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A 90-year-old woman who was denied insurance coverage she had paid for more than a decade has won a multimillion judgment against her insurer.

She and her husband decided to take out a long-term care insurance policy for both of them in case they became unable to care for themselves. Even after her husband died a year later, the woman continued making payments to Mutual Protective Insurance, which later became Medico Insurance Co.

In 2007, the woman was diagnosed with dementia, and she moved into a nursing home in January 2008. The cost of the nursing home was covered by her long-term care benefits. Ability Insurance Company obtained all of the long-term care policies of Medico Insurance and reviewed her case. They denied her coverage because the medical staff at the nursing home said she did not require “continual supervision” and that her doctor had classified her as only “moderately” impaired. Finally in October 2011, Ability Insurance agreed to start paying the benefits she was entitled to after a doctor hired by the insurance company said she required constant care. But they would not pay for the benefits she was denied between January 2010 and October 2011.

The woman and her daughter filed a lawsuit in federal court against Ability in September 2010 for their failure to pay her benefits and ultimately won a $34 million jury award on April 6, 2012. Of the award, $32 million was for punitive damages, which serve to punish the defendant in the hopes that it will deter similar actions in the future. The punitive damages will most likely be reduced because the state has a $10 million cap on punitive damages.

While this case will probably be appealed and the damages won’t be awarded for years, it still shows that even a nursing home resident, one of the most vulnerable people in the U.S., can take on a large insurance company and win. Virginia nursing home residents do not need to be afraid to fight for what is rightfully theirs. With the proper legal guidance and a solid case, anything is possible.


About the Editors: The Shapiro, Lewis & Appleton personal injury law firm, which has offices in Virginia (VA) and North Carolina (NC), edits the injury law blogs Virginia Beach Injuryboard, Norfolk Injuryboard and Northeast North Carolina Injuryboard as pro bono services.

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