In 2004, plaintiff Norman Carter decided to purchase a lower-priced health insurance plan for his family. He dropped his Blue Cross policy and selected a basic hospital-surgical expense policy from Mid-West National Life Insurance Co. of Tennessee. The premium for the policy was approximately $300 per month, and the policy was purchased through Mid-West agent Joseph Bertino. Mr. Carter had claims in 2008 that were denied by Mid-West since the claims were not in-patient hospital charges. In 2011, Mr. Carter’s wife, plaintiff Kathleen Carter, received certain medical services resulting in a hospital bill of about $300,000. As a result of discounts applied because of the Mid-West policy and payments by Mid-West of about $30,000, the remaining hospital charges were approximately $144,000. These charges were not paid by Mid-West because they exceeded the coverage limits selected by Mr. Carter when he purchased the coverage. The Carters sued Mid-West and Bertino for breach of the implied covenant of good faith and fair dealing, fraud by concealment, and false promise. The Carters asserted that the policy sold by Mid-West was “junk insurance” because the policy did not cover $144,000 of the hospital bills they incurred. The couple’s counsel asserted that Mr. Carter requested comprehensive coverage for all expenses exceeding his deductible. The Carters alleged that certain provisions in the policy were ambiguous, and that they would not have purchased the policy if they knew its limitations. Mid-West and Bertino argued that Mr. Carter was offered Mid-West’s Preferred Provider Organization plan, which provided higher benefit levels, but that Mr. Carter decided to purchase a less expensive, basic plan at the lowest benefit levels available. The plan selected by Mr. Carter was the least expensive plan offered by Mid-West. Defense counsel maintained that all benefits owed under the selected plan were paid in full up to the maximum limits selected by Mr. Carter. Mid-West also asserted that Mr. Carter was put on notice on several occasions regarding the limits of the health insurance policy he chose, and he could have purchased coverage that would have provided higher benefit levels if he wished to do so. Thus, Mid-West and Bertino denied acting in bad faith or defrauding the Carters, and their counsel asserted that the fraud claim was barred by the statute of limitations. The defense’s retained expert in insurance industry practices and regulations testified that the basic hospital medical expense certificate form issued by Mid-West is an insurance product that has been sold by many insurers in California and other states for at least 50 years. The expert further opined that the miscellaneous hospital in-patient benefit has been a common feature of such policies, typically covering hospital services and supplies other than room and board and intensive-care-unit charges. According to Mid-West’s retained expert in insurance pricing, Carter could have purchased new health insurance coverage after his injury in 2008, despite his “pre-existing condition.”, The Carters sought recovery of $144,000 in unpaid medical charges, plus unspecified amounts for emotional distress, punitive damages and attorneys’ fees.