A federal court in Pennsylvania recently certified a class of Plaintiffs under Defendant Aetna Life Insurance Co.’s disability benefits plan (“Plan”). The Plaintiffs alleged that the Defendants forced beneficiaries who had received payments for personal injury claims to send the payments back to the company in violation of ERISA.

The named Plaintiff, Joanne Wolff, first filed suit against Aetna in 2019 when the company asked for the repayment of over $50,000 in long-term disability benefits stemming from a temporary disability suffered by the Plaintiff after a car wreck. At the time of the request, Wolff told the Defendants that her employer, Bank of America, did not allow reimbursement, and negotiations ended in an agreement that that Wolff would pay $30,000 despite this fact.

This did not end the dispute, however, and Wolff along with an at least 48-member class now allege that Aetna violated ERISA when it required reimbursement payments of long-term personal injury disability payments. Aetna responded that class certification would be inappropriate, as the proposed class did not meet the specifications required for certification under the Federal Rules of Civil Procedure. Mainly, the Defendants argued that some of the members of the proposed class should be disqualified, thus the number of participants in the class did not meet the numerosity requirement. It argued that since some of the members of the class were from different companies, there was not sufficient typicality to fulfill the requirements under the Civil Rules and members under other employers should be disqualified, reducing the class number to 28. Aetna also argued that timing issues barred several more participants under the relevant statutes of limitations.

The Court disagreed, stating that the class size both exceeded the minimum number of members and that the benefit plans of each member were substantially similar, thus making certification appropriate under the Civil Rules. It was decided that the plans at issue contained similar enough language that the fact that the beneficiaries worked for different companies was irrelevant. Judge Matthew W. Brann stated, “Because Wolff meets all three concerns implicated by typicality, the court finds she had satisfied this requirement.” Regarding the argument that certain members were barred under statutes of limitations, the Court stated that this number was so few that it would not impact the ability for the class to be appropriately certified under the Civil Rules.

Therefore, Wolff and the class of members is permitted to move forward in federal court as all requirements have been satisfied. This decision is a victory not only for members of the class, but for participants in disability plans governed by ERISA. ERISA requires that plan administrators fulfill various fiduciary duties to their participants; when these duties are violated it is often done on a large scale and impacts participants across not only the specific company but under similar plans as well. This decision shows the importance of policy language and similarity between plans, creating the standard that when companies breach their duties to participants, an action may be brought under similar policy language rather than under the same employer. This provides the opportunity for recourse under ERISA to a wider range of plan participants, ensuring the fulfillment of benefits and accountability from administrators.

In 2020 more than ever, the risk of interrupted travel plans loomed for those seeking to spend time and money planning trips in an uncertain world. With the Covid-19 pandemic an ongoing source of disruption for travelers across the globe, the decision to seek insurance coverage for trips was, and remains to be, justified. But what if the insurer doesn’t hold up their end of the deal? A federal court in New York is preparing to hear such a case in Seibel v. National Union Fire Insurance Company of Pittsburg, PA et al. This case concerns travel insurance policies bought by the Plaintiffs, who are alleging that the insurers overcharged on certain pre-departure and post-departure bundled plans by not reimbursing the “unearned portion of premiums” on trips that had been cancelled.

The suit was filed by the named Plaintiff, Nicholas Seibel, on behalf of a class including other individuals who held travel insurance policies with the Defendants, and were allegedly improperly required to pay premiums due to the policies’ failure to distinguish between pre-departure and post-departure coverage plans. This class is stated to be over 100 members, all purchasers of “lump-sum travel policies.” There is an additional subclass, asserting violations of Pennsylvania state law, specifically the Pennsylvania Consumer Protection Act. In the main case at issue, Seibel alleges that the Defendants routinely charge policy holders for all-inclusive travel insurance plan premiums, then subsequently refuse to reimburse any portion of the premium costs that were not earned. In fact, these premiums were impossible for the policyholders to earn due to cancellations occurring before the chance to depart.

Seibel had purchased two policies from the Defendants, one for a 10-day trip to Paris and one for a 5-day cruise to Miami. The Paris trip cost over $29,000 (as it was Seibel and four other travelers), and was cancelled in August of 2020, two months before the proposed departure date (intended to be in October, 2020). Each policy respectively provided the same pre- and post-departure coverage, the former including a promise of reimbursement for “non-refundable deposits” upon the cancellation of a trip before departure. The post-departure coverage included provisions for reimbursement for interruptions of the trip, medical emergencies, and the loss or theft of baggage. Essentially, Seibel argues that since premiums are paid to cover risks that may take place post-departure, if said departure never occurs, the insurer should be required to refund the amount of premiums paid on the policy. The Plaintiffs’ complaint further alleges that the policy does not include any provision for how to deal with the reimbursement of unearned premiums that have been pre-paid by the policy holder and qualifies the areas that are covered under a provision as “indemnification for travel related perils.”

Upon the cancellation of the Paris trip, Seibel was reimbursed for all deposits he had made (minus service fees) by the travel agency, though AIG (the Defendant responsible for the amount of the premiums) did not provide any funds to the reimbursement. AIG argued that it was not obligated to pay, as the cancellation was outside of a stipulated 15-day period, beginning at the date that the policy became effective. AIG instead offered a travel voucher worth $440.98, which was set to expire on August 25, 2020 and could only be used for one future trip, thus was virtually worthless. Regarding the 5-day Miami cruise trip, the cruise line issued a cancellation and full refund, though AIG continued to refuse to reimburse the amount of premiums paid, again citing that the cancellation had taken place outside of the 15-day window.

Counsel for the Plaintiffs proffer that insurers are “legally required” to reimburse holders of travel insurance policies for the amount of premiums that have gone unearned. The Plaintiffs are mainly seeking relief in the form of restitution for the amount of unearned premiums, among other categories of damages.