DISABILITY DOLLARS AND SENSE IN TOUGH TIMES

Heavy Rain, Fewer Umbrellas

2009-02-12T13:23:00.000-08:00

While health spending in the U.S. is expected to climb to $2.6 trillion in 2009, the number of people without health insurance is expected to surge from 45 million to about 54 million, according to the Congressional Budget Office, as reported by the Associated Press.

The $2.6 trillion breaks down to $8300 for each person in the nation and calculates out to about 18% of the U.S. economy.

As the nation's legislators seek to expand health insurance coverage, they are also looking to make big changes in the system in an effort to slow overall health care costs.

Some changes being considered are changing the method of paying health care providers and altering tax policy vis-a-vis health insurance payments.

More Openness on Fees

2009-02-09T08:52:00.000-08:00

New York State Insurance regulators are considering opening a window on the details of compensation agents and brokers receive from insurance companies. Contingency fees are included in the package under study.

The regulation would require agents and brokers to inform their clients in writing of the total compensation to the producer involved in an insurance transaction.

The broker or agent would have to inform the client if there were any incentive payments from insurers that might influence decisions on placing policies. If requested, producers would be required to provide a client with details of payments actually received for a policy the producer recommends.

The proposed regulation is in the early discussion stage with insurance industry groups and consumers. It is expected to be subjected to a formal comment period and to be adopted by the end of 2009.

The regulation is similar to one approved by insurance regulators in New Jersey late last year.

Social Security Hit Hard

2009-02-02T13:07:00.000-08:00

A big surge in new disability claims has swamped the Social Security Administration, according to a report in the magazine Government Executive.

The magazine was told by the SSA that its disability claims caaseload had increased by 10% recently, more than the agency had expected and budgeted for.

Good for NAIC

2009-01-27T14:38:00.000-08:00

State insurance commissioners have turned down a request by the nation's insurers to loosen up the amount of funds insurers have to keep in reserve to pay life insurance claims.

As part of the continuing saga of the economic tailspin, the National Association of Insurance Commissioners (NAIC) held a hearing last January 29 on requests by insurers to ease the reserve requirements of life insurance companies. The reserve is the amount of funds each state requires insurers to keep safe to support payments which may have to be paid out on policies.

In announcing the decision, NAIC's president said the insurance industry is generally in better shape than the rest of the financial services sector because of strong state solvency regulations.

The proposed changes were opposed by some consumer groups.

Isn't It The Truth?

2009-01-13T10:27:00.000-08:00

Isn’t it amazing how whenever an industry makes a money mistake it is inevitably in favor of the “mistakor” (the industry) rather than the “mistakee” (the consumer)?

Another example of this truism just came to light with a settlement recently announced between the State of New York and giant insurer, UnitedHealth Group.

The State investigated claims that databases operated by a UnitedHealth business unit and widely used by insurance companies to calculate policyholder reimbursements when policyholders used doctors who were not part of the insurance company’s network, consistently underreported the actual cost to patients, thereby saving insurance companies hundreds of millions of dollars over the last decade.

Insurers usually have to reimburse policyholders 70 or 80% of an out-of-network doctor’s charges. If the charge is said to be $80 rather than the actual $100 charge, the insurance company’s 70% reimbursement cost would be $56 rather than the $70 it should be. And, the policyholder is stuck with paying the difference.

In the settlement, UnitedHealth agreed to pay $50 million to create new databases to determine the prevailing cost of medical care in various sections of the country. The database will be created and operated by a university yet to be named.

Another Blast for UNUM

2009-01-07T13:47:00.000-08:00

Some insurance companies have all the luck! Another Court has teed off on the business practices and tactics of a UNUM insurance company (see UNUM item below) in a disability income insurance case by adopting language saying the company has a "...disturbing pattern of erroneous and arbitrary benefits denials, bad faith contract misinterpretations and other unscrupulous tactics."

In McCauley v First Unum Life Insurance Company, 2008 U.S. App. LEXIS 26094 (2nd Cir. 2008), the Appellate Court found that the evidence clearly indicated that the client was entitled to disability benefits from the time he made his claim in 1995, a period of about a dozen years.

To maintain a lawsuit for such a long period of time when one is seriously ill and can't work to bring in money to live on requires a special set of circumstances that most claimants don't have. And, don't think the insurance companies, such as Unum, aren't aware of this situation. They are in the business of savings themselves money on claims and the natural circumstance of the claimant without funds to live on puts intense pressure on claimants to settle for less than they would be entitled to or even to give up claims altogether if they can't get a disability insurance attorney to take the case on contingency.

Time is usually of the essence for the claimant in a disability income insurance case. An attorney who knows disability income law and insurance company tactics would seem also essential.

$25 Billion Insurance Brouhaha

2009-01-06T13:05:00.000-08:00

Economic hard times are gnawing away at what appears to be the last solid bastion of financial stability - the insurance industry.

Changes in the amount of reserves that insurers must hold by law are being sought by the American Council of Life Insurers (ACLI) and are under very active consideration by the National Association of Insurance Commissioners (NAIC), the organization of all 50 State Insurance Commissioners. The proposed changes would reduce the reserves of life insurers by about $25 billion.

Just a few months ago, NAIC was proudly announcing that state-mandated reserve requirements were buoying insurance companies, keeping them afloat and solvent while financial giants such as Lehman Brothers were going belly up. Now, at the behest of ACLI, NAIC is on the cusp of reducing the reserve requirements because the market downturn has reduced the insurance industry's capital levels.

The move to reduce insurance reserve rules is opposed by the Consumer Federation of America and the Center for Economic Justice. These groups believe any reduction in reserves, especially in these tough economic times, increases the risk that an insurer might fail to pay its obligations under life policies and annuity contracts.

The NAIC has scheduled a public hearing on the issue for Tuesday, January 27, 2009, from 10 AM to 2 PM at the Marriott Wardman Park Hotel, 2660 Woodley Road, NW, Washington, DC 20008. Written comments should be submitted by Friday, January 23 to tsells@naic.org.

UNUM Slammed!!!

2008-12-18T13:51:00.000-08:00

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.

Sign Of The Times

2008-12-09T07:21:00.000-08:00

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.

No-Cost Mortgage Help and FAST!

2008-12-05T09:38:00.000-08:00

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

Same Sex = Same Coverage

2008-12-02T14:20:00.000-08:00

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.

How Much Is It Costing You?

2008-12-02T09:29:00.000-08:00

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.

Insurance Anxiety

2008-11-12T14:26:00.000-08:00

With news similar to the General Motors report (See "Things Get Worse", below) growing by leaps and bounds in these troubled times, many a group policyholder is wondering what would happen if their employer were to end its group disability income insurance program.

Not all policies are the same, but in general, the answer is that for those who have been adjudicated as disabled and are receiving benefits, the insurer would have to continue to pay. But, for those whose claim has not been adjudicated when insurance is terminated by an employer, the insurance company would not have to pay.

In any event, insureds should realize that in an economic downturn, insurance companies are most likely to get tougher on claims and it is most important for claimants to get their life, disability income and long term claims filed and prosecuted correctly.

If you have any questions on this issue, call Attorney Mike Quiat at 800-797-5575 for a fast answer or contact him by e-mail at http://www.uqur.com/.

Things Get Worse

2008-11-12T14:22:00.000-08:00

With the economic slowdown ramping up, health insurance hardships are on the rise. About 100,000 General Motors white collar retirees have learned that their premium GM medical benefits program is to come to an end at the end of 2008.

The company, fighting to stay alive, is trying to stem a $2 billion a month loss and the termination of these benefits are part of that savings program. Factory retirees are not affected because of union contracts.

Metro Area Insurance Costs Rising

2008-11-07T10:10:00.000-08:00

Employer-sponsored family health insurance costs are going up faster than paychecks in both New Jersey and New York, according to Families USA, a national non-profit organization dedicated to affordable, high quality health care for all Americans.

While health premiums for NJ families rose 71% between 2000 and 2008, median income rose only about 15%. For NY families, premiums went up almost 81% while worker pay increased only 11% from 2000 to 2007. Nationally premiums rose about 74%, while median income grew about 14.5%.

Employer contributions to employee health insurance also increased during the period but not as fast as the amount workers were asked to pay.

For more information, http://www.familiesusa.org.

Watch Your First Step

2008-10-20T10:11:00.000-07:00

If disability income and long term care insurance claimants thought their carriers were giving them a hard time before, with the economy in turmoil, "they ain't seen nothin' yet!"

With insurance companies worrying more and more about their bottom lines, the first place they will likely look to save money is by cutting down on claim payments. That's why it is imperative for those who have a claim to present it properly right from the get-go.

If you believe you have a claim get experienced legal help to present it properly right at the start. Most insurers love it when an inexperienced policyholder gets a complex DI or LTC claim off on the wrong foot.

A single mistake is all it takes to deep-six such a claim forever.

Let's Get Started

2008-10-14T14:43:00.000-07:00

Blogs should have personality and overflow with information of concern to people. A blog should also have human interest and humor. We hope this new blog of ours will more than meet these criteria.

Undertaking a new venture with these parameters is not done lightly. But, this firm has a long history of tackling tough cases, so here goes.

While our law firm’s site (http://www.uqur.com/) details our more than 50 years’ experience in Commercial, Land Use, Zoning, Disability Income Insurance and other legal areas, we wanted a special blog devoted to hints and events from our disability insurance claims experience for those who might get some help or solace from them and those who might want to participate in the blog.

Our insurance star is Michael E. (Mike) Quiat. He has been licensed to practice in New York and New Jersey and has been for more than 25 years.

About 20 years ago, while working for a prestigious New York “white collar’ law firm, Mike represented his first DI (Disability Income) insurance claimant. It was a challenge requiring him to research whole new areas of the law. This was also his first experience with finding his client’s way through the jungle of insurance policy language.

Despite the burden of taking on new law and new language, Mike found he liked helping DI claimants get their money. After all, people pay good money to insurers for their policies down through the years. Why, when it comes time to pay these people, do many insurers drag their feet or just outright refuse to pay?

Of course, there are times the insurer is right. If a policy doesn’t cover your situation or the policy was issued on faulty information then the insurance company most likely doesn’t have to pay.

But, many times the claimant has a valid claim but the insurer doesn’t see it that way. In such cases, after preliminary talks with the client, Mike gets into the trenches and, if necessary, goes to war with the insurer.

The more Mike does insurance work, the more he realizes that a claimant should have legal help from lawyers very familiar with policy language and the special way an insurance claim proceeds. This is because speed of decision, whether it involves a disability income (DI/LTD), long term care (LTC) or life claim, is usually vital to the client.

Since the basis of a DI/LTD claim is that earning power is seriously impaired, if not actually “zero”, it is easy to see why a disabled worker or professional needs the fastest possible resolution of a claim. The same holds true in long term care or life claims. Without the proceeds of the policy, what is the policyholder or the family to do? Add to the mental and physical stress of the condition which is the basis of your claim the stress of being unable to meet family needs out of present income, and you have a potpourri of worries that would tend to sink an ordinary person.

Mike knows that while not all insurers take this advantage to the limit, all of them are aware of it. Insurance companies are in the business of saving money and adding it to their bottom line and all insurers use that weakened financial and emotional condition against the claimant to some degree or another.

Mike points out that insurance companies have staffs of highly experienced attorneys who know how to put a claimant through a legal wringer so as to slow a matter to a snail’s pace or to get a claimant so disgusted that the claimant drops the claim. Mike has found that to fight this kind of response a policyholder needs experienced legal help.

Having said all this, we just want to let you know what this blog hopes to be about: A people’s bank of helpful and educational information on DI/LTD, LTC and life insurance claims, how they should be pursued in the best interest of the policyholder, and other news which would be of interest to those involved with such claims.

All of this tempered, we hope, with a touch of humor and an optimistic outlook for the future.

Wish us luck!