Cochran Firm wins record $1.62 billion insurance fraud case.

A landmark $1.62 billion verdict in a single plaintiff insurance fraud case won by The Cochran Firm earlier this year may bring about industry reform. Industry insiders are saying this verdict is impacting now insurance agents are hired and trained.

The case involved a $25,000 universal life insurance policy bought by a black woman in May 1995 from Texas-based Southwestern Life Insurance Co. Carolyn Whittaker paid monthly cash premiums of around $50 to insurance agent James Richard Perry who was accused of turning over some of the money to the insurance company and pocketing the rest. When Perry told Whittaker to let her policy lapse in December 2001, she called Southwestern Life and found out that her policy had been void since October 1996. She had been defrauded of $3,000 in premiums.

The verdict awards Whittaker $810 million ($800 million in punitive damages and $10 million in compensatory damages) from both Perry and Southwestern Life. Southwestern Life is Seeking an appeal The award in punitive damages could be reduced to $60 million because of state law award limitations, But even if it is the verdict sent a resounding message to insurance companies: "Stealing money out of the hands of black policyholders ... has to come to a final end," says Jock M. Smith, lead attorney representing the plaintiff.