Posts Tagged ‘ Insurance ’

Think your Company-Sponsored Life Insurance has your back? Think again

April 26th, 2011. By Kristine B

In the realm of people being ripped off, there are a few stories that are often the most heart breaking. Seniors losing their life savings to Ponzi schemes, seniors suffering financial elder abuse at the hands of their own families and people being denied necessary medical treatment because of bad faith insurance practices.

But there’s another story that’s been emerging that is also heart wrenching—stories of how insurance companies have denied and/or delayed legitimate accidental death claims by alleging the death was not an accident at all. These situations leave the surviving family members to deal with mountains of paperwork and facing the death of their loved ones over and over again while ERISA laws reportedly help insurance companies get away it. 

The situation was first reported by David Evans at Bloomberg (02/28/11). A man died in a car accident after a long battle with cancer. A medical examiner and a sheriff determined that the car crash was an accident—meaning the victim’s death was accidental. But the insurance company refused to pay, saying that the victim committed suicide. 

In other words, the insurance company knew more than the medical examiner and the sheriff. Now, consider that for a moment. By claiming the man committed suicide, the insurance company allegedly aimed to get out of paying out the accidental death policy. But there’s more to it than that. Because the insurance company claimed to know the mind of the victim better than his own family and better than the investigators who looked into the accident. 

The good news is that the victim’s wife sued and received the full life insurance policy. The bad news is that the insurer still denied wrongdoing—apparently, it’s not wrong to allege someone committed suicide—and didn’t pay any interest or penalties for holding the money. 

Why? Because ERISA (Employee Retirement Income Security Act) protects insurers. It says they can keep the survivors’ money while a claim is in court and invest that money, too, keeping the profits. Furthermore, under ERISA, insurance companies don’t have to pay compensatory or punitive damages. In other words, they can hold the money for an extra year or two, make a profit off investing that money and still only have to give the survivor the amount of the policy at the end. They profit while the survivor loses. 

So, once again, insurers are only too happy to receive premiums and benefit if they delay paying out claims. 

And why is ERISA involved in this at all? Because many companies provide life insurance, and company sponsored benefits—such as life insurance—are covered under ERISA. Making matters even worse, because ERISA is a federal law, state insurance departments don’t have the authority to step in on survivors’ behalf. It’s up to survivors to hire lawyers to help them fight any wrongfully denied accidental death claims. 

The end result is that if you have a company-sponsored life insurance policy claim that you feel has been wrongfully denied, don’t rely on the insurance company to tell you what “normal procedure” is. Your best bet is probably to contact an attorney and find out if you can fight the denial. After all, insurance companies apparently have little to lose by denying legitimate claims.

Tags: Bad Faith Insurance, Denied Insurance, ERISA, Insurance, life insurance
Posted in Insurance, Pleading Ignorance | No Comments »

MetLife: Can you Sink any Lower to Avoid Paying a Claim?

March 14th, 2011. By Hunter West

If there ever was a case for having a police force for insurance companies, it is this one. Jane Pierce could be the poster child for a clamp down on greedy, uptight insurers who will to a fault suspect the worst in people and grasp at any straw to avoid paying a claim.

Have you heard about this story?

Jane Pierce’s husband Todd died tragically in a car accident a few years ago. Yes, he had some health issues. Cancer. In his case, Todd developed skin cancer in his nasal cavity. But he fought the disease valiantly and was cancer-free within two years. There were more surgeries to follow, however—to rebuild his jaw and palate. Certainly not pleasant. But such is the jurisdiction of a fighter, and a devout Catholic who loved life and was not about to throw in the towel, even in the face of more than 40 surgeries…

Life was good, you see? Hard, but good. And Todd had driven to a family reunion one warm, July day in 2009. Enjoyed himself. They said he was the life of the party. There was certainly nothing untoward that caused any member of his family to be worried about him.

It was on the drive home that tragedy struck. Pierce pulled out to pass another vehicle on the highway and lost control of his truck. The vehicle, in which Todd was the lone occupant, rolled down Read the rest of this entry »

Tags: Accidental Death and Dismemberment, Bad Faith Insurance, Insurance, Jane Pierce, MetLife
Posted in Insurance | 3 Comments »

NY Life Insurance Agents Sued for Elder Financial Abuse

February 3rd, 2011. By LucyC

Beware of Agents Bearing ‘Gifts’?

What would you do with 20 life insurance policies? Would you even buy 20 life insurance polices? Probably not, that is, if you knew what you were doing. Mary Mullen, an institutionalized senior—in her 80s—with Alzheimer’s disease, did not know what she was doing and so relied on salesmen from New York Life Insurance to take care of her. Instead, they took care of themselves. Those 20 life insurance policies– by the way—cost $600,000—and involved a number of elaborate schemes including an arranged marriage. New York Life, for their part, apparently refuses to investigate the suspicious policies, for which “the primary motivation” was “commissions and premiums.”

The whole sorry saga, which is now the subject of a lawsuit, began in 1994, when, according to Rebecca McFarland, trustee of the Mary Mullen Revocable Trust, one John Palmateer approached Mullen representing himself as an expert in insurance and financial matters. McFarland claims he gained Mary Mullen’s trust by visiting her occasionally, sometimes at the hospital. Of course, most people at this point would ask—’what about her family?’ Well, Mary Mullen had family, but they all lived out of state. Palmateer is accused of keeping the truth about Mullen’s deteriorating health from her family.

Palmateer also stands accused of collaborating with Mullen’s neighbor, Guido “Jack” Chirillo, to defraud the elderly woman of her assets. According to the complaint, “At Palmateer’s suggestion and direction, Chirillo married Mullen, who was then 87 years old, ostensibly to assist with the care of Mullen.” And, you guessed it, her family was never notified. BTW—Chirillo and Mullen never lived together.

The complaint also states, “Palmateer and [Jeffrey] Knight participated in a series of steps to Read the rest of this entry »

Tags: elder abuse, Insurance, Insurance Fraud
Posted in Elder Care Abuse, Financial | 2 Comments »

What Exactly does Insurance Cover? Maybe More than you Think

November 24th, 2010. By janem

Understanding the intricacies of vehicle insurance puts my brain into a fog. Fortunately, James Bedard, someone I recently interviewed regarding his legal malpractice complaint, shares some insight. “I wonder how many people suffer financially because they are not aware of what coverage they have,” says James, “and the insurance company sure isn’t telling them.” (Unfortunately, James lost his case but he isn’t giving up.)

James Bedard: Insurance can be very confusing and I think that most people do not understand what they do have in coverage.

Under many state laws, there are two types of insurance coverage.

• Uninsured (UM) means the other party has no insurance so you have to carry that UM insurance yourself.
• Underinsured (UIM) means you don’t have enough insurance.

For instance, if someone hits me and they only have minimum insurance (that the state requires), but my injuries exceed that amount, I can claim my own coverage for the difference. In 2001, someone ran a red light and I was injured. He only had $50,000 coverage but I had $1 million coverage on my truck; I was able to collect $50,000 from his insurance company and my attorney filed a claim with my employer’s insurance company for $950,000.

UM and UIM Coverage

Most every state makes it mandatory for everyone to have UM and UIM coverage. So every driver is covered if they are in an accident caused by a driver who is either not insured or doesn’t have enough insurance.

As well, most states require that you have to have the minimum coverage of $25,000/50,000/10,000, which means $25,000 for injury to one person, $50,000 for two or more people and $10,000 for property damage, e.g., car, house, etc.

When you take out your coverage it is automatic that your coverage for uninsured (UM) and underinsured (UIM) is the same. So if a person who hits you has no insurance, you are covered for the $25,000/50,000/10,000.

Say your coverage is $100,000/300,000/100,000 and you are hit by a person who only has the 25,000/50,000/10,000; your car was totaled and it was worth 50,000 dollars. You could collect the $10,000 for property damage from the other party’s insurance and fall back on your insurance for up to $90,000, which is the difference. And your car would be totally covered.

On the other hand, say you had the same coverage as the party that caused the accident. All you would receive is their $10,000 because there is no difference from your insurance policy and their policy.

It seems complicated but it really is quite simple. Most States allow a person to reject the higher UM and UIM coverage and lower it to the minimum coverage.

For example, the 100,000/300,000/100,000 coverage I had meant that the UM and UIM coverage was the same. But you could save a few dollars and reject that coverage and reduce it to 25,000/50,000/10,000. So if you hit someone they would be covered for the higher amount but if they hit you and were not insured, you could only fall back on the 25,000/50,000/10,000.

Why anyone would want to insure themselves and their family for less then the general public makes no sense–because you don’t save that much.

Insurance Incidents

My friend asked me how she was going to get her car fixed, because the person who hit her had no insurance and did not have anything to sue for. I told her to call her agent and file a UM claim. She said her coverage was $25,000/50,000/10,000 and I told her the last figure of $10,000 was for property damage–the maximum she could recover for her car. She called me later and thanked me.

My son’s friend got his hand caught in another friend’s car door and he could not use his hand for work. He worried how he was going to pay his bills. I told him to call his agent and tell him he wanted to file a Personal Injury Protection (PIP) claim, which is mandatory in most states. He called me later and thanked me–he was getting $900

a month for lost wages and up to $4500 for medical expenses.

A little girl and her mother were recently in a car accident. She was worried that her personal insurance wouldn’t cover the accident and pay her bills. Again, I told her to contact her agent and file a liability claim for their injuries and the PIP for her lost wages. Her little girl would suffer permanent facial scars and I told her not to settle for less then her maximum coverage, which was $25,000. She received all of it.

Truck vs Automobile and State vs Federal Claim

Most states also have statutes that define the words used in the statutes. For example, Kansas statute 40-284 establishes what your ” Automobile Liability ” insurance will be for the UM and UIM

State statute 40-298 and statute 8-126(x) define an ” Automobile ” as a passenger vehicle designed primarily to carry 10 or fewer passengers, which is not used as a truck.

Statute 40-284 also mentions a ” Motor Vehicle ” State statute 40-276 defines ” Motor Vehicle ” as in statute 40-284 to mean a vehicle of a passenger or station wagon type, that is not used as a public livery conveyance for passengers, not rented to others and any four wheel motor vehicle with a load capacity of one thousand five hundred pounds (1,500) or less, which is not used in the occupation or business of the named insured.

This makes it very clear that statute 40-284(c), which is used to reject and reduce the UM and UIM coverage, is not meant for trucks or any vehicle or truck used in the occupation or business of the person, who is insured. This statute is for cars driven by the citizens of the State of Kansas.

But insurance companies use this statute to reject and reduce the coverage on large trucks, used in the business of the named insured. As you can clearly read, that is not allowed. The definitions I have given you above are the exact definition of those statutes and every State has a similar statute.

You would not believe how many cases are lost to the insurance companies, simply because attorneys do not know the regulations/laws of the FMCSA and the PHMSA.

In my research I found a case where a driver had his little girl with him and a pickup caused the truck to crash. The little girl had injuries over $200,000 and their attorney filed a State UIM claim because the pickup did not have enough insurance coverage.

When they filed on the truck insurance, the insurance company came up with a rejection to the coverage and reducing it to $50,000. So they got nothing.

I researched the case and could find no rejection besides the form the insurance company submitted. I also found that the little girl was covered under the public liability of the truck. I even confirmed it with the Federal Motor Carrier Safety Administration (FMCSA). So she should have been covered for up to $1million coverage.

But because their attorney did not know the FMCSA regulations that the truck was under and then filed a State UIM claim (it should have been a federal claim), they lost the case. Unfortunately, when I checked it out, the statute of limitations had run out on their case. So it was all over, insurance company wins.

What You Can Do

Clearly, it is up to you, the insurer, to be pro-active. Not all insurance companies are created equally and not all insurance companies act in your best interest. It’s worth the time to study your insurance coverage and get good legal advice before you file a claim. And please take James’s advice: ” Always ask your attorney why he does or doesn’t do this or that…”

Tags: Car Accident, Car Insurance, Insurance
Posted in Pleading Ignorance | 3 Comments »

Happy Thanksgiving Unum

November 24th, 2010. By janem

During more than six years at LawyersandSettlements I have interviewed close to a thousand people who have suffered an injury or injustice, from bad drugs and medical devices to labor law violations. Many people I talked with brought tears to my eyes and sometimes we cried together. Among the saddest cases I heard were  those people whose lives were ruined because they were denied disability benefits from Unum insurance company, also known as First Unum and UnumProvident. Our conversations left me feeling frustrated and angry, and useless. All I could do was tell their story.

As for the name changes, the company now calls itself Unum, in an effort to make the public forget Unum Provident’s past bad faith practices. But the rebranding ain’t working for Unum’s policyholders, although it might be working for Unum: according to the Associated Press, the company’s revenue increased approximately 1 percent from last year to $2.53 billion. So why can’t the biggest insurance provider share some its wealth with those who are entitled to it?

Unum also posted an operating income of $204.7 million, up four percent from last year. To me, that translates to a lot of employees taking home fat paychecks, thanks to the company denying policyholders disability benefits.

One interview I remember that took place about four years ago still upsets me. Gladys was about 60 years old; her husband had recently passed away, the kids were long gone and she had become disabled. Because Unum refused her long term disability benefits, Gladys’s home went into foreclosure and she was counting on social security benefits, but they hadn’t kicked in.  I interviewed her from a Motel 6, where she was living a day-to-day existence, not knowing where she would stay tomorrow.

Sadly, there a lot of victims like Gladys; people who worked hard all their lives, they or their employers paid their insurance premiums for years and when tragedy strikes, they are left out in the cold. More often than not, their former employers have no knowledge of Unum denying them. Certainly Unum isn’t going to tell its clients that they haven’t acted in good faith.  (One man I interviewed actually notified his former employer, Coca-Cola, and he was able to win an appeal, but I think Jimmy’s case is rare. )

It’s ironic that Unum was recently recognized for donating millions of dollars and volunteer hours to schools, food banks, education, the arts, as well as health and wellness projects, while at the same time it is still employing underhanded tactics to deny, deny.

I guess their marketers figure that’s the way to attract more business and sell more policies. It certainly isn’t the way to keep more policy holders. Happy Thanksgiving, Unum. May you choke on your turkey wishbone.

Tags: Insurance, Unum
Posted in Emerging Issues | 2 Comments »