Paragould Couple Sues, Seeks Insurance Refund

A Paragould couple has sued their insurance company for not receiving a refund from the credit insurance they bought.

Danny and Irma Thomas are seeking class action certification for the lawsuit they filed against Southern Pioneer Life Insurance Co. The couple alleges that the total damage to the class could be as high as $4.5 million.

In February 2007, the couple bought a vehicle from a dealership and had to buy a credit insurance policy from Southern Pioneer for $1,451, according to the lawsuit, filed in U.S. District Court. The coverage was set to end in February 2013.

The policy would have covered the cost of the vehicle if the couple died before it was paid off, the lawsuit said.

The couple, though, paid the loan off in July 2007 and said they were legally entitled to a refund of the unearned premium, which they never received.

"If a person pays off his or her loan early, then the person paid Southern Pioneer for insurance coverage that Southern Pioneer never provided, and Southern Pioneer is holding 'unearned premiums' - money that rightfully belongs to the class member," the lawsuit said.

The Thomases are seeking damages for breach of contract.

Robert Thompson III of Paragould, an attorney representing Southern Life, declined to comment on the case.

Southern Pioneer had been based in Trumann but was sold to the Midland Co. of Cincinnati in 2006.