Saturday, 27 October 2012

'Imaginary' insurance policies cost families

ALBUQUERQUE (KRQE) - New Mexico state employees who pay for extra life insurance take heed: You?d better make sure all your ducks are in a row or your family could end up with nothing.

That?s the lesson learned by the families of at least two state workers who paid supplemental life insurance premiums for years only to have the insurance company deny claims based on a technicality after they died.

?I was shocked, stunned,? said Gene Moser, director of the State Personnel Office. ?I?ve never encountered anything like this.?

Martin Hoefler, a wildland firefighter with New Mexico?s Forestry Division, was one of the state workers News 13?s Larry Barker discovered during his investigation into the situation. Years ago, Hoefler bought extra life insurance offered by the state to provide for his family in case something happened.

That ?something? struck in April, when Hoefler died of cancer at the age of 50. He left behind a wife and eight children.

?It?s just hard without him,? said Lena Hoefler, his widow. ?We all just miss him.?

Weeks after Martin Hoefler?s funeral, his family received a three-page form letter from the Standard Insurance Co. It said that because Martin Hoefler hadn?t filled out a medical form, it wouldn?t be paying them the $33,000 they were expecting.

In fact, it wouldn?t be paying them a dime, despite the fact that the company had been pocketing Martin Hoefler?s premiums every two weeks for years.

?We were paying the premiums,? Lena Hoefler said. ?It was automatically deducted from his check. He thought he was insured.?

Lena Hoefler said neither Standard Insurance nor the State of New Mexico ever told her husband the form was missing from his file.

Bob Allard was a long-time state employee who worked at Heron Lake State Park in Northern New Mexico.

?He was the kind of person that would show up early, leave late,? said Anthony Marquez, park superintendent. ?He took great pride in what he did here at the park. He worked his butt off. He took the job in his late 60s to provide health insurance for him and his family and worked hard every single day that he came here.?

Allard also paid extra life insurance premiums every two weeks for years. But when he died in 2010, Standard Life refused to pay his widow a $22,000 claim because the company said the medical form hadn?t been filled out.

?Something like this shouldn?t happen to such a nice guy,? Marquez said. ?To find out that this happened to him was kind of a surprise -- most appalling when his wife and family need it most. It?s quite shocking.?

And these imaginary life insurance policies are not limited to Martin Hoefler and Allard. News 13 has learned that some current state employees are also being victimized by paying for non-existent life insurance.

?It does seem that if you are paying for insurance, you should get what you pay for,? said John Bemis, secretary of the state?s Energy, Minerals and Natural Resources Department, where both Martin Hoefler and Bob Allard worked. ?It didn?t sit well with any of us. We said, ?This can?t be right.? It certainly didn?t reinforce confidence in insurance companies.?

News 13?s attempts to obtain an explanation from Standard Life Insurance, which claims to be one of the oldest and most reliable insurance companies in the country, also didn?t inspire much confidence. Company officials refused to discuss the situation on the phone. And when News 13 showed up at their corporate headquarters in Portland, Ore., they again declined to talk to us.

?My instructions are to ask you to leave,? a receptionist told a reporter.

In fact, the company?s only comment was a statement blaming New Mexico for the problem.

?When a family is expecting that funding, that money, to pay for death benefits, whatever, and find out they are not getting anything ? I think that?s obscene,? Moser said. ?Their response was immoral. It?s wrong.?

Approximately 9,100 state employees pay Standard Life $4.8 million a year for supplemental life insurance.

?When I found out that the two employees were denied coverage, I was shocked,? said Ed Buckle, secretary of the General Services Department, which oversees state employee benefits. ?I found it unbelievable that Standard Life had denied their claim when the two employees had been paying their premiums all along.?

Burckle said he doesn?t believe the insurance company knows who?s covered and who?s not.

?It?s my understanding that Standard does not maintain a master list of covered employees,? he said. ?They do not know until the time that someone needs to filed for the insurance whether or not the employee is covered. Unfortunately (that?s) after someone dies.?

State officials at the General Services Department, are now in the process of pulling the files of all employees who pay for supplemental life insurance to find out who?s covered and who?s not.

Moser said he takes partial responsibility for not adequately training human resources staff on proper procedures.

?I?d probably put 80 percent (responsibility) with the insurance company and 20 percent with the state,? Moser said.

Meanwhile, Standard Life has made it?s position clear. Last week in a letter to New Mexico officials, the company refused to pay the widows of Martin Hoefler and Bob Allard a single penny, even though its insurance services division pocketed more than $2 billion in revenue last year. Standard did refund premiums paid by the two families.

?If Standard continues to deny the claims, the state will make those two families whole and pay the total of $55,000 that are due both families collectively,? Burckle said. ?We would hate to make this a legal matter, but we are fully prepared to do so if Standard Life refuses to pay.?

In fact, the state has already delivered checks to the two widows and plans to sue Standard Life to get the money back.

Bill Carpenter, an Albuquerque personal injury attorney specializing in insurance disputes, said he thinks ?every insurance agent in the state is going to be cringing when they hear this story.?

?It is not only the widow, but it?s the life insurance industry that?s being punished because the important thing is that insurance be certain,? Carpenter said. ?And people, when they buy it, they need to know that it?s certain. And we don?t take advantage of technicalities to deny benefits.?

Source: http://www.krqe.com/dpp/larry_barker/imaginary-insurance-policies-cost-families

madonna give me all your luvin video roseanne barr president green party day 26 gronkowski new hunger games trailer sasquatch

No comments:

Post a Comment