Telles v. Commissioner of Insurance

Life-insurance companies have long used sex-based underwriting to classify risks and choose whom to insure and at what rates. Males and females presented different risk calculations, given the higher mortality rates for males than females. Because females live longer, their life insurance premiums were lower because they typically paid into the plan longer before benefits accrued. In 1988, the Massachusetts Commissioner of Insurance (defendant) issued regulations forbidding the use of sex-specific mortality tables in life-insurance underwriting. The regulations also prohibited treating insureds differently on the basis of sex. The regulations resulted in higher life-insurance premiums for women. However, other Massachusetts statutes permitted insurers to engage in sex-based risk classifications. Deborah Telles, other life-insurance consumers, and two insurance companies (plaintiffs) challenged the regulations, citing (1) a lack of statutory authority, (2) a violation of other statutes allowing for sex-based risk classification, (3) the arbitrary and capricious nature of the regulations, and (4) an equal-protection violation. Cross-motions for summary judgment were filed. The trial court upheld the regulations on the grounds that authority came from the Massachusetts Constitution’s Declaration of Rights and that the regulations did not have a discriminatory purpose. The Massachusetts Supreme Judicial Court granted direct appellate review.