Farmers New World Life Putative Class Action Over Universal Life Charges and Interest Moves Forward in Washington Federal Court

A federal judge in Seattle has refused to dismiss a putative class action accusing Farmers New World Life Insurance Company (“FNWL”) of overcharging a universal life policyholder and crediting too little interest to her policy’s accumulation account. On October 13, 2026, U.S. District Judge Jamal N. Whitehead denied FNWL’s motion to dismiss in full. The ruling does not decide who is right. It means the case moves into discovery.

This is not a settlement. There is no settlement fund, no claim form, and no claim deadline. No class has been certified, and FNWL has not been found liable.

The case is Marino v. Farmers New World Life Insurance Co., No. 2:25-cv-02200-JNW, in the U.S. District Court for the Western District of Washington. You can read the October 13, 2026 court order on Justia.

Marino v. Farmers New World Life: Quick Facts

Detail	What the record shows
Case name	Marino v. Farmers New World Life Insurance Co.
Case number	2:25-cv-02200-JNW
Court	U.S. District Court, Western District of Washington (Seattle)
Judge	Jamal N. Whitehead
Plaintiff	Sheila Marino, on behalf of herself and others similarly situated
Defendant	Farmers New World Life Insurance Company
Plaintiff’s lawyers	Joshua H. Haffner, Alfredo Torrijos and Trevor Weinberg of Haffner Law P.C.
Defense lawyers	Stoel Rives LLP
Policy type	Flexible universal life insurance
Guaranteed minimum interest rate at issue	4.5%
Claims	Breach of contract; breach of the implied covenant of good faith and fair dealing; violation of the Washington Consumer Protection Act
Class status	Putative class action. No class has been certified.
Latest ruling	Motion to dismiss denied in full (October 13, 2026)
Settlement or claim deadline	None announced

Timeline of Marino v. Farmers New World Life

Date	Event
October 1, 2025	Marino files the putative class action in King County Superior Court (Case No. 25-2-28917-6-SEA)
November 5, 2025	FNWL removes the case to federal court
November 20, 2025	FNWL files its motion to dismiss
January 12, 2026	Court stays discovery and scheduling deadlines while the motion is pending
October 13, 2026	Court denies the motion to dismiss and lifts the stay

What the Farmers New World Life Lawsuit Claims

Marino alleges that FNWL mishandled the way it runs her flexible universal life policy. This type of policy combines a death benefit with an interest-bearing accumulation account. The insurer deducts monthly charges from that account, including a charge for the cost of insurance, and credits interest to the balance that remains.

According to the court’s order, Marino bought her policy from FNWL in 1988, with a $100,000 death benefit. The policy describes a monthly risk charge, which pays for the risk of loss, and a separate administration charge, which covers the cost of managing the policy. That distinction is at the center of the case.

The complaint raises two main theories.

The alleged overcharge in FNWL’s monthly cost of insurance

Marino alleges FNWL built non-mortality factors into the monthly risk charge and did not lower that charge as mortality rates improved. Her argument is that a reasonable policyholder would read the risk charge as paying only for mortality risk, with administrative costs belonging in the separate administration charge.

FNWL argues the policy lets it set the monthly risk rate at its discretion, as long as the rate stays under the guaranteed maximum rates listed in the policy.

The alleged underpayment of interest on the FNWL accumulation account

The policy guaranteed a minimum interest rate of 4.5% and allowed FNWL to credit more. Marino alleges FNWL credited only the 4.5% minimum during the 2023–2024 policy year, even though its 2023 investment earnings allegedly exceeded that figure. To support the theory, she asked the court to take judicial notice of historical Federal Funds Effective Rates, which are public benchmark interest rate figures.

FNWL responds that the policy never promised a rate above the guaranteed minimum and that the company is entitled to earn a profit.

These are allegations. The court has not found that FNWL overcharged anyone or underpaid any interest.

Why the Judge Refused to Dismiss the Farmers New World Life Case

FNWL moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which tests only whether a complaint states a plausible claim, not whether the claim is true. At that stage a court generally accepts well-pleaded facts as true and draws reasonable inferences for the plaintiff. The plausibility standard comes from Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009).

According to Barry Zalma’s published summary of the ruling and the court’s order, Judge Whitehead concluded the following:

• Overcharges: Marino’s reading of the risk-charge language was reasonable, so the court could not reject it at the pleading stage. The judge also did not require her to reverse-engineer FNWL’s actuarial calculations before the case could proceed, even though her allegation about improving mortality rates was made on information and belief.
• Interest: FNWL’s discretion over the credited rate was not necessarily unlimited. The judge acknowledged FNWL can earn a profit, but found Marino’s bad-faith allegations sufficient at this stage.
• What the court did not decide: It did not rule that FNWL must match the Federal Reserve’s rates, follow any index, or pay a particular rate above 4.5%.

The judge also lifted the stay on discovery and said a new order would address initial disclosures, a joint status report and early settlement. In practice, the contract language FNWL says gives it room to set these charges will now be tested with evidence, not just argument.

Which Laws Apply in Marino v. Farmers New World Life?

Washington breach of contract law

Insurance policies are interpreted as contracts, from the standpoint of how a reasonable purchaser would read the language. Under Washington law, when policy language is reasonably open to more than one reading, the ambiguity may be construed against the insurer that drafted it. The court found Marino’s reading plausible but did not finally decide which reading is correct.

Washington’s implied covenant of good faith and fair dealing

Washington law recognizes an implied duty of good faith in performing a contract. It matters most when the contract gives one side discretion over a term. Marino argues FNWL abused its discretion when it set risk charges and chose the interest to credit. The court found those allegations plausible, but it did not hold that FNWL must automatically raise interest or cut charges when market conditions change.

Washington Consumer Protection Act, RCW 19.86.020

RCW 19.86.020 makes unfair or deceptive acts or practices in trade or commerce unlawful. A private claim generally requires:

1. An unfair or deceptive act or practice.
2. An act in trade or commerce.
3. Public-interest impact.
4. Injury to business or property.
5. Causation.

FNWL challenged the first element. The court found the policy’s description of the risk charge could plausibly mislead a reasonable policyholder if the charge included costs unrelated to mortality despite a separate administration charge. Whether Marino can prove all five elements is a question for later.

Why Washington law, and not Illinois law, governs

Marino lives in Illinois, and FNWL argued Illinois law should apply. The difference mattered because Illinois generally treats the implied covenant as part of the contract claim, while Washington can recognize it as a separate claim. The court found a real conflict on that issue, applied Washington’s most-significant-relationship analysis, and concluded Washington law governs the claims in the motion. That ruling does not decide which state’s law would govern the claims of every other policyholder.

Federal Rule of Civil Procedure 23 and class certification

Under Federal Rule of Civil Procedure 23, a court must separately decide whether a case can proceed for a whole class. The requirements include numerosity, common questions, typicality and adequate representation, and, depending on the class sought, whether common questions predominate and whether a class action is the superior way to resolve the dispute. The October 13 order did not certify a class. Differences between policies, account histories, applicable state laws and damages could all matter when that issue is decided.

Class Action Fairness Act, 28 U.S.C. § 1332(d)

FNWL removed the case from King County Superior Court to federal court under the Class Action Fairness Act of 2005. 28 U.S.C. § 1332(d) gives federal courts jurisdiction over qualifying class actions that meet its conditions on amount in controversy, class size and diversity of citizenship, subject to exceptions. It governs where the case is heard. It says nothing about whether FNWL broke its contracts.

What a 4.5% Interest Rate Means for Farmers New World Life Policyholders

The dispute is not that FNWL credited no interest. Marino’s theory is that FNWL paid only the minimum even though it could pay more.

A simplified example shows why rates matter. A $10,000 accumulation balance earns $450 in one year at 4.5%, and $550 at a hypothetical 5.5%, assuming no withdrawals, deductions or compounding. That is a $100 difference before policy charges. These numbers are illustrations only, not estimates of Marino’s damages or of anything any policyholder is owed.

What Happens Next in Marino v. Farmers New World Life

The case now enters its early phase: initial disclosures, a joint status report and, under the court’s order, early settlement. Marino will eventually have to ask the court to certify a class, and FNWL is expected to oppose it. The record reviewed sets no trial date and shows no announced settlement.

Open questions include whether FNWL improperly calculated its risk charges, whether mortality trends required lower charges, whether its interest decisions complied with the policy and the duty of good faith, whether Marino can prove compensable losses, and whether the proposed class meets Rule 23. Check the public docket for later filings.

Who Could Be Affected by the Farmers New World Life Putative Class Action?

The complaint seeks to represent individuals in the United States, or their estates, who own or owned an FNWL policy with an insurance-cost or risk deduction, a death benefit and an interest-bearing accumulation component. That is a proposed class definition, not a determination of who is eligible.

The case does not cover every Farmers customer. It concerns Farmers New World Life Insurance Company and the type of life insurance policy at issue, not Farmers auto, home or other products.

What FNWL universal life policyholders can do now

There is no claim form or deadline to file anything. Practical steps include:

1. Review your policy. Find the provisions on the cost of insurance, monthly risk charges, guaranteed maximum rates and credited interest.
2. Keep your annual statements. They show the charges deducted and the interest credited.
3. Keep any notices about changes to charges or interest rates.
4. Watch the case for a class certification ruling or settlement announcement.
5. Talk to a licensed insurance or consumer attorney if you want your own policy reviewed.

Do not stop paying premiums, withdraw funds or surrender a policy only because of this lawsuit. Those choices can affect coverage and cash value.

How the Farmers New World Life Lawsuit Differs From Other Insurance Settlements

A pending lawsuit is not the same as a settlement under court review. The Brighthouse Life Insurance $9.25 Million Settlement, Universal Life Policyholders Get Automatic Payments With No Claim Form involves universal life cost-of-insurance allegations too, but it has an actual settlement agreement and approval process. The Talcott Premium $11M Settlement, Opt-Out Deadline Aug. 26 concerns premium-tax charges rather than the risk-charge and interest-crediting claims in Marino’s case. And the Merrill Lynch $39 Million Cash Sweep Settlement, Who May Qualify and Why There Is No Claim Deadline Yet is about interest on uninvested brokerage cash, not life insurance.

Farmers New World Life Putative Class Action: Frequently Asked Questions

Did a judge dismiss Marino v. Farmers New World Life?

No. On October 13, 2026, the Western District of Washington denied FNWL’s motion to dismiss in its entirety.

Is there a Farmers New World Life settlement I can claim money from?

No. No settlement has been announced. The court’s new order does address early settlement, but that does not mean a deal has been reached.

Has a class been certified in the Farmers New World Life case?

No. It remains a putative class action until the court rules on class certification.

What interest rate is at issue in the Farmers New World Life lawsuit?

The policy guaranteed a 4.5% minimum. Marino alleges FNWL credited only that minimum in the 2023–2024 policy year despite having discretion to pay more.

Did the court order Farmers New World Life to pay more than 4.5% interest?

No. The court found the interest allegations plausible but did not decide what rate FNWL had to credit.

Does this ruling mean Farmers New World Life did something wrong?

No. A motion to dismiss asks only whether the allegations, taken as true, state a plausible claim. FNWL has not been found liable.

Can any Farmers policyholder join the lawsuit?

Not automatically. The proposed class concerns certain FNWL universal life policies, and its scope will depend on whether the court certifies a class.

Who represents Sheila Marino?

Joshua H. Haffner, Alfredo Torrijos and Trevor Weinberg of Haffner Law P.C.

What happens if Farmers New World Life loses?

Any remedy would depend on the claims proven, applicable law and the court’s rulings. No damages award exists, and class-wide recovery would also depend on certification.

Bottom Line: Where the Farmers New World Life Putative Class Action Stands

The Marino case continues after the court rejected FNWL’s request to dismiss. The ruling lets the breach of contract, implied covenant and Washington Consumer Protection Act claims proceed. It does not establish liability, certify a class or create a settlement fund. For policyholders, the most useful step is to understand the terms of their own policy and keep their account statements.

Sources and Court Records

1. October 13, 2026 Order Denying Motion to Dismiss, Marino v. Farmers New World Life Insurance Company
2. Public docket, Marino v. Farmers New World Life Insurance Company, No. 2:25-cv-02200
3. Stipulated Motion to Stay Discovery and Order, No. 2:25-cv-02200-JNW (W.D. Wash. Jan. 12, 2026), via CourtListener
4. Barry Zalma, “Plaintiff’s Reading of the Policy is Plaintiff’s Reasonable Allegations,” Zalma on Insurance, October 19, 2026
5. Washington Consumer Protection Act, RCW 19.86.020
6. Federal Rule of Civil Procedure 12
7. Federal Rule of Civil Procedure 23
8. 28 U.S.C. § 1332

This article is for general information only and is not legal advice. AllAboutLawyer.com is a legal information website, not a law firm. The allegations described have not been established as facts by a final judgment. For questions about your own policy, consult a qualified attorney.

Researched and written by Israr Ahmad, legal content researcher and founder of AllAboutLawyer.com. All facts verified against the October 13, 2026 court order and public docket in Marino v. Farmers New World Life Insurance Co., No. 2:25-cv-02200-JNW (W.D. Wash.), the January 12, 2026 stay order on CourtListener, and Barry Zalma’s published summary of the ruling, as of October 27, 2026. Last Updated: October 27, 2026.