649 A.2d 1296 (App. Div. 1994)(citing Sparks, 100 N.J. at 338), certif. denied, 139 N.J. 441, 655 A.2d 443 (1995). See also Doto, 140 N.J. at 555. In the face of this inequity, the courts "assume a vigilant role in ensuring ... principles of fairness and conformity to public policy." Schmidt, 1996 WL 637612, at *6 (citing Sparks v. St. Paul Ins. Co., 100 N.J. 325, 335, 495 A.2d 406 (1985)). See also Doto, 140 N.J. at 556 (1995)(citation omitted); Paul Revere Life Ins. Co. v. Haas, 137 N.J. 190, 199, 644 A.2d 1098 (1993).
Basic tenets of construction guide the resolution of insurance contract disputes. Language of an insurance policy that is clear and unambiguous will be given its ordinary meaning. Longobardi v. Chubb Ins. Co. of New Jersey, 121 N.J. 530, 537, 582 A.2d 1257 (1990); Imperial Cas. and Indem. Co. v. High Concrete Structures, Inc., 858 F.2d 128, 131 (3d Cir. 1988); Daus v. Marble, 270 N.J. Super. 241, 251, 636 A.2d 1091 (App.Div. 1994); American Casualty Co. v. Resolution Trust Co., 839 F. Supp. 282, 290 (D.N.J. 1993). See also Bergholm v. Peoria Life Ins. Co. of Peoria, Ill., 284 U.S. 489, 492, 76 L. Ed. 416, 52 S. Ct. 230 (1932). The terms of an insurance policy should be read to avoid ambiguities. American Casualty Co., 839 F. Supp. at 290.
"A contract is ambiguous if it is susceptible of more than one meaning." Sumitomo Mach. Corp. of Am., Inc. v. AlliedSignal, Inc., 81 F.3d 328, 332 (3d Cir. 1996)(citations omitted); Pennbarr Corp. v. Insurance Co. of North America, 976 F.2d 145, 151 (3d Cir. 1992) (citing Tigg Corp., 822 F.2d at 362); Kaufman, 825 F. Supp. at 283; Air Master Sales Co., 748 F. Supp. at 1115; Armco Inc., 746 F. Supp. at 1251. An insurance policy is not ambiguous, however, merely because it is complex. Pennbarr Corp, 976 F.2d at 151 (citing Transamerica Ins. Co. v. Keown, 451 F. Supp. 397, 400 (D.N.J. 1978)).
The goal is to decide whether "there [are] objective indicia that, from the linguistic reference point of the parties, the terms of the contract are susceptible of different meanings." In re New Valley Corp., 89 F.3d 143, 150 (3d Cir. 1996)(citations omitted); Sumitomo Mach. Corp., Inc., 81 F.3d at 332 (citation omitted). The "words of the agreement, alternative meanings suggested by counsel, and extrinsic evidence offered in support of those meanings" are determinative of ambiguity. Pennbarr, 976 F.2d at 151 (quoting International Union, United Auto v. Mack Trucks, Inc., 917 F.2d 107, 111 (3d Cir. 1990), cert. denied, 499 U.S. 921, 113 L. Ed. 2d 246, 111 S. Ct. 1313 (1991)).
If the language in the insurance policy is capable of different interpretations, "courts invariably accept the interpretation under which coverage will be found and reject the interpretation under which the injured person would be left without protection." Lemos v. Sousa, 294 N.J. Super. 28, 32, 682 A.2d 277 (Law Div. 1996)(quoting Craig and Pomeroy, New Jersey Auto Insurance Law, § 2:3-1 (1996)). See also Allen v. Metropolitan Life Ins. Co., 44 N.J. 294, 305, 208 A.2d 638 (1965) ("[New Jersey Courts] have consistently construed policy terms strictly against the insurer and where several interpretations were permissible, we have chosen the one most favorable to the assured").
When the meaning of a phrase in an insurance contract is ambiguous, the ambiguity will generally be resolved in favor of the objectively reasonable expectations of the insured. Doto, 140 N.J. at 556 (1995); Lindstrom v. The Hanover Ins., Co., 138 N.J. 242, 250-51, 649 A.2d 1272 (1994); Clients' Security Fund v. Security Title and Guarantee Co., 134 N.J. 358, 372, 634 A.2d 90 (1993); Voorhees v. Preferred Mut. Ins. Co., 128 N.J. 165, 175, 607 A.2d 1255 (1992); Salem Group v. Oliver, 128 N.J. 1, 4, 607 A.2d 138 (1992); Meier v. New Jersey Life Ins. Co., 101 N.J. 597, 612, 503 A.2d 862 (1986); Sparks, 100 N.J. at 336; DiOrio v. New Jersey Mfrs. Ins. Co., 79 N.J. 257, 269, 398 A.2d 1274 (1979); Vargas v. Hudson County Bd. of Elections, 949 F.2d 665, 672 (3d Cir. 1991). An insurance contract should comport with the parties' intent and with the reasonable expectations of the insured. Oritani Savings and Loan Ass'n v. Fidelity and Deposit Co. of Maryland, 989 F.2d 635 (3d Cir. 1993).
Under the doctrine of reasonable expectations, even an unambiguous contract may be interpreted contrary to its plain meaning. Voorhees, 128 N.J. at 175; Werner Indus., Inc. v. First State Ins. Co., 112 N.J. 30, 35-36, 548 A.2d 188 (1988); Gerhardt v. Continental Ins. Cos., 48 N.J. 291, 225 A.2d 328 (1966) (language in issue not deemed to be ambiguous, but was insufficiently clear to justify depriving the insured of her reasonable expectation). See also Oritani, 989 F.2d at 638 (it must be determined "whether the policy language is insufficiently clear such that the average policyholder would be deprived of a reasonable expectation of coverage").
The court, however, may not make a better contract than the parties initially entered into. Kampf v. Franklin Life Ins. Co., 33 N.J. 36, 43, 161 A.2d 717 (1960); Stanton v. Rich Baker Berman & Co., P.A., 876 F. Supp. 1373, 1384 & n.12 (D.N.J. 1995)(citations omitted). A court may not rewrite the terms of a policy or give them a construction in conflict with the accepted and plain meaning of the language of the policy. See Pennbarr, 976 F.2d at 151 (citing In re Community Medical Ctr., 623 F.2d 864. 866 (3d Cir. 1980); Kampf, 33 N.J. at 43; American Casualty Co., 839 F. Supp. at 290 ("a strained or distorted meaning will not be indulged in and the clause in an insurance policy will be given [its] ordinary and usual meaning").
MONY argues Seidenberg has conceded the Waiver of Premium term is unambiguous, and, therefore, the Insurance Policy should not be construed in favor of the insured and against the insurer. MONY Reply at 2-3 (citing Seidenberg Brief at 2-4). MONY urges the terms of the policy should be afforded "their 'plain and ordinary meaning'." MONY Reply at 1 (citing Kaufman, 828 F. Supp. at 283 (D.N.J. 1992) (quoting Armco Inc., 746 F. Supp. at 1252)).
Miriam Seidenberg contends the "special rules of interpretation" applied in New Jersey for insurance contracts necessitate a determination of the language in favor of the insured and against the insurer. See Seidenberg Brief at 3 (citations omitted). Miriam Seidenberg argues she is entitled to the full face value of the Insurance Policy.
C. Waiver of Premium
As mentioned, in December 1983, Phyllis Seidenberg purchased an optional Waiver of Premium rider as an additional benefit to her MONY Insurance Policy. The Waiver of Premium provision lies at the center of the instant dispute. The language of the Waiver of Premium states, in relevant part:
THE BENEFIT- We shall waive payment of certain premiums if: (a) the Insured incurs total disability, as defined below; (b) that disability starts before age 65 and while this rider is in force; and (c) that disability continues with no interruption during the insured's lifetime for 6 months. Waiver will take place when due proof is given to us, at our Home Office, that (a), (b) and (c) above has occurred.
DISABILITY STARTING BEFORE AGE 60- If the disability starts before age 60, all premiums will be waived which (a) became due during such 6 months; and (b) thereafter become due while total disability continues. But, in no case will any premium be waived if it becomes due before the policy anniversary nearest the Insured's 5th birthday.