On June 14, 2000, Westbury Canadian Life Insurance Company (Westbury) announced the settlement of proposed class actions in Ontario, British Columbia and Quebec, which had been brought against Mutual of Omaha.
Commenced in 1996 and 1997, the lawsuits raised allegations about the sale of Mutual of Omaha participating whole life insurance policies and in particular, the vanishing premium or premium offset feature available with those policies. Westbury acquired the life insurance business of Mutual of Omaha in 1998.
The settlement will provide universal benefits to all current policy owners. These benefits will ensure that all policy owners will have the benefit of a reduced vanish or premium offset point. Additionally, Westbury has guaranteed that a minimum amount will be available for relief under the agreement, with no maximum limit.
The settlement involves approximately 10,000 in-force policies and 20,000 lapsed and surrendered policies. The settlement will apply in every province and territory to all current policy owners and those former policy owners who lapsed or surrendered their policies after December 31, 1994. Approval hearings for the three actions are scheduled to be held in July, 2000.
Acting for Westbury, a subsidiary of RBC Insurance, were Vice-President Law, Robert W. Bell, and counsel in the three provinces: Ontario—Timothy Pinos and Glenn Zakaib at Cassels Brock & Blackwell LLP; British Columbia—David Martin at Douglas Symes & Brissenden; and Quebec—Bernard Amyot at Heenan Blaikie. Acting for the representative plaintiffs in the three actions were Siskind, Cromarty, Ivey & Dowler LLP of London, Ontario (Charles Wright, Mike Peerless and Mike Eizenga), Lauzon Bélanger of Montreal (Yves Lauzon and Gilles Gareau), and Poyner Baxter Poyner of North Vancouver (Kenneth Baxter and Jim Poyner).