Personal life insurance, taken out by employer?

Question

Has anyone ever heard of such a thing? My late husband worked for a company, for 7 years before he was killed in an auto accident. He had no life insurance, privatly, and no policy at work that I was aware of. However it has come to my attention that his employeer very likely took out a policy on him. meaning if he died they got the money. does anyone know how I could optain this information , with out going to his last employyer. I do know that anyone can take out life insurance on anyone they choose to. from what I am hearing from past employees it is a one million dollar policy.

Answer 1

miga eu sou bazileira eu intendo nada do q escreves

mil bjs

okis

Answer 2

You can't take a policy out on anyone.  You must have an insurable interest.  The company had a financial stake in his survival and would loose a valuable employee if he passed away suddenly.

This may have been done on one of the old EOLI (employer owned life insurance) deals without the employees consent.  These have already been challenged, and the result is that most new EOLI must be fully disclosed.  Disclosure is still not required for certain contractual relationships.  

If the company was the owner, payor, and beneficiary, it is very unlikely that you would receive anything from the policy as you were not party to it (if that's what you're asking).  Life insurance is a private transaction.

I'm sorry for the loss of your husband, and I hope your friends and family take the opportunity to review their coverages.

edit: The company's loss is the same whether he died on the job or off the job.  EOLI polices that were issued on a group basis, without the employee's knowledge, were not eligible for the employee to purchase extra - they didn't know about it.  He may have some coverage through his group health plan, and of course check with the department of social services about a survivers benefit.  Feel free to contact an attorney for specific advice (it sounds like you're leaning that way), but I personally think this is probably a defensible position.

Answer 3

My condolances to you...

If the employer offered a life insurance policy for employees and he bought one (paid the premiums out of his paycheck), the insurance company should have sent him something stating the benefits and limitations. It may be in his papers. You might also be able to get the info from the past employees that you have spoken with. In my experience, these employer based policies are usually small ($5,000 or so) unless the employee opts for additional coverage (at a higher premium, of course.)

However, there really is no need to NOT contact the employer-THEY are not beneficiaries-they did not get the money from the policy and have a fiduciary duty to give you the info.

Answer 4

Many businesses have what are called key employees and the business needs to be protected against the loss of the employee.

It would not matter if he was on or off the job.

You should check with the former employer it is very common for a group to provide at least a small life policy to everyone on the health insurance plan.

Answer 5

Nope, they can't take out a policy on him without his signature.    And if he signed off on it, it's a private transaction, and you won't be able to access this information.

I'm guessing these people have NO idea what they are talking about.   Unless your husband was upper management, and irreplacable, they did NOT take out a policy on him.  

Want proof?  Assuming you are executor of his estate, you can pay $75 to these guys, fax over proof that you're executor, and they'll check which companies received an APPLICATION on your husband's life in the past 10 years.  http://www.mib.com/html/lost-life-insura...  

But I think you're throwing your money away.

Besides that search, that you pay for, and you HAVE to be executor of his estate, there is no database you can search - it's PRIVATE INFORMATION.  But really, it's not there.  These people have you chasing your tail in the wind, I'm not sure why.

**Once again, they can't take it out on him without his permission.  Period.  They can't.  Whether he's on or off the clock doesn't matter - but if he is "clocking in", he's not a key man, for sure.  Someone is feeding you a load of bull.   But if he DID sign off on it, you can't get the money, period.  You're not the beneficiary.  Period.  All you can do is press criminal charges against the business, and make them return the money to the insurance company - IF they forged his signature.  This chase is NOT going to put any money in your pocket.

It really burns my b*tt when people feed you false hope like this.  Tell me, if the policy DOESN'T exist, there's no proof it's not there!!   If it does, the MIB search will turn it up.  BUT, like I said, you're throwing your money away - it's going to come up with no results.**

**hah, whoever is promising you that this policy exists, have them pay you $100 for the search, and promise them $1,000 if it comes back with anyhting.  They won't cough up, I promise.**

Answer 6

Employers can, with the consent of the employee, purchase insurance on the individual.  It is typically called Key Man insurance.  In the circumstances of how he passed away, it would depend upon the contract (policy) in regards to terms and claims of whether or not that death benefit got paid.  If there also was fraudulent claims made (buddy clocked him in) the insurance would make an investigation if they became aware of the situation.  

Another option for employer purchased life insurance is called janitorial insurance.  It's when the employee purchases life insurance without the consent of employees for monetary gains.  For example.  

As explained in Section 50.7 and Section 19.1, Subdivision G, the tax law as it existed before 1996 provided too great a temptation for some very large corporations to resist abusing COLI by procuring large-scale leveraged COLI policies. These were known as "janitor insurance", because they involved taking out life policies on very large numbers of employees (in some instances thousands), most of whom were obviously not key employees, to gain a deduction of the interest paid on policy loans used to pay the premiums. In 1996 that deduction was revoked. Thereafter, the IRS pursued several corporations on the ground that their pre-1996 COLI schemes were shams, and succeeded in most cases in getting courts to hold that the deductions must be returned. See Section 19.1, Subdivision G for detailed accounts of this story.

Answer 7

It was more than likely a key man policy.  Assuming that was the case, it does not matter if he was clocked in or not.  He is as much of a loss to you as to the business.  Especially if he was key to the business operations.

The policy is not meant for financial gain, but to cover the loss of income they receive due to his loss and cover the costs of finding and training his replacement.

My condolences for your loss.

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In reference to the amount, it is relative.  For you, it may be excessive.  To the company, it may not.  That could be equal to potential loss of income because of his death.