The full fury of a Nevada Federal District Court judge was recently turned onto UNUM and Paul Revere Life Insurance Company in a disability income insurance case in which the Court awarded a plaintiff more than $26 million in punitive damages against UNUM while permitting another $36 million in punitives, found by a jury, to stand against Paul Revere.
After what the Court said was a thorough review of the evidence in the case, Merrick v. Paul Revere Life Insurance Company, et als., (U.S.D.C., Nev.) CV-S-00-0731-JCM-RJJ, (Nov., 2008) it found that UNUM had engaged in highly reprehensible conduct to augment profits, had targeted the financially vulnerable thereby risking the health and safety of the policyholder and had repeatedly engaged in such conduct as to the insured and many others
In a 39-page blow-by-blow discussion of the tactics used by UNUM in an effort to duck payments under its disability policy, the Court outlines a corporate scheme to boost profits at the expense of claimants.
The decision makes clear that any one with a disability income claim against UNUM or its allied insurance companies had better prepare a proper case going in and have in his or her corner an advocate who knows how to and is willing to go the mat with UNUM. For more detail on UNUM, click here.
To see the full opinion, click here.
Thursday, December 18, 2008
Tuesday, December 9, 2008
Sign Of The Times
With economic uncertainty the order of the day, sales of fixed annuities jumped 54% in the third quarter of the year, according to a report by A.M. Best Company, Inc. During the first
9 months of 2008, variable annuity sales dropped 10%, the report continued.
The report noted that the variable annuties drop would likely have been much larger except that some companies offered additional riders that were designed to protect annuity income or the annuity principal.
The report shows that the "shoot from the hip" style of investing for the future has itself been shot down. Now the emphasis is on a future based on as much certainty as can be provided in these troubled times.
This bodes well for insurance companies which are required to maintain certain reserves against losses by their state insurance commissions and not so well for stock brokers.
The report by Best was based on sales reports of 51 companies which represent about 87% of the annuities market.
9 months of 2008, variable annuity sales dropped 10%, the report continued.
The report noted that the variable annuties drop would likely have been much larger except that some companies offered additional riders that were designed to protect annuity income or the annuity principal.
The report shows that the "shoot from the hip" style of investing for the future has itself been shot down. Now the emphasis is on a future based on as much certainty as can be provided in these troubled times.
This bodes well for insurance companies which are required to maintain certain reserves against losses by their state insurance commissions and not so well for stock brokers.
The report by Best was based on sales reports of 51 companies which represent about 87% of the annuities market.
Friday, December 5, 2008
No-Cost Mortgage Help and FAST!
Why aren't Congress and the Treasury utilizing a simple no-cost fix for the current mortgage foreclosure turmoil? Congress and the deregulators helped create the mortgage meltdown when they prohibited bankruptcy judges from dealing with home mortgage foreclosures in bankruptcy proceedings.
At the behest of bankers, Congress told bankruptcy judges to leave residential mortgage foreclosures alone. This removed risk from the bankers so they could gamble even more heavily on home mortgage "products" which have precipitated the present recession (Depression?).
All Congress has to do is reverse this nitwit legislation so that these courts can have returned to them the right to deal with home mortgages in bankruptcy proceedings. This will have two immediate effects:
1. Foreclosures will come to a standstill until the bankruptcy case is heard. The bank will receive no payments until the judge makes a decision. This pushes mortgageholders to make realistic deals with home owners quickly so as to turn the payment flow back on.
2. With the really recalcitrant mortgage holders, the judge can force a "cramdown" in which the mortgageholder is forced to revise the terms of the mortgage loan in the light of the reality of the morgage market at the time the decision is made. Being obstinate is no longer a valid option.
Instead of throwing billions of taxpayer dollars at the foreclosure problem in a haphazard way (a la TARP, CITI, AIG and all of the other letters), this change in the law will have an immediate effect since mortgage lenders will know that foreclosures are stopped and a knowledgeable judicial review of the situation will be imposed.
Is this obvious solution too sensible to make headway in Washington or do the bankers hold Congress in a more powerful special -interest grip now that the taxpayer has provided them with hundreds of billions of bailout dollars?
For a more complete view on this subject, see http://articles.moneycentral.msn.com/Banking/BankruptcyGuide/a-foreclosure-fix-more-bankruptcies.aspx
At the behest of bankers, Congress told bankruptcy judges to leave residential mortgage foreclosures alone. This removed risk from the bankers so they could gamble even more heavily on home mortgage "products" which have precipitated the present recession (Depression?).
All Congress has to do is reverse this nitwit legislation so that these courts can have returned to them the right to deal with home mortgages in bankruptcy proceedings. This will have two immediate effects:
1. Foreclosures will come to a standstill until the bankruptcy case is heard. The bank will receive no payments until the judge makes a decision. This pushes mortgageholders to make realistic deals with home owners quickly so as to turn the payment flow back on.
2. With the really recalcitrant mortgage holders, the judge can force a "cramdown" in which the mortgageholder is forced to revise the terms of the mortgage loan in the light of the reality of the morgage market at the time the decision is made. Being obstinate is no longer a valid option.
Instead of throwing billions of taxpayer dollars at the foreclosure problem in a haphazard way (a la TARP, CITI, AIG and all of the other letters), this change in the law will have an immediate effect since mortgage lenders will know that foreclosures are stopped and a knowledgeable judicial review of the situation will be imposed.
Is this obvious solution too sensible to make headway in Washington or do the bankers hold Congress in a more powerful special -interest grip now that the taxpayer has provided them with hundreds of billions of bailout dollars?
For a more complete view on this subject, see http://articles.moneycentral.msn.com/Banking/BankruptcyGuide/a-foreclosure-fix-more-bankruptcies.aspx
Tuesday, December 2, 2008
Same Sex = Same Coverage
New York insurers have been put on notice that same sex couples legally married in any state are validly married for insurance purposes. The state insurance department issued a directive saying that it expects insurers to provide the same rights and benefits to all legally married couples, regardless of the sex of the spouses.
The directive covers just about all insurance products, including disability, life, long-term care and health insurance. Failure to comply with this directive could subject insurance companies to penalties under various New York human rights and anti-dsicrimination statutes.
The directive covers just about all insurance products, including disability, life, long-term care and health insurance. Failure to comply with this directive could subject insurance companies to penalties under various New York human rights and anti-dsicrimination statutes.
How Much Is It Costing You?
New Jersey is requiring all health insurance producers to to disclose, in writing, to purchasers just how much the producer is benefiting from the sale of a health insurance policy.
The rule becomes effective on and after January 5, 2009, and will enable health insurance buyers to evaluate the commission or other thing of value attached to a policy which an agent is advising the purchaser to buy.
Disclosure has to made no later than the effective date of the insurance policy, but a savvy buyer will ask for the info before signing for a policy. Although the insurance agent or broker has the responsibility of providing the disclosure, the New Jersey Banking and Insurance Department permits the carrier issuing the policy to provide the notice.
Although the types of health insurance covered by this requirement is broad, it does not apply to Workman's Compensation policies.
The rule becomes effective on and after January 5, 2009, and will enable health insurance buyers to evaluate the commission or other thing of value attached to a policy which an agent is advising the purchaser to buy.
Disclosure has to made no later than the effective date of the insurance policy, but a savvy buyer will ask for the info before signing for a policy. Although the insurance agent or broker has the responsibility of providing the disclosure, the New Jersey Banking and Insurance Department permits the carrier issuing the policy to provide the notice.
Although the types of health insurance covered by this requirement is broad, it does not apply to Workman's Compensation policies.
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