‘Agent’ Scams Seniors out of nearly $490,000 in life insurance premiums
Seniors are more trusting of other seniors and a senior scammer in Hillsborough County took advantage of that trust. Two seniors attended 60-year-old Richard Incandela’s free presentation at a local church and became the victims of a life insurance a scam. The “agent” offered them a profit and the return of their principal through the sale of life insurance policies in their names that he would then sell as part of a Stranger-Originated Life Insurance (STOLI) transaction. The victims paid $489,426 in premium payments to the agent which he promptly deposited into his personal account for his personal use. The Department of Financial Services’ divisions of Insurance Fraud and Agent and Agency Services determined that Incandela was never licensed in Florida as an insurance agent. He was sentenced to 34 months in prison followed by 25 years probation and ordered to pay full restitution to the victims. Click Here for more details.
Lesson: If it sounds too good to be true, it usually is. Before purchasing insurance, use our Verify Before You Buy page to ensure that the company, broker or agency is licensed to transact business in Florida.
Senior scammer falsifies documents to sell $4.6 million in products
Seniors in Pinellas County trusted an insurance agent to place their savings into financial investments, but sadly those investments were later deemed unsuitable for their needs. The agent induced several senior victims to sign blank documents and then, for personal gain, fraudulently completed the forms to qualify these consumers for unsuitable investments. It is estimated that victims invested over $4.6 million. The now-former insurance agent was convicted in September 2012 on eight counts of grand theft, exploitation, and theft from persons 65 years and older and faces up to 54 years in prison. See Press Release for more details.
Lesson: Never sign incomplete or blank documents and always review a prospectus for the product you are purchasing to ensure that it meets your financial needs.
Division of Consumer Services fights to get nearly $14,000 in senior health claims paid
A senior consumer who lived outside of Florida submitted a claim for benefits under her long-term care policy purchased in Florida. The medical documentation for the claim supported the need for assistance with daily activities; however, the claim was denied. A legal representative for the consumer called Division of Consumer Services for assistance. When the insurance company was contacted on the consumer’s behalf, a thorough review of the claim was conducted. Information was gathered from four additional physicians, which provided evidence that the home health care was needed for the consumer. A claim of $13,882 was paid for these services.
Lesson: When submitting a medical claim, be sure to include all necessary medical documentation from physicians as required by the insurance company.
Consumer receives overdue notices when check is sent to wrong address
A Broward County senior consumer had been in and out of a health care facility due to medical needs. Although most claims for his care had been paid by his medical supplemental policy, he began receiving overdue notices from the facility for one visit. The consumer’s daughter called the Division of Consumer Services for assistance. When a Consumer Helpline specialist called the insurance company on the insured’s behalf, it was discovered that the claim check had been incorrectly sent to the consumer at a previous address so payment was never received by the consumer or the facility. The claim was reprocessed and the health care facility was issued a payment in the amount of $3,255.
Lesson: Be sure to keep your address and other personal information current with your insurance company.
Annuity company attempts to make consumer pay surrender charge during “free-look” period yet $3,683 is refunded
A senior in Collier County decided to surrender an annuity while still in the free-look period during which there is no penalty for cancelling an annuity contract. The company deducted a surrender charge. After repeatedly trying to work with his insurance agent, the policyholder contacted the Division of Consumer Services. An insurance specialist worked on the consumer’s behalf to settle the dispute and had the company issue a refund in the amount of $3,683.
Lesson: Know your rights. Consumers 65 or older can get an unconditional refund of premiums for a fixed annuity, including contract fees or charges, within 21 days of receiving the annuity. An unconditional refund for variable or market value annuity contracts is also required during the first 21 days.
Health claim of $1,132 is paid once company recognizes their lack of communication
After receiving treatment at a Sarasota hospital, a consumer submitted a claim for her hospital stay. When her claim was denied, she was advised that the insurance company no longer had a contract with the hospital and that the hospital’s services were no longer covered by her policy. The consumer stated that if she had been made aware of the change, that she would have selected a different provider. The Division of Consumer Services contacted the insurance company on her behalf, and when the company was not able to locate any communication advising the consumer that the hospital had been removed from its network, the company paid the claim of $1,132.
Lesson: Keep documentation of all correspondence regarding insurance policies.
Sweepstakes scam victim in fake lottery gets help securing accounts
A Palm Beach County consumer was receiving daily calls from a company that called themselves “National Sweepstakes” and claimed that she had won a lottery prize worth over $ 1 million. In order to receive her “winnings,” she was told she needed to send $20,000 to the Internal Revenue Service. Because the entire amount was not readily available in her account and had to be transferred from another source, the “company” said they would accept installment payments. After writing personal checks totaling $9,000, she requested additional money from her annuity to complete the payment. An employee from the annuity company contacted the Division of Consumer Services because she knew something was amiss. Consumer Services immediately contacted the Division of Insurance Fraud who had a detective at the consumer’s home within 30 minutes to explain the scam and assist her in closing her bank account to secure her remaining savings.
Lesson: Know that it is a red flag if you are notified of winning a lottery for which you never submitted an entry, or are asked to pay money to collect any prize. Click here to report fraud.
Change in insurance policy not best fit for senior - $6,500 reimbursed to consumer’s estate
As executor of his father’s estate, the son of a Highlands County consumer needed assistance after realizing that his father was sold the wrong type of health care policy – he needed a Medicare supplemental policy rather than the managed care policy that he was sold. As a result, the consumer’s estate was exposed to thousands of dollars in expenses for medical services that would have been covered if the proper policy was sold. The Division of Consumer Services contacted the insurance company on behalf of the consumer’s son. The division requested that the mistake be corrected and the claims were reprocessed. The estate and medical providers received $6,500 in payments from the insurance company.
Lesson: When changing insurance policies, make sure you understand the coverage before signing anything.
Good Documentation Results in $219,000 in Long-Term Care Benefits
A consumer contacted the Department of Financial Services regarding his father’s long-term care insurance policy after the company denied the claim based on the total number of benefit days having been used. Because the insurance company had been bought by another company, there was a dispute over the contractual provisions that were in place prior to the company’s purchase. The consumer provided a copy of prior correspondence with the original insurance company, which supported his position. With the assistance of a Division of Consumer Services insurance specialist, the long-term care benefits were paid in the amount of $219,000.
Lesson: Understand your policy and maintain all documents.
Reinstatement of Long-Term Care Coverage Yields $71,742
The Department of Financial Services was contacted by a consumer on behalf of her brother regarding his long-term care insurance policy. The brother suffers from cognitive impairment. The insured transferred to another nursing care facility, and the insurance company erroneously thought the consumer had been released to his personal residence and placed the policy back on an active billing status. This was a very important factor to the insured’s claim because the policy carried a “waiver of premium” provision that paid policy premiums only while the insured was confined to a covered facility. Premium notices were sent to the insured’s personal residence but were returned to the insurance company noted as “Not Deliverable as addressed/Unable to forward,” but with a forwarding address. The insurance company failed to note the “new” address prior to issuing a final lapse notice.
Once the company was contacted by a Division of Consumer Services insurance specialist, the policy was reinstated, from the lapsed policy date and the accrued claims in the amount of $71,742 were paid.
Lesson: Long-term care policyholders should always designate a secondary addressee that must be notified if a long-term care policy is in jeopardy of lapsing for non-payment of premium. In addition, the company should always be notified of address changes for the insured and the secondary addressee.
Long-Term Care Benefits Paid in the Amount $18,259
A consumer contacted the Department of Financial Services regarding an unpaid long-term care insurance policy claim on behalf of her aunt. The insured was admitted to an assisted living facility (ALF), and the ALF billed the insurance company on a monthly basis. After a Division of Consumer Services insurance specialist got involved, the insurance company admitted they had failed to process the payment reimbursement within Florida’s 40 day prompt payment guidelines.
With the assistance of a Division of Consumer Services insurance specialist, the long-term care benefits were paid in the amount of $18,259, along with interest in the amount of $73.
Lesson: Know your rights.
Man Posing as Insurance Agent Steals Senior’s Identity, Takes out $5 Million Policy
A man posing as an insurance agent met with a 70-year-old senior at his home to discuss an investment opportunity. During the meeting the senior unwittingly divulged sensitive financial information that the man later used to purchase a $5 million life insurance policy in the victim’s name. An investigation by insurance fraud detectives with the Department of Financial Services later determined that the man forged the senior’s signature on numerous documents and submitted the paperwork to the company using a stolen insurance agent license number. The con man was charged with multiple felony charges.
Lesson: Always make sure you are dealing with a licensed insurance agent and verify before you buy. Guard your personal information carefully and request copies of all documents you sign.
Homeowners’ Insurance Premium Cut in Half
A senior consumer contacted the Department of Financial Services for assistance when her homeowners’ insurance premium skyrocketed. Her insurance company had steadily raised her home’s insured value. Although the insurance company was within their rights to calculate their own replacement value, consumers have options available for coverage. With the assistance of a Division of Consumer Services insurance specialist, the consumer secured proper coverage at a premium of less than half of the rate quoted by the original company.
Lesson: Shop around at every policy renewal period for a lower rate for the same coverage.
Consumer Fights to Get Deceased Husband’s Annuity Payment
When a senior consumer did not receive payment on her husband’s annuity policy six months after his death, she contacted the Department of Financial Services. It was discovered that her husband had been sold this policy during a time when his memory was failing and had signed the documents then made the proper payments. After providing the information requested by the company, the widow still had not received payment even six months after her husband’s death. A Division of Consumer Services insurance specialist reviewed the documentation, contacted the company on her behalf, and got her claim settled and payment of almost $318,000.
Lesson: Make sure loved ones or trusted family members know about important financial decisions.
Delays in Long-Term Care Payments Put Patient in Financial Bind
A senior had been covered by his insurance company at a healthcare facility where he lived. He was assured by his new insurance agent that this coverage would continue under a new policy, but when claims were submitted, they were denied for a three-month period because his inpatient stay began before his policy went into effect. This unexpected delay put the consumer in financial difficulty as a result of paying out of pocket for that time period. The senior contacted the Department of Financial Services and with the assistance of a Division of Consumer Services insurance specialist helped the man recover $5,749 in claim payments.
Lesson: Get all questions answered, preferably in writing, before buying a new policy.