Litigation

Does the submission of huge volume of rated age requests to life insurance companies, with little to no expectation of submitting business to those companies, all the while taking a big fee for acting as the middleman, constitute theft of services?

A good rated age helps drive cost savings on Medicare Set Aside arrangements.

The explosion of the Medicare Set aside industry subset has driven many insurers to the brink of capacity on rated age delivery, drastically affecting turnaround times on both workers compensation cases and  liability cases (from a few hours to a few days in some cases!). In a significant number of cases the life insurers have not seen any business in return. Let's call it "unrequited love".

Insurers have significant overhead costs associated with the medical underwriting and actuarial interplay that is required to deliver rated ages. The costs associated with potential heavy volumes of unrequited rated ages requests have got to be a consideration for insurers evaluating the profitability of entering the structured settlement annuity marketplace.  While competition for business is a given on both the liability level and the workers comp level, there must be a reasonable chance to earn the business.

Allstate Life Insurance Company at first stopped medical underwriting on workers comp cases and subsequently stopped doing rated ages at all. Other companies have analyzed broker rated age requests by compiling good tracking data against business submitted and have actually begun a cull of the culprit brokers. 

Without a rated age the broker will find difficulty to compete in cases where there is a life contingency. This includes  workers compensation MSAs. If the offending broker passes the baton on to another broker and that broker also "unrequited love" develops with the insurer, the problem continues to snowball.

Several years ago this author was approached by a well known firm in the workers comp industry offering to pay the author a significant retainer to obtain rated ages with an expected weekly volume in the hundreds.  This author turned the offer down.  Other broker(s) apparently have not. At the time, which coincided with Allstate's withdrawal from medical underwriting of annuities, this author expressed concerns about the industry capacity to handle the volume of requests as well as (perhaps more significantly) the possibility that accepting such money to essentially tie up the insurer with no assurance of business might eventually be construed as a "theft of services".  

Being able to receive rated ages is a privilege earned by licensed and appointed agents and brokers, It is not a right.  Brokers, agents and those who assign large volumes of rated age request without being a able to perform in the other direction

This author encourages the industry to come up with a long range solution that restores the efficiency of rated age delivery as a priority and addresses the MSA rated age.

Previous posts about Rated Age Abuse

More Information on Rated Ages

More Information About Medicare Set Aside

A song seems appropriate and relevant: (to the tune of the to Bonnie Raitt ballad  "I Can't Make You Love Me)

"We Can't Make You Love Us" -Ode of Medical Underwriter

Turn Down the lights, turn down the "bread"

Rated age abusers inside our heads

Lay down with us, tell us no lies

Just hold us close, please patronize, PLEASE PATRONIZE us

'Cause we can't make you love us if you won't...

You submit all those meds, business to follow you don't

Here in our cubes, in these final hours

We lay down our hearts and you abuse ours.

But you won't, no you won't

"Cause we can't make you love us if you won't

We'll cut you off, then you won't see

Rated ages no more, then we'll be free

Morning will come and we'll do what's right

Serve the greater good, a more worthy fight

A more worthy fight

Cause we can't make you love us if you won't...

You submit all those meds, business to follow  you don't