Earnhardt's widow claims she's owed millions

LEXINGTON, N.C. A life insurance company cheated the
widow of late race car driver Dale Earnhardt out of millions of
dollars by refusing to pay up when he died, her lawyer said in the
opening statements of a civil trial Wednesday.

The insurer, United of Omaha, argued the $3.7 million policy was
never in effect because Earnhardt had not taken the required
physical before he died in a crash at the Daytona 500 in 2001.

"We made a fair decision. We made a reasonable decision.
There's no question we made an unpopular decision, but we did what
we're supposed to do based on what occurred," company lawyer
Stephen Coles told the jury.

But Richard Childress Racing Earnhardt's car owner, which is
pursuing the matter on behalf of the family has accused the
insurer of failing to properly investigate before denying payment
just days after the driver's death.

An insurance company has "a duty to find out why a claim
should've been paid," said attorney John Morrow.

He said in his opening statement that Earnhardt had passed a
physical for NASCAR shortly before his death.

Richard Childress Racing took out the policy on Earnhardt's
behalf and made a $5,000 payment in January 2001.

Earnhardt died in the last-lap crash that Feb. 18. The next day,
the race team received a second invoice dated two days before the crash for another $5,000 payment toward the annual $21,645
premium. Childress Racing made the payment believing the policy was
active, according to the complaint.

The $3.7 million was part of a $7.2 million benefits package,
according to the driver's contract. A $3.5 million policy with a
second insurer, set up in 1996, was paid to Childress and signed
over to Earnhardt's widow, Teresa.

But United of Omaha sent a letter dated Feb. 21 to Childress
Racing saying it would not pay the $3.7 million because the
application was incomplete "and now cannot be completed,"
according to the complaint.

Coles said that, despite the payments, the policy hadn't
attached to the 49-year-old Earnhardt, one of the most popular
drivers in the history of stock-car racing, because he had put off
requests to undergo a physical.

"Just because somebody files an application doesn't mean they
get a policy," Coles said. "It's not automatic. It's especially
not automatic when it's the amount of money in this case."

Childress Racing's lawsuit alleges that the insurer operated in
bad faith by not investigating completely, and that the denial of
benefits without a "reasonable" investigation amounted to unfair
and deceptive trade practices. Childress' attorneys indicated
earlier this week that they should receive the full $3.7 million
payment, along with compensatory and punitive damages.

Aside from its claim that Earnhardt never took the required
physical, United of Omaha also denied responsibility for the
actions of the two contractors who set up the policy. Childress has
reached a partial settlement with the two, though the agreement is
sealed. Davidson County Superior Court Judge Kimberly Taylor has
issued a gag order in the case.

Childress and Bill Patterson, executive vice president of
Childress Racing, both testified about the payments made to the
Shuford Insurance Agency of Concord, which helped arrange the

Childress testified that he was "pretty upset" when the letter
arrived denying the claim.

"All I know is we had the checks where we paid for insurance," he said.