A federal district court in California has dismissed a claim brought under a long-term care insurance (LTCI) policy for statutory financial elder abuse, ruling that a “basic denial of insurance coverage” was never contemplated as a form of financial elder abuse.
Janice O’Brien sued Continental Casualty Company after it denied her claim under a long-term care insurance policy that she had purchased. Among the claims she asserted: financial elder abuse in violation of California Welfare and Institutions Code Section 15610.30 et. seq., based on Continental’s “failure to pay benefits due under the policy.”
Continental moved to dismiss the claim for financial elder abuse, arguing that O’Brien’s claim was one for breach of insurance contract rather than one for abuse.
California Welfare and Institutions Code Section 15610.30(a) provides that financial abuse of an elder occurs when a person does any of the following:
- Takes, secretes, appropriates, obtains or retains real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.
- Assists in taking, secreting, appropriating, obtaining or retaining real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.
- Takes, secretes, appropriates, obtains, retains, or assists in taking, secreting, appropriating, obtaining or retaining, real or personal property of an elder or dependent adult by undue influence.
A person can take, secrete, appropriate, obtain or retain property when the person or entity knew or should have known that this conduct is likely to be harmful to the elder or dependent adult, or when an elder or dependent adult is deprived of any property right, including by means of an agreement, donative transfer or testamentary bequest, regardless of whether the property is held directly or by a representative of an elder or dependent adult.
The Court’s Decision
The court granted the motion to dismiss, finding that O’Brien had not stated a claim for financial elder abuse under Section 15610.30.
The court found that the complaint described a “straightforward contract breach” and said that there was no indicia of fraudulent or otherwise improper activity underlying the wrongful receipt of property. It added that neither the language of Section 15610.30 nor its accompanying legislative history indicated that a basic denial of insurance coverage was ever contemplated as a form of financial elder abuse.
Accordingly, the court dismissed O’Brien’s claim for financial elder abuse without leave to amend.
The case is O’Brien v. Continental Casualty Co., No. 5:13–cv–01289 EJD (N.D.Cal. Aug. 13, 2013).
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