~pathwalker~

Civil case against insurance company begins
Associated Press
Posted: 4 hours ago

LEXINGTON, N.C. (AP) - A life insurance company cheated the widow of late race car driver Dale Earnhardt out of millions of dollars by refusing to pay up when he died, a lawyer for Richard Childress Racing said in the opening statements of a civil trial Wednesday.

The insurer, United of Omaha, argued the $3.7 million policy was never in effect because Earnhardt had not taken the required physical before he died in a crash at the Daytona 500 in 2001.
"We made a fair decision. We made a reasonable decision. There's no question we made an unpopular decision, but we did what we're supposed to do based on what occurred," company lawyer Stephen Coles told the jury.

But Richard Childress Racing - Earnhardt's car owner, which is pursuing the matter on behalf of the family - has accused the insurer of failing to properly investigate before denying payment just days after the driver's death.

An insurance company has "a duty to find out why a claim should've been paid," said attorney John Morrow.

He said in his opening statement that Earnhardt had passed a physical for NASCAR shortly before his death.

Richard Childress Racing took out the policy on Earnhardt's behalf and made a $5,000 payment in January 2001.

Earnhardt died in the last-lap crash that Feb. 18. The next day, the race team received a second invoice - dated two days before the crash - for another $5,000 payment toward the annual $21,645 premium. Childress Racing made the payment believing the policy was active, according to the complaint.

The $3.7 million was part of a $7.2 million benefits package, according to the driver's contract. A $3.5 million policy with a second insurer, set up in 1996, was paid to Childress and signed over to Earnhardt's widow, Teresa.

But United of Omaha sent a letter dated Feb. 21 to Childress Racing saying it would not pay the $3.7 million because the application was incomplete "and now cannot be completed," according to the complaint.

Coles said that, despite the payments, the policy hadn't attached to the 49-year-old Earnhardt, one of the most popular drivers in the history of stock-car racing, because he had put off requests to undergo a physical.

"Just because somebody files an application doesn't mean they get a policy," Coles said. "It's not automatic. It's especially not automatic when it's the amount of money in this case."

Childress Racing's lawsuit alleges that the insurer operated in bad faith by not investigating completely, and that the denial of benefits without a "reasonable" investigation amounted to unfair and deceptive trade practices. Childress' attorneys indicated earlier this week that they should receive the full $3.7 million payment, along with compensatory and punitive damages.

Aside from its claim that Earnhardt never took the required physical, United of Omaha also denied responsibility for the actions of the two contractors who set up the policy. Childress has reached a partial settlement with the two, though the agreement is sealed. Davidson County Superior Court Judge Kimberly Taylor has issued a gag order in the case.

Childress and Bill Patterson, executive vice president of Childress Racing, both testified about the payments made to the Shuford Insurance Agency of Concord, which helped arrange the policy.

Childress testified that he was "pretty upset" when the letter arrived denying the claim.

"All I know is we had the checks where we paid for insurance," he said.

~pathwalker~

The insurance company probably doesn't want to pay because they had just taken out the policy. I think that if they accepted two payments toward the premium, then they accepted him and he did have a policy. Otherwise they shouldn't of accepted the money.

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10% Lil Devil

Annie Fawn

I agree. I think they will discover in court that by accepting the money they in essence acknowledged the policy and will have to pay.

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Courage is just fear that has said it's prayers.

~pathwalker~

I know, its not like THEY KNEW he was going to die in an ACCIDENT! He had probably put off the physical, BECAUSE he was BUSY racing. Gawd, red tape is rediculous! If I hear anymore about it I will let you know. Thanx for posting Fawn.

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10% Lil Devil

Plenty Fox

Yes. They entered into a fiduciary relationship when they accepted the premium payments.

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Damme ape’semmai, "Andabichidaiboonee’ gimmadu’i.Wihyu memme hainjinee’ nahandu’i. Enne wizha sudei’ tsaangu mabizhiahkande," mai.

The Creator said, "A foreign race of white people will come, who will become your friends. You should treat them well."

The Creator sure had a strange sense of humor!

~pathwalker~

I wonder what ever happened with it, I havent heard anymore about it. But, as with most things in court, it will probably take forever and if Theresa wins then we probably WONT hear about it.

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suzyq

You would think they would have some type of follow-up system and would advise Childress and Earnhardt there wasn't a policy in effect without the physical.

__________________
"I cannot think that we are useless or God would not have created us.
There is one God looking down on us all. We are all the children of one God. The sun,
the darkness, the winds are all listening to what we have to say." **Geronimo

billyjoejimbob

Having worked for and dealt with with insurance companies in the past, I can say that even if they sent a check it doesnt mean anything. I can send a check to a company I dont have insurance with and they will cash it. There are payment processing centers that just get the checks and note accounts, if there is no account it goes into an overage file until they find an account or the person asks for the money back (they wont return it without you asking) but if they are audited, they will get caught.

they are a business and will do anything to make money and avoid giving it out.

if he didnt get the physical, the policy is no good. yeah he got a NASCAR physical but the insurance company has nothing to do with that or didnt even know about it. plus, what is involved in a NASCAR physical? Do they test how long you can sit on your butt and drink before you have to pee? lol.

i say they are only gonna get the $10k they paid into it.

Insurance companies provide a good service but you have to follow the directions to a "T".

~pathwalker~

ITS called RED TAPE!

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10% Lil Devil

Dawgwhisperer

Fortunately Theresa won't be needing food stamps if she doesn't get the insurance money, but it should've been handled more professionally to begin with. It's a high risk sport and I'm sure there are alot of technicalities pertaining to it because of the the high possibility of an accident. Just for "normal" homeowners insurance we were "grilled" about what kind of dogs we had and for auto insurance, did we scuba dive? did we ride a motorcycle, etc. etc.

The objective for them is to TAKE our money, not to hand it back out.....

__________________
“People once believed that when someone dies a crow carries their soul to the land of the dead, but sometimes something so bad happens that a terrible sadness is carried with it and the soul can’t rest. Then sometimes, just sometimes the Crow can bring the soul back and put the wrong things right.”

I WISH.............

suzyq

Now, if Richard Childress took out the insurance, wouldn't it be their money? I could see them taking it out because Earnhardt brought in so much money for them and this money wouldn't even touch what Earnhardt earned for them. This should probably be on the hmmmmmm thread. lol But in thinking now, does Teresa get the income from his novelty items still being sold? Or does Richard Childress since he owned the car? NASCAR? Inquiring minds wanna know. lol

__________________
"I cannot think that we are useless or God would not have created us.
There is one God looking down on us all. We are all the children of one God. The sun,
the darkness, the winds are all listening to what we have to say." **Geronimo

billyjoejimbob

wow, nj isnt even THAT anal about questions. they ask if you have an alarm, if its garage, driveway or street kept, how far you drive to work.

than they charge you a ton of money anyway cause its NJ.

i moved from one county to another in january and because there is a bad town in the county my insurance went up $800!

~pathwalker~

They accepted two payments ON THE policy. He had a physical scheduled but DIED before it could be done. However, He was issued the policy and they are just trying to get out of the pay-off with a loophole. Its not like they didnt know what the money was for. SuzyQ, Those are good questions, I will check into that for you.

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10% Lil Devil