The Policy is in The Mail: Judge's ruling OKs nonprofit rates. (Insurance).

In 1992, the hot movie was A Few Good Men in which Jack Nicholson barked at Tom Cruise that the pretty boy couldn't handle the truth.

It also the year that the United States Postal Service (USPS) told the Aid Association for Lutherans (AAL) in Appleton, Wisc., that mailings for insurance policies that AAL designed specifically for member of the Lutheran church, did not qualify for nonprofit postage rates. And, in 1993, the two rolled up their sleeves and went to court.

Finally, nearly a decade later, United States District Court Judge William B. Bryant in September ruled for AAL. Now, the USPS can take heed and adapt from another 1992 classic, A League Of Their Own. "There's no crying in postal."

It's a huge win for nonprofit mailers. AAL may receive as much as $8 million in refunds from the USPS, the difference between the nonprofit rate and the more expensive commercial rate the organization began using in when forced to do so by the USPS plus interest.

While the $8 million figure is being floated, the organization is taking a wait and see attitude. "We don't know what to expect back," said Bill Harke, AAL's manager of media relations.

"We're quite happy with the decision and have notified the post office we intend to start mailing at the nonprofit rate," said Harke. "We are not pleased it took so long already. But, we are waiting for it to play out."

And, the decision may have a wider implication than simply permitting fraternal benefit societies to mail their insurance offerings at the nonprofit rate. According to attorney Geoffrey Peters, who argued the case for AAL, "Now we have a decision that invalidates the 'otherwise commercially available' insurance portion of the Travel Insurance and Financials (TIF) regulations. This seems to open the door to other organizations that can claim to have a "not otherwise commercially available" insurance offering," said Peters.

The USPS did not return telephone calls for comment.

Basically, what the judge did was declare invalid Section E670.5.5 of the USPS Domestic Mail Manual because the regulation is inconsistent with the purpose of the statute, 39 U.S.C. Section 3626(j), explained Ellenor A. Kirkconnell, assistant director of the Alliance of Nonprofit Mailers in Washington, D.C.

This history, she explained, is that on November 5, 1990, the president signed into law Public Law 101-509, the Treasury, Postal Service and General Government Appropriations Act for 1991, adding new subsection (j) to 39 U.S.C. 3626. This provision prohibits the mailing of material at the Nonprofit Standard Mail rates if it contains advertising for credit, debit, or charge cards or similar financial instruments or accounts. This provision also restricts the mailing of material at the Nonprofit Standard Mail rates if it contains advertising for insurance policies and travel arrangements and limited solicitations for all other products and services.

According to Peters, the USPS's previous position was that if you offer auto insurance, it doesn't the terms of the policy do not matter because it is still auto insurance and is otherwise commercially available. The same is true of all other major types of insurance. "But now, for example, a nonprofit association of nonprofit organizations might be able offer its own unique directors' and officers' liability policy to its members," he said.

"Had they settled with AAL any time from 1992 forward they could have carved out an exception for nonprofit organizations that were, themselves, issuers of insurance. Now they owe AAL millions of dollars for the difference between the commercial bulk (Standard A) rate and the nonprofit bulk rate," said Peters.

There was no immediate word as to whether the USPS will appeal. But, Peters said that the decision "is so clearly and carefully written, and the logic is so inescapable, that I am hopeful that instead they will work with my client and with the various organizations representing nonprofits, such as the DMA Nonprofit Federation."