ClearView to refund $1.5M to policyholders, Maryland seeks life insurance changes - Baltimore Post-ExaminerBaltimore Post-Examiner

ClearView to refund $1.5M to policyholders, Maryland seeks life insurance changes

Life insurance provider ClearView has announced that the company will be refunding $1.5 million to its 16,000 customers. The refunds are due to the company’s own actions. ClearView’s phone staff was found to conduct fraud in many cases.

The staff was involved in an array of questionable sales tactics and also made misleading claims to potential clients in an effort to get them to sign up for their products.

The staff also fraudulently processed payments without the consent of customers. The company has since stopped offering direct life insurance.

ClearView boasted $334 million in revenue in 2017. Australia’s Investments and Securities Commission (ASIC) intervened in the company’s life insurance division before it was closed.

Full or partial refunds will be provided for policies spanning over a three-and-a-half-year period. ASIC’s claims that many of the policies, over 1,100, were sold to people that are unlikely to have spoken English as their first language. Refunds will cover 32,000 policies sold by the company.

ClearView claims that they closed the division in mid-2017, with ASIC’s not having an impact on their decision. The company claims that the reason for closing the branch was “rising consumer expectations.” The company also cites regulatory scrutiny as a reason for closing down the life insurance division.

The company’s payouts will not have a major impact, as the life insurance division made $4.5 million in 2016. The company will continue selling life insurance as part of their program when a client asks for personal financial advice.

ASIC’s claims that the tactics used by ClearView were unacceptable and pressure tactics that are unacceptable.

Life insurance policies are also facing a change in the United States. The case of a toddler, Prince McLeod Rams, takes center stage during the policy change. The 15-month-old boy’s father murdered his child during an unsupervised visit in an attempt to cash in on the child’s $500,000 life insurance policy.

The father couldn’t use a life settlement broker due to the child’s young age, so he turned to murder.

General Assembly members have introduced legislation that put insurance companies under pressure to tighten their underwriting standards. Life insurance policies on kids will also have a stricter procedural process.

Prince’s father was able to easily get a life insurance policy on his son despite the father’s financial issues and shaky past. Maryland’s lawmakers will ultimately decide on the bill, which makes insurance companies responsible for the policies that they write.

Financial experts agree that life insurance policies on toddlers are for the benefit of the insurance industry rather than the child. New York has policies in place that put a limit on the amount of insurance parents can take out on their children.

Experts question why a life insurance policy is available on a baby. The courts were also in the wrong during the murder with the mother begging the court to not allow her ex to has an unsupervised visit with their child. The court ruled to allow the father the unsupervised visit, which led to Prince’s death.

Life insurance is a key focus of fraud, with one David O’Dell being murdered by his friend Joseph Meyers in New York. O’Dell was burned alive as his friend who wanted to collect $165,000 in insurance.

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