                    IN THE SUPREME COURT OF MISSISSIPPI

                                 NO. 2019-IA-00252-SCT

MUTUAL OF OMAHA INSURANCE COMPANY

v.

THERESA DRISKELL


DATE OF JUDGMENT:                           01/14/2019
TRIAL JUDGE:                                HON. EDDIE H. BOWEN
TRIAL COURT ATTORNEYS:                      EUGENE COURSEY TULLOS
                                            JASON RICHARD BUSH
                                            STEVEN JOEL JOHNSON
                                            JOHN RAYMOND TULLOS
COURT FROM WHICH APPEALED:                  SMITH COUNTY CIRCUIT COURT
ATTORNEY FOR APPELLANT:                     JASON RICHARD BUSH
ATTORNEYS FOR APPELLEE:                     JOHN RAYMOND TULLOS
                                            RAYMOND PATRICK TULLOS
NATURE OF THE CASE:                         CIVIL - INSURANCE
DISPOSITION:                                REVERSED AND RENDERED - 04/02/2020
MOTION FOR REHEARING FILED:
MANDATE ISSUED:


       BEFORE RANDOLPH, C.J., MAXWELL AND BEAM, JJ.

       MAXWELL, JUSTICE, FOR THE COURT:

¶1.    In Mississippi, when an insurance company “tenders a policy at variance with the

application, the tender constitutes a counteroffer.”1 At that point, the applicant “must accept

or reject the policy issued according to the terms of the insurer.”2 If the applicant accepts a


       1
         Interstate Life & Accident Ins. Co. v. Flanagan, 284 So. 2d 33, 36 (Miss. 1973)
(internal quotation marks omitted) (quoting 43 Am. Jur. 2d Insurance § 211 (1969)).
       2
           Id.
policy that varied from her application, “the varied policy becomes a contract between the

parties.”3

¶2.    Here, Theresa Driskell, with the help of an insurance agent, submitted applications

for a life insurance policy and a disability income rider. When reviewing the application, the

insurance company discovered Driskell was ineligible for the disability income rider. So it

issued her a life insurance policy that varied from her application—a policy that did not

provide disability income. Driskell received this policy and reviewed it. She did not reject

or return it. Instead, she accepted the policy and began making premium payments.

¶3.    Nearly three years later, Driskell made a claim with the insurer for disability income.

Because the policy did not include a disability income rider, the insurer denied her claim.

Driskell sued the insurer, citing her expectation of disability income coverage. The insurer

moved for summary judgment, which the trial judge denied. This Court granted the insurer’s

interlocutory appeal to decide if summary judgment was wrongly denied. After review, it

is clear the policy issued to Driskell and accepted by her did not include a disability income

rider. Therefore, we reverse the denial of summary judgment and render a judgment in the

insurer’s favor.

                        Background Facts and Procedural History

¶4.    In May 2011, Theresa Driskell applied for a life insurance policy from United of




       3
           Id. (internal quotation marks omitted) (quoting 43 Am. Jur. 2d Insurance § 211
(1969)).

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Omaha Life Insurance Company (United).4 In addition to her primary application, Driskell

also submitted a supplemental application for a disability benefits rider. United’s disability

benefits are provided either as income for a set number of months and/or a waiver of life

insurance premiums. Driskell applied for thirty months of disability income. United

approved her application and issued her a life insurance policy. But it did not approve her

for monthly disability income. Instead, the disability rider to Driskell’s life insurance policy

waived further premium payments in the event she became disabled.

¶5.    During the underwriting process, a pharmaceutical report showed Driskell had been

prescribed medicine for neuropathy. On her supplemental application, Driskell marked that

she had never been diagnosed with or treated for a nervous system disorder. This was false.

And, as the supplemental application states, an applicant who has been treated or diagnosed

for a nervous system disorder, such as neuropathy, is ineligible for monthly disability income.

¶6.    United delivered Driskell’s insurance policy to her agent, Andrea Garretson, on July

2, 2011. Garretson noted the policy did not provide disability income. So she emailed

United that same day asking to make changes to Driskell’s insurance policy and to add a

disability income rider. Four days later, an underwriter for United responded to Garretson.

He informed her that Driskell’s policy could be changed but, based on her pharmaceutical

report, she was ineligible for a disability income rider. Garretson never replied and no

changes were made to Driskell’s policy. The policy was issued without a disability income



       4
         Although Driskell named Mutual of Omaha Insurance Company in her complaint,
United of Omaha Life Insurance Company actually issued the life insurance policy. United
is a subsidiary of Mutual of Omaha.

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rider.

¶7.      United had also mailed Driskell a copy of her policy, which she received in early June

2011. Driskell looked over the policy but claimed she did not read it completely. She did,

however, review the policy coverage limit—$50,000—and the premiums United was

charging, a premium for the life insurance policy and a premium for a disability benefits

rider. The disability benefits rider waived future premium payments if she became disabled.

But it did not provide monthly income. Driskell made no attempt to reject the policy or

return it to United.

¶8.      On March 14, 2014, Driskell claimed she had become disabled. She then filed a claim

for monthly disability income. Because her policy did not include monthly disability income,

nor had Driskell paid any premiums for such benefits, United denied her claim. On October

27, 2015, Driskell filed a complaint against United in Smith County Circuit Court. She

alleged United wrongly denied her benefits to which she was entitled. United responded to

the complaint and also moved to file a third-party complaint against Garretson, seeking

indemnification, which the trial court granted. In her answer, Garretson admitted she asked

United about changing Driskell’s policy and adding a monthly disability income rider.

Garretson also admitted United had informed her that while Driskell’s policy could be

changed, Driskell was not eligible for a disability income rider. But Garretson never

conveyed this information to Driskell. Driskell insists that when she received her policy in

the mail, she assumed that because she applied for monthly disability income, United had

approved her application. But she admitted she could not find these benefits in her policy.



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¶9.    United moved for summary judgment, arguing Driskell never sought to return the

issued policy, which did not provide disability income benefits. It also pointed out Driskell

had never paid premiums for disability income benefits. Still, the trial judge denied United’s

motion. He found that whether Driskell’s policy included disability income benefits was a

question of fact for the jury to decide. United petitioned for an interlocutory appeal, which

this Court granted.

                                          Discussion

¶10.   This Court reviews de novo the grant or denial of summary judgment. Mladineo v.

Schmidt, 52 So. 3d 1154, 1160 (Miss. 2010). “[I]f the pleadings, depositions, answers to

interrogatories and admissions on file, together with the affidavits, if any, show that there is

no genuine issue as to any material fact . . . the moving party is entitled to a judgment as a

matter of law.” Miss. R. Civ. P. 56(c). Evidence is viewed in the light most favorable to the

nonmoving party, and the movant bears the burden to show no genuine issue of material fact

exists. Mladineo, 52 So. 3d at 1160.

¶11.   Driskell argues that because she applied for a disability income rider and was assisted

by Garretson, she reasonably expected to receive monthly disability income benefits. And

because United’s letter that accompanied her policy did not communicate the policy was a

counteroffer, she reasonably expected her rider application had been approved.

¶12.   “The interpretation of an insurance policy is a question of law, not one of fact.”

Noxubee Cty. Sch. Dist. v. United Nat’l Ins. Co., 883 So. 2d 1159, 1165 (Miss. 2004) (citing

Lewis v. Allstate Ins. Co., 730 So. 2d 65, 68 (Miss. 1998)). “[W]hen the words of an



                                               5
insurance policy are plain and unambiguous, the court will afford them their plain, ordinary

meaning and will apply them as written.” Id. (citing Paul Revere Life Ins. Co. v. Prince,

375 So. 2d 417, 418 (Miss. 1979)). A “policy either affords coverage or not, based upon the

application of the policy language to the facts presented.” Architex Ass’n Inc. v. Scottsdale

Ins. Co., 27 So. 3d 1148, 1156 (Miss. 2010) (citing Corban v. United Servs. Auto. Ass’n,

20 So. 3d 601, 609 (Miss. 2009)).

¶13.   First, Driskell’s life insurance policy does not provide monthly disability income

benefits. That coverage does not exist. Still, she argues United should provide the coverage

she hoped to have. But an insured has an affirmative duty to read an insurance policy.

Mladineo, 52 So. 3d at 1161 (citing Atlas Roofing Mfg. Co., Inc. v. Robinson & Julienne,

Inc., 279 So. 2d 625, 629 (Miss. 1973)). And “knowledge of an insurance policy is imputed

to an insured regardless of whether the insured read the policy.” Id. (internal quotation

marks omitted) (quoting Oaks v. Sellers, 953 So. 2d 1077, 1083-84 (Miss. 2007)). It is

undisputed that United delivered a policy to Driskell that had a premium waiver rider instead

of a disability income rider.

¶14.   Second, an application for insurance is not a contract but rather an offer to contract.

Interstate Life & Accident Ins. Co. v. Flanagan, 284 So. 2d 33, 36-37 (Miss. 1973); see also

Provident Life & Accident Inc. Co. v. Goel, 274 F.3d 984, 992 (5th Cir. 2001); Smith v.

Med. Life Ins. Co., 910 So. 2d 48, 51 (Miss. Ct. App. 2005). An insurer may accept or reject

the application or may state the terms on which it will offer insurance. Id. When an insurer

issues a policy that varies from the application, it is a counteroffer, which the applicant may



                                              6
either accept or reject. Id. United sent Driskell a policy without the requested disability

income rider. Driskell had the policy in her possession and the affirmative duty to read it.

She did not reject or return the policy. Instead, she began making premium payments and

continued payments for almost three years. So Driskell accepted United’s counteroffer.

¶15.   Finally, this Court has consistently held that insureds who possess a policy that

contradicts an agent’s representations cannot rely on the agent’s representations to create

coverage when none exists. Hayne v. The Doctors Co., 145 So. 3d 1175, 1183 (Miss. 2014);

Mladineo, 52 So. 3d at 1167. And parol evidence, like prior oral agreements, is inadmissible

and does not change the terms of a written contract. Hayne, 145 So. 3d at 1183. Even

assuming Garretson misrepresented that Driskell’s policy would include a disability income

rider, Driskell is bound by the actual policy she entered into—a policy that does not include

a disability income rider.

                                        Conclusion

¶16.   Because the policy Driskell accepted provides no monthly disability income benefits,

none exist. Therefore, United was entitled to a judgment as a matter of law.

¶17.   REVERSED AND RENDERED.

    RANDOLPH, C.J., KITCHENS AND KING, P.JJ., COLEMAN, BEAM,
CHAMBERLIN, ISHEE AND GRIFFIS, JJ., CONCUR.




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