Success Story: Mohammed Ibrahim
*Names have been fictionalized to protect the privacy of our clients.
Mohammed Ibrahim was the owner of a small drywall company in Midland. He started the business before either of his sons was born and took great pride in its success and the success of his family. So, when his eldest son became a father, Mohammed was delighted to say the least. He even smoked a cigar to celebrate the arrival of his first grandchild. Little did anybody know that this gesture would come back to haunt him.
Insured with good intentions
Because his family was so important to him, Mr. Ibrahim had purchased a $250,000 life insurance policy to provide for them in the event of his death. While at work on one of the hottest days of the year, at age 53, he died from a heart attack. When his wife and sons claimed the benefit, the claim was denied.
Mr. Ibrahim had purchased the policy at age 50. His application disclosed no prior medical problems, except elevated blood pressure. Of particular note, the policy was issued with a non-smoker provision. He clearly stated on his insurance application that he did not smoke.
Denial based on misrepresentation
After his wife and sons submitted a claim for the benefit, the insurance company took six months to investigate. It then wrote a letter denying the claim based on misrepresentation. Because more than two years had passed since the policy was issued, the insurance company would have to prove that the misrepresentation was fraudulent to void the policy and deny the claim.
History as a smoker
Through its investigation, the insurer discovered a photo on one of Mr. Ibrahim’s sons’ MySpace pages showing Mr. Ibrahim smoking a cigar at a party celebrating the birth of his grandchild. The investigators also secured medical records indicating that he had a history of cigarette smoking. The medical information was inconclusive about whether he was still a regular smoker, or had smoked at all since getting insured – other than the cigar at the party.
Got counsel on referral
The Ibrahim family heard about the law firm of Share Lawyers through friends who had got help with a disability insurance claim. They engaged the Share Lawyers legal team to pursue the claim. Share Lawyers felt that the matter could be pursued to success.
Trial would result in all or nothing
A case like this requires a thorough review of medical records and any evidence that could determine whether the case could be settled or would have to proceed to trial. It was understood that, at trial, the outcome would be “all or nothing”. That is, the beneficiaries would either recover the entire life insurance benefit, or the case would be dismissed.
Total certainty elusive
After reviewing the evidence and the litigation process, Share Lawyers recommended that they try to settle the case through mediation. The case had strengths, especially that proving fraud is difficult. The case also had weaknesses. Fairly certain that Mr. Ibrahim had quit smoking years earlier, the family were not sure whether he might have snuck a smoke here and there. The insurance company also could not be certain.
One cigar not proof of fraud
Nevertheless, the one instance of celebratory cigar-smoking would not be enough to satisfy the court that Mr. Ibrahim was a smoker, much less that he intentionally committed fraud in purchasing a non-smoker’s life insurance policy.
Settled for 75%
At mediation, a settlement was achieved. The family received 75% of the life insurance proceeds, plus interest and a contribution toward their legal costs. The Ibrahims found this outcome acceptable and were pleased that the money would enable them to move forward with their lives – including care for Mohammed’s grandchild.
Denied your long term disability claim?
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