Attorney Mark Scherzer was recently consulted for and cited in an article posted May 26, 2023, on the Life Annuity Specialist website. The article, “Insurers Get Swept Up in Complaints Over Missed Policy Conversions,” discusses a recurrent problem with employees who leave their companies – typically due to illness or disability – and miss the opportunity to convert or otherwise continue their group life insurance coverage. As Mr. Scherzer points out, there is a confusing array of rules that govern conversion (replacement of group coverage with an individual insurance policy) and continuation (ongoing enrollment in the group coverage through mechanisms such as a disability premium waiver benefit), so that the average employee may be uncertain as to what steps must be taken to keep coverage in force when they commence a leave of absence and/or are terminated from employment.
Failure by an employer to give notice of conversion rights and a resulting lapse in an employee’s coverage may lead to disputes between a deceased employee’s family, the employer, and the group life insurance carrier, as to who is responsible for the lapse in coverage, and whether there is a remedy for the lapse.
The full article can be read on the Life Annuity Specialist website (available to members).
There is a discussion of life insurance conversion and disability waiver of premium continuation benefits on our website.
