Boulder County jury returns $37 million verdict in case of cancelled insurance policy: Lafayette woman lost coverage after serious car accident [Daily Camera, Boulder, Colo.]

Jan. 31--A Boulder County jury has ruled that a health insurance company must pay $37 million to a Lafayette woman whose health insurance policy was canceled after she was seriously injured in a car accident.

The insurance company had said she failed to disclose previous medical treatments, namely an emergency room visit for shortness of breath and treatment for uterine prolapse. The company refused to cover roughly $185,000 in medical bills from the accident and canceled the woman's policy.

The plaintiff's attorney, Marc Levy of Greenwood Village-based Levy, Morse & Wheeler, had asked the jury to consider a verdict of $7 million or $8 million based on the evidence. He said he was "shocked, but obviously very gratified" when the six-person jury returned on Friday with one of the largest jury verdicts in Colorado history.

"The jury was asked to consider how we want insurance companies to treat people," Levy said. "It sends a message that the answer is 'Not like this.'"

Levy said the large verdict is very satisfying for his client -- Jennifer Latham, a former preschool teacher who now supports her four children on Social Security disability payments -- but nothing will change for her in the short-term. He said Time Insurance Co., which also does business as Assurant Health, will almost certainly appeal the decision.

"The first thing (Latham) said to me was, 'Hopefully this will change how they do business,'" Levy said. "She finally got her day in court after four years, and six citizens of Boulder County said, 'We do not think this is right.'"

Peter Duckler, a spokesman for Assurant Health, said he could not comment on litigation or say whether the company will appeal.

Latham, now 39, suffered multiple compound fractures and a brain injury when a suspect fleeing police rammed into her car in October 2005 near the intersection of 23rd Avenue and Collyer Street in Longmont.

Latham spent a month at Longmont United Hospital and another month at the Mapleton Center for Rehabilitation, Levy said.

Five months before, she bought an individual health insurance policy from Time Insurance Co. for herself and her two younger children. Her older children were covered under her ex-husband's insurance through work.

Soon after she was released from the hospital, she received a letter from Time Insurance informing her the company had rescinded her policy and would not pay her expenses from the accident. The decision to cancel her policy also made it nearly impossible for her to get insurance from other companies, Levy said. She now receives Medicare benefits.

Last year, Congress investigated Assurant Health and several other insurance companies for their rescission practices.

Assurant CEO Don Hamm testified that investigations into full disclosure of past medical treatment are not based on the cost of a claim but are only initiated when someone makes a claim related to a chronic condition that is likely to have existed before the person requested insurance coverage.

He also testified that policies are canceled only when the missing information would have affected the decision to insure that person.

Hamm and the other insurance executives all said they would not change their policies to only cancel coverage in cases of deliberate fraud, as opposed to simple error or misunderstanding.

An investigation by the House Subcommittee on Oversight and Investigations showed that health insurers WellPoint Inc., UnitedHealth Group and Assurant Inc. canceled the coverage of more than 20,000 people, allowing the companies to avoid paying more than $300 million in medical claims over a five-year period.

Contact reporter Erica Meltzer at 303-473-1355 or meltzere@dailycamera.com.

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