COMBINED INSURANCE COMPANY OF AMERICA v. THOMAS Et Al Complaint

usFILED
IN THE UNITED STATE DISTRICT

EASTERN DISTRICT OF ARKANSAS NOV O B ,.
JONESBORO DIVISION . ZD12
COMBINED INSURANCE COMPANY
OF AMERICA
vs.
DAVIDW. THOMAS and
DEBBIE L. THOMAS
PLAINTIFF
Plaintiff Combined Insurance Company of America, by and through counsel
Wright, Lindsey & Jennings LLP, submits the following as its complaint and prayer
for damages against defendants David W. Thomas and Debbie L. Thomas:
I. PARTIES
1. Plaintiff Combined Insurance Company of America is a corporation
organized and existing under the laws of the State of Illinois, with its principle
place ofbusiness in Glenview, Illinois. Plaintiff is authorized to and does conduct
business in the State of Arkansas.
2. Defendant David W. Thomas is a natural person residing in Jonesboro,
Craighead County, Arkansas.
3. Defendant Debbie L. Thomas is a natural person residing in
Jonesboro, Craighead County, Arkansas.
4. This lawsuit is for fraud and breach of contract involving an insurance
policy issued by plaintiff to defendants on March 21, 2005.
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Case 3:12-cv-00254-SWW Document 1 Filed 11/08/12 Page 1 of 24
5. A substantial part of the events giving rise to this lawsuit occurred in
Jonesboro, Craighead County, Arkansas.
6. The amount in controversy exceeds $75,000.00, exclusive of interest
and costs.
II. STATEMENT OF JURISDICTION AND VENUE
7. This Court has jurisdiction pursuant 42 U.S.C. 1332.
8. Venue is proper in this Court pursuant to 42 U.S.C. 1391.
III. STATEMENT OF THE CASE
9. On March 21, 2005, plaintiff issued a Sickness Hospital Confinement
Indemnity Policy, No. R6286252-12830 ("the Policy") to defendants. A copy of the
Policy is attached hereto as Exhibit A.
10. Pursuant to the terms of the Policy, the insured and any beneficiary of
the Policy are entitled to monetary benefits for days the insured was hospitalized as
an inpatient, visited an Emergency Room for treatment, recovered from a surgical
procedure or recovered at home following a hospital confinement.
11. Defendant David W. Thomas was the insured under the terms of the
Policy.
12. The Policy is guaranteed renewable and non-cancellable until the 75th
birthday of defendant David W. Thomas.
13. Defendant David W. Thomas and defendant Debbie L. Thomas are
husband and wife and were so related when the Policy was issued.
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14. Defendant Debbie L. Thomas was listed as the beneficiary to the
Policy.
15. At the time the Policy was issued, defendant David W. Thomas was
employed as a District Manager for plaintiff.
16. Prior to 2006, defendant David W. Thomas was diagnosed with
cirrhosis of the liver and in 2006 underwent a liver transplant.
17. Defendant David W. Thomas received treatment for the above
referenced medical conditions at St. Bernard's Medical Center in Jonesboro,
Arkansas, and Methodist Hospital in Memphis, Tennessee.
18. Defendant David W. Thomas' treating physicians included Dr. Brad
Moore from Jonesboro, Arkansas.
19. Defendants subsequently submitted valid claims for benefits under the
Policy for the time periods of April21, 2006, through May 9, 2006; July 21, 2006,
through July 29, 2006; and February 23, 2007, through February 27, 2007,
occasioned by inpatient hospitalizations and recovery periods related to defendant
David W. Thomas' liver disease.
20. However, in addition to the valid claims cited above, defendants also
submitted numerous fraudulent claims for benefits under the Policy. Specifically,
defendants fraudulently submitted eighteen (18) claims representing to plaintiff
that defendant David W. Thomas was hospitalized as an inpatient, visited the
Emergency Room or was recovering from the hospitalization or a surgical procedure
and seeking benefits for fifty (50) separate periods of time.
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21. To facilitate their fraud, the defendants submitted falsified billing
documentation from St. Bernard's Medical Center in Jonesboro, Arkansas, and
Methodist Hospital in Memphis, Tennessee, supporting their claim.
22. To further facilitate their fraud, the defendants presented falsified
attending physician's statements to verify the insured's claimed hospitalization, ER
visit or surgical procedure. Specifically, the defendants alternatively used a prior
physician's statement which bore Dr. Brad Moore's signature or forged Dr. Moore's
signature onto a new attending physician's statement. Such fraudulent conduct by
the defendants is evident as the majority of the attending physician's statements
submitted by the defendants as originating from Dr. Moore were dated and
purportedly signed by Dr. Moore after September 21, 2007, the date on which Dr.
Moore died.
23. To further facilitate their fraud, defendants used the trust inherent in
defendant David W. Thomas' employment and managerial relationship with
plaintiff, as well as defendant David W. Thomas' previously confirmed medical
condition.
24. Moreover, to discourage inquiry by plaintiff, along with the false and
fraudulent claims documents referenced above, defendants sent personal messages
expressing their appreciation for plaintiff and detailing defendant David W.
Thomas' declining health condition which included comments such as "We almost
lost David last night" and falsely stating that defendant David W. Thomas had been
admitted to hospice "comfort care." Each of these comments were false and were
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offered with the sole purpose to induce reliance by plaintiff and discourage
questions regarding the payment of benefits under the Policy.
25. Both defendants David W. Thomas and Debbie L. Thomas jointly
conspired and, by their individual actions, actively participated in concert in
furtherance of a conscious agreement to pursue the fraudulent acts described
herein.
26. To date, defendants' fraudulent acts have directly and proximately
caused the plaintiff to pay to defendants $448,000.00 in benefits under the terms of
the Policy.
IV. CAUSES OF ACTION
A. FRAUD/DECEIT
27. The allegations in paragraphs 1-26 are incorporated herein by
reference pursuant to Fed. R. Civ. P. lO(c).
28. As outlined above, defendants made false representations of material
fact, namely their entitlement to benefits under the terms of the Policy.
29. Specifically, defendants submitted falsified billing documentation from
St. Bernard's Medical Center in Jonesboro, Arkansas, and Methodist Hospital in
Memphis, Tennessee, as well as falsified and forged attending physician's
statements, to support their claims for benefits under the terms of the Policy.
30. Defendants submitted the following fraudulent claims for benefits for
the specified time periods:
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(a) Claim #26252355
09/09 - 09/12/06
10/16- 10/20/06
11117 - 11/22/06
12/19 - 12/23/06
01111- 01117/07
02/12- 02/15/07
03/16 - 03/22/07
07/06-07/10/09
(b) Claim #26435402
05/04- 05/10/07
(c) Claim #26468428
06/11- 06119/07
07/06- 07115/07
08/17 - 08/25/07
10/02- 10/19/07
12/11- 12/15/07
(d) Claim #26668985
03/01- 03/12/08
(e) Claim #26736973
06/03 - 06/13/08
(f) Claim #26787245
08/17 - 09/03/08
10/16- 10/21108
(g) Claim #26851197
11124 - 12/05/08
01105- 01109/09
(h) Claim #26932681
03/04 - 03/21109
04/21- 05/09/09
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(i) Claim #27033371
08/19 - 09/05/09
09/20 - 09/25/09 "
10/21- 11/09/09
12/10- 12/15/09
01111- 01/28110
03/01- 03/03/10
G) Claim #27161843
03/25-04/05/10
(k) Clahn #27178300
05/12- 05/15/10
06/08- 06/25/10
07/26- 07/29/10
(l) Claim #27243126
09/11- 09/22/10
11105- 11/22/10
(m) Claim #27303507
01102- 01107/11
(n) Claim #27332912
02/23 - 03/12/11
03/25 - 04/05/11
05/04 - 05/09/11
(o) Claim #27382318
06/22 - 06/27/11
(p) Claim #27401751
08/01- 08/12/11
09/07- 09/10/11
09/22- 10/03/11
(q) Claim #27 445805
11104- 11121111
12/13 - 12/18/11
01102 - 01120/12
02/17 - 02/28/12
03/24 - 03/29/12
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(r) Claim #27522934
04/27 - 05/08/12
06/09- 06/14/12
07/08- 07/19/12
31. Defendants knew that their representations of material fact, namely
their entitlement to benefits sought in the above claims, were false.
32. Defendants intended to induce plaintiff to rely on their false
representations of material fact by paying benefits sought in the above claims and,
further, intended to induce plaintiff to refrain from investigating the above claims
by falsely portraying its employee defendant David W. Thomas as terminally ill.
33. Plaintiff justifiably relied on defendants' false representations of
material fact by paying benefits sought in the above claims and, further, by
refraining from investigating the claims and as a direct and proximate result,
sustained damages.
B. ACTING IN CONCERT
reference pursuant to Fed. R. Civ. P. 10(c).
35. As illustrated by their joint and active participation in the acts alleged
herein, defendants David Thomas and Debbie Thomas entered into a conscious
agreement to pursue a common plan or design to commit the fraud/deceit alleged
herein.
36. Both defendants, David Thomas and Debbie Thomas, actively took
part in the fraud/deceit alleged herein.
37. Defendants did commit the fraud/deceit alleged herein.
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38. Thus, defendants David Thomas and Debbie Thomas are jointly and
severally liable for the damages caused by their fraud/deceit.
C. CIVIL CONSPIRACY
40. Defendants David W. Thomas and Debbie L. Thomas knowingly
entered into an agreement to accomplish a purpose that is unlawful or oppressive or
to accomplish, by unlawful or oppressive means, a purpose that is not in itself
unlawful or oppressive. Specifically, defendants entered into a conspiracy to
commit the fraud/deceit alleged herein.
41. Both defendants David W. Thomas and Debbie L. Thomas committed
one or more overt acts in furtherance ofthis conspiracy.
42. In entering into this conspiracy, defendants David W. Thomas and
Debbie L. Thomas had the specific intent to harm plaintiff.
43. Defendants did commit the fraud/deceit alleged herein.
44. Thus, defendants David W. Thomas and Debbie L. Thomas are jointly
and severally liable for the damages caused by their fraud/deceit.
D. BREACH OF CONTRACT
46. The Policy is an insurance contract between plaintiff and defendants.
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47. The Policy set the terms by which defendants are entitled to certain
monetary benefits from plaintiff for days defendant David W. Thomas was
hospitalized as an inpatient, visited an Emergency Room for treatment, recovered
from a surgical procedure or recovered at home following a hospital confinement.
48. Pursuant to the terms of the Policy, defendant David Thomas was
required to submit written proof of his claims.
49. Plaintiff did what was required of it pursuant to the terms of the
Policy.
50. By making claims for benefits to which he was not actually entitled
and by submitting invalid and fraudulent documentation in support of those claims,
defendant David Thomas did not do what was required of him pursuant to the
terms of the Policy which constitutes a breach of contract which directly and
proximately resulted in damages to plaintiff.
E. INTENTIONAL INTERFERENCE WITH CONTRACTUAL
RELATIONS
51. The allegations ofparagraphs 1-50 are incorporated herein by
52. The Policy was a valid contract between the plaintiff and defendant
David W. Thomas.
53. Defendant Debbie L. Thomas had knowledge of the Policy.
54. By aiding and abetting defendant David W. Thomas's making claims
for benefits to which he was not actually entitled, by actively participating in
submitting invalid and fraudulent documentation in support of those claims, and by
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other acts of intentional and improper interference, defendant Debbie L. Thomas
induced or caused defendant David W. Thomas to breach the Policy.
55. Defendant Debbie L. Thomas's intentional interference with defendant
David W. Thomas's obligations under the policy directly and proximately resulted in
damage to plaintiff.
F. FRAUDULENT CONCEALMENT, WAIVER, AND ESTOPPEL
57. By submitting falsified and forged supporting documentation, abusing
the trust inherent in defendant David W. Thomas' employment and managerial
relationship with plaintiff, and submitting false facsimile messages designed to
deter inquiry of plaintiff into defendants' claims, defendants committed positive acts
of concealment that were distinct from the conduct that forms the basis of plaintiffs
claims, namely defendants' false representations as to their entitlement to benefits
under the Policy, and that were so secretly planned and executed as to keep
plaintiffs causes of action hidden.
58. In the alternative, by submitting falsified and forged supporting
documentation, abusing the trust inherent in defendant David W. Thomas'
employment and managerial relationship with plaintiff, and submitting false
personal messages designed to deter inquiry of plaintiff into defendants' claims,
defendants' conduct that forms the basis of plaintiffs causes of action was
perpetrated in such a way that the basis of plaintiffs claims concealed itself.
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59. Plaintiff exercised reasonable diligence to discover the facts of its
causes of action.
60. The point at which plaintiff knew or had reason to know of the basis
for its causes of action occurred within any applicable statute of limitations.
61. Accordingly, any applicable statute of limitations was tolled and did
not begin to run until the point at which plaintiff knew or had reason to know of the
basis for its causes of action.
62. In the alternative, defendants have waived and/or are estopped from
asserting the statute of limitations as an affirmative defense to plaintiffs causes of
action.
63. Plaintiffs causes of action are therefore timely brought, for the
purposes of any applicable statute of limitations, as to each fraudulent claim
submitted by defendants.
V. DEMAND FOR RELIEF SOUGHT
A. DAMAGES
65. As a direct and proximate result of the actions of defendants set forth
above, plaintiff has made payments totaling $448,000.00, which is the amount of
compensatory damages to which plaintiff is entitled to receive from defendants.
66. Pursuant to Ark. Code Ann. 16-22-308, defendants are entitled to
their attorney's fees.
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67. In addition to compensatory damages, as a result of defendants'
intentional, willful and wanton conduct in disregard ofplaintiffs rights, punitive
damages should be imposed to punish defendants and to deter similar intentional,
willful and wanton conduct in others.
B. DECLARATORYJUDGMENT
69. As alleged above, defendants have breached the Policy, which is an
insurance contract between the parties.
70. Defendants' breach of the Policy was a material breach. Plaintiff is
therefore exc:used from further performance under the Policy.
71. Accordingly, pursuant to 28 U.S.C. 2201 and Fed. R. Civ. P. 57,
plaintiff is entitled to a declaration that defendants' material breach of the Policy
has terminated the Policy and extinguished all of plaintiffs duties and obligations
under the Policy.
C. CANCELLATION
73. The Policy is guaranteed renewable and non-cancellable until the 75th
birthday of defendant David Thomas, meaning that under the terms of the Policy,
plaintiff does not have the ability to unilaterally cancel the Policy before that date.
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74. Accordingly, if defendants' material breach of the Policy did not, as
alleged above, automatically terminate the Policy and excuse plaintiffs performance
under that contract, plaintiff will be required to pay future, properly supported
claims and will be unable to assert the defendants' conduct as alleged herein as a
defense to payment of any future claims.
75. However, based on the defendants' conduct as alleged herein, it would
be unjust and inequitable to require plaintiff to continue in a contractual
relationship with defendants and in its duties and obligations under the Policy.
76. Moreover, based on defendants' conduct as alleged herein, plaintiff
would be required to devote extraordinary time and expense to the investigation of
all future claims submitted by defendants to ensure that any such claims were valid
and not fraudulent.
77. Plaintiff will therefore suffer irreparable injury if it is required to
continue in its duties and obligations under the Policy.
78. To the extent that it is not granted the declaratory judgment requested
herein, plaintiff has no adequate remedy at law.
79. Considering the balance of the hardships between plaintiff and
defendants, equitable relief is warranted.
80. Therefore, as an alternative remedy to the declaratory judgment
requested herein, plaintiff requests that the Court exercise its equitable powers to
cancel the Policy.
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VI. JURY DEMAND
81. Plaintiff demands a trial by jury on all factual issues.
VII. PRAYER
WHEREFORE, plaintiff Combined Insurance Company of America prays
that a judgment will be entered against defendants David W. Thomas and Debbie L.
Thomas and that plaintiff be awarded compensatory and punitive damages,
together with costs, pre- and post-judgment interest, and attorneys' fees;
declaratory and/or equitable relief cancelling and terminating plaintiffs duties and
obligations toward defendants; and all other just and proper relief to which plaintiff
may be entitled.
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WRIGHT, LINDSEY & JENNINGS LLP
200 West Capitol Avenue, Suite 2300
Little Rock, Arkansas 72201-3699
(501) 371-0808
FAX: (501) 376-9442
By _
(89118)
Michael A. Thompson (2010146)
Attorneys for plaintiff Combined
Insurance Company of America
15
EXHIBIT
A Legal Reserve Stock Corporation
(herein called Combined) .
Home Office and pollcyhoJder Service Center .
5050 Broadway Chicago, Illinois 60640
1-BOD-225-4500
NON-CANCELLABLE AND GUARANTEED RENEWABLE
SICKNESS HOSPITAL CONFINEMENT INDEMNITY POLICY .
.. LIMITED BENEFIT HEALTH COVERAGE
.POLICY TERMINATES AT AGE 75 .
. JHIS IS A SICKNESS ONLY POLICY
AND DOES NOT PAY.BENEFITS FOR.LOSS FROM ACCIDENT$
. Premiums and Benefits will increase each: year, for the first ten years, as .
scheduled in the Schedule of Premit,Jms and Benefits ..
. This is a legal contract between the Insured and Combined. READ YOUR POLICY CAREFULLY.
Benefits': .
Hospital Income
Dailylntensive .Care Income
. Emergency .Room .
Outpatient Surgery Recovery
.Recovery'. Income Following
Hospital Confinement
Claim lnformati.on
Definitions
Exceptions
GUIDE TO YOUR POLICY
Page .Page.
Grace Period 4
2 Payable in Addition to Other Insurance 3 .
2 Pre-existing Cpnditions Limitation . 3 ..
2 Premlum and Benefit Increases 2
2 Reinstatement .4
Renewability 1
2 . Right to Examine Policy . 1
4 Schedule of Premiums and Benefits . 6 & 7 .
3 Termination . 5
3 Time Limit o.n Certain Defenses . 4
10.DAY RIGHTTO EXAMINE POLICY
. . .
A
. If this policy is not satisfactory for any reason, within 10 days of the.issue date you can return it to
. Combined or its agent. Any premium.. paid will be refunded and this- policy will be void from its .
beginning..
NONCANCELLABLE AND GUARANTEED RENEWABLE
Combined guarantees .your right to renew this policy -until the first premium due-date after your 75th
birthday so long as the premium is paid on or before the due. date or within the grace period. For the
first ten years the policy is in force the premiums and benefits. will increase each Policy Anniversary
Year in accordance with the Schedule . of Premiums and Benefits . for the plan selected on the
application. Combined cannot. change .the. premiums shown in the Schedule of Premiums and

. This policy shall terminate on the first premium due date after you reach age 75. If Combined accepts
any after that date, the policy. continues in force while premium is accepted.
Form. No. 12815-AR Combined.lnsurance Company of America -1996 . 11196 Printed in U.S.A. .
- 2-
CONSIDE.RATION
This. policy is issued in consideration of the statements. contained in the application and payment of
the first premium. Combined agrees to pay you, the Insured named in the application, subject to the
terms and limitations of this policy. B.enefits will be paid for the following losses sustained by you and
caused by Covered Sickness as defined herein .. Benefits will be .paid in accordance with the
Schedule of Premiums and Benefits (herein also referred to as "Schedule") for the plan
selected and the appropriate Policy Anniversary Year. Both premiums and benefits will
Increase each Policy Anniversary Year In accordance with the Schedule and subject to the
Premium and Benefit Increases Section.
SECTION A DAILY HOSPITAL INCOME- SICKNESS
If because of a Covered Sickness and beginning while this. policy is in force, you are confined overnight
as an Inpatient in a Hospital, Combined will pay you for each day of such confinement, starting with
the first day and for up to your lifetime, the. benefit amount shownin the Schedule under Section A. .
SECTION 8 . DAILY INTENSIVE CARE INCOME - SICKNESS
If because of a Covered Sickness you are confined in an Intensive Care Unit during a period for which
benefits are payable under Section A, Combined will pay you for each day of such confinement, in
addition to Section A, the benefit amount shown in the Schedule under Section B.
SECTION C RECOVERY INCOME FOLLOWING
HOSPITAL CONFINEMENT - SICKNESS
If because of a Covered Sickness you are continuously Totally Disabled following a period of
confinement in a Hospital for which benefits are payable under Section A, Combined will pay you while
you remain so disabled, but not to exceed four times the number of days of such Hospital confinement,
the benefit amount shown in the Schedule under Section C.
SECTIOND OUTPATIENT SURGERY RECOVERY - SICKNESS
If because of a Covered Sickness you require Outpatient Surgery while this policy is in force,
Combined will pay you the benefit amount shown in the Schedule under Section D for any one
sickness. The amount of the benefit depends upon whether the Outpatient Surgery is classified as
Major or Minor.
"Outpatient Surgery" is the cutting of tissue, the repair or removal of bodily parts that have been
damaged due to sickness followed by the suturing of the resulting wound. Outpatient Surgery .is
classified as "Major'' when performed in a Hospital operating room as an outpatient or Ambulatory
Surgical Center. Outpatient Surgery is classified as "Minor" when p.erformed in an Emergency Care
Facility, emergency room, Physician's office, clinic, or any other location not classified. Outpatient
Surgery must be performed by a Physician.
SECTION E EMERGENCY ROOM- SICKNESS
If because of a Covered Sickness, you. require emergency. room treatment at a Hospital emergency
room, Hospital affiliated Emergency Care Facility or 24 hour Emergency Care Facility while this policy
is in force, Combined will pay you the benefit amount shown -in the Schedule under Section E for any
one sickness.
PREMIUM AND BENEFIT INCREASES
For the first ten years the policy is in force, the premiums and benefits will increase each Policy
Anniversary Year shown in the Schedule of Premiums and Benefits for the plan selected. All benefits
payable under this policy shall be calculated based on the scheduled benefits Jor .the . Policy
Anniversary Year in which the sickness occurred. Benefits are not payable based on any, other" date.
In the event your policy lapses due to non-payment of premium, you may policy in
accordance with the Reinstatement provision and the calculation of your Policy Anniversary Year will
be subject to the definition of Policy Anniversary Y-ear.
PAYABLE IN ADDITION TO OTHER INSURANCE
. . Benefits provided by this policy are payable in addition to those provided by any other insurance policy.
EXCEPTIONS
This policy will not pay for losses resulting from: bodily injuries; from mental or emotional disorders; or
from normal pregnancy or childbirth.
PRE-EXISTING CONDITIONS LIMITATION
. Loss caused by a Pre-existing Condition is not covered unless such loss begins after 12 months from
the issue date.
DEFINITIONS
"Ambulatory Surgical Center'' means a public or private .institution which. complies with each of the
following: (1) employs a medical staff of Physicians; (2):consists of permanent equipped and
operated primarily for performing surgical procedures; (3). offers continuous Physician and registered .
nursingservices when a patient is in the .facility; (4) does not provide services or accommodations for
patients to stay overnight; and (5) operates pursuant to law.
"Covered. Sickness" means a bodily illness or disease you incur, including complications of pregnancy,
but not including conditions caused by a bodily injury or Pre-existing Condition. A Pre-:-existing
Condition will be considered a Covered Sickness if loss caused by such condition begins after 12
months from the issue date ..
"Emergency Care Facility" is an institution which meets the following requirements: (1) operates
pursuant to law; (2) has a staff of at least one licensed Physician and one registered nurse available
at all times; and, (3) has facilities for diagnosis and treatment of emergencies.
"Hospital" is an institution which meets all of the following requirements: (a) operates pursuant to law;.
(b) operates primarily for the care and treatment of sick or injured persons as inpatients; (c) provides
24 hour nursing service; (.d) has facilities available for diagnosis and surgery either on its own premises
or in facilities available to the.Hospital on a pre-arranged basis; (e) has a staff of at least one licensed
Physician available at all times.
"Hospital" does not include a nursing home or convalescent care facility, whether such facility is
independent or associated with a Hospital.
"lnpatienf' means Hospital confinement which the Hospital classifies as Inpatient. It does not mean
confinement on an outpatient basis.
"Intensive Care Unif' means that part of a Hospital (other than a patienfs room, operating room or
recovery room) where patients receive continual nursing care and which is commonly known as the
intensive care or cardiac care unit.
"Physician" means a licensed practitioner of the healing arts acting within the scope of his or her
license. It does not include the Insured or a member of his or her family .
. "Policy Anniversary Year" means each continuous 12 month period the policy is in force beginning from
the issue date of the policy. Any amount of time accrued between the last Policy Anniversary Year and
the.reinstatement date which .does not equal a continuous 12 month period the policy is in force will
not be taken into account in the calculation of a Policy Anniversary Year.
"Pre-existing Condition" means a bodily illness or disease which was diagnosed or treated by a
Physician within the 12 months preceding the issue date of the policy .
. "Totally Disabled" means the inability to perform all of the substantial and material duties of your
business or occupation (usual activities if not employed). If you are able to perform any of the
substantial and materialduties of your business or occupation (usual activities if not employed), you
are -not Totally Disabled. You must be under the care of a Physician.
- 3-
. 4.
UNIFORM PROVISIONS
{1) ENTIRE CONTRACT; CHANGES: This-policy with the application and attached papers, if any,
is the entir& contract between the Insured and Combined. No change in this policy will be effective
until approved by an executive officer of Combined .. This approval must be noted on or attached to
this policy. No agent may change this policy or waive any of .its provisions.
(2) TIME LIMIT ON CERTAIN DEFENSES: (a) Misstatements in the Application: .After two years
from the issue date only fraudulent misstatements in the application may be used to void the policy or
deny any claim for loss incurred or disability that starts after the two year period. (b). Pre-existing
Conditions: No claim for loss incurred or disability that starts after one year from the-issue date will
be reduced or denied because a .sickness or physical condition not excluded by name or specific
.description before the date of loss had existed before the issue date.
(3) GRACE PERIOD:This policy has a 31 day grace period. This means that if a renewal premium
is not paid on or befo-re the date it is due, it may be paid during the following.31 days. During the grace
period, the policy will stay in force.
(4) REINSTATEMENT: If the renewal premium is not paid before the grace period ends, the policy
will lapse. Later acceptance of the premium by Combined (or by an agent authorized to accept
payment) without requiring an application for reinstatement will reinstate this policy.
If Combined or its agent requires an. application the Insured will be given a cond.itional receipt for the
premium .. If the application is approved, the policy will be reinstated as of the approval date. Lacking
such approval, the policy will be r-einstated on the 45th day after the date of the conditional receipt
unless Combined has previously written the Insured of its .disapproval.
On your reinstatement date you will begin a new Policy Anniversary Year. Any amount of time accrued
prior to reinstatement which does not equal a continuous 12 month period. the policy is in force, will
not be taken into account in the calculation of a Policy Anniversary Year.
The reinstated policy will cover only loss that results from sickness that starts more than 1 0 days after
the date of reinstatement. lnall other respects the rights of the Insured and Combined will remain the
same, subject to any provisions noted on or attached to the reinstated policy.
(5) NOTICE OF CLAIM: Written notice of claim must be given within 30 days after a covered loss
starts or as soon as reasonably possible. The notice can be given to Combined at its Home Office,
Chicago, Illinois or to Combined's agent. Notice should include the name of the Insured and the policy
number.
(6) CLAIM FORMS: When Combined receives the notice of claim, it will send the claimant forms
for filing proof of loss. If these forms are not given to the claimant within 15 days, the claimant will
meet the proof of loss requirements by giving Combined a written statement of the nature and extent
of the loss within the time limit stated in the Proofs of Loss Section.
(7) PROOFS OF LOSS: If the policy provides for periodic payment for a continuing loss, written
proof of loss must be given to Combined within 90 days after the end of each period for which
Combined is liable. For any other loss, written proof must be given within 90 days after such loss.
If it was not reasonably possible to give written proof in the time required, Combined shall not reduce
or deny the claim for this reason if the proof is filed as soon as reasonably possible. In any event, the
proof required must be given no later than 1 year from the time specified unless the claimant was
legally incapacitated.
(8) TIME .OF PAYMENT OF CLAIMS: After receiving written proof of loss, Combined will pay
monthly all benefits then due the Insured for disability.
Benefits for any other loss covered by this policy will be paid as soon as Combined receives proper
written proof.
(.9) PAYMENT OF C.LAIMS: Benefits will be paid to. the Insured. Any other benefits unpaid at
death may be paid, at Combined's option, either to the Insured's beneficiary. or estate.
. {H)). -.PHYSICAL EXAMINATIONS: Combined at its-expense Insured
. examined as .often as reasonably necessary while a .claim is pendinQ;
(1t} LEGAL ACTIONS: No Jegal action may be brought to recover on: :policy Within eodays
after- written.proof.of Joss has been given as required by .tt)is policy., NOS(JCb _actiqn:may;:be brought-
after 'the. expiration of 3 years from the time written proof of loss is . .
{12) CONFORMITY WITH STATE STATUTES: Any-provision of
date, is in conflict with the laws of the state in which the Insured resides on that date is amended to .
col!form to the minimum requirements of such Jaws.
(13). MISSTATEMENT OF AGE: .If your age has been misstated, any amount payable wiiJ. be that
which the premium paid would have purchased at the correct age. But, if the misstatement-of age
caused this policy.to be issued to you beyond the age set by Combined for issue of. this policy, then
liability is limited to a. return of all premiums paid. If the misstatement of age caused this.
policy to be continued or.renewed beyondthe date setfor the policy to terminate, then Combined's
liability for loss occurring after that date is limited to a return of the premiums. paid after that date. .
(14) CHANGE OF BENEFICIARY: The Insured can change the beneficiary at any time by giving
Combined written notice satisfactory to Combined which is received by Combined at its home office
during the Insured's lifetime. Unless irrevocably designated, the beneficiary's consent is not required.
GENERAL PROVISIONS
A. TERM: This policy is issued for the term shown in the It begins and ends at 12:01 A.M.,
Standard Time, at the place where you reside. It is effective on the date issued. It continues in force
so long as the applicable scheduled premium is paid on or before the due date or within the grace
period.
B. PAYMENT OF PREMIUM: This policy is issued in consideration of the initial premium and the
statements in the application. If payment of the initial premium is made by check or draft not honored
the policy shall be void.
C. YOUR RIGHT TO CANCEL: You may cancel this policy at any time by writing Combined.
Coverage will end on the date the notice. is received or on a later date you specify. Combined will
return any unearned premium. Cancellation will not affect any claim beginning before the date of
cancellation.
D. TERMINATION: This policy shall terminate on the policy anniversary after you reach age 75 ..
If Combined accepts any premium after that date, the policy continues in force while premium is
accepted. However, if a misstatement of age caused this policy to be continued or renewed beyond
.thedate set for the policy to terminate, then Combined's liability for Joss occurring after that date is
limited to a return of all premium paid after that date.
E. REFUND OF UNEARNED PREMIUM: Upon the death of the Insured, the proceeds payable
shall include premiums paid .for the policy for any period beyond the end of the policy month in which
death occurred.
This poliCy is issued by COMBINED INSURANCE COMPANY OF AMERICA. It shall not be
. binding on Combined unless countersigned by our authorized agent.
Chairman and
Chief Executive Officer
-5-
Corporate Secretary
Plan Selected:
D
Plan II
.
Policy
..
Anniversary
Year
At Issue
"1
2
3
4
5
6
7
8
9
10 and over
Polley
Anniversary
Year
At Issue
1
2
3
4
5
6
7
8
9
10 and over
SCHEDULE OF PREMIUMS AND BENEFITS
PLAN II
Premiums
Annual
.. Monthly
:IS$U&Age . lssueAge
. 0-19 20-34.
35"54
. 55-64. . 2D-34- 35,-54 55-64
$264.00 :$396.00 $660.00 $. 858;00 $22.00 $33.00 $55.00 $ 71.50
$415.80 $693:oo $ 900:90 $23.10 $34.65 . $57.75 $.75.08.
$290.40 $435.60 '$726.00 $ 943.80 $24.20 $36.30. $60.50. $ 78.65
$303.60 $455.40 $759.00' $ 986.70 $25.30' $37.95 $63.25 $ 82.23
$316.80 $475.20 $792;00 $1,029.60 $2.6.40 '$39.60 $66.00 $ 85.80.
$330.00 $495.00 $1,072,50 $27.50 $41.25 $68.75 . $ 89.38
$343.20 $514.80 $858.00 $1,115.40 $28.60 $42.90 $71.50 $ 92.95
$356.40 $534.60 $891.00 $1-,158.30 $29.70 $44.55 $74.25 $ 96.53
$369.60 $554.40 $924.00 $1,201.20 $30.80 $46.20 $77.00 $100.10
$382.80 $574.20 $957.00 $1,244.10 $31.90 $47.85 $79.75 $103.68
$396.00 $594.00 $990.00 $1,287.00 $33.00 $49.50 $82.50 $107.25
Benefits
SECTION A SECTIONB SECTION C SECTION D SECTIONE
Dally
Dally Recovery
Outpatient
DaiJy Intensive
Following Hospital
Surgery Emergency
Confinement (for up
Hospital Care
to 4 times Section A
Major Minor Room(Per
Income Income
Confinement)
(Per Sickness) Sickness)

100.00 1,000.00 $100.00 $500.00
105.00 $ 1,050.00 $105.00 $525.00 $52.50 $105.00
$ $ 1 '100.00 $.110.00 $550.00 $55.00 $110.00
$ 115.00 $ 1,150.00 $115.00 $575.00 $57.50 $115.00
$. 120.00 $ 1,200.00 $120.00 $600.00 $60.00 $120.00
$ 125.00 $ 1',250.00 $125.00 $625.00 $62.50 $125.00
$ 130.00. $ 1,300.00 $130.00 $650.00 $65.00 $130.00
$ 135:00 '$ 1,350.00 $135.00 $675.00 $67.50 $135.00
$ 140.00 $ 1',400.00 $140.00 $700.00 $70.00 $140.00
$ 145.00 $ 1,450.00 $145.00 $725.00 $72.50 $145.00
$ 150.00 $ 1,500.00 $150.00 $750.00 $7s;oo $150.00
AU--benefits payable under this policy shall be calculated based on the scheduled benefits for the Policy
Anniversary Year in which the sickness occurred. .not payable based, on any other date.ln
.the event- your policy taps.es due to. ncm-payment of premium; you may relnstate. your policy in
accordance-with the Reinstatement provision-and the-calculation of your Policy Anniversary Year Will
be subject -to the definition of Policy Anniversary Year.

-6-
Plan Selected:
o
Plan I
(12a29)
Policy
Anniversary
Year
At Issue '
1
2
. SCHEDULE OF PREMIUMS AND BENEFITS
PLANI .
Premiums
Annual Monthly
Issue Age Issue Age
0-19 . '20-34 35-54 55-64 0-1.9 35-54 55-64
$:132.00 $198.00 $330.00 . $429.00 $11.00 $16.50 $2750 $35.75
$138.60 $207.9.0 $346;50 $450.45 '$11.55 $17.33 $28.88 $37.54
$145.20 $217.80' $363.00. $471.90 $12.10. $18.15 $30.25 $39.33
3 . $151.80 $227.70 $379.50 $493.3S $12.65 $18.98 $31.63 $41.11
4 $158.40 $237.60 $396.00 $514.80 $13.20 $19.80 $33.00 $42.90
5
. $1.65.00 $247.50. '$412.50 $536.25 $13.75 $20.63 $34.38 $44.69
6 $171.60 $257.40 $429.00 $557.70 $14'.30 $21.45 $35.75 $46.48
7 $178.20 $267.30 $445.50 $579.15 $14.85 $22.28 $37.13 $48.26
8 $184.80 $277.20 $462.00 $600.60 $15.40 $23.10 $38.50 $50.05
9 $191.40 $287.10 $478.50 $622.05 $15.95 $23.93 $39.88 $51.84
10 and over $198.00 $297.00 $495.00 $643.50 $16.50 $24.75 $41.25 $53.63
Benefits
SECTION A SECTIONB SECTION C SECTION D SECTION E
Policy Daily
Daily Recovery Income
Outpatient
Anniversary Dally Intensive
Following Hospital
Surgery Emergency
.confinement (for up
Year Hospital Care
to 4 times Section A
Major Minor Room(Per
Income Income
Confinement)
(Per Sickness) Sickness)
At Issue

50.00 $ 500.00 $50.00
1 52.50 $ 525.00 $52.50 $262.50 $26.25 $52.50
2 $ 55.00 $ 550.00 $55.00 $275.00 $27.50 $55.00
3 $ 57.50 $ 575.00 $57.50 $287.50 $28.75 $57.50
4 $ 60.00 $ 600.00 $60.00 $300.00 $30.00 $60.00
5 $ 62.50 $ 625.00. $62.50 $312.50 $31.25 $62.50
6 $ 65.00 $ 55o.oo $65.00 $325.00 $32.50 $65.00
7
$'
$ 675.00 $67.50 $337.50 $33.75 $67.50
8 $ 70.00 $ 700.00 $70.00 $350.00 $35.00 $70.00
9 $ 72.50 $ 725.00 $72.50 $362.50 $36.25 $72.50
10and over $ 75.00 $ 750.00 $75.00 $375.00 . $37:50
$75.00
All benefits payable under this policy shall be calculated based on the scheduled benefits for the Policy
Anniversary Year ln which the sick_ness occurred. Benefits are not payable based on any.other date; In
the event your policy .lapses due to non-payment of premium, you may reinstate your poJicy in
accordance w:itll the :Reinstatement provision and the calculation of your Policy Anniversary Year will
be subject to the definition of Policy Anniversary Year.
(12815-SI)
-7-
. COMBINED.INSURANCE COMPANY OF AMERICA
Chicago; Illinois 60640 .
LIMITED BENEFIT HEALTH COVERAGE
SICKNEss HOSPITAL CONFINEMENT INDEMNITY POL1CV
Plan Selected: WITH SCHEDULED ANNUAL INCREASES
0 . D . . . IN PREMIUMS AND BENEFITS
. Plan II . Plan I .OUTliNE OF COVERAGE
{12830) (12829) For Policy Form No. 12815-AR
(1}Read Your. Policy Carefully. This outline of coverage provides a very brief description of some important .features of your
This is not the insurance contract and only the actual. pqlicy provisions will control. The policy itself sets forth. in detail,.
the. rigbtsand obligations of both you and your insur.ance eompany; It is, therefore, important that you READ YOUR POLICY
CAREFULLY! . .
(2) Lim Heel Coverage. Policies :of this category are designed to-provide, the. person insured, limited or supplemental
(3) Description of Benefits. This is a Sickness Only .Policy and Does Not Pay Benefits for Loss From Accidents. For the first
:I'Oyears the premiums and benefits- increase each Polley Anniversary All benefits .
. payable- under this policy shall be calculated based on . the scheduled benefits. for the
Policy Anniversary Year in which the sickness occurred. Benefits are not payable based on
any other date.
.Benefit at
Section A. Plan II Plan I
Issue/Policy
Year
Daily Hospital Income.
$ 100.00 per day At Issue Benefit paid when confined in a Hospital overnight. $ 50.00per day
Benefit payable for up to your lifetime. $ 1 05.00 per day $ 52.50 per day 1
$ 110.00 per day $ 55.00 per day 2
$ 115.00 per day $ 57.50 per day 3
$ 120.00 per day $ 60.00 per day 4
. $ 125.00 per day $ 62.50 per day 5
$ 130.00 per day $ 65.00 per day 6
$ 135.00 per day $ 67.50 per day 7
$ 140.00 per day $ 70.00 per day 8
$ 145.00 per day $ 72.50 per day 9
$ 150.00 per day $ 75.00 per day 10 and over
Section B.
Daily Intensive Care Income.
$ 500.00 per day Additional benefit paid when confined in an Intensive $ 1 ,000.00 per day At Issue
Care Unit during a Hospital stay for which benefits are $ 1,050.00 per day $ 525.00 per day 1
payable under Section A. $ 1,100.00 per day $ 550.00 per day 2
$ 1,150.00 per day $ 575.00 per day 3
$ 1,200.00 per day $ 600.00 per day 4
$ 1 ,250.00 per day $ 625.00 per day 5
$ 1 ,300.00 per day $ 650.00 per day 6
$ 1,350.00 per day $ 675.00 per day 7
$ 1 ,400.00 per day $ .700.00 per day 8
$ .1,450.00 per day $ 725.00 per day 9
$ 1 ,500.00 per day $ 750.00 per day 10 and over
Section c.
Recovery Income Following Hospital Confinement.
$ .100.00 per day $ 50.00 per day Benefit paid if total disability continues after a Hospital At Issue
. stay for which benefits are payable under Section A. $. 105.00 per day $ 52.50 per .day 1
Benefit paid up to four times the number of days of $ 110.00 per day $ 55.00 per day 2
Hospitar stay. $ 115.00 per day $ 57.50 per day 3
$ 120.00 per day $ 60.00 per day 4
$ 125.00 per day $ 62.50 per day 5
$ 130.00 per day $. 65.00 per day 6
$ 135.00 per day $ 67.50 per day 7
$ 140.00 per day $ 70.00 per day 8
$ 145.00:per day $ 72.50 per day 9
$ 150.00 per day $. 75.00 per day 10 and over
Benefit at
Form No. 012815-AR {Continued on Reverse Side)
Section o.
Outpatient Surgery Recovery
Benefit paid for recovery from Major or Mfnor-
Outpatient ~ u r g e r y . performed by a Physician.
.Classified as "Major'' when performed in a
Hospital operating room on an outpatient
basis or in an Ambulatory Surgical Center.
Classified as "Minor'' when performed in an
Emergency Care Facility, emergency room,.
Physician's office, clinic, or any other location
not classified.
Section E.
Emergency Room
Benefit paid for emergency room
treatment at a Hospital emergency room,
a Hospital affiliated. Emergency Care Facility or
a 24 hour Emergency Care Facility.
flm.ll
Major Minor
PER SICKNESS
$ 500.00 $ 50.00 .
$ 525.00 $ 52.50
$ 550.00 $ 55.00
$ 575.00 $ 57.50
$ 600.00 $ 60.00
$ 625.00 $ 62.50
$ 675.00 $ 65.00
$ 700.00 . $ 67.50
$ 725..00 $ 70.00
$ 725.00 $ 72.50
$ 750.00 $ 75.00
PER SICKNESS
$ 100.00
$ '105.00
$ 110.00
$ 115.00
$ 120.00
$ 125.00
$ 130.00
$ 135.00
$ 140.00
$ 145.00
$ 150.00
.eJiml
Major Minor
PER SICKNESS
$ 250.00 . $ 25.00 .
$ 262.50 $ 26.25
$ 275.00 $ 27.50
$ 287:50 $ 28:75
$. 300.00 $ 30.00
$ 312.50 $ 31.25
$ 325.00 $ 32.50 ..
$ 337.50 $ 33.75
$ 350.00 $ 35.00
$ 362.50 $ 36.25
$ 375.00 $ 37.50
PER SICKNESS
$ 50.00
$ 52.50
$ 55.00
$.57.50
$ 60.00
$ 62.50
$ 65.00
$ 67.50
$ 70.00
$ 72.50
$ 75.00
Issue/Policy .
Anniversary Year
At Issue
1
2
3
4
5
6
7
8
9
10 and over.
At Issue
1
2
3
4
5
6
7
8
9
10 and over
If your policy lapses and is reinstated, in accordance with the reinstatement provision, your reinstatement date will begin your
new Policy Anniversary Year. Any amount of time accrued between the last Policy Anniversary Year and the reinstatement date
which does not equal a continuous 12 month period the policy is in force will not be taken into account in the calculation of a
Policy Anniversary Year.
(4) Exceptions. For the first year the policy does not cover sickness for which medical advice or treatment was received within
the 12 months before the issue date. The policy does not cover loss resulting from bodily injuries received in an accident; from
mental or emotional disorders; or from normal pregnancy or childbirth.
(5) Renewability. You have the right to renew the policy until the first premium due date after your 75th birthday. For the first
ten years the premiums and benefits will increase each Policy Anniversary Year as outlined in the policy. Combined cannot
change the premiums shown in the Schedule of Premiums and Benefits.
THIS POLICY IS NOT A MEDtCARE SUPPLEMENT POLICY. If you are eligible for Medicare, review the Guide to Health
Insurance for People with Medicare available from the company.
Form No. 012815-AR

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usFILED

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