An Arizona jury has ordered MetLife to pay $55 million in a bad faith case. The claim arose out of the insurer’s refusal to pay a $30,400 claim from a couple whose SUV was stolen and vandalized. A new Ford Explorer owned by Kenneth and Tammy Nardelli was stolen in Arizona from a shopping mall parking lot in 2002. The vehicle was later found in Mexico abandoned and severely damaged. A claim was made by the owners and a battle started over the refusal to cover their claim with MetLife’s Auto & Home division. The dispute lasted for six-and-a-half years. Although the Nardellis contended that the vehicle was a total loss and could never be restored to its original condition, MetLife refused to replace the SUV. Instead, the insurer sent their insureds a check for $10,759 and cut off payments for a rental car required under their policy.
The Nardellis then filed suit, accusing MetLife of a deliberate bad faith scheme to deny them their rights under their insurance policy. During the trial the jury was asked to compensate the couple for their emotional distress and to award sufficient punitive damages to punish MetLife and set an example for other insurers. After a month-long trial, the jury found that MetLife had acted in bad faith in handling the Nardellis’ claim. Jurors awarded the couple $155,000 in compensatory damages and $55 million in punitive damages.
Internal MetLife documents indicated that the car qualified under the company’s rules for a total loss and should have been totaled. MetLife reported that it had a profit goal of $155 million for 2002, an increase of about $100 million from the previous year. There was an indication in the company’s documents that if the division didn’t make that goal, it would be sold. Documents – many of them marked confidential – showed there was extreme pressure on the claims department to assist in making that goal. Jurors viewed videos and documents produced by MetLife’s home office and distributed to the claims office that encouraged staff to get tough on claims. MetLife also concealed information from the Nardellis that there was a provision in their policy stating that if the vehicle was less than a year old and had fewer than 15,000 miles, they were entitled to a replacement vehicle if their vehicle was totaled.
Richard A. Dillenburg of The Law Office of Richard A. Dillenburg in Tempe, Arizona, and Steven C. Dawson and Anita Rosenthal of Dawson & Rosenthal in Sedona, Arizona, represented the Plaintiffs and did a very good job.
Source: Lawyers USA
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