Wednesday, September 15, 2010

Prudential Financial Inc., it appears, needs a talking to

And the VA people who allowed this to get through should be fired. At least.
The U.S. Department of Veterans Affairs failed to inform 6 million soldiers and their families of an agreement enabling Prudential Financial Inc. to withhold lump-sum payments of life insurance benefits for survivors of fallen service members, according to records made public through a Freedom of Information request.

Since 1999, Prudential has used so-called retained-asset accounts, which allow the company to withhold lump-sum payments due to survivors and earn investment income on the money for itself

Hey, Prudential, I hope we manage to make EVERYBODY aware of what you're doing.

1 comment:

Sigivald said...

I call bullshit.

They're not "withholding" lump-sum payments. They're offering them, and people aren't taking the option, but keeping the retained asset account open - and earning more interest on it than I do on my checking account.

(Sure, not as much as a really good dedicated savings account, but an insurer isn't a bank.)

Now that I'm "aware" that Prudential is treating military families just like everyone else, using the same sort of account that is an industry standard, my opinion of them is... completely unchanged.

The angry woman in the article Sean links to... chose to let the money sit because she viewed it as a "payoff" for her son's death. (Which, when you think about it, is an odd thing to be angry about, since it was a life insurance policy. That's kinda what one IS, by definition.

And then she didn't realise that just because something looks liek a check, they you can't take it to a store and pass it?

She might have bothered to read the packet they sent, or just cashed it out immediately, but no... somehow Prudential is the bad guy for giving her a minimum of .5% interest on it (or as much as 2%, according to their guy, depending on the account) - which, again, is over three times what my checking account earns.

As I said over at Sean's blog, I'm not sure what I'm supposed to be all angry and outraged about... I'm not seeing any malfeasance, just a reporter trying to drum up a controversy.