Care expenses can be met with life insurance

It's become a well-observed fact that health care costs are rising without any indication of relief in the near future. As people begin to enter their older years, they may wonder if they will have enough money to live comfortably, let alone cover expenses if they need to enter a long-term care facility.

For people with such financial woes, life insurance may provide the assistance and security they need.

Life insurance agent J. Brendan Ryan wrote in an article for the Cincinnati Enquirer about the potential money a life insurance policy may offer.

In his example, Ryan said that a healthy 60-year-old woman may qualify for a $200,000 death benefit by paying $2,700 a year. With a rider she could be able to withdraw $2,000 a month for 100 months by paying just an additional $150 a month. The unused portion of money used could be given to beneficiaries as a tax-free death benefit, he wrote.

This is just one example of how a life insurance policy can provide a person and their loved ones with extra financial support.

How to Find the Best Life Insurance Deals Online

Less than half the adult population have life insurance and most of those who do have never switched their insurance provider. Follow our top tips on how to find the best life insurance deals online.

Only 30% of people surveyed by Confused.com recently said that they had ever switched life insurance providers with men more likely to switch than women at 35% compared to 29%. "It's worrying that so few people have a life insurance policy, and equally worrying that so few have switched provider,” said Confused.com head of life insurance Matthew Lloyd. “Any change in life circumstances, like getting married, buying a new house, starting a family or even getting divorced should be a trigger for reviewing your life cover and ensuring you have the right level for your needs.”

How do I find the right life insurance policy? Life insurance supports your family or dependants by covering debts and replacing your income if you die or are seriously injured or made ill, so that you can no longer work; the premium you pay monthly or annually provides an agreed amount if you die during the life of the policy. Different policies cover a range of different circumstances including funeral costs, mortgage payments, protection for your family and protection over family inheritance.

What to Look for to Get the Best Life Insurance Deals Important points to consider when comparing different policies are joint life insurance and critical illness cover. Joint life insurance means a pay out from the policy will occur based on the death of the person who dies first, while critical illness cover will work out cheaper if included in a life insurance policy as opposed to opting instead for two separate insurance policies for life insurance and critical illness cover, however be sure to understand whether your insurance covers critical and terminal illness cover. Another thing worth considering is to make sure you buy enough cover to pay-off all of your outstanding debts, such as a mortgage and schooling fees for your children, should you die prematurely.

As with all insurance products if you don’t tell the truth, you could invalidate your cover, too, so be sure to mention any health issues that you may have on your application; be it the occasional bad back to smoking, high blood pressure to cholesterol. Life insurance premiums have been reducing in recent years, too, so it is always worth comparing prices online on a regular basis to ensure that you have the best possible deal in place for protecting your family.

Life insurance plans can bring in extra money for seniors

A life settlement transaction may yield larger profits than some may think. A recent report released by the U.S. Government Accountability Office found that seniors profited eight times more by selling their life insurance policy than they would have if they surrendered the plan.

Using the study sample, life insurance holders would have received $37.4 million if they had surrendered their policy. However, the plans brought in $269 million from settlements.

The funds received from selling a life insurance plan can bring in extra money an elderly person needs to cover expenses.

Among other findings, the study also revealed that many states are lagging behind in terms of creating rules for the life settlement market.

President of the Life Settlement Institute Brian Smith says that such findings don't surprise him.

"This finding also comes as no surprise to us. We have been working with state legislators and state insurance regulators to adopt consistent model legislation across the country and eliminate such discrepancies," say Smith. "Last year we helped get legislation enacted in several states including New York and California."

Appellate Division holds that failure of insured to submit PIP package does not void PIP coverage due to noncooperation

In Advanced Spine Centers, Inc. v. Pilgrim Ins. Co., 2010 WL 2225530 (Mass. App. Div.), the PIP insurer mailed to the insured a PIP package following her injury in an automobile accident. The packet had been created by the insurer and included a PIP application form, an authorization to obtain medical and wage information, and a health insurance affidavit form.

The insured never filled out and returned the paperwork. The insured's attorney sent the insurer a copy of the operator's report for the accident, and a notice of her PIP claim. Her chiropractor submitted treatment notes and reports, an affidavit of no health insurance, and an authorization signed by the insured permitting the chiropractor to release the medical information necessary to process her PIP claim.

The court held that the insurer was required to pay the PIP benefits despite the failure of the insured to fill out and return the forms provided by the insurer, because the insurer had received all the material information it sought. It had therefore not been prejudiced.

Superior Court limits amount recoverable under worker's compensation lien

In Curry v. Great Am. Ins. Co., 2010 WL 1795375, the Superior Court held that the recovery under a lien of a worker's compensation carrier in a wrongful death case was limited to the portion of damages allocated to loss of net expected income of the next of kin of the deceased. The worker's compensation carrier was not entitled to the portions of the damages allocated to conscious pain and suffering or loss of consortium. Its recovery was so limited because damages for loss of net expected income represented benefits "that are duplicated by the worker's compensation benefits."

The court also held that the insurer and the plaintiffs must each pay their proportionate share of the legal fees and costs in the wrongful death action.

Data Breach

Best Review reported this month that the average cost of a data breach is now $204 per record exposed.

This includes the cost of notifying those whose records have been released, reissuing credit cards, credit monitoring services, and counseling services.

Standard insurance will not pay for these expenses.  Insurers are coming out with Cyber Liability policies to pay for the liability of data breaches and the expenses of mitigating the loss.

-Protect your data - paper records and electronic data - onsite and online.

-Have a plan in place to deal with a breach.

-Monitor laptops and consider retrieval services like "Lojack for Laptops."

-Train your people about the consequences of a data breach.

Unidentified Vehicle: The Corroborating Evidence Rule

Is a passenger in an insured's motor vehicle an "independent witness" who can corroborate the insured's evidence concerning the involvement of an unidentified motorist for the purposes of the OPCF 44R Family Protection Endorsement? Is the passenger an "independent witness" if the passenger has also sued the insurer under the unidentified coverage provisions and therefore has an interest in the outcome?

D.A. Wilson J. recently said yes to these questions in Pepe v. State Farm Mutual Automobile Insurance Co., [2010] O.J. No. 2138 (S.C.J.).

Sections 1.5(c) and 1.5(d)(i) of the OPCF 44R, known as the Family Protection Endorsement, read as follows:

(c) where an eligible claimant alleges that both the owner and driver of an automobile referred to in clause 1.5(b) cannot be determined, the eligible claimant's own evidence of the involvement of such automobile must be corroborated by other material evidence; and

(d) "other material evidence" for the purposes of this section means (i) independent witness evidence, other than evidence of a spouse ... or a dependent relative ...; or (ii) physical evidence indicating the involvement of an unidentified automobile..


Wilson J. found that: "It is clear that the intention of this section is to limit the ability of individuals to make claims against their OPCF 44R policies for claims involving unidentified vehicles unless there is independent evidence to corroborate the involvement of a vehicle whose driver or owner cannot be ascertained. Further, the individual who corroborates the evidence of the claimant cannot be the spouse or a dependant of the claimant." (para. 10)

In the instance before Wilson J., the independent witness was a passenger in the plaintiff's vehicle and a girlfriend at the time of the accident but not at the time of the motion. Wilson J. concluded that this witness did not fit into the narrow class of persons excluded, namely a spouse or relative, and therefore she was an independent witness who could provide corroborating evidence.

It would seem that allowing a passenger, who has also sued the insurer under the unidentified coverage provisions and therefore has an interest in the outcome, to be the witness required under the Endorsement, defeats the intent of having "independent" corroborating evidence. On the other hand, it seems a correct finding on a plain and narrowly construed interpretation of the Endorsement's wording.

No 93A damages for mistaken interpretation of policy

I have been discussing Fundquest Inc. v. Travelers Cas. & Sur. Co., 2010 WL 2223301 (D. Mass.). The United States District Court for the District of Massachusetts held that there was coverage under an employee dishonesty clause of a policy where the human resources department of the company accidentally deposited the bi-monthly salary of the CEO into the bank account of a low-level employee, and such deposits continued after the employee left the company.

The court held that the insurer's denial of part of the claim on the ground that there was no coverage for deposits after the employee left the company was not a breach of Mass. Gen. Laws ch. 93A. Although the court ultimately agreed with the company, the company had been unable to marshal any case law supporting its position on the novel issue, and the one seemingly relevant case arguably pointed in the other direction. "Despite Travelers' ultimately erroneous interpretation of the Bond, the court does not believe that . . . a reasonable insurer could not have deemed the issue one open to reasonable debate, particularly given the court's own struggle to see through the insurance-ese in which the Bond is written."

Best Insurance Companies

Every year The Ward Group publishes a list of the 50 best insurance companies, rated on the basis of financial strength and business sense.



Here's the latest list.



Quality of insurer is an underutilized insurance decision criteria.



Ward's provides insurers with industry benchmarks to gauge operations in many different part of their operation.  Well run insurers do a better job for insurance buyers.



Besides the Ward list I use AM Best and Weiss Ratings in my review of insurer quality.  I also use my experience as a guide.

Are SABS assessors "experts"?

Those of you defending accident benefits actions may wish to review this case before your next discovery.

Babakar v. Brown (2010), 100 O.R. (3d) 191 (Div. Ct.)

The defendant insurer had the plaintiff assessed pursuant to s. 42 of the SABS to determine whether he continued to be entitled to benefits. Based on these reports, the insurer terminated benefits and the plaintiff brought an action against the insurer. During examination for discovery, the claims examiner refused to answer certain questions about the s. 42 reports on the basis that they constituted cross-examination of expert witnesses, beyond the permissible limits of r. 31.06(3).

The master ordered the questions answered and an appeal to the Superior Court was dismissed on the basis that the experts retained by the insurer were not "experts" within the meaning of r. 31.06(3).

The Divisional Court allowed the appeal. The experts were chosen by the insurer to help it make a determination under the SABS and as such, they were engaged by or on behalf of a party being examined in the action in relation to a matter in issue in the action. The discoverability of their evidence is therefore governed by r. 31.06(3).

The incompetence continues

I have been discussing FundQuest Inc. v. Travelers Cas. & Sur. Co., 2010 WL 2223301 (D. Mass.), in which a company sought insurance after its human resources department accidentally deposited for fourteen months the CEO's salary into a low-level employee's bank account, even after the employee left the company.

FundQuest sought insurance coverage on under an additional policy provision providing coverage for "[l]oss of property resulting directly from (a) . . . misplacement."

FundQuest lost that argument. Why? Because when it filled out its Proof of Loss form for submission to the insurer, it failed to check a box for a claim for "Mysterious Disappearance/Misplacement." It thereby waived the claim.

Company gets insurance coverage for paying former employee the CEO's salary

Answering the question from my last post:

Yes. Which makes me wonder whether underwriters should start thinking about an exclusion for -- I don't know, reckless indifference to not receiving your salary for over a year? Or more generally, radical stupidity? Or gross negligence where the claim is a first-party claim? I realize that such exclusions would lead to endless litigation over definitions, but still . . . In any event, the actual policy clauses at issue were much more mundane.

In my last post I described the facts of FundQuest Inc. v. Travelers Cas. & Sur. Co., 2010 WL 2223301 (D. Mass), in which Curran, a low-level employee, managed to embezzle the CEO's salary for sixteen months when the human resources department accidentally began direct depositing the salary into Curran's bank account.

FundQuest attempted to recover its loss through a Financial Institution Bond issued by Travelers. Travelers agreed to reimburse FundQuest for the amount placed in Curran's account while Curran remained employed by FundQuest. It denied coverage for the amount FundQuest placed in Curran's account after Curran left FundQuest.

The United States District Court for the District of Massachusetts held that FundQuest was entitled to be reimbursed for the entire amount.

The insuring agreement provided coverage for "[l]oss resulting from dishonest or fraudulent acts committed by an Employee . . ." Another section of the policy provided coverage for "[l]oss of property resulting directly from . . . (b) theft, false pretenses, common-law or statutory larceny, committed by a person present in an office or on the premises of the Insured . . ."

"Employee" was defined as "a natural person in the service of the Insured at any of the Insured's offices or premises covered hereunder whom the Insured compensates directly by salary or commissions and whom the Insured has the right to direct and control while performing services for the Insured."

The court held that the "acts that gave life to the machinery that caused the loss" occurred while Curran was employed by FundQuest. Curran's "dishonest passivity - maintaining his silence after learning that he was receiving a grossly inflated paycheck - began at FundQuest and simply continued uninterrupted after he left."

The Five Promises

The Five Promises

Someone has said, “We are the product of the five promises we make ourselves early in life.”

It is an interesting concept. In looking at this idea, the first thing you might notice is that your promises and others will rarely be identical.

For instance, a boy who grew up scraping by financially may resolve that when he is older he “will never be without money.”

Or a girl who is sadly abused by those she trusted, might promise herself that she “will never again be hurt by a man,” or “she would die before she let her children be abused.” Many folks repeat these promises out loud as if they are a mantra.

Possibly, a son that moves so much he is in eight schools in twelve years may promise himself “when I am older, I will not move around like this, and I will put down some roots.”

Another trait you might recognize is that these promises affect others. Take the boy who grows up covenanting within himself to always have plenty of money. This might lead him to work hard and invest money. Conversely, it could also lead to life of embezzlement and other crimes. Unfortunately, many folks have made promises to themselves after seeing hypocrisy in the church. Maybe they said they “never be a member of a church again.” This affects their children who, by default, will not be raised in a church at all.

The timing of the promises can vary as well. Some of the promises that affect our lives also happen much later in life. For instance, when a salesman has the door slammed in his face one too many times, he may decide to go get a degree such that clients will come to him. Certainly, in the practice of law, students will often clerk for lawyers who work in an area of law that they find unpalatable. That student may promise himself that he will never practice that type of law when he is licensed.

It has been said that, if you want to change, you have to change one of your earlier promises to yourself. There may be truth in that. However, what changed me was a real encounter with the Living God, who became a man. His name is Jesus. He is still in the life-changing business. If you are at the end of your rope, let go. Seek Him.

The most fun insurance case to come our way in a while

As I have frequently written, including in my last post, we all make mistakes, and sometimes those mistakes hurt other people. That is why liability insurance is a great thing. But in general my various rants address third-party claims; that is, person A made a mistake and person B was injured as a result. Person A's liability insurance will provide money to pay for the loss person B suffered.

First-party insurance is insurance that pays the policyholder. For example, homeowner's insurance includes property damage coverage. If your house burns down, the insurance you pay for will reimburse you for the financial damage you suffered.

There is generally no coverage under homeowner's insurance if your house burned down because you committed arson. There is more likely going to be coverage if you accidentally caused a fire that burned your house down. But what if you accidentally burned your house down because of an act of incredible stupidity? I'm not talking smoking in bed. I'm talking not noticing that your kids are building a campfire in the middle of your living room.

In FundQuest Inc. v. Travelers Cas. & Sur. Co., 2010 WL 2223301 (D. Mass.), the court addressed an analogous situation in an employee dishonesty policy.

FundQuest, a financial advisory firm (you'll see how ironic this is in a moment) had an employee named John Curran who had a low level IT support position. Curran submitted a request to transfer direct deposit of his paycheck to a new bank.

A human resources employee accidentally inserted the payroll information of FundQuest's founder, president, and CEO, Robert Del Col. As a result, the company began depositing Del Col's paychecks in Curran's account. The court described the paycheck as "appreciably larger" than Curran's. The human resources department had made a stupid mistake, somewhat akin to falling asleep while smoking in bed.

Curran did not notify FundQuest of the mistake. Instead--and you have to give him credit for chutzpah--he complained of not receiving his own paycheck.

FundQuest did not respond by looking into the paperwork and noticing that Curran was receiving his CEO's paycheck. Instead, it merely began adding Curran's own paycheck to his direct deposit account. Another stupid mistake, somewhat akin to noticing that a pan on the stove is on fire and assuming that the fire will burn itself out.

Curran received both paychecks for two months, when he quit working for FundQuest. I would love to know why he quit and if he guessed what would happen next: although his own paycheck stopped when he left the employment of FundQuest, he continued to receive Del Col's paycheck.

More than a year later, Del Col noticed that he had not been paid for sixteen months. Why did he notice at that point? I can only guess that it was because it was January, 2009, which was right around the time we all realized that the tanking of the economy was not going to be a mere blip. Suddenly, every $258,964.27--the amount of salary he was not paid-- must have begun to matter to Del Col. In other words, he must have suddenly started to care that his kids were burning down his living room, because he might actually have to live in it.

Not surprisingly, since Del Col was president and CEO and all, FundQuest promptly reimbursed Del Col the amount he was owed in back salary.

I know you're all wondering: Did Fundquest get reimbursed by its insurer? Find out here on Tuesday, July 20, at 1:30 PM, when my next post will be published.

Extended Business Income Coverage

I have often posted on business income insurance.



The coverage pays for lost profits and expenses that continue while a business is rebuilding from an insured loss that causes an interruption in the business.



What about the time it takes to get a business back-up and running after construction is complete but when the business is still not operational?



Your manufacturing plant is rebuilt and operational.  However, it may take 3 months for your customers to come back - if they come back at all?



Many policies only provide 30 days extension.



What if you are a hotel in Maine and your place burns in July and is ready to open in December?  You have lost a year's worth of business and may not see your first guest until June.



Consider how long it will take to rebuild.  Move that loss into your most profitable time of year (the worst possible loss).  How long will it take to get back into "normal" operations.



Talk with your insurance advisor about how your insurance responds.

Another rant about why you should have liability insurance

A few months ago I posted about my irritation with the decision of my mechanic to not purchase liability insurance. Same issue with my eight-year old daughter's day camp, only this time it's more like fury.

I learned that the camp does not have insurance months after I signed her up (and, as any of you who are parents will know, long after the time to make decent alternate plans had passed), as I was filling out additional paperwork. Among that paperwork was a release requiring me to forgo any claims my daughter might have if she is injured at the camp, and to acknowledge that the camp does not have insurance.

So, let me get this right: I am paying (a lot) for you to have my daughter in your care for eight hours a day. If you make a mistake that results in my daughter getting hurt--and because I'm superstitious I'm not going to list all the possible mistakes that you could make in the course of taking care of fifty elementary-school aged kids, or all the possible injuries I can imagine--you are going to say, "Oops, so sorry," and walk away.

Let me say this again: Liability insurance is a cost of doing business. No one enjoys paying it. Everyone who has a business in which there is a decent likelihood that someone could be injured as a result of a mistake the business makes needs to have it.

Discovery by Videoconference

Midland Resources Holdings Ltd. v. Sharif (2010), 99 O.R. (3d) 550 (S.C.J.).

In this case, the plaintiff was living in Moscow and had a medical condition and his physician recommended against lengthy airplane trips. He brought a motion seeking to be examined for discovery by videoconference.

Justice Newbould granted the motion and refused to follow a prior Master's decision that held that video conferencing should be used rarely. The Court held that given the high costs of modern litigation, videoconferencing should be encouraged. The Order was granted pursuant to r. 34.07(1)(f).

It seems that in modern litigation it is increasingly common for parties to be outside of Ontario. Videoconferencing can be useful in such cases to help decrease some of the costs in litigation, which accords with the new emphasis on proportionality and access to justice.

Vote for me!

This blog was nominated as one of the Top 50 Insurance Blogs for 2009. If you would like to post a comment supporting my candidacy, please follow this link.

Backups

You simply must backup your computer.



Yesterday, a panicked friend called asking for advice.  Her laptop had been stolen and she wanted to know if I knew how to track it down.  She called Apple and they couldn't help either.



You must backup your data.



You must have a way to quickly change passwords and logins in case your computer is stolen



If you have a laptop, consider Lojack for Laptops.  The service allows you to track a stolen laptop and can even wipe the harddrive if necessary.

Audiotaping Independent Medical Examinations

In Adams v. Cook (2010), 100 O.R. (3d) 1 (C.A.), the defendant sought an independent medical examination of the plaintiff by a specialist in physical medicine and rehabilitation. The plaintiff would consent only if the examination was audio recorded. In the initial motion, plaintiff's counsel swore an affidavit alleging there was a systemic bias by those conducting IMEs. He made no allegations against the specific specialist selected by the defendant. The motions judge refused to order the IME without audiotape and the Divisional Court dismissed the appeal. The defendant then appealed to the Court of Appeal.

The Court of Appeal allowed the appeal. In order to show that audio or video recording is necessary, there must be something more than an allegation of general bias among doctors who perform IMEs; there has to be something specific to the case.

The Court was invited to opine on whether there should be routine recording of IMEs in all cases; however, it declined to do so, preferring to leave this issue for the Rules Committee.

Independent medical examinations seem to be an area ripe for disputes between plaintiffs and defendants. The Court of Appeal's decision is one that may assist the defence in opposing requests to record the examination, although it seems that the Court of Appeal has left the door open for plaintiffs to argue for recording of IMEs in specific cases.

Moving To A New Location

A client just sent out a mass email with the details of an upcoming move of their central office.  I reminded them of some insurance issues in such a change.



First, there is the insurance on your stuff being moved from one location to the other.  Movers usually only provide coverage of xx cents per pound and are almost always only responsible for damage caused by their negligence.  Theft, lightning strikes, and an accident caused by another probably will not be reimbursed by the mover.



Look to your own insurance to cover your stuff while in transit.  Call your agent and tell them you need to be sure your property is covered during the move.



Second, you need to add the new location to your property, liability, and workers' compensation insurance. Again, your agent can help with these endorsements.

Unbiased Insurance Review Video

My new video on the importance of an unbiased insurance review...



HERE

Inherent Vice

Inherent vice is an object's tendency to deteriorate.



Ray Burnham, in his most excellent, Burnham's Insurance Dictionary, uses examples of meat putrefying, iron rusting, and people aging.



Property insurance almost always excludes inherent vice, though most policy forms do not use the term.



The ISO property form excludes inherent vice with the following words:



"Rust or other corrosion, decay, deterioration,

hidden or latent defect or any

quality in property that causes it to damage

or destroy itself;"



Class dismissed.