Hollinger v. Mutual Benefit Life Insurance

MR. JUSTICE ERICKSON

specially concurring:

The analysis set forth in the majority opinion and the result reached are basically sound, but there is one issue which requires clarification.

The majority opinion states that:

“This court has consistently held that the question of materiality does not depend upon the opinion or subjective knowledge of the applicant.” (Emphasis added.)

I agree. However, the distinction which is necessary is that between materiality [that which affects the insurer’s risk] and what a question means to a lay applicant. Materiality is to be judged by the insurer; however, the insurer is not at liberty to deny coverage, after a loss has occurred, on the basis of an answer to an insurer’s question that is ambiguous or too general to evoke a material response. For example, a question that calls for the applicant to state whether he has suffered from a number of enumerated maladies, followed by the general catch-all phrase, “or other disease or ailment or surgical operation,” is overly broad. It is so broad as to deny an applicant the opportunity, as a reasonable person, to determine the scope of the question.

We applied this distinction in the companion case, Wade v. Olinger Life Insurance Co., 192 Colo. 401, 560 P.2d 446. There, we formulated a rule whereby an applicant’s response to an ambiguous or overly broad question was to be measured by an objective standard: whether a reasonable person, with the applicant’s physical or mental characteristics, under all the circumstances, would understand that the question calls for disclosure of specific information. The prophylactic rule announced in the Wade case is consistent with the opinion in this case.

I have been authorized to say that MR. JUSTICE HODGES, MR. JUSTICE GROVES, MR. JUSTICE LEE, and MR. JUSTICE CARRIGAN join me in this special concurrence.