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A Good Story (sadly not health insurance but life insurance)

Every day it seems the health insurance companies are making mistakes, denying claims, rescinding coverage and all of the rest. They pay claims grudgingly (if at all) and, according to many media sources, try to get out of paying as many as they can.

I asked my doctor during a recent checkup if it was true what 'Dr. Dean' says about doctor spending 1/2 their time working on patient files. He told me "not anymore", most of his time is spent fighting with health insurance companies. Sigh!

So, I wanted to share the following true story. It is not a health insurance story, but a life insurance story. I dream of the day even one California health insurance company could tell a story like this. I doubt any of them could..........

In 1999 I attended the annual agents meeting of Northwestern Mutual Life in Milwaukee, WI. This is an annual "must" for NML agents and it is both educational and a lot of fun.

Then-CEO Jim Ericson opened the first morning session with the following story (and yes it has stuck with me 11 years now).

In early 1999 an agent's client applied for a life insurance policy for his young teenage daughter. Something for the future I guess. Well, for some reason the case got hung up in underwriting and they didn't get what they wanted with medical records and never completed the underwriting.

The client called his agent in late spring to inquire as to whether or not the life insurance policy on his daughter was ever issued. The agent checked and told his client that it had not completed underwriting and was never issued.

The client told his agent, "well, I guess it doesn't matter anyway, my daughter has passed away".

The agent took the case to NML where it ended up on the desk of Mr. Ericson. He directed his underwriting department to complete the underwriting on the young girl's application and report to him whether or not the policy would have been issued at that time (given the missing information).

Underwriting reviewed the application, received the missing information and reported to Mr. Ericson that, indeed, a policy would have been issued at that time had they received all of the information they required.

Mr. Ericson directed Northwestern Mutual Life to issue the life insurance policy posthumously on the young girl, waive premium payments, and immediately pay the benefit to the beneficiary.

Northwestern Mutual did not have to do this. They could have simply said that the policy was never issued due to missing medical information. But they didn't.

This story never made the press, was never published in any newspaper. Quietly, as their nickname "The Quiet Company" suggests, they made a decision to do the right thing, or more to the point, to do the honorable thing.

It's about honor and being honorable. That's what it really means to be an insurance company!


  1. Enjoy reading your blog I'm a fan of yours and the Vitality Blog on California Health Insurance


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