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SAN RAFAEL, Calif. – A jury on Thursday awarded $31.7 million to an eye surgeon who accused disability insurer UnumProvident Corp. of cutting off his benefits as part of a management scheme to boost profits.
The judgment, including $30 million in punitive damages, was handed down in Superior Court in Marin County, where the three-month-long trial was held.
Novato ophthalmologist Randall Chapman sued in 2001 after UnumProvident refused to pay him a $11,600 monthly benefit that he sought under long-term disability policies purchased during the 1980s.
Citing the opinions of his doctors, Chapman said a phobia had given him the shakes, preventing him from performing eye surgery. UnumProvident’s internal doctors disagreed with the diagnosis, prompting the company to terminate his benefits in September 2000 after three months of payments.
The jury ruled that UnumProvident acted in bad faith, handing the Chattanooga, Tenn.-based company the latest setback in a widening legal tussle over its claims practices.
Messages left for UnumProvident officials were not returned after the verdict was announced Thursday.
UnumProvident, the nation’s largest disability insurer, is facing hundreds of lawsuits filed by disillusioned policyholders who say the company puts its profits ahead of the seriously ill and badly injured people that it’s supposed to protect.
A federal judge in San Francisco also concluded in November that UnumProvident had abused its policyholders to avoid paying legitimate claims.
About 3,500 people work for UnumProvident in Portland, Maine, where the former Unum Corp. was founded. UnumProvident was created by the 1999 merger of the Unum Corp. and The Provident Companies.
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