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The disbursement of life insurance benefits cannot be contested in Florida after the statutory time limit, even if the policyholder obtained the policy by having an impostor take the required medical underwriting exam, the 11th U.S. Circuit Court of Appeals has ruled. The three-judge panel unanimously upheld U.S. District Judge Ursula Ungaro-Benages, who ruled that Florida law makes the execution of life insurance policies uncontestable as long as the policy was active for two years during the insured person’s life. “Because we agree with the district court that Florida law recognizes no implied ‘impostor’ exception to the two-year statutory incontestability period, summary judgment was properly granted and we affirm,” the panel said Monday in a decision in Allstate Life Insurance Co.v John Miller written by Judge Rosemary Barkett. Judges Stanley Marcus and Lloyd D. George, sitting by designation, concurred. “The fact of the matter is the insurance industry needs to do their investigation, whatever it is, within two years,” said attorney Bruce Alan Katzen, a partner at Kluger Peretz Kaplan & Berlin in Miami who represented the winning appellees. “That’s the law in Florida, and the 11th Circuit acknowledged that has been the law in Florida for almost a century.” Allstate Life Insurance Co. was represented by Carlton Fields, which referred calls to the insurance company. Reading from a prepared statement Monday, company spokesman George Nolan said, “Allstate is disappointed in the court’s decision today regarding this litigation. However, this case is still pending and Allstate will continue to explore the options available to us in finding a suitable outcome that is fair for our company.” The case stems from the death of John Miller in April 2003. Miller had purchased his policy from Allstate in September 2000. He changed the beneficiaries to Steve Miller, John’s son, and Nicholas Demetro in October 2002. After John Miller’s death, Steve Miller and Demetro applied to collect the $500,000 in benefits. Allstate filed suit in U.S. District Court in Fort Lauderdale, asking Ungaro-Benages to declare the policy void. Allstate claimed that an impostor must have taken the initial medical exam for John Miller because of discrepancies between the medical problems that led to Miller’s death and the health status of the person who was examined for underwriting purposes. Miller died of an infection following back surgery. Steve Miller and Demetro countersued, claiming breach of contract. Katzen said his clients disputed Allstate’s claim that someone else took Miller’s health exam. Ungaro-Benages allowed Allstate some discovery but eventually granted summary judgment to Steve Miller and Demetro. She ruled that Allstate’s claim was barred because the policy included a provision, required by Florida law, prohibiting any challenge to the policy after two years. Allstate appealed to the 11th Circuit in September 2004. The appellate panel agreed with Ungaro-Benages analysis. “Just as Florida courts would dismiss an otherwise valid action once the statute of limitations on that claim had run,” the court said, “Florida’s appellate courts have uniformly held that once the incontestability clause becomes effective, insurers are barred from attempting to rescind or cancel the insurance policy based on allegations that the insured engaged in fraud or misrepresentation.” Katzen said this case is interesting because insurance companies frequently deny claims based on an expired statute of limitations. “Now, they’re saying ‘Please don’t hold us to the same standards.’”

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