Making Money on Dead Soldiers

[jclalor 12]

The worse form of war profiteering.


http://www.military.com/news/article/congress-probes-prudentials-sgli-payouts.html

[turtlespeed 221]

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The worse form of war profiteering.


http://www.military.com/news/article/congress-probes-prudentials-sgli-payouts.html

Somehow this doesn't surprise me.

I'd like to see what the end result is . . . but I'm not surprised.

I'm not usually into the whole 3-way thing, but you got me a little excited with that. - Skymama
BTR #1 / OTB^5 Official #2 / Hellfish #408 / VSCR #108/Tortuga/Orfun

[JohnRich 4]

If the beneficiaries want the money, they can get it. All of it. Whenever they want it. They don't have to keep it in the interest-bearing account that Prudential sets up. Prudential just needs to make it crystal clear to the survivors that this is so.

[jclalor 12]

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If the beneficiaries want the money, they can get it. All of it. Whenever they want it. They don't have to keep it in the interest-bearing account that Prudential sets up. Prudential just needs to make it crystal clear to the survivors that this is so.

Prudential did not make it "crystal clear." Prudential was clearly trying to make a profit off the grieving relatives, most of whom did not understand that they had a right to a lump sum. Prudential was making 5% while paying only .5% to the survivors. I have a very hard time understand how someone could defend Prudentials actions.

And some people say the insurance industry does not need to be regulated.

[JohnRich 4]

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I have a very hard time understand how someone could defend Prudentials actions.

I have a very hard time seeing how you took my statement as "defending Prudential".

I simply stated what is, and what needs to be.

[mnealtx 0]

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If the beneficiaries want the money, they can get it. All of it. Whenever they want it. They don't have to keep it in the interest-bearing account that Prudential sets up. Prudential just needs to make it crystal clear to the survivors that this is so.

Prudential did not make it "crystal clear."

They certainly made it clear in the packet that I received from them when Shannon died.

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Prudential was clearly trying to make a profit off the grieving relatives, most of whom did not understand that they had a right to a lump sum.

See above.

Mike
I love you, Shannon and Jim.
POPS 9708 , SCR 14706

[wmw999 2,461]

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Prudential did not make it "crystal clear." Prudential was clearly trying to make a profit off the grieving relatives, most of whom did not understand that they had a right to a lump sum. Prudential was making 5% while paying only .5% to the survivors. I have a very hard time understand how someone could defend Prudentials actions.

Prudential is a business. The vast majority of people understand that life insurance can be paid out as a lump sum. The current interest rate on a savings account is about 1%. The quantitative difference is small.

Banks and insurance companies make their money be earning more than they pay. It's what keeps them in business. It's how they pay the administrative accounts of that insurance money.

Were I they, I'd consider making those accounts bear the market average for savings accounts, and make sure the paperwork is clear (which, according to Mike, it is).

Wendy P.

There is nothing more dangerous than breaking a basic safety rule and getting away with it. It removes fear of the consequences and builds false confidence. (tbrown)

[jclalor 12]

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Prudential did not make it "crystal clear." Prudential was clearly trying to make a profit off the grieving relatives, most of whom did not understand that they had a right to a lump sum. Prudential was making 5% while paying only .5% to the survivors. I have a very hard time understand how someone could defend Prudentials actions.

Prudential is a business. The vast majority of people understand that life insurance can be paid out as a lump sum. The current interest rate on a savings account is about 1%. The quantitative difference is small.

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Banks and insurance companies make their money be earning more than they pay. It's what keeps them in business. It's how they pay the administrative accounts of that insurance money.

Were I they, I'd consider making those accounts bear the market average for savings accounts, and make sure the paperwork is clear (which, according to Mike, it is).

From Bloomberg news:

"Under Prudential’s original 1965 contract with the VA and a 2007 revised contract -- both of which were released as part of the FOIA response -- the insurer is required to send lump-sum payouts to survivors requesting them. The contract covers 6 million active service members, their families and veterans.

The checkbooks Prudential sends to survivors are tied to what the insurer calls its Alliance Account. The checkbooks are made up of drafts, or IOUs, and aren’t insured by the Federal Deposit Insurance Corp. Prudential invests the survivors’ money in its general corporate account, where it can earn the insurer as much as eight times as much as it currently pays in interest to beneficiaries."

At the very least should Prudential have not explained that the money held by them was not insured?

What person in their right mind would say " Ya, you hold on to my money in an uninsured account and pay me .005%, instesd of me putting the money in an insured account and making four times more in interest."

I think Mike's experience is not surprising for someone who is more educated and worldly than others, who perhaps are not so savy when it comes to finance.

I still say Prudential profited off people at the lowest point in their life by not being up front and honest. I also don't think this story is over.

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[tkhayes 348]

your rant is out to lunch.....

Bottom line is that benefits and insurance money are being paid out. There are many vehicles by which those payments can be made. They have a 'standard' method unless you request otherwise.

There are options.

It's like saying that my car mechanic is at fault because he does not fully divulge every possibility of what might be wrong with my car and every possible option of how it might be fixed and therefore somehow is negligently culpable in the repairs of my car.

I am completely capable of asking the questions that satisfy my needs. If some people are not, well, too frickin bad -

Prudential is not stealing anyone's money, it is all there. hundreds of civil suits, insurance deals, death benefits, policy payments are handed out daily in this country in exactly the same way and have been for decades. If there was something 'so horribly wrong' with it, then Congress probably would have changed the rules by now.