Long term care policy cancelled for 80 yo woman

[tessialee]

What is the name of your state? Hawaii

The long term care insurer for my 80 year-old mother-in-law terminated her policy due to a 70 day lapse in payment of her premium. She was never late in her nearly two decades as a policy holder, however, her husband was diagnosed with cancer right at the time this most recent premium was due and passed away within 7 months of the diagnosis. We also believe that she has early signs of Alzheimer's, but has not officially been diagnosed. She attempted to pay the premium about 2.5 months after it was due, but the insurance company cancelled her policy and returned her check. After nearly two decades as a policy holder who consistently paid the premium without once being late, does she have a legal case to have her policy reinstated?

 

[cbg]

Neither her age nor the length of time she's been a policyholder legally obligates them to grant her any leeway in the payment of her premiums. Unless the state of Washington has some VERY unusual laws in this regard, the company has no legal obligation to reinstate her policy.

 

[tessialee]

Thanks for your response, CBG...but the state in which this occurred is in Hawaii, not in Washington. Any difference?

 

[cbg]

I'm not aware of ANY state where they have a legal obligation to reinstate the policy after it has been cancelled for non-payment, regardless of the circumstances. You are free to contact the Hawaii Insurance Commission - I've been out of the insurance industry for about five years so it's possible things may have changed, although I doubt it.

 

[mjn0103]

Negotiating with the insurance company

I have a similar situation. My 72 year old father's life insurance was canceled without our knowledge. His premium is automatically deducted every month from his checking account. Last week, my sister noticed that the deductions have stopped. The last payment was in December 2003. We asked our cousin, who 15 years ago sold my parents their policies, to inquire with her old company since she no longer works for them. They informed her that my father's premium had increased and he owes them about $200. They apparently sent him a letter informing him of the increase but to his old address. My father, who in his old age is not the most organized person, forgot to tell them he had a change of address. Is there something we can do to get him reinstated?? It irritates us that they were collecting the monthly payment up until December of last year from a valid checking account. They could have collected the new monthly premium is what we think they should have done instead of canceling his insurance. We have made an appointment to see a lawyer next week.

 

[Bigfoot]

The rules on long term care policies and life insurance policies are totally different.

With life insurance policies, although the policy was cancelled in Dec. 2003, there still may be enough cash value to keep the benefit in effect. If your father had a modified life insurance policy, it may be that this is the time that the increased premium is required.

And, no, it's doubtful that the insurance company can automatically increase the amount taken from his checking account without his permission. After all, if it was taken and he was unaware, such an increase may cause other checks in his account to bounce.

If you can find an attorney for less than the $200 needed to possibly reinstate his policy, it will be interesting.

 

[mjn0103]

Thank you for your input. There will no problem as far as an attorney is concerned. My husband has worked for the same law firm for 16 years and has made many attorney friends. He is attending law school at the moment himself. My father made no modifications to his existing policy and even has no problems paying the $200 they are saying is owed to them. We really just want him reinstated. He is 72 years old and we doubt he would pass any medical test which will be required of him to get a new policy.