Outwitting Insurers

TitleOutwitting Insurers
Publication TypeCase Study
Year of Publication2010
Date Published08/2010
PublisherAssociation for Practical and Professional Ethics
Publication Languageeng
AbstractA recent insurance scam involved a lawyer and investors recruiting terminally ill patients, providing them money for the purchase of a variable annuity contracts, used those patients names, and listed themselves as beneficiaries. The terminally ill patients and their families were paid a small amount for their participation, and when the patients died,, the contracts were cased in for the benefit of the investors. The securities industry is often likened to gambling because the industry profits from the investment of money, assumption of risk and attempts by investors the see the future. The entities selling securities set the rules governing the transparency and fairness of the system. In this case, the investors argued that insurance companies draft contracts that govern how the variable annuities will work, and the investors who take advantage of such arrangements did not violate any contractual terms, and were just being business-savvy. However, the insurance companies, while not wanting to limit the customer's freedom to chose who benefits from their annuity, they do want to exclude true strangers from benefiting.
NotesAssociation of Practical and Professional Ethics Regional Cases 2010 http://www.indiana.edu/~appe/ethicsbowl.html
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