Assignment:
Insurance companies’ practice of rescinding policies based on misrepresentations in an application has come under significant criticism in the area of health insurance. In several publicized cases, companies have been accused of cancelling health insurance contracts based on minor or technical defects in the original applications, typically after the insured has already incurred significant healthcare expenses due to serious illness. In response to these cases, the Obama administration issued regulations that limit insurers’ ability to rescind health insurance contracts.
As a policy analyst for a consumer advocacy agency, you have been asked to write a short (3-5 page) pamphlet explaining the regulations to consumers. Your pamphlet should discuss why the regulations were issued (drawing on examples of real cases you can find on the Internet) and explain how the regulations change the rules that would normally apply under the common law.
Please incorporate, if you can :
- One source to use: Contracts in a Nutshell, “Remedies”
One case, if can: State v. Ernst & Young
Learning Objectives:
At the end of this week, you will be able to:
- Distinguish between a covenant and a condition
- Recognize when a party will be excused from performing a contract under the doctrine of impossibility
- Estimate the amount of compensatory damages likely to be awarded in specific breach of contract cases
- Explain the doctrine of mitigation of damages and why it does not apply to a “lost volume seller”
- Explain when the remedy of specific performance is likely to be available
