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And People Feel Sorry For Insurance Companies

Discussion in 'Business & Economics' started by Old_Trapper70, Apr 18, 2016.

  1. Old_Trapper70

    Old_Trapper70 Well-Known Member

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    http://www.cbsnews.com/news/60-minutes-life-insurance-investigation-lesley-stahl/

    "When you take out a life insurance policy, you pay premiums in the expectation that when you die your spouse or your children will receive the benefit. But audits of the nation's leading insurance companies have uncovered a systematic, industry-wide practice of not paying significant numbers of beneficiaries.

    In a little-known series of settlements, 25 of the nation's biggest life insurance companies have agreed to pay more than 7 and a half billion dollars in back death benefits. However, about 35 insurance companies have not settled and remain under investigation for not paying when the beneficiary is unaware there was a policy, something that is not at all uncommon."
     
  2. dogtowner

    dogtowner Moderator Staff Member

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    So claims were not made and as a result benefits were not paid. And they can't figure out why ?
     
  3. Old_Trapper70

    Old_Trapper70 Well-Known Member

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    As usual, you didn't watch the interview, or you did not understand it.
     
  4. dogtowner

    dogtowner Moderator Staff Member

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    I read the article and know the industry. I rarely watch video.
    This highlights why wills are a good idea for everyone of any age. You never know when your number comes up.
     
  5. Old_Trapper70

    Old_Trapper70 Well-Known Member

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    If you could actually comprehend what was said, and found out, is that insurance companies do not pay out even when the policy is fully paid for, and they know the party has died. Guess you missed that part.
     
  6. dogtowner

    dogtowner Moderator Staff Member

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    No, I saw. If you have a claim you file it with appropriate documentation. There is a process and it's there to protect the rightful beneficiary. If you have a policy you see to it that your beneficiary knows. This isn't rocket science it's just responsible behaviour.
     
  7. Old_Trapper70

    Old_Trapper70 Well-Known Member

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    So, if the beneficiary has no knowledge the insurance company has no responsibility to locate the beneficiary. They just get to keep the money.

    Honesty is not a hit and miss proposition. You either are, or you aren't.
     
  8. dogtowner

    dogtowner Moderator Staff Member

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    Contracts are black and white. There is no mystery, juse words.
    If one is responsible enough to carry insurance they should be responsible enough to have it documented.
    You may see it as an honesty matter but that has to be a two way street. People have been known to misrepresent their authority when it comes to money.
     
  9. Jason76

    Jason76 Well-Known Member

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    The health insurance model is based on the fact a small percentage will have major problems, while the rest will be healthy. However, in the case of life insurance, everyone dies. Therefore, how is it possible for life insurance companies to make a profit?


    Anyhow, I've never seen the Affordable Health Care Act as being logical, because it doesn't fit the traditional health insurance business model.
     
  10. dogtowner

    dogtowner Moderator Staff Member

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    Sticking with life insurance, they make a profit by guessing how long you will live. If they guess right, your premiums plus what they make investing them exceeds what they pay as a benefit. If they guess wrong, they hope they guess right more often.
    And they are good at guessing. Actuaries are smart guys. I loved working with them with programming to get the data they wanted. Those guys were the best regional crew in the country (way back when).
     
  11. Old_Trapper70

    Old_Trapper70 Well-Known Member

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    Actually, the ACA does since it is based on a concept of the Founding Fathers, not modern "health insurance models" which are all about profit, not care for the patient.

    https://theusconstitution.org/news/founding-fathers-would-approve-national-healthcare-policy

    As to the insurance companies making a profit off life insurance, they invest the money received. Who do you think pays the increase in your pension, or 401K? Now, tell us, since the insurance company receives a "death list" from Social Security every month, or could if they asked for it, do they not have a duty to inform a beneficiary of money owed to that beneficiary?
     
    Last edited: Apr 21, 2016
  12. Old_Trapper70

    Old_Trapper70 Well-Known Member

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    As the insurance compnaies obviously have. And it is documented within the policy itself as to who is entitled to the money, and it sure as hell ain't the insurance company.
     
  13. dogtowner

    dogtowner Moderator Staff Member

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    No.
    How do you know it's the deceased ?
    Where does the rightful beneficiary live ? Are they even alive ?
     
  14. dogtowner

    dogtowner Moderator Staff Member

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    Don't always know.
     
  15. Old_Trapper70

    Old_Trapper70 Well-Known Member

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    Are you saying the insurance company does not record who the beneficiary is? I have never seen a policy where one is not recorded.
     
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