The margin of victory can be by a fraction of an inch, but every North American Stock Car Auto Racing (NASCAR) race ends with a winner. No matter how close it is, someone always walks home with the checkered flag.
It’s not always as easy to figure out who, if anyone, comes out on top in a civil lawsuit. While dismissals and massive jury awards are pretty clear-cut, some litigations end with a settlement that doesn’t announce details. Such appears to be the case in the “we-said-they-said battle” between a driving legend and an insurance company, which ended with a confidential settlement that will leave those hoping for juicy details feeling like they blew a tire.
In late February 2026, a notice of settlement was filed in the federal court in Lincoln County, North Carolina, in the ongoing legal tussle between plaintiffs Kyle Busch and his wife, Samantha Busch, and defendants Rodney Smith, Pacific Life Insurance Company (PacLife), and Red River LLC. Busch, a NASCAR driver, and his wife filed suit in October 2025 (later amended) against PacLife, Smith, and Red River, claiming over $8.5 million in losses. The complaint included allegations of negligence and breach of fiduciary duty.
PacLife, Smith, and Red River have denied all claims in the Kyle Busch lawsuit from day one, arguing that they were very clear about the indexed universal life insurance policies (IUL) the Busch family was entering into. They alleged that the Busches didn’t read the IUL policies and failed to make premium payments. While the court filing doesn’t allude to which side might be receiving damages, it does indicate that both parties are responsible for their own attorneys’ fees. A motion of settlement is expected before the end of March 2026.
That's a Lot of Fine Print
The crux of the disagreement in the lawsuit is the IUL policies the Buschs began purchasing from insurance agent Rodney A. Smith and his limited liability company, Red River, in 2018. IULs are combination insurance products that provide immediate death benefit protection and the potential for cash value growth through tax-free retirement plans, the latter of which is subject to market fluctuations. The Busch family bought five separate IUL policies between 2018 and 2022, placing them in irrevocable life insurance trusts held by each spouse.
In addition to other claims, the suit charges Smith with negligent misrepresentation about exactly how the IULs they were buying functioned, the number of annuity payments they would have to make, and the risks involved. The Buschs claim that Smith told them that after five annual payments of $1 million each, they’d be able to take out $800,000 per year of tax-free retirement income once Kyle reached age 52. They also allege that Smith assured them the IULs would be self-funding.
Once the bill arrived for a sixth annual payment, the Buschs uncovered other supposed red flags in their deal with Smith, including high fees, most of the money already gone, and a 35% upfront commission they claimed they were unaware of. Since Smith used Pacific Life policies, the Buschs added the insurance company to the suit for issues including Smith’s training and for failing to disclose that Smith had a felony conviction on his record. Smith had pleaded guilty to a possession of marijuana charge in Arizona in 1993.
PacLife argued that the Buschs had signed several documents that acknowledged that they had read and understood the IULs they were entering into, including the inherent risks. All five policies sent to the Buschs for signature allegedly included cover letters in large, bold fonts that urged potential policyholders to read and understand the terms of what they were agreeing to. In addition, each offered a 20-day cancellation period. The Buschs signed off on all five forms, certifying that they had reviewed and grasped the provisions of the IULs.
The defendants also had a pending motion to dismiss the claims of breach of fiduciary duty and negligent representation. The Buschs’ suit was filed seven years after they began purchasing the IUL policies, which PacLife argued fell outside of the statute of limitations. They also argued that the Buschs understood that meaningful returns would come only after decades of growth and that they failed to pay required premiums on the IUL policies. With a settlement supposedly reached, the motion becomes moot.
Back to the Brickyard
The high-profile case generated considerable interest in the eventual outcome. The nondisclosure of any payments rendered will leave many questions unanswered. The suit cited negligence, breach of fiduciary duty, negligent misrepresentation, and violations of the North Carolina Unfair and Deceptive Trade Practices Act against PacLife and Smith. Claiming loss of investment opportunities, emotional distress, financial instability, and other injuries, the Buschs sought to recover over $8.5 million in out-of-pocket losses.
Will the true story ever become public knowledge? Given how confidential settlements work and PacLife’s repeated insistence that it did nothing wrong, the details will likely remain unshared. Regardless, two-time motorsport champion Busch can presumably now focus on seeking his third NASCAR title.
Related Resources
- Raise the Checkered Flag: NASCAR and Jordan Settle Antitrust Case (FindLaw’s Legally Weird)
- Negligence and the “Reasonable Person” (FindLaw’s Accident and Injury Law)
- When To Sue a Financial Advisor (FindLaw’s Law and Daily Life)
