Opinion ID: 7011521
Heading Depth: 2
Heading Rank: 2

Heading: The Contractual Three Year Limitation

Text: The policy provides that a legal action cannot be started “(1) until 60 days after proof of claim has been given; nor (2) more than three years after the time proof of claim is required” (emphasis added). In the policy section entitled “Notice and Proof of Claim,” the policy provides that “[p]roof of continued disability and regular attendance of a physician must be given to the Company within 30 days of the request for the proof” (emphasis added). It is undisputed that Mogck is seeking continued disability benefits, not initial disability benefits. Therefore, in order to determine when the contractual limitation period began, we must first determine when Unum asked Mogck for a “request for the proof,” or a “proof of claim.” The district court determined that Unum’s June 1, 1995, letter constituted an adequate “request for proof.” We disagree. The June 1, 1995, letter (and the September 29, 1995, letter) informed Mogck of Unum’s decision to discontinue the disability payments past June 25, 1995. However, nowhere in either letter are the terms “proof,” “request for the proof,” or “proof of claim” utilized. Without an adequate request for the proof of claim, Unum never took the steps necessary to trigger the running of the contractual time limitation under the policy. 1 The insurance policy at issue was drafted entirely by Unum and is therefore a contract of adhesion. See Carrington Estate Planning Servs. v. Reliance Standard Life Ins. Co., 289 F.3d 644, 647 (9th Cir.2002); National Farmers Union Prop. and Cas. Co. v. Colbrese, 368 F.2d 405, 410-11 (9th Cir.1966) (“A fundamental principle of insurance law is that a policy is to be construed liberally in favor of the insured and strictly against the insurer, who normally is responsible for the language it contains.”). When an insurer drafts particular policy terms and procedures relating to the insured’s right to commence a legal action, the insurer must utilize those basic terms and procedures in order for the policy provision to be triggered. See McDonald v. American Family Mut. Ins. Co., 251 Ill.App.3d 354, 190 Ill.Dec. 653, 622 N.E.2d 63, 65 (1993) (insurer never adequately requested a proof of loss before denying claim; therefore, the policy’s limitation period could be tolled by the plaintiffs submission of additional information). ThMcDonald court also noted that the “proof of loss form” sent by the insurer was significantly different from the form described in the policy, further supporting the tolling of the policy’s statute of limitations. In conclusion,, because Unum drafted certain terms regarding the time limits on legal actions, but did not utilize those terms at all in its correspondence with Mogck, the policy’s time limitation provision was never rendered operative. Mogck’s action filed on February 9, 1999, therefore was not time-barred. The judgment of the district court is reversed and the case is remanded for further proceedings. REVERSED AND REMANDED.