Insurance Claim – Class Action – Dividend Provisions

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7^th Circuit Court of Appeals

Case Name: Rick Ochoa, et al. v. State Farm Life Insurance Company, et al.

Case No.: 18-1336; 18-1338

Officials: KANNE, SYKES, and ST. EVE, Circuit Judges.

Focus: Insurance Claim – Class Action – Dividend Provisions

Rick Ochoa and Irene Anderson hold participating life-insurance policies from State Farm Life Insurance Company and Country Life Insurance Company respectively. The policies guarantee policyholders annual dividends from their insurers’ surpluses, but the insurers decide the dividend amounts. Dissatisfied with their dividends, Ochoa and Anderson filed nearly identical class-action complaints claiming that the dividend provisions in their policies violate the Illinois Insurance Code. In a single decision, the district court dismissed the complaints. We consolidated the appeals and now affirm. Illinois requires only that life-insurance policies of this type contain a provision for policyholders to participate in their insurers’ surpluses. The policies at issue here contain such a provision.

Affirmed

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Derek A. Hawkins is a trademark corporate counsel attorney for Harley-Davidson, where he concentrates his practice on brand protection and strategy.