Liberty National Life Insurance Company v. Sanders
Alabama Supreme Court
792 So. 2d 1069 (2000)
- Written by Alex Ruskell, JD
Facts
Betty Sanders (plaintiff) wanted to buy a life insurance policy for her son, David Ogle. Sanders contacted Liberty National Life Insurance Company (defendant) and spoke with Keith Mahone. Mahone sold Sanders a life insurance policy that Mahone said would pay Sanders $10,000 upon Ogle’s death. However, this statement was not true because Ogle stated he had a brain disease on the application. Under the policy’s terms, the policy would only pay the submitted premiums plus 10 percent if Ogle died of natural causes within three years of getting the policy. There was another policy available that would have insured Ogle immediately for $2,500. A few days later, Ogle died of natural causes. Liberty National paid Sanders the one premium she had paid plus 10 percent. Sanders sued, arguing that she was entitled to $10,000 as represented by Mahone. The trial court ruled in her favor, and Liberty National appealed.
Rule of Law
Issue
Holding and Reasoning (Johnstone, J.)
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