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Nothing Personal, Soldier, Just Business

Fallen Soldiers' Families Denied Cash as Insurers Profit | Bloomberg

The package arrived at Cindy Lohman’s home in Great Mills, Maryland, just two weeks after she learned that her son, Ryan, a 24-year-old Army sergeant, had been killed by a bomb in Afghanistan. It was a thick, 9-inch-by- 12-inch envelope from Prudential Financial Inc., which handles life insurance for the Department of Veterans Affairs.

Inside was a letter from Prudential about Ryan’s $400,000 policy. And there was something else, which looked like a checkbook. The letter told Lohman that the full amount of her payout would be placed in a convenient interest-bearing account, allowing her time to decide how to use the benefit.

“You can hold the money in the account for safekeeping for as long as you like,” the letter said. In tiny print, in a disclaimer that Lohman says she didn’t notice, Prudential disclosed that what it called its Alliance Account was not guaranteed by the Federal Deposit Insurance Corp., Bloomberg Markets magazine reports in its September issue.

. . .

As time went on, she says, she tried to use one of the “checks” to buy a bed, and the salesman rejected it. That happened again this year, she says, when she went to a Target store to purchase a camera on Armed Forces Day, May 15.

. . .

It was being held in Prudential’s [non segregated] general corporate account, earning investment income for the insurer. Prudential paid survivors like Lohman 1 percent interest in 2008 on their Alliance Accounts, while it earned a 4.8 percent return on its corporate funds, according to regulatory filings.

“I’m shocked,” says Lohman, breaking into tears as she learns how the Alliance Account works. “It’s a betrayal. It saddens me as an American that a company would stoop so low as to make a profit on the death of a soldier. Is there anything lower than that?”

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this just seems very . . .

wrong--

defending insurance companies is like defending the military industrial complex or the medical pharmaceutical chemical complex (maybe they are one and the same)--

and crying for justice for the big banks and corporations--

this is fraudulent--

I don't think the 'government' (whatever it is anymore) will intervene; it's quite obvious *they* don't care about the 'little' people anymore--

it's hard to be awake; it's easier to dream--

Read on down further

This article should be on Huffpo, not Daily Paul. Here you are calling for the Fed to get involved. Unbelievable! This site is falling apart at the seams....

"Qui audet adipiscitur"

It is Corporatism

and government in collusion. This is the right place to discuss this. Don't trust business or government or unions. They all get corrupted by the criminal element.

"We can see with our eyes, hear with our ears and feel with our touch, but we understand with our hearts."

Oh the new lingo

In any case it calls for more collusion not less. This woman did two things wrong. (1) She should have read and understood what was happening, instead of trusting, (2) She should have demanded an immediate payout which she had every right to do.

This article overall is calling for Federal regulation, albeit implicitly, but that's what its doing and the people here complaining are adding their voice to that cry.

Did the insurance company wrong this woman, yeah, but they did it with her consent....

"Qui audet adipiscitur"

Yep, they all do it.

Just about all large corporations have life insurance policies out on their employees.

"Give a man a gun, and he could rob a bank. Give a man a bank, and he could rob the world."

Theres no existing law

that forces you to participate and pay into them however.

"Qui audet adipiscitur"

Couple points

All this article does is cry for more Fed intervention. Why its posted here is beyond me.

Insurance companies are regulated at the State level NOT Federal. Insurance companies are NOT or never were FDIC insured. They are not banks, though this one surely took it upon itself to begin acting like one by placing the insurance payout into a checking-account-like account instead of paying the payout in full.

I feel bad for this woman and think this insurance company might possibly be doing something it shouldn't, but this article just cries for Fed intervention.

The woman should have been much more careful and thats what liberty and freedom are about. Living by your own mistakes and successes. She made a mistake. Lesson learned.

"Qui audet adipiscitur"

and of course.. news once again piles onto the popular

insurance company bashing.. yet neither that obese mother of his nor the journalists dare touch all the immunities from competition granted by the government. forgive me for disregarding anything cowards write or cry about, including that uninformed sympathy looking "breaking into tears" mother of his. i wonder if she even bothered reading the contract when she signed up? it's difficult to think the insurance company would do something so outright sue-able unless it thought it had legal backing in the form of a signed contract of sorts. if she was too busy munching on chips when signing his son's death insurance contract, who cares about all this late whining really.

and of course there is always the chance a giant company could still make a stupid mistake that makes them vulnerable to lawsuits with no legal preparations whatsoever despite all the legal experts working for it. i'm just saying the chance is minor compared to the chances that someone again didn't read the contract before signing, just like the arm housing mortgage, the credit cards, and all the rest.

reedr3v's picture

This convoluted insurance practice is

intentionally misleading. Why your sympathies would be with this corporate chiseler I cannot imagine.

And you seem to be weirdly hung up on the woman's body weight. How is that relevant? She is right in speaking out to help warn other families.

Well, it sure would

be nice if people would realize that the military is not all that it is cracked up to be. The reality is military are "cannon fodder" and "useful idiots" for Corporate elitist US interests. They are NOT there to protect our freedoms because we don't have any.

"We can see with our eyes, hear with our ears and feel with our touch, but we understand with our hearts."

This is crazy!

Then they send her a book of checks that apparently need approval to use?

If I disappear from a discussion please forgive me. My 24-7 business requires me to split mid-sentence to serve them. I am not ducking out, I will be back later to catch up.

dont be a pin head

They gave her a choice. She was not forced to accept a book of checks (She could have cashed out immediately into a local bank account). She chose the checks (their account). Also read my comment above. Insurance companies are not FDIC insured. She never had any guarantee on her money when they created an account her. If you want liberty and freedom then you better start understanding the responsibilities of having liberty and freedom. I think half the people here dont know any better. They "think" they are clamoring for liberty, but when things go south, they want heads to roll, and dont want to live by their poor decisions.
Insurance companies are regulated at the state level. With that comes the knowledge (or should) that the Fed is not there to back you up. So whats it gonna be? Do you want freedom or do you want Fed intrusion? I dont think you know...

"Qui audet adipiscitur"

Pinhead?

I read what was presented and it said nothing of a choice.You must have inside info that was not presented.
The cheques were unusable so?

If I disappear from a discussion please forgive me. My 24-7 business requires me to split mid-sentence to serve them. I am not ducking out, I will be back later to catch up.

Yeah Choice

She decided to believe at face value, decided to leave the money to decide what to do with it, when she should have either demanded an immediate payout, which she had every right to do or immediately deposited one of the checks into a personal bank account and if it did not clear demand to know why. She trusted, did not think or read, or do anything, she just accepted what she was told and went about her days. Well, why the hell do you think everyone is DEMANDING government intervention these days. You are either proactive in your financial affairs or you are a fool. Fools are why we are where we are. Im not defending the Insurance Co., but for Pete's sake where in the world did anyone get the idea Insurance Co's were Federally Insured. This article reeks of "help me government" and the fact its posted here is what I call disgusting....

"Qui audet adipiscitur"

try being an attorney, money manager or consultant

and placing "client funds" in your general account....

earning interest for your firm (rather than the client)

a path to sure conviction and disbarrment....

why do insurance companies get such dispensation?

(it is NOT just soldiers)

cee cee

I hadn't thought of the Attorney ,Client relationship.

How right you are!

If I disappear from a discussion please forgive me. My 24-7 business requires me to split mid-sentence to serve them. I am not ducking out, I will be back later to catch up.

Disgusting

These crooks need to be hung.

I was told two days ago that my cousin in Florida was really sick. I ask what was wrong and was blown away. He went into Basic training and while he was there had a battery of shots given to him. Right after getting the shots his health started to decline. He started getting headaches, stomach pains to the point where he would be on the ground in the fetal position with his hands all deformed and clinched..When it would finally end he would just break down and cry..He has also now developed turrets..They put him on 3 different kinds of anti depressants and nothing seemed to help. So now in their eyes he is no good as a soldier anymore. So they gave him a medical discharge, cut him off cold turkey from the meds they had him on and the VA refuses to help. So now his health is ruined and he has to pay for any help he can get out of his own pocket. Even though it was them that pumped him full of poison..God Bless America.

"I have found that being rich is not about having the most but about needing the least"

It's the realization that you're chattle that really hurts

Expecting anything resembling fairness from our society borders on insanity.

SteveMT's picture

Sad; Added insult to injury.

Hell is a terrible place.

nothing is sacred

it's just one thing after another

bump

Thanks Michael.

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