Estelle KIRSH, etc., Plaintiff and Appellant, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant and Respondent.
Plaintiff, Estelle Kirsh, appeals from summary judgment entered in favor of defendant, State Farm Mutual Automobile Insurance Company, in plaintiff's action challenging defendant's practice of selling medical insurance policies that cost women more than they cost men and exclude coverage for medical costs incurred solely by women.1
The second amended complaint alleged: In November 1984 defendant sold plaintiff, then 36 years old, a hospital-surgical policy (policy) and a catastrophic medical expense rider (catastrophic rider) that cost $564.60 for six months. Defendant's rate table indicates that it would have charged plaintiff only $344.90 for a six-month period if she had been a man. The policy and the catastrophic rider both exclude coverage for costs of normal pregnancy and childbirth, but neither excludes coverage for any care, treatment or surgery required solely by men. Plaintiff, a woman of childbearing age, declined to purchase a maternity rider offered by defendant that would have covered normal pregnancy and childbirth costs for an additional premium of $633 for a six-month period. Plaintiff purchased renewals of the policy and the catastrophic rider semiannually through an expiration date of December 31, 1989. The premium defendant charged plaintiff for the most recent renewal was more than defendant would charge a man of plaintiff's age.
It was further alleged: Defendant's practices constitute arbitrary discrimination, and therefore violate the Unruh Civil Rights Act (Unruh Act) (Civ.Code, § 51), because they classify men and women into distinct groups based solely on sex and then treat those groups differently by charging women higher premiums for health insurance policies that exclude coverage for medical conditions peculiar to women. The second amended complaint contained causes of action for an injunction enjoining defendant's allegedly discriminatory practices, a declaration that such practices violate the Unruh Act, and damages for such violation.2
After answering the second amended complaint defendant moved for summary judgment in its favor or, in the alternative, summary adjudication of issues.3 In support of the motion defendant submitted the declaration of an actuary who stated: Defendant charges women in the 20–54 age group a higher premium for the policy than it charges men in the same age group; this result is consistent with and justified by defendant's claim cost experience which shows that defendant pays out more in health care benefits to women than to men in the 20–54 age group. Defendant did not dispute that it charged plaintiff a higher premium for the policy than it would have charged a similarly situated male for like coverage and that the policy did not cover costs of normal pregnancy and childbirth, but argued: (1) The Unruh Act does not apply to the life and disability insurance business; (2) the Insurance Code permits both gender-based premiums and exclusion of pregnancy coverage and these specific provisions prevail over the Unruh Act's general prohibition of sex discrimination; and (3) actuarial justification makes such practices nonarbitrary discrimination within the meaning of the Unruh Act.
The trial court granted defendant's motion for summary judgment. Judgment was entered in favor of defendant and against plaintiff on all causes of action in the second amended complaint. Plaintiff appeals from the judgment.
ISTANDARD OF REVIEW
Because the facts are not in dispute no triable issue of fact was presented by defendant's motion for summary judgment. The only issues presented to the trial court were issues of law, which may be determined in summary judgment proceedings. (Allis–Chalmers Corp. v. City of Oxnard (1981) 126 Cal.App.3d 814, 818, 179 Cal.Rptr. 159.) The sole question on appeal is whether the trial court properly resolved the issues of law raised by the motion.
UNRUH ACT APPLIES TO BUSINESS OF INSURANCE
The Unruh Act protects all persons from arbitrary discrimination in “accommodations, advantages, facilities, privileges, or services in all business establishments of every kind whatsoever.” (Civ.Code, § 51.) As explained in O'Connor v. Village Green Owners Assn. (1983) 33 Cal.3d 790, 795, 191 Cal.Rptr. 320, 662 P.2d 427: “ ‘․ [T]he term “business establishments” was used in the broadest sense reasonably possible. The word “business” embraces everything about which one can be employed, and it is often synonymous with “calling, occupation, or trade, engaged in for the purpose of making a livelihood or gain.” [Citations.] The word “establishment,” as broadly defined, includes not only a fixed location, such as the “place where one is permanently fixed for residence or business,” but also a permanent “commercial force or organization” or “a permanent settled position (as in life or business.)” [Citation.]’ ”
Under this definition of the word “establishment” defendant, an entity engaged in the business of selling insurance, is a business establishment within the meaning of the Unruh Act because while defendant may not have a fixed place of operations, such as a restaurant or a store has, it does have a permanent commercial force or organization.
DEFENDANT VIOLATED UNRUH ACT BY EXCLUDING COVERAGE FOR COSTS OF NORMAL PREGNANCY AND CHILDBIRTH
The Unruh Act provides in pertinent part: “All persons within the jurisdiction of this state are free and equal, and no matter what their sex, race, color, religion, ancestry, national origin, or blindness or other physical disability are entitled to the full and equal accommodations, advantages, facilities, privileges, or services in all business establishments of every kind whatsoever. [¶] This section shall not be construed to confer any right or privilege on a person which is conditioned or limited by law or which is applicable alike to persons of every sex, color, race, religion, ancestry, national origin, or blindness or other physical disability.” (Civ.Code, § 51.)
The history and language of the statute “disclose a clear and large design to interdict all arbitrary discrimination by a business enterprise.” (In re Cox (1970) 3 Cal.3d 205, 212, 90 Cal.Rptr. 24, 474 P.2d 992.) By its inclusion of “sex” the Unruh Act “is clearly a declaration of California's public policy mandate and objective that men and women be treated equally.” (Rotary Club of Duarte v. Board of Directors (1986) 178 Cal.App.3d 1035, 1047, 224 Cal.Rptr. 213.) Differential pricing based on sex is detrimental to both men and women because it reinforces harmful stereotypes and is not permissible merely because it is profitable. (Koire v. Metro Car Wash (1985) 40 Cal.3d 24, 32–38, 219 Cal.Rptr. 133, 707 P.2d 195.) While no California court has been called upon to determine whether an insurer's failure to provide coverage for normal pregnancy and childbirth constitutes sex discrimination within the meaning of the Unruh Act, the following reasoning by the Supreme Court of Colorado is persuasive on that issue: “The failure to provide coverage for the treatment of pregnancy in an otherwise comprehensive insurance policy discriminates against women on the basis of sex as surely as, for example, the failure to provide coverage for the treatment of prostate conditions in a comprehensive policy would discriminate against men on the basis of sex. [¶] ․ [P]regnancy is a natural incident of adult life requiring medical attention. [Citation.] The failure to provide coverage for this medical condition, regardless of whether it may technically be classified as a disease, in an otherwise comprehensive insurance policy provided as compensation constitutes discrimination. The purpose of health insurance plans is to defray the costs of needed medical treatment. There is no basis other than sex discrimination to exclude the costs of normal pregnancy-related medical treatment from a comprehensive plan that provides coverage for the costs of other normal conditions.” (Colorado Civil Rights Com. v. Travelers Ins. Co. (Colo.1988) 759 P.2d 1358, 1364; see also Quaker Oats Co. v. Cedar Rapids Human Rights Com. (Iowa 1978) 268 N.W.2d 862, 865–867; Massachusetts Electric Co. v. Massachusetts Commission Against Discrimination (1978) 375 Mass. 160, 375 N.E.2d 1192, 1198–1199.)
Thus, were our inquiry limited to the Unruh Act, summary judgment in favor of defendant clearly would be improper. Defendant insists, however, that the Unruh Act is superseded by Insurance Code section 10140, which provides in pertinent part: “(a) No admitted insurer, licensed to issue life or disability insurance, shall fail or refuse to accept an application for that insurance, to issue that insurance to an applicant therefor, or issue or cancel that insurance, under conditions less favorable to the insured than in other comparable cases, except for reasons applicable alike to persons of every race, color, religion, national origin, ancestry, or sexual orientation. Race, color, religion, national origin, ancestry, or sexual orientation shall not, of itself, constitute a condition or risk for which a higher rate, premium, or charge may be required of the insured for that insurance ․ [¶] (d) This section shall not be construed to limit the authority of the commissioner to adopt regulations prohibiting discrimination because of sex, marital status, or sexual orientation or to enforce these regulations, whether adopted before or on or after January 1, 1991.”
A special statute dealing expressly with a particular subject controls over a more general statute covering the same subject matter. (People v. Superior Court (Ruiz) (1986) 187 Cal.App.3d 686, 692, 234 Cal.Rptr. 214.) This is true regardless of whether the special provision was enacted before or after the general one and notwithstanding that the general provision, standing alone, would be broad enough to include the subject to which the more particular one relates. (Conservatorship of Ivey (1986) 186 Cal.App.3d 1559, 1565, 231 Cal.Rptr. 376.) Also applicable is the principle that where a statute contains a given provision with reference to one subject, the omission of such a provision from a similar statute containing a related subject is significant to show that a different legislative intention existed. (Cumero v. Public Employment Relations Bd. (1989) 49 Cal.3d 575, 596, 262 Cal.Rptr. 46, 778 P.2d 174.) Further, “ ‘[t]he failure of the Legislature to change the law in a particular respect when the subject is generally before it and changes in other respects are made is indicative of an intent to leave the law as it stands in the aspects not amended.’ ” (Estate of McDill (1975) 14 Cal.3d 831, 837–838, 122 Cal.Rptr. 754, 537 P.2d 874.)
The Unruh Act proscribes arbitrary discrimination by business establishments based on sex, among other factors. Insurance Code section 10140 proscribes discrimination by an insurer in the issuance or cancellation of, and premiums charged for, life or disability insurance based on several enumerated factors which do not include sex. Insurance Code section 10140, a special statute which applies to discrimination in the issuance and pricing of life or disability insurance, prevails over the Unruh Act, a general antidiscrimination statute, with the result that different treatment based on the sex of the insured is not prohibited in the issuance, cancellation or pricing of life or disability insurance. Insurance Code section 10140 was amended in 1990 to add sexual orientation as an impermissible factor in determining whether to issue a policy of life or disability insurance and, if issued, the cost of the policy. The failure of the Legislature in 1990 to include sex in section 10140 is further evidence of a legislative intention that the sex of the insured properly may be considered in deciding whether to issue or cancel a policy of life or disability insurance and the premium to be charged for the policy. It follows that defendant's practice of charging plaintiff a higher premium for health insurance than it charged men in plaintiff's age group is not prohibited as an act of discrimination under the Unruh Act.
Defendant's failure to include coverage for the cost of normal pregnancy and childbirth stands on a different footing. While Insurance Code section 10140 does not prohibit disparate treatment of individuals based on sex in the issuance and pricing of life or disability insurance, the statute is silent regarding the permissibility of discrimination in the terms and coverage of such insurance on the ground of sex or on any other ground. Accordingly, the Unruh Act controls regarding the content of life or disability policies as distinguished from the issuance, cancellation or cost of such policies. As previously indicated, exclusion of coverage for costs of normal pregnancy and childbirth discriminates against women on the basis of sex. Defendant's failure to include coverage for the costs of normal pregnancy and childbirth therefore violates the Unruh Act.
Insurance Code section 10140 recognizes the authority of the Insurance Commissioner to adopt regulations prohibiting discrimination because of sex (among other factors). (Ins.Code, § 10140, subd. (d).) 4 In 1975 the commissioner promulgated regulations covering discrimination on account of sex or marital status. (Cal.Code Regs., tit. 10, § 2560 et seq.) Those regulations include the following provisions: “The purpose of this Article is to eliminate unfair discrimination based upon sex ․ in the terms and conditions of insurance contracts ․” (Id., § 2560.1.); “No person or entity engaged in the business of insurance in this State shall refuse to issue any contract of insurance or shall cancel or decline to renew such contract because of the sex ․ of the insured or prospective insured. The amount of benefits payable, or any term, condition or type of coverage shall not be restricted, modified, excluded or reduced on the basis of the sex ․ of the insured or prospective insured․” (Id., § 2560.3, emphasis added.) These provisions of the Insurance Commissioner's regulations are consistent with the Unruh Act since they, too, condemn as prohibited sexual discrimination the exclusion of coverage for costs of normal pregnancy and childbirth.
While defendant did not violate the Unruh Act by charging plaintiff a higher premium than it charged men in her age group for the same policy, defendant's exclusion of coverage for costs of normal pregnancy and childbirth constituted sex discrimination within the meaning of the Unruh Act. Inasmuch as a defendant moving for summary judgment must show that the plaintiff cannot prevail on any cause of action or theory pleaded by him or her (Blackwell v. Phelps Dodge Corp. (1984) 157 Cal.App.3d 372, 376, 203 Cal.Rptr. 706), summary judgment in favor of defendant was improper.
The judgment is reversed. Costs on appeal are awarded to plaintiff.
1. Actually, plaintiff purports to appeal from the order which granted defendant's motion for summary judgment “entered herein on May 18, 1990.” An order granting a motion for summary judgment is not appealable; only a judgment entered following such an order is appealable. (Rogness v. English Moss Joint Ventures (1987) 194 Cal.App.3d 190, 192, fn. 2, 239 Cal.Rptr. 387.) Inasmuch as the record on appeal includes a judgment in favor of defendant entered May 18, 1990, we deem the appeal to have been taken from the judgment and not from the order granting defendant's motion for summary judgment specified in the notice of appeal.
2. The second amended complaint also included a cause of action for violation of Insurance Code section 790.03, subdivision (a). Plaintiff does not challenge the granting of defendant's motion for summary judgment on that cause of action.
3. Plaintiff, too, moved for summary adjudication of issues. Upon granting defendant's motion for summary judgment the trial court placed plaintiff's motion off calendar as moot.
4. Citing a report of the Finance and Insurance Subcommittee on Health and Workers' Insurance, defendant argues that subdivision (d) was added to section 10140 to assure the Department of Insurance that the amendment of section 10140 to include sexual orientation as a prohibited ground of discrimination did not nullify the regulations adopted by the commissioner in 1975. We do not see the significance of the argument, for regardless of the Legislature's motive in enacting subdivision (d), that provision recognizes the continuing validity of the regulations.
LILLIE, Presiding Justice.
JOHNSON and FRED WOODS, JJ., concur.