Insurance Litigation and Regulatory Law

One of the biggest deficiencies in the American system of health insurance is that there is very little standardization. Each plan is different. And the devil is in the details, as they say. Your plan might not cost much in weekly or monthly premiums, but it probably won’t provide much of a benefit either. A yearly checkup and a few prescription drugs? No problem. But an emergency room visit that leaves you responsible for paying off a high deductible before your health insurance kicks in a dime? Huge problem.

The harsh reality is that a person can be insured on any plan and still be financially ruined due to COVID-19. The economic relief package passed into law by Democrats addresses some of these concerns.

Director of the National Center for Coverage Innovation at Families USA Stan Dorn said, “If Congress can circle back and make these improvements permanent, it will go a long way toward making insurance affordable in this country.”

Civil rights attorney John Stackett said, “One of the biggest issues with previous relief packages was that they provided protections that disproportionately left minority groups out in the cold. The Biden package does better, but it probably still doesn’t go far enough. Right now, families living below the family line will receive a small payment monthly for the rest of the year. We needed that terribly, and we hope to see an extension in the future.”

What does all this mean? Essentially, it means that health insurance is still far too expensive for many working families in the United States. But by providing what is basically a universal basic income (UBI) for parents, Democrats have found a round-about wait to make insurance payments more manageable. The trick is getting the payments renewed after this year — but as we already know, it’s very difficult to take away this kind of benefit once people have it. And Republicans will have to struggle for how to respond to this when they’re running in the midterm elections next year.

Biden has also ensured that open enrollment for the Affordable Care Act will stay available for months, which is great for people who lose employer-provided coverage. Many citizens are still out of work, and they need healthcare coverage now more than ever. 

The American Rescue Plan Act also removes repayment requirements for premium tax credits, which should go a long way into helping families who don’t have any extra funds on hand to pay them. It’s worth noting that those who use the ACA to find coverage must update demographic information now in order to guarantee these changes have the desired effect. 

We already knew that payments for the economic relief package most recently passed by Congress and signed into law by President Joe Biden were delayed for certain groups of people — but now we may have a better idea of why. House Democrats believe that delays for the $1400 individual payments may have been purposely delayed by former Trump employees in the Social Security Administration.

Those waiting on social security disability checks are accustomed to long wait periods — even being approved for SSDI can take two years — but experts warn that lives could be lost in the interim.

House Ways and Means Committee chairman Richard Neal (D-Massachusetts) said, “We understand that these beneficiaries are waiting because the Social Security Administration has not sent the necessary payment files to the Internal Revenue Service.”

An SSA spokesperson said, “Social Security staff is working day and night with Treasury and IRS representatives to ensure that the electronic file of Social Security and SSI recipients is complete, accurate, and ready to be used to issue payments.”

Once the SSA provides the requisite information, it could be a week or two before anyone currently on social security receives a check.

IRS Commissioner Chuck Rettig provided his testimony at a Ways and Means Committee hearing: “Many of these folks are also entitled to an [earned income tax credit]. They’re also entitled to a child tax credit. We did not get that information from the non-filer portal.”

The current head of the SSA wants to implement deep cuts to the organization, which is a non-started for Congressional Democrats. If it seems strange that a Trump appointee would want to make cuts to the programs he oversees, don’t forget that he also appointed a climate change denier to head the Environmental Protection Agency (EPA). When Trump wanted to gut funding for a particular organization, he attacked from within.

Those still waiting on relief payments can visit the “Get My Payment” portal to find out if the check has already been sent.

The House Ways and Means Committee released a written statement to explain the delays: “The American Rescue Plan was intended to provide much-needed economic stimulus and assistance to people across the country — immediately — and we are counting on your agencies to ensure that beneficiaries are not left behind in the seamless delivery of those payments.”

It continued, “However, we were alarmed to learn recently that most Social Security, SSI, RRB, and VA beneficiaries who are not required to file a tax return have not yet received their payments and the IRS is unable to provide an expected timeline for these payments. Some of our most vulnerable seniors and persons with disabilities, including veterans who served our country with honor, are unable to pay for basic necessities while they wait for their overdue payments.”

Are you an SSDI or SS recipient? There’s no need to worry if you normally file taxes with the IRS. Your information should be on file and your payment should be scheduled normally.

We believe that people should know and understand exactly what their insurance policies say and mean. But insurance companies purposely use a lot of jargon and complicated terminology that the average person could never (or would never want to) wrap their heads around. That’s why we’re going to do it for you. Here are a few insurance-related terms that you might find in any policy you’ve purchased, and what they mean.

Actual Cash Value

This term refers to the value of repayment requested after a financial loss (most usually due to property damage). You’ll also see it coupled with the word “indemnification,” which refers to the protection of one party when a third party is damaged. 

Actuary.

This term refers to the professional responsible for determining the level of risk that an insurance company might be willing to accept. The actuary determines the equations for calculating premiums, dividends, etc.

Adjuster. 

If you ever need to cash in on a policy, then the insurance adjuster is the one who will investigate your claim. Basically, the adjuster’s job is to never give you an inch and not give you the company’s money unless a certain standard is met. They determine the claim’s worth in relation to the policy’s cash value.

Admitted Assets. 

These are an insurer’s valuations for specific assets. You’ll find them on the balance sheet.

Advance Premiums.

Normal premiums are the price you pay — usually once a month — once you’ve agreed to purchase a policy. An advance premium means you’ve paid…in advance. 

Affiliate.

Insurers refer to anyone who is under the insurer’s control as an affiliate.

Agent.

These are the insurance lackeys who sell their services. They don’t always work for the insurance provider. Sometimes providers will ask a third-party for sales work.

Aggregate.
This word refers to the most money you can have returned from a single loss (total coverage).

Most rational people on planet Earth would recognize the futility of planning a murder (or two or three) in order to collect a massive life insurance settlement. And yet, it keeps happening. Hawthorne resident Ali F. Elmezayen, 45, was sentenced to 212 years in federal prison after the buffoon took out accidental death life insurance policies on his two kids and wife — and then partially carried out the plot when he drove his vehicle off the Port of Los Angeles.

His wife survived, but his two disabled sons died. 

Judge John F. Walter imposed the maximum sentence available when he ruled for 212 years. Walter said, “He is the ultimate phony and a skillful liar…and is nothing more than a greedy and brutal killer. The only regret that the defendant has is that he got caught.”

Elmezayen was also slammed with $261,751 in restitution fees that were paid out as part of the accidental death policy.

An anonymous lawyer for a personal injury law firm (https://www.socalinjurylawyers.com/) commented that these types of cases were surprisingly plentiful: “People don’t realize that they can’t possibly get away with it. The first person they suspect is the closest person in the deceased’s life.”

Acting United States Attorney Tracy L. Wilkison said, “Mr. Elmezayen conceived a cold-blooded plan to murder his autistic sons and their mother, then cash in on insurance policies. He now has ample time to reflect — from the inside of a federal prison cell — on where his greed and self-interest took him. We continue to grieve for those two helpless boys who deserved better from their father, who will never again walk among us as a free man.”

The scheme was poorly planned from the beginning. Before the plot was executed, Elmezayen contacted the relevant insurance companies a number of times — sometimes posing as his wife — in order to ensure the eight insurance policies he had purchased for more than $3,000,000 would pay out without much scrutiny. Prosecutors say one of his motivations was a bankruptcy he filed the year he purchased the policies (which he couldn’t even afford). 

Assistant Director in Charge at the LA FBI Field Office Kristi Johnson said, “Fathers are supposed to protect their children but instead, Elmezayen drove his boys straight to their certain death in exchange for cash. The defendant maliciously planned the death of his autistic sons and gave them virtually no chance of survival. The investigation that led to today’s sentencing won’t give them their lives, but affords them justice in death.”

Insurance policies have a “contestability” period. Once it expires, there are no longer any investigations into the cause of death. Theoretically, Elmezayen could murder his family only days after the contestability window expired and no one would bat an eye. He waited only 12 days. Funny thing: the FBI tends to take notice of such aberrations in the system. Who knew?

We rarely think about how the transport industry works. But maybe we should. Every year, millions of trucks — gasoline-fueled missiles, rather — travel from one end of the United States to the other. We’re talking hundreds of millions of miles traveled on an annual basis. With those kinds of numbers, accidents are inevitable. And what happens when those accidents lead to massive lawsuits that wind up in court?

Mike Card is president and CEO of Combined Transport. He took over the business from his father, who started it in 1980. And suffice it to say, business is better than ever. This is in part because of the reliance on material goods during the coronavirus pandemic. The government relies on some trucking services to get vaccines and PPE from one region to the next. But Card says the bigger the business gets, the more he worries.

He commented, “If someone wins $20 million from the jury, my insurance companies only pay the first $5 [million]. I would have to pay the next $15 million. We couldn’t afford that. We’d have to shut our doors.”

It’s a legitimate concern. From 2010 to 2019, the number of trucking accidents with fatalities blew up 43 percent. Overall injuries rose 7 percent. Needless to say, most of the casualties were passengers or drivers in other vehicles.

Combine that with the epidemic of “nuclear verdicts” — or the ballooning costs and jury awards from those crashes in excess of $10 million, and you get a lot of worried business owners. The aforementioned 43 percent increase in fatalities doesn’t come close to the whopping 1000 percent increase in jury awards during the exact same time period.

Why are the awards getting so high so fast? Liberty Mutual Insurance says that the main reason is the idea that the system in general is broken (and hint: it is). 

But the trucking industry is more likely to receive a punitive judgement (i.e. a punishment from the judge) for gross negligence than many other industries. That’s because truck drivers are often fatigued behind the wheel. Coupled with the fact that some drivers are allowed to keep their drives even without a flawless driving record, and it’s easy for a personal injury lawyer to win a case for injured plaintiffs.

An anonymous lawyer from Koonz McKenney Johnson & Depaolis LLP (https://koonz.com/) said, “99 percent of the time, it’s the business owner’s fault. It’s the hiring practices, the overtime hours, the broken laws and regulations that lead to the majority of these accidents. Ordinary people are the ones who pay the price with their lives. Why shouldn’t we take the owners to town for their mistakes? Someone has to reimburse victims for the damage done, and it’s got to be the ones responsible. The drivers are just tools for those business owners. And so we target the business owners.”

But senior vice president of the American Transportation Research Institute Dan Murray says, “In most states there’s a disconnect between your level of negligence and your level of liability. There are states where you can be identified as 10 percent of 15 percent negligence and still be vulnerable for 100 percent of the financial liabilities.”