I’ve been careful about life insurance claim abuse cases I’ll help with only because, in most cases, the state insurance commissions are  very good  at putting things back on track and getting valid claims paid. But occasionally it will be something that can be resolved with just a phone call, or as in the case of a woman I helped this week who had a claim pending with Forester’s Insurance for almost a year (filed 8/15/12) and there was still no end in sight, it just struck me as something that needed resolved quickly.

Her husband had died in a house fire. They were both in the house and she was able to get out and when she looked back she saw her husband on fire, going the wrong way because he couldn’t see. His body was found in the shower with the water running on him but he died of smoke inhalation. The death was ruled accidental. His wife, now without a home and with no job or family was homeless, hoping for the life insurance money to come through so she could start over. The two policies, totaling just over $40,000, were within the two year contestability period so the company explained there would be an investigation before the payment. She understood and cooperated in everything they asked for. Eleven and a half months later they were still investigating for something that would show, in their words, “if he lied on the application”, about his health. In the meantime the wife, the beneficiary of these small policies, was homeless and finally taken in by a friend who went and got her as soon as she found out.

It was her friend who contacted me. At first I was going to respond to the email by suggesting that they go through the state insurance commission, but I just couldn’t let go of it. This woman who was poor to start with had watched her husband dying, lost the meager home because they couldn’t afford insurance, and had spent several months homeless because Foresters Insurance and in this case their “claim adjudicator” Lisa Buckland, lost track of the fact that there was a real, hurting human being to whom this small amount of money would make a huge difference. They completely laid waste to the contestability process when they continued to try to determine if this person had lied about his health when his death had been deemed an accident and the cause of death smoke inhalation. Even if he had lied, which he didn’t, about his health, the cause of death trumps that information, especially when half of each policy was a benefit for accidental death.

So, in 11 1/2  months Ms Buckland had found nothing and as early as they day before I was contacted the beneficiary had been told that they couldn’t pay the claim based on just the cause being accidental, until they had finished verifying her deceased husband’s honesty, or in their words, “whether he had lied on the application”. How crass is that when you are talking to a widow? So I deleted the email suggesting they go to the insurance commission and had them send me all of the relevant information to prepare me to call the company directly.

I pulled up a list of executives on their website. Having done this before I knew that getting this story in front of someone as high up the chain of command as possible was the best possibility. Of course they never post phone numbers for CEO’s, presidents and vice presidents, so I picked the path of least resistance, Suanne Nielsen, senior vice president in charge of recruiting. I explained what was going on and asked for her help. She referred it to Dianne Fox, senior vice president of Operations. Within half an hour the beneficiary got a call from the funeral home saying that they had just been notified that the claim was approved.

$40,000! That is probably less than Lisa Buckland makes every year and yet she and Foresters thought it was in the best interests of Foresters to pull an AARP (making the claims process awful) and see if they could wear a beneficiary out. They almost did. I hope the President and CEO, George Mohacsi takes note of this kind of customer service and especially the way people in his customer service department are handling death claims and talking to beneficiaries. I pray that it was not his guidance to be more thorough on contestable claims that led to this injustice.

Bottom line. Don’t use AARP/New York Life or Foresters for your life insurance. They don’t deserve your business when they can’t guarantee this kind of experience won’t go on when you finally need them to do something other than take money. This is the kind of thing that ruins everything for good insurance companies. If you have any questions, call or email me directly. My name is Ed Hinerman. Let’s talk.