB Sft !'ORTII IlEIDIf TO rIND 0U'l' WIIIbUl: YOU CAB aft ,.......at. HBLP.
court Maiftiatrator
CWlberland COUnty CauRbouae, 4th Floor
one COUftbouea Squara
Carlls1e, PI. 17013
(717):140-6200
.
TRUE COPY FROM RECORD
In TISlImony wMreof.1 hItI ullla III my hlInd
aIId UII seal of said CWrt at CarUsII, ~
... ~ 1A~.J
ThlI n-'"CJ:iY
. Pr~f\
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.
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.
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CD....DNWULyH.OF ~ENJllyLVANIA
INIURANCEDEPAITMENT
. .
1TIAIllIIIIIIY ICIllAIII
MAIIIIISIUIIG,.A m.
, ..
"
I ,I .
OCtobee 14, 1994
TIL.....III' 17111. 783-2164
Cael A. ~e_n
. .. B1Vh Stee.t Box 54
Kill.ratown, PA 17082
RBI Dapar~nt pll. HOI 94-1.'-08.83
L
D.ar Mr. ~er..nl
w. have juat received a reply frOD Willlam Stafford in r.f.renc.
to your coaplaint.
Bnola.ad i. a photocopy of that l.tter for your revi.w whioh
.xplaln. the coapany'. posltlon.
Sbould the coapany not follow through, a. agread upon or l.aue
youe ooverag. with an exclusion rld.r, pl.... notify...
Thank you for bringlng tbl. ..tter to the D.par~.nt'. attention.
we ar. glad to have ba.n of aad.unc. to you.
Sineerely your.,
/i..J q. ~
~ i. SIIitb, CLU
COa.uaer Servic.. Repr...ntativ.
DSlbjb
IDclosure
118 1110-1&-1
-
~30 '96 10:27
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R.S.S,:.I.~
717 236 3777;'151/52
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mcHIB1'1' 1-2
os,3Q '95 10:27
sro 8Y:R,S,S,~. 12151851-1.120: ~-30-95 :\0:33,\.'111 :
p:"',t.:I'
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. I ..
WlIllIII It. SlIffan. CW, RIll '
1Jl... 0'11111II an.. ' \
SIuII.. ' - Slftloll IIMII.
TlII" J .,.. I .... ~ at "'-I.
SlIIII.' CIllml_
P.D. lall"..... NlIII. R. 3m!
1104I .'-1771
S.ptaabar 21, 1994
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IUllrdl carl A. AaerJl&n
Plan 'I Z5712200
Your 10'1 9'-119-081IS
Baro14 a. SII1th, CUJ
Coneu..r S.rvlc.e aepr...ntativ.
(! -nwea1th of Plnuylvania
Inlurana. Departalnt
itrawberr~ ~r.
Barrllburg, PA 17120
Dear Hr. SlI1ttl
~ECEIVEb
OlIlaI~"n1Pa1~~
OCT 04 1994
PennsylvanlOl
In;ur...nClil Dapanmll"'
Thank you for your letter datltll septllll!Jl1' lli coaa.rl11nv Mr. Aaenllll' II
application for cave rag. under our .-play.. S.naf1ta PrQ9raa (DJI).
I appreciat. ttl. opportunity )'our letter baa Viven IIIe to review this
fl1a 1n 4etail. .
Mr. ~maD originally appli.d for covera,. a. an on-time 1IIP10fll
addltion to plan number 15712200 on S.ptaabar 12, 1989. ~ tba~
tiu, all app11catlou for !lIP were elJbject to M41ca1 wu!ervd1:11l9'
BII4 C0gerave val not gurantHCl. Hr. __man'e app11c:atloD for
_era,. va. 48clined due to tlle hietorr of a beart _~r. 'fllls
deel.1cm "a. _48 1n accordarlc. with our lIallal llDdervrltl1l9
gui4eUn"e for tlaart IIII1'IIIIr.. .. alJbaaquantlI 1euucl that the
Glllr41aD DeCl1alon protlibit:a Mdlcal UDdenrit DI) for cm-tlM
ac141tiollll. '
Oft J\llJ' 11, 1991 Mr. __ ruDP111tll for coveralJ8.' fti.
applloation for coveraVI ".. al.o-aaolined a. .e iDCOrreat:1y.
trutH Hr. ....l'IWl ... a 1a~lltrant.
,11: ,,.oal4 IIH -p tbat ". di4 48oUIIIIl1". _l'IWl'. app11G1t:1pn 1D
.error. ' .. itiU be 91&4 to ac14 Ma:. ....man OIlto the pou.CI?,
.ubjeat to ,_ipt af a n.., fan, _ oo.Dl.tH app11cat1on fOal.
.,I have lItAolo-f14 a oopr of tII8 ,appucatloa .loE~III:. .---....,..'
uae. .;~.,.. iIPlcatioJl 111-'" H .ut: to Il1t:ob1e Wn.on, r-n.
:-.;r:Jr~j~..fl+'~ Dl,,1aIOll, .,.0. IIoa .2510, J~aoa~1U.'..!!7, ;.;..'
, ;", 'e,
. ,'C:. ..,.....,..
1 .iDC8r:3 apologb. for uy IDCOl1VenJ..nC8 that OIR .rra~-_Y
have Gla . If 7011 have anI' fusthar queadou or concern.,
pl.... do not healtat. to ClOIltaat u..
Sli2I~ It
wft/~aa B. Sta!for ,
08/30 '9S 10:27
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.
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exhibit B
.
CARL AMMERMAN and WENDY AMMERMAN
Husband and Wife, and all others
similarly situated,
Plaintiffs
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
'\S
No, ~-4410 CIVIL TERM
CLASS ACTION LAWSUIT
vs.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA, and THE PRUDENTIAL
PROPERTY AND CASUALTY INS. CO.,
Defendants
JURY TRIAL DEMANDED
MOTION FOR EXTENSrON OF TrME
Defendants, The Prudential Insurance Company of America
and The Prudential Property and Casualty Ins. Co., by their
counsel, Reed Smith Shaw & McClay, move for an extension of time
to October 2, 1995 to answer or otherwise plead to the complaint
in this matter and in support thereof set forth as follows:
1. The complaint in this class action lawsuit was
filed on or about August 17, 1995.
2. Service of the complaint was made on or about
August 21, 1995, making a response in the form of an answer or
preliminary objections due on or before September 11, 1995,
.
3, The allegations of this matter involve events
commencing in 1989 or earlier and, since the complaint contains
class action allegations, involve issues extending beyond the
named individual plaintiffs,
.-..'~
".
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4. The complaint also raises :ssues which may have a
relationship to the complex areas of state regulation of insurance
and federal regulation of employee benefit programs.
5. Counsel for the defendants requested an extension
of time to answer or otherwise respond to the complaint from
counsel for the plaintiff. Plaintiffs' counsel advised defense
counsel that no extension of the time for filing preliminary
objections would be granted and that only a two week extension in
which to answer the complaint would be granted. A true and
correct copy of the letter from counsel to the plaintiff to
counsel for the defendant stating plaintiffs' counsel's position
on this matter is attached hereto as Exhibit "A".
6. Defendants need a modest amount of additional time
to complete the evaluation of this matter and determine whether
preliminary objections should be filed. In addition, because of
the investigation needed to file an answer to the complaint, an
extension of time for two weeks is insufficient,
7. An extension of 20 days to answer or otherwise
plead would expire on Sunday, October 1, 1995. Accordingly,
defendants seek an extension of time to answer or otherwise
respond to the complaint to and including Monday, October 2, 1995.
8. On Thursday, September 7, 1995, the undersigned
counsel for the defendants attempfed to contact counsel for the
plaintiff with regard to the presentation of this motion and was
advised that counsel for the plaintiff was away from her office
and would not return until Monday, September 11, 1995.
.
-2-
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, .
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WHEREFORE. defendants request the Court to enter an
order in the form attached hereto granting them an extension of
time to and including October ~, 1995. in which to answer or
otherwise respond to the complaint in this matter.
Re~ectfully submitted,
,~jf~
~n McN. Cramer
A~torney I.D. No, 00478
I
I
REED SMITH SHAW & McCLAY
'~213 Market Street. 9th Floor
P.O. Box 11844
Harrisburg, PA 17108
(717) 234-5988
Attorneys for Defendants The
Prudential Insurance Company of
America, and The Prudential
Property and Casualty Ins. Co.
.
-3-
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'-....- ~-.... " - .~,~
.. -. ..;.. ,
,
.
JOSIrll N.1olIUU.o
TlUY S.IIYMAH
DAVID L LIIlZ
MICIIAIL I.ICOS1X
PAMIl.\ o.llIUMAN
CA1ltIIIlNlI N.IolAIIADY.StoI/1'H
IUCILUII A,IAIlLOCK
DAVID So W1SHUII
ANGINa & ROVNER. P.C.
'<1IOU C, DUOII
"1CIlAEL1. HAVlT1KY
ROlIN ,. N.U7m I ~
LAWUNCap,1AaONa
DAWN L lIH1nNOI
S1VIlIH .. faaIIlN
SOI.llMDN Z. _SKY
IDlIrll N. DDIIA
UI1m 01
TIlE 8FST LAWYERS
-01-
AMFJICA
IUCILUII Co AHOIHO
HIlL l.lllYND
September 1, 1995
John MeN. Cramer, Esquire
R.ed Smith Shaw , MCClay
213 Market Street
P. O. Box 11844
Harrisburq, PA 17108
Ra: Ammerman v. Prudential
No. 95-4410 CCP CUmhAr18nd
Dear Mr. Cramer:
This 1. to confirm our telephone conversation of Auqust 31,
1995. You requested an extension to respond to the Complaint. I
informed you that we are aqreeable to a two week extension to file
an Ansver. If, however, it is your intention to file Preliminary
Objections, ve cannot qrant an exten.ion and they mu.t be filed
within the time prescribed by our Rule. of Court.
Thank you for your cooperation in this mat:ter.
Very truly yours,
~Jj.~
Pamela G. Shuman
PGS/bjs
~
75589/UI
'503 HORTH FRONT STREET. HARRISBURG, PA 17110.' 708
.717123l-4l711'
F4X r7171 238-&110
EXHIBIT A
.
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CERTIPICATE OP SERVICE
I hereby certify that a true and correct copy of the
foregoing Motion for Extension of Time has been served this 8th
day of September, 1995, by United States Mail, first-class,
postage pre-paid, upon:
Pamela G. Shuman, Esquire
Angino & Rovner, P.C.
4503 North Front Street
Harrisburg,~A 17110-1708
:-.-J_
rJoHh MeN. Cramer
I
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exhibit C
.
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"
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CARL AMMERMAN and WENDY AMMERMAN
Husband and Wlfe, and all others
similarly situated,
Plaintiffs
vs.
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
No. t{:4410 CIVIL TERM
CLASS ACTION LAWSUIT
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA, and THE PRUDENTIAL
PROPERTY AND CASUALTY INS. CO..
Defendants
JURY TRIAL DEMANDED
ORDBR
AND NOW, this ~ day of September, 1995, the time in
which defendants The Prudential Insurance Company of America and
the Prudential Property and Casualty Insurance Company may respond
to the complaint in this matter is extended to and including
Monday, October 2, 1995.
By the Court:
IV [!c1<j.a.... .d. t3, 'l.1e;-
Bayley, J.
..
TRUE COPY FROM RECORD
In TlISIhno"~ Whereof, I hInl unto.. my hind
and the SIll of said Court It c.rlIIlI PI
!}Ii; ~~ ~ ~~ 1i~
~ I.M .}'t u .J
PruthOllCll8ry
DI
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CERTIFICATE OF SERVICE
I hereby certify that on September 20, 1995, a true and
correct copy of the foregoing document was served upon the
following counsel of record by United States mail, postage
prepaid:
Pamela G. Shuman
Angino and Rovner
4503 North Front Street
Harrisburg, PA 17110
Counsel for Plaintiffs
REED SMITH SHAW & McCLAY
By
R bert B. Hoffman, E
Attorney I.D, No. 23
213 Market Street, N
P. O. Box 11844
Harrisburg, PA 17108
(717) 234-5988
46
nth Floor
.