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Third Circuit Rules for State Farm in Juvenile Smoking Policy Lawsuit 

A class action over clauses in insurance contracts concerning youth smoking appears to be extinguished. In an unpublished decision, the U.S. Court of Appeals for the Third Circuit has upheld the dismissal of claims against State Farm Insurance Company brought by a plaintiff who sued because the company didn't differentiate between smokers and non-smokers when calculating policy premiums for her children.

In 2002, Samuel Doctor, now deceased, bought life insurance policies for his sons (Samuel, who was 16, and Nathan, who was 10) for face amounts of $15,000 each. The standardized application forms, which State Farm uses for both adult and juvenile applicants, asked Doctor whether each child smoked or used tobacco products. He designated both children to be nonsmokers/non-tobacco users. According to court documents, State Farm has offered tobacco-distinct premiums for adults, but has never offered tobacco-distinct premiums for insureds age 20 and under. Rather, it offers an aggregate juvenile premium rate that takes into account the mortality experience of all juveniles (both those who use tobacco and those who do not). . . .

Other, similar youth smoking suits have bounced around in other jurisdictions without much success. The Pennsylvania suit was seen as the most promising for plaintiffs lawyers.

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