Lillian Atlin v. Security-Connecticut Life Insurance Co. v. National Paragon Corporation v. Nilta Enterprises, Inc. Appeal of Lillian Atlin

OPINION OF THE COURT

WEIS, Circuit Judge.

In this diversity case, the question is whether a life insurance company is required to pay interest on policy proceeds for the interim between receipt of proof of death and payment into court as part of an interpleader action. We conclude that under Pennsylvania law interest is payable as a matter of right for loss of use of the principal. Institution of an interpleader in response to competing claims will not defeat the claimant’s entitlement to interest. Accordingly, we will reverse the ruling of the district court and will direct entry of a judgment…