California Insurance Commissioner Labels Unum
an “Outlaw” Insurer as the California Department of Insurance Fines Unum $8 Million
When the insurance commissioners of 48 states agreed to a $15 million multi-state settlement last year against Unum, California Insurance Commissioner John Garamendi rejected the settlement, stating that it did not go far enough to protect California insureds. This week, the California State Department of Insurance instead fined Unum $8 million, the largest settlement in the agency’s history, with Garamendi calling Unum an “outlaw company” that harmed consumers by denying their disability claims.
This company engaged in a strategy to increase its bottom line at the expense of its customers. — California Insurance Commissioner John Garamendi
State regulators determined that UnumProvident misinterpreted job classifications, improperly overruled doctors’ opinions and knowingly used incorrect insurance definitions to avoid payment of disability benefits owed to insureds.
While the multi-state settlement required Unum to reopen 215,000 claims and pay a fine of $15 million, the $8 million California settlement includes a third-party review by insurance experts, limits the discretion insurers have to interpret policy language and establishes a model policy that Unum and other disability insurers will be required to adhere to in California.
Paper Trail Surveillance:
How Disability Insurance Companies Investigate You
Without Ever Leaving a Computer
We have written about video, photograph and social media surveillance in the past, but have yet to address another kind of “surveillance” that disability insurance companies use when a claim is filed: detailed record searches. When a policyholder files a claim for disability insurance benefits, one of the first things that claims personnel do is conduct a series of detailed record searches and record requests for all kinds of information on the claimant, including:
- Corporate and business filings;
- Civil court filings;
- Criminal background check;
- General internet search results;
- Workers compensation claims;
- Professional licenses;
- Real estate purchase and sale records;
- Medical records;
- Credit reports; and
- Pharmacy records.
The disability insurance claim process can be daunting, especially when insurers are delving into your personal and professional records. It is always best to have a disability insurance lawyer working to protect your privacy and your rights under the policy.
