Shernoff Bidart Echeverria Bentley attorneys William Shernoff and Howard Shernoff are actively litigating against the life insurance company Ohio National Life Assurance Company.

The lawsuit, which alleges fraudulent misrepresentation and bad faith conduct on the part of the insurer, was brought on behalf of a policyholder who had arranged to sell his policy legally on the life settlement market. Ohio National sought to thwart the life settlement by preventing assignment of the policy and concealing its anti-assignment provision.

The secondary market for life settlements allows a policyholder to sell a life insurance policy as a transferable property under certain circumstances. A viatical settlement involves a terminally ill policyholder seeking to convert their policy to cash.

At issue in this case is a hidden provision in certain Ohio National policies which would prevent valid life settlements or viatical settlements from going forward. The provision appears to violate California law. According to Howard Shernoff, the California Department of Insurance will likely weigh in on the issue.

Life settlement transactions typically involve independent brokers who serve as intermediaries between investors and policyholders. When the brokers do not comply with California life settlement laws, they too may be liable for their conduct. In this case, the broker is also a defendant.

If you have had a similar experience with life settlement issues or would like further information about the case, contact us.

Bang Lin, a 37-year-old Irvine business owner, died in 2006 of stomach cancer, leaving a wife and two school-age children. Had Lin died three weeks later, the two-year "contestibility" period would have been over. His family would have collected $1 million. Instead, Metropolitan Life, the nation's largest life insurance company with $8.6 billion in annual sales, rescinded the policy, alleging misrepresentation. The issue was not the cancer; that had been diagnosed 15 months after he took out the policy. Rather, the company alleged Lin had failed to mention in his application that he had been successfully treated years before for hepatitis B, a condition unrelated to his death. Jean Lin sued. She said the agent had filled out the application, not her husband, and that she never asked about hepatitis. In any case, Jean Lin said the information was in her husband's medical records and the firm could easily have ordered a hepatitis B test. Read the rest of this entry »

Rescission is a factor not just in health policies, but in life coverage too. As if the insurance industry didn’t have enough bad press, it’s just gotten more. An article in the Sunday Los Angeles Timesis taking a look at the practice of rescission—canceling insurance coverage after a policy has been issued—as it’s playing out in the cases of some beneficiaries who were denied benefits when the policy owners died... William Shernoff, an attorney acting on behalf of one of the beneficiaries denied benefits by another company, said in the report, "You don't wait until a guy dies to determine insurability. That's not fair." Read the rest of this entry »

LOS ANGELES April 19 (BestWire) — An attorney whose firm recently filed a proposed class-action lawsuit against AmerUs Group Co. and its affiliates in California federal court, charging deceptive sales of deferred annuities to senior citizens, said his firm would continue to sue more life insurers that "take advantage" of the elderly by selling these products that aren't suitable for their financial needs. Read the rest of this entry »

Carmen Migliaccio said her husband thought he was ensuring their financial well-being when he shifted the bulk of their savings into a Midland National Life Insurance Co. annuity. The problem, she said, became apparent only after he died in May: The annuity wasn't scheduled to begin making payments until Jan. 27, 2045 — when John G. Migliaccio would have been 115 years old. Read the rest of this entry »