The Superior Court of Quebec for the District of Quebec recently certified a class action against Industrial Alliance Insurance and Financial Services. The lawsuit is being filed on behalf of a group policyholders and their dependents who purchased Uniflex universal life contracts and which were in force on October 5, 2009.
The lawsuit is being filed by the Létourneau Gagné law firm on behalf of André Dorval, and it alleges that the insurer made false or misleading representations and breached its duty to provide information by omitting important facts about premiums and the conditions necessary to keep policies in force.
The plaintiffs are divided into three subgroups. Subgroup 1 consists of customers whose contracts had lapsed due to the exhaustion of the accumulation fund, where the total premiums paid divided by the number of months during which the policy was in force is equal to or greater than the minimum premium under the contract. Subgroup 2 includes those who died when the policy had lapsed or after the nominal value of the insurance coverage had been reduced, where the sum of the premiums paid divided by the number of months during which the policy was in force is equal to or greater than the minimum premium under the contract. Subgroup 3 includes all class members whose nominal value of insurance coverage was reduced.
The lawsuit is seeking different forms of compensation depending on the group in question. In general, the lawsuit is asking that Industrial Alliance reimburse plaintiffs for the difference between the premiums paid and the contractual premiums, plus returns, less the value of the fund. The lawsuit demands that the lapsed contracts of living insured parties be reinstated and that company notify them of the methods by which they can be kept in force in future. For the dependents of deceased insured parties, the lawsuit seeks to compel Industrial Alliance to pay them the difference between the benefits provided when the contract was signed and those which were paid. For subgroup 3, the plaintiffs want any reduction of the nominal value to be completely erased.