Opinion ID: 543582
Heading Depth: 2
Heading Rank: 2

Heading: The Availability of a Jumbo Policy in Light of Bias's Prior Drug Use

Text: 19 The defendants submitted affidavits from several experts who testified that in their expert opinions no insurer in 1986 would have issued a jumbo policy without inquiring, at some point in the application process, about the applicant's prior drug use. Dr. Francis Achampong, an Associate Professor of Business Law and Insurance and an occasional consultant for the insurance industry, asserted that life insurance companies will always and as a routine matter ask an applicant whether the applicant has ever used cocaine before issuing a term life policy of this size to that applicant. Joint Appendix (J.A.) 61. Dr. Achampong testified that insurers inquire about prior drug use at some stage of the application process, generally either in the initial application, during the medical examination, during the follow-up character investigation, or at some other stage. J.A. 466. Dr. Achampong further concluded that an affirmative answer to this question renders an applicant uninsurable because, [a]s a matter of standard underwriting procedure, insurance companies do not issue term life insurance policies, let alone $1 million term policies, to applicants they know have recently used cocaine. J.A. 61. Bernard R. Wolfe, a licensed insurance agent experienced in evaluating the insurance needs of professional athletes, offered essentially the same opinion that insurance companies do not issue substantial term life insurance policies without first investigating an applicant's prior drug use and that insurance companies do not issue substantial term life insurance policies to applicants who use cocaine. J.A. 79. 20 The Estate responded with expert testimony of its own showing that in 1986 some companies did not inquire about an applicant's prior drug use at the application stage and that other companies at that time did not inquire about an applicant's prior drug use at the medical examination stage of the application process. The Estate did not offer any testimony showing that a company existed at that time which would not have inquired about an applicant's prior drug use at some stage in the process. Moreover, the Estate did not offer any testimony tending to show that even if an applicant did admit to being a cocaine user, a company existed in 1986 which would have issued a jumbo policy to that applicant. The District Court thus concluded that the Estate had failed to rebut the defendants' showing that as a cocaine user Bias would have been unable to obtain a jumbo policy. The District Court recognized that Bias might have been able to obtain a policy by lying about his prior drug use, but rightly concluded that such a knowing and material misrepresentation in response to a direct question would have rendered void any policy which Bias thereby obtained. See D.C.Code Ann. Sec. 35-414 (1988). 21 We agree with the District Court. The defendants offered evidence that every insurance company inquires about the prior drug use of an applicant for a jumbo policy at some point in the application process. The Estate's evidence that some insurance companies existed in 1986 which did not inquire about prior drug use at certain particular stages in the application process does not undermine the defendant's claim that at some point in the process every insurance company did inquire about drug use, particularly where a jumbo policy was involved. The Estate failed to name a single particular company or provide other evidence that a single company existed which would have issued a jumbo policy in 1986 without inquiring about the applicant's drug use. Because the Estate has failed to do more than show that there is some metaphysical doubt as to the material facts, Matsushita Elec., 475 U.S. at 586, 106 S.Ct. at 1356, the District Court properly concluded that there was no genuine issue of material fact as to the insurability of a drug user.