Policy cancellation precludes coverage
In Kutz v. State Farm Fire & Casualty Company, 2008 OK CIV APP 60, the Kutzes claimed that State Farm was in bad faith for failing to defend them on an auto accident claim that arose after their policy had been cancelled for non-payment of premium.
Plaintiffs did not deny they failed to pay the full premium due. But they claimed that State Farm did not prove that notice of cancellation was sent to them. The parties agreed that the policy requires State Farm only to mail the cancellation notice, and not to insure that it is received.
State Farm presented the affidavit of Taylor to prove mailing of the notice (which Plaintiffs said they did not get). The court found the affidavit was sufficient evidence that the notice was mailed: the undisputed evidence showed that the cancellation notice was prepared on August 26, 2004, the envelope was photographed going through State Farm's automated mail system, it was State Farm's regular practice and pocedure to submit the notices to the post office immediately thereafter, and State Farm did not deviate from that procedure. Taylor could testify as to the procedure, even though the mailing of the notice happened in Arizona, while Taylor was located in Oklahoma.
A business's regular practice and procedure is admissible as proof of mailing. State Farm's policy plainly states that mailing of the notice is sufficient proof of notice of cancellation.
Because the Court found that State Farm strictly complied with the cancellation provision in the policy, summary judgment was proper.
In addition, the court found that the agent was properly dismissed. The Plaintiffs claimed that the agent should have told them about the impending cancellation. But the court noted that an agent's duty relates to the procurement of insurance, not to the maintenance of insurance. Summary judgment to the agent was also affirmed.
This case was interesting because it discussed the type of evidence which could be used to prove mailing. State Farm has an automated mailing system. It provided evidence that the notice was created, and also had a photo of an envelope addressed to the Plaintiffs going through the automated mail system. The affidavit was not from someone at the mailing center, but from someone in it's local office.
Plaintiffs did not deny they failed to pay the full premium due. But they claimed that State Farm did not prove that notice of cancellation was sent to them. The parties agreed that the policy requires State Farm only to mail the cancellation notice, and not to insure that it is received.
State Farm presented the affidavit of Taylor to prove mailing of the notice (which Plaintiffs said they did not get). The court found the affidavit was sufficient evidence that the notice was mailed: the undisputed evidence showed that the cancellation notice was prepared on August 26, 2004, the envelope was photographed going through State Farm's automated mail system, it was State Farm's regular practice and pocedure to submit the notices to the post office immediately thereafter, and State Farm did not deviate from that procedure. Taylor could testify as to the procedure, even though the mailing of the notice happened in Arizona, while Taylor was located in Oklahoma.
A business's regular practice and procedure is admissible as proof of mailing. State Farm's policy plainly states that mailing of the notice is sufficient proof of notice of cancellation.
Because the Court found that State Farm strictly complied with the cancellation provision in the policy, summary judgment was proper.
In addition, the court found that the agent was properly dismissed. The Plaintiffs claimed that the agent should have told them about the impending cancellation. But the court noted that an agent's duty relates to the procurement of insurance, not to the maintenance of insurance. Summary judgment to the agent was also affirmed.
This case was interesting because it discussed the type of evidence which could be used to prove mailing. State Farm has an automated mailing system. It provided evidence that the notice was created, and also had a photo of an envelope addressed to the Plaintiffs going through the automated mail system. The affidavit was not from someone at the mailing center, but from someone in it's local office.
