DuBeck v. Cal. Physicians' Serv.Annotate this Case
In September 2006, Blue Shield, canceled DuBeck’s medical insurance policy, claiming DuBeck had made material misrepresentations in her application and concealed that she had undergone a fine needle aspiration for a lump in her breast days before submitting the application. The policy had been in effect 17 months. Blue Shield had paid medical claims unrelated to the breast cancer, deemed a pre-existing condition. The cancellation letter expressly stated that Blue Shield was electing to cancel coverage prospectively, rather than rescind the policy, and that any claims for covered services incurred prior to cancellation would be covered. In September 2008, DuBeck filed suit, alleging that Blue Shield had failed to pay covered claims while the policy was in force. Blue Shield asserted its right to rescind the policy, voiding it ab initio. The trial court granted Blue Shield summary judgment. The court of appeal reversed, holding that the 2006 decision to cancel, rather than rescind the policy; the affirmation of coverage up to that date and assurance that it would pay for services covered prior to cancellation; retention of premium; and failure to assert a right to rescind until more than two years after Blue Cross had all the pertinent facts, constituted a waiver of the right to rescind.