Opinion ID: 8410698
Heading Depth: 2
Heading Rank: 1

Heading: The HealthExtras Program

Text: In 1997, HealthExtras, Inc., created a group insurance program that offered $1,000,000 or $1,500,000 accidental permanent and total disability coverage, plus  $2500 emergency accident and sickness medical expense coverage (HealthExtras Program). HealthExtras advertised and sold policies to consumers through marketing agreements with banks and companies that issued credit cards, including American Express, Citibank, Capital One, J.C. Penney, Sears, and Conoco Phillips. The banks and credit card companies solicited cardholders to enroll in the HealthExtras Program by sending flyers with their customers' monthly credit card bills, by direct mail, or by telephone. The flyers included images of the late actor Christopher Reeve, statements by Mr. Reeve endorsing the HealthExtras Program, and brief descriptions of the HealthExtras policies. 1 If a cardholder expressed interest in the HealthExtras Program, the marketing agent mailed them a program description encouraging them to enroll and reminding them that HealthExtras was created to provide families with financial security because sometimes lives change in an instant, like Christopher Reeve's. Joint App. A-38. Cardholders who chose to enroll did so by agreeing to a monthly charge on their credit card bill. Because HealthExtras is not a licensed insurer or broker, however, it contracted with defendants Stonebridge, TransAmerica, and Federal to underwrite and issue the disability insurance. 2 Defendants issued the policies to HealthExtras, the policyholder, as group and blanket accident disability and medical expense insurance, and the enrolled card holders became group members. The policies, however, narrowly circumscribed the kinds of injury or illness under which policy holders could recover. 3 Plaintiffs were among the card holders who purchased HealthExtras coverage. They began paying premiums on the policies in 2000 and continued to do so until HealthExtras terminated the HealthExtras Program in December 2014. During their fourteen years  of coverage, plaintiffs did not suffer qualifying losses or submit claims.