MANHATTAN (CN) – A “cancer-battling widow raising three children” claims she paid life insurance premiums on her husband to Prudential for 24 years, but when her husband died, Prudential denied her policy and enforced a 2-week-old policy, with a cheaper payout, benefiting her husband’s secret mistress and unborn “out-of-wedlock baby.”
Teresa Williams sued Prudential Financial, Pruco Life Insurance Co. of New Jersey and her insurance agent, Albert Brodbeck, in New York Supreme Court.
“At the same time plaintiff lost her husband and defendants attempted to terminate the policies on her husband’s life, she was battling cancer and undergoing chemotherapy,” according to the complaint. “When premiums were due on two term policies for which plaintiff was the beneficiary, defendants failed to properly communicate that information because defendants were trying to hide this mistress’ identity.”
Williams says she and her now-deceased husband, Eric, purchased their first of many insurance contracts from Brodbeck in May 1986.
“In April 2008, Pruco had issued five separate, concurrent term life insurance policies on Mr. Williams’ life,” according to the complaint.
Williams is the direct beneficiary of four of the policies, worth $4.25 million; the fifth was issued on behalf of Eric’s mistress, Synthia Jones, “who, at the time the policy was issued, was pregnant with Mr. Williams’ baby,” according to the complaint
In early 2008, Eric told Brodbeck that he was having an affair with a woman in Atlanta, Williams claims.
“In furtherance of this scheme, Brodbeck consulted with plaintiff’s husband and suggested a way to surreptitiously insure his mistress,” according to the complaint. “He did this to obtain more premiums for him and the company he worked for, defendant Pruco.”
Williams claims Brodbeck advised her husband to “develop a ‘business’ with his mistress” and make the fifth policy payable to her as his “business partner.”
Prudential issued the policy for Jones 2 weeks before Eric died in May 2009, and Brodbeck instructed his staff not to tell Teresa anything about the mistress, according to the complaint.
“Brodbeck did not tell plaintiff about the mistress her husband took,” the complaint states. “Nor did he tell her that the mistress was pregnant with her husband’s baby at this time or that the mistress was becoming a beneficiary of one of Eric Williams’ policies.”
Teresa says she received “mixed signals” and contradicting information from Brodbeck about the policies.
“For example, she was told with respect to two policies that premiums were due in April 2009, that the policies would lapse if the premiums were not paid by May 13, 2009, and then that the policies would be switched to quarterly, and premiums would be due on June 4, 2009,” according to the complaint. “Plaintiff relied on Brodbeck to give her accurate information concerning her and Eric’s policies and so when she saw the e-mail from Brodbeck’s office that the premium was due on June 4, 2009, she followed it despite prior notices contradicting that advice.”
Williams says she trusted Brodbeck and treated him as family because of their long-standing relationship.
Though she paid the premium before June 4, “much to her shock, dismay and surprise, following her payment of the premiums, Pruco took the position that the two policies that plaintiff made payment for had lapsed,” according to the complaint.
“Pruco cashed the checks but did not honor the policy,” Williams says.
“Moreover, they chose to treat the policy that Eric Williams bought for his mistress and their out-of-wedlock baby as enforceable.”
The policy that Pruco enforced, benefitting the mistress, had the lowest payout: $500,000. The policies that named Teresa Williams as beneficiary were each worth twice as much, and the two policies that the plaintiff was denied were worth a combined $2.25 million.
“Pruco has thus prevented plaintiff, a cancer-battling widow raising three children, with a 24-year history of paying premiums to Prudential, from obtaining benefits,” the complaint states. “Without legal justification, Pruco paid the girlfriend of Eric Williams, who never owned a Pruco policy, $500,000 as beneficiary. By choosing to pay the girlfriend, Pruco saved $1,750,000, to the detriment of plaintiff.”
Williams seeks orders for promissory and equitable estoppel, alleging breach of fiduciary duty, breach of insurance contract and negligent misrepresentation. She is represented by Derek Sells.