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NSW Former Company has a Life Insurance Policy for me

Discussion in 'Insurance Law Forum' started by Mike siegle, 18 February 2015.

  1. Mike siegle

    Mike siegle Member

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    I sold my share in my company after 15 years of blood sweat and tears. Now I'm retired at 70 years old. I just found out that the company is still paying a life insurance policy on my life! Is this legal and how can I cancel it or even sue the company? I left the company 5 years ago.
    Very upset.
     
  2. Sarah J

    Sarah J Well-Known Member

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    Hi Mike,

    Pardon my ignorance, but may I ask how is this negatively impacting you? Are you financially out-of-pocket because of this or do you personally take offence to this?

    My understanding is that your former company is paying insurance premium for your life insurance coverage as part of a package. Is this understanding incorrect? Perhaps they have simply forgotten to cancel this.

    Have you tried speaking with the company directly, asking them to cancel the policy or for you to take over payments?
     
  3. Mike siegle

    Mike siegle Member

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    Thank you for your reply....I do take offence to this and would like to know can they continue paying for the policy without my approval?

    I really don't want to speak to the new owners until I know where I stand from a legal perspective .
    They have not forgotten to cancel the policy they just want to cash in...I'm in ill health
    Thank you
     
  4. Sarah J

    Sarah J Well-Known Member

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    Hi Mike,

    There are three parties to a life insurance plan:
    • The insured (you)
    • The person paying the premiums (company)
    • The beneficiaries who will benefit should something happen to you
    Whilst the second and third person can be the same, this is not always the case. In fact, when companies pay for their employee's life insurance, the beneficiary is usually the employee's family members or whomever is nominated by the employee. The company usually enters into this (i.e. buying insurance as part of a package rather than individually for each employee) because it is easier and cheaper for the company (as well as tax incentives). But the company generally does not become the beneficiary of the insurance policy.

    Hence, you need to figure out who is the beneficiary of the policy. To do this, you can contact the insurer and ask for a copy of the insurance policy agreement. You can also request a copy of your own agreement (which the company is paying for). From those agreements, you can figure out (i) who the beneficiary is and (ii) exactly what benefits the company would be getting should you pass.

    Figure out what is going on first before taking offence to something that might actually benefit your family.

    If you still want the plan cancelled, the best place to start would be talking with the insurer and requesting for the plan to be cancelled.
     
    Ivy likes this.

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