Insurance Defamation Lawsuit Ends With 1 Shekel Award

An Israeli insurance agent and agency who sued a client for 1.5 million shekels (approximately $400,000) over social media posts ended up with a symbolic award of just one shekel - and were ordered to pay the defendant's substantial legal fees.

The case began when a policyholder attempted to transfer his health and long-term care insurance policies from Migdal insurance company to Harel. The agent and agency claimed the client subsequently published six defamatory posts on social media containing false accusations about their professional conduct.

The plaintiffs argued these posts severely damaged their reputation and professional standing. They demanded the enormous sum based on allegations of defamation, harm to reputation, and false portrayal of their business practices.

An investigative report on Israel's Kan 11 television revealed a dramatically different picture than the one presented by the plaintiffs. The dispute's origins told a troubling story about the insurance transaction itself.

The insured client needed medical treatment and an MRI scan, but Harel refused coverage, claiming a "pre-existing condition." Further investigation revealed that promises to reduce premiums without affecting coverage terms had been grossly violated.

The long-term care benefit had plummeted from 7,400 shekels to just 5,500 shekels monthly, while the benefit period was slashed from lifetime coverage to a mere 36 months. These fundamental changes were made without the policyholders' knowledge and in breach of original commitments.

Judge Yair Delugin, who presided over the case, sharply criticized the business conduct. In his ruling, he determined that the original commitments were violated through "abject bad faith, fraud, and deception." The judge explicitly noted that policy terms were altered without the insured parties' knowledge.

Given these circumstances, Judge Delugin ruled that awarding any real compensation to the plaintiffs would fundamentally contradict basic principles of justice. He therefore granted them a contemptuous symbolic award of one shekel.

Instead of collecting the millions they sought, the plaintiffs were ordered to pay the defendant 177,000 shekels in legal fees.