Rumery v. Travelers Home & Marine Insurance Company, The
OPINION AND ORDER by Judge John E Dowdell The defendant's motion for summary judgment is granted. A separate judgment will be entered forthwith ; granting 16 Motion for Summary Judgment (JED1, Chambers)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF OKLAHOMA
THE TRAVELERS HOME & MARINE
Case No. 15-CV-295-JED-TLW
OPINION AND ORDER
The material facts are not disputed. The defendant, The Travelers Home & Marine
Insurance Company (Travelers) issued an automobile insurance policy to the plaintiff, with an
effective date of September 15, 2013 through September 15, 2014. The policy initially covered a
1997 Honda Accord, a 2005 Honda Odyssey, a 2003 Honda Accord, and a 1984 AMC. On
October 11, 2013, plaintiff purchased a 2006 Chevrolet Corvette, which was added to the policy
on or about October 16, 2013. On October 16, 2013, plaintiff paid the annual policy premium. In
February 2014, plaintiff’s wife traded in the 2005 Honda Odyssey and purchased a 2014 Hyundai
Sonata, and the plaintiff’s insurance agent processed a request to add the Sonata to the policy and
remove the Odyssey. At the time, the plaintiff knew that an additional amount would be owed as
a result of the addition of the newer vehicle, as he has indicated in sworn interrogatory answers
that he “tried to pay the difference” at the time of the policy change, but his agent did not know
the amount and informed him that Travelers would send a bill for the difference. (Doc. 16-6 at 3,
Answer to Interrogatory No. 13).
Travelers has supplied evidence that it mailed two premium invoices to the plaintiff – on
February 21 and March 26, 2014 – for the $156.00 due as a result of the addition of the Sonata to
the policy. The second invoice stated that payment was due by April 15, 2014. Travelers has also
supplied evidence that, upon nonpayment of the invoices, Travelers mailed a Notice of
Cancellation on April 25, 2014, which provided that the Policy would be cancelled on May 15,
2014 if payment of the past due amount was not received by that date. Plaintiff disputes that he
ever received the invoices or Notice of Cancellation, and he testified that he has “problems getting
mail” and “sometimes [his] mail ends up in somebody else’s mailbox.” (Doc. 16-5 at 14 [Dep. p.
38, ll. 22-25]).
It is undisputed that the plaintiff did not pay the amount due, and that the policy was
cancelled effective May 15, 2014. On May 25, 2014, after the policy was cancelled, plaintiff was
involved in a single-vehicle accident while driving his 2006 Corvette. On May 26, 2014, plaintiff
submitted a property damage claim to Travelers in relation to the accident, and he contacted
Travelers regarding the claim on May 27, 2014. Travelers notified plaintiff that the policy was
cancelled due to nonpayment of premium, and Travelers denied coverage of the insurance claim.
Plaintiff then initiated suit in Tulsa County District Court, alleging breach of the insurance contract
and insurance bad faith. Upon plaintiff’s request for damages in excess of $75,000.00, plus
interest, costs, and attorneys’ fees, Travelers removed this action based on diversity jurisdiction.
Travelers moves for summary judgment and has presented evidence and legal authorities
establishing that it did not breach the insurance contract, it provided proper notice of cancellation,
and it properly denied coverage on the accident claim due to policy cancellation. The only issue
raised by plaintiff in response is plaintiff’s argument that plaintiff did not receive notice of the
invoices or the policy cancellation. However, the terms of the policy and applicable Oklahoma
law both provide that proof of the mailing of a cancellation notice, rather than proof of actual
receipt of the notice, is all that is required in order for the cancellation to be effective in
circumstances like those presented here. The policy language provides that the “policy may be
cancelled during the policy period” as follows:
“We may cancel by mailing to the named insured shown in the Declarations at the
address shown there . . . at least 10 days’ notice . . . if cancellation is for nonpayment
of premium. . . . Proof of mailing of any notice shall be sufficient proof of notice.”
(Doc. 16-1 at 26, 27) (emphasis added). Similarly, Oklahoma insurance regulations provide:
Unless otherwise provided, insurers shall give at least ten (10) days notice
prior to the date of cancellation . . .
If notice is given by mail, said notice shall be deemed to have been given
on the day said notice is mailed. Proof of mailing of the notice of cancellation . . .
to the named insured at the address shown in the policy, shall be sufficient proof of
Okla. Admin. Code § 365:15-1-14(a), (c).
Travelers has provided undisputed evidence that it mailed the invoices to plaintiff at his
home address, by first class mail, on February 21 and March 26, 2014, and mailed the Notice of
Cancellation for non-payment more than 10 days prior to the May 15, 2014 cancellation of the
policy. (See Doc. 16-9; Doc. 20-1). Pursuant to the insurance contract and Oklahoma law, that is
sufficient proof of notice of cancellation to the plaintiff, and the plaintiff’s failure to receive such
notice is irrelevant. See § 365:15-1-14; see also Midwestern Ins. Co. v. Cathey, 262 P.2d 434
(Okla. 1953) (Where policy provided that insurer may cancel by mailing written notice and that
such mailing “shall be sufficient proof of notice,” the court held that “the assured assumed the risk
of receiving the notice when properly mailed to him at the address given in the policy” and “it
would place an unreasonable and unfair burden on the company to say that notice of the
cancellation must be actually delivered to the assured. To make such a requirement would be
placing additional words in the policy far beyond the actual terms of the policy agreed to by the
Other state and federal courts have cited Cathey for the proposition that an insurer’s
mailing of a notice of cancellation, not its actual receipt, is all that is required in order for a policy
cancellation for nonpayment to be effective. For example, in State Farm Fire & Cas. Co. v. Van
Horn, No. 97-5131, 1998 WL 58187 (10th Cir. Feb. 11, 1998) (unpublished), the insureds denied
receiving notices of cancellation of a fire insurance policy for nonpayment and argued that, based
on their claim of non-receipt, they had successfully rebutted the insurer’s evidence that it mailed
the notice. Applying Oklahoma law and citing Cathey and other cases, the Tenth Circuit disagreed
and affirmed the district court’s grant of summary judgment to the insurer based upon proper
cancellation of the policy:
Oklahoma law does not necessarily require that an insurance company prove that
the insureds received notice of cancellation of a fire insurance policy. Where the
insurance company strictly complied with the terms of the policy for cancellation,
including mailing a notice of cancellation to the insureds at their address shown on
the policy, the risk of non-receipt falls on the insureds.
Van Horn, 139 F.3d at *2; see also Kutz v. State Farm Fire & Cas. Co., 189 P.3d 740, 743 (Okla.
Civ. App. 2008) (affirming summary judgment in favor of insurer where automobile accident
claim was denied based upon prior policy cancellation that was mailed but which the claimant
alleged was not received).
Based upon the foregoing, there is no genuine dispute of material fact, and Travelers is
entitled to judgment as a matter of law on the plaintiff’s claims. Travelers mailed the Notice of
Cancellation of the automobile insurance policy to the plaintiff more than 10 days before
cancellation, in accordance with the policy and Oklahoma law. Having received no payment of
the premium differential by the due date identified on the notice, Travelers then cancelled the
policy. As a result, Travelers properly denied the plaintiff’s insurance claim on the automobile
accident that occurred after the policy had been terminated.
Accordingly, the defendant’s Motion for Summary Judgment (Doc. 16) is granted. A
separate Judgment will be entered forthwith.
SO ORDERED this 31st day of March, 2017.
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