411 Garrard Street Covington, KY 41011 Phone: 859.291.9000
Life Insurance Litigation Attorneys
Championing you when your insurance company violates your trust
You buy insurance products to protect yourself, your family, your property, and your future. Unfortunately, not every insurance company delivers on its promises. Sometimes, they handle claims incorrectly or unfairly. Sometimes they misrepresent their products.
We understand that businesses and individuals buy insurance to protect against risks and that often insurers do not provide the protection that was bought and paid for by the policyholder. We know that many insurers believe that their obligation is to make profits for their shareholders rather than to be fair with their policyholders.
Our experience has taught us the tricks that are used in the insurance industry. We have learned how many life insurers “over-project” the earnings that will be generated by the cash values in the policies and annuities they sell. We have also learned how property and casualty insurers use computer programs to underpay injury claims and property damage claims. We have used our experience in insurance litigation to recover on countless claims for our business and individual clients, both in individual lawsuits and class action law suits.
We often serve as co-counsel to referring attorneys in insurance matters and we have litigated insurance cases with co-counsel throughout the country.
Parry, Deering, Futscher & Sparks, PSC is a nationwide firm that has been on the cutting edge of litigation involving insurance company wrongdoing as it has evolved over the last 30 years. Ours is one of the few firms in the country to concentrate on this narrow area of the law. Our very specific experience in this arena has permitted us to amass vast knowledge in insurance litigation and to recover on countless claims for our clients as individuals and through class action lawsuits.
We represent clients in litigation related to:
What should I know about class action lawsuits?
Trust us to help
If you or a loved one has been the victim of a deceptive scheme by a company, do not hesitate to contact Parry, Deering, Futscher & Sparks, PSC online or in Kentucky at (859)291-9000. Our nationwide consumer lawyers also serve as valuable co-counsel to referring attorneys.
Empowering people
Annuities
Parry Deering Futscher & Sparks, PSC represents purchasers of fixed and variable annuity products that were improperly marketed.
Three typical practices that annuity companies use to misrepresent their products—
- Promise teaser rates—high first-year interest rate increases or bonuses. Sometimes they are not paid. Many times buyers are led to believe the teaser rate continues throughout the duration of the annuity when, in fact, it is only paid in the first year.
- Claim that interest rates are based on market conditions or other language indicating that the annuity is tied to the performance of the stock market. The company then actually pays interest as it deems fit, regardless of the performance of the stock market.
- Assert that variable annuity products are suitable to fund a 401(k) plan because they are tied to the stock market and grow tax-deferred. Variable annuities actually do both. What the insurance company does not disclose is that, by law, a 401(k) investment grows tax deferred regardless of whether it is an annuity or a mutual fund. Insurers also fail to mention that a variable annuity comes loaded with mortality and expense charges that actually diminish the value of the investment.
Auto Insurance Litigation
The firm has experience bringing claims on behalf of policy owners for violation of the terms of their insurance policies or for violation of state and federal insurance laws and regulations. We have pursued claims on behalf of policyholders arising from the use of imitation parts and the refusal to pay to return a vehicle to its pre-loss condition
Imitation parts
Imitation parts are parts not manufactured by the original equipment manufacturer (OEM parts) and usually are of substantially inferior quality with respect to fit, corrosion protection, and general construction. Imitation parts are not covered by factory transferable warranties on replacement parts. Installation of such parts voids the manufacturer’s warranty not only on the replacement part, but also on adjacent parts and systems. In fact, some imitation parts may compromise the supplemental restraint systems and other safety features on a vehicle.
Some auto insurance companies only pay for imitation parts or only write an estimate based on the use of imitation parts. This saves the insurance company money. But for the policyholder, it compromises the quality of the repairs and possibly the vehicle’s safety.
A company’s use of imitation parts is a violation of its obligation to pay the cost of repairing a damaged vehicle to its pre-loss condition.
Refusal to pay for necessary repair procedures
Likewise, many auto insurance companies write repair estimates that systematically omit materials, procedures, and/or parts that are necessary to properly repair the vehicles. They then send their policyholders to captive body shops that are not permitted to question the repair estimate written by the insurance company.
Cancer Insurance
Parry Deering Futscher & Sparks, PSC represents policy owners in litigation against major life insurance companies who refuse to pay benefits owed under cancer insurance policies.
Cancer insurance is a supplemental insurance policy that covers you only if you are diagnosed with cancer. There are many different types of cancer insurance policies providing many different benefits. Some policies pay a flat dollar amount after you are diagnosed with cancer, some pay only for care received in a hospital, and most policies have fixed dollar limits. For example, a policy might pay only up to $1,500 for surgery costs or $1,000 for radiation therapy, or it may have fixed payments such as $50 or $100 for each day in the hospital. Others limit total benefits to a fixed amount such as $5,000 or $10,000.
Some policies pay unlimited benefits for chemotherapy or radiation. These policies may promise to pay for any “actual charges” you incur for chemotherapy or radiation. Initially, insurance companies interpreted “actual charges” to be the amount that your doctor or hospital billed you, regardless of whether private insurance, Medicare, or Medicaid, had an agreement with the doctor or hospital to pay a lesser amount. In recent years, insurance companies have changed their interpretation of “actual charges.” Many companies now interpret “actual charges” to mean the amount that your doctor or hospital is pad by private insurance, Medicare, or Medicaid. These insurance companies have changed their interpretation even though they may have been paying claims the other way for decades. This change in interpretation is motivated solely by the insurance company’s desire to increase its profits.
Parry Deering Futscher & Sparks, PSC, represents policy owners who are victims of this unfair practice.
Credit Life and Disability Insurance Litigation
Parry Deering Futscher & Sparks, PSC represents policy owners in litigation against major life insurance companies and consumer lenders who market credit life and credit disability insurance policies to buyers of large items, such as cars, furniture, or appliances.
In most cases our firm pursues, policy owners allege that the amount of insurance they were sold exceeded that needed to protect the debt that would remain in the event of death or disability. In other instances, credit life and disability insurers charge rates that exceed those permitted by state statutes or regulations.
Debt Settlement Litigation
PDFS investigates deceptive practices by companies who promise to negotiate with and pay your creditors. The deal debt settlement companies propose sounds unbeatable.
For an up-front fee (usually quite large):
- You can cease any payments to your creditors
- Make affordable payments to them
- The companies promise to negotiate a settlement with your creditors
- They make payments directly to creditors for you
- You will no longer have to deal with your creditors
- Your creditors will quit calling you
- Your creditors will be paid off
In many cases, the reality is that creditors do not stop, no settlements have been negotiated, and thousands of dollars have been paid in fees to the debt settlement company over the course of many months. The fee charged by these companies often exceed the fees that are permitted by state law-many states cap fees for this service at or below $100 per year. Changing fees in excess of this amount is a crime in many states.
Our firm is currently involved in debt solution litigation with these companies:
- Global Client Solutions
- GHS Debt Solutions
- Rocky Mountain Bank & Trust
Disability Insurance Litigation
Our attorneys represent policy owners in litigation against major disability insurers. Disability insurance is supposed to provide income payments to the insured when income is interrupted or terminated because of illness, sickness, or accident.
Parry, Deering, Futscher & Sparks, PSC has seen the disability insurance picture change substantially in the last three decades. Gone are the days when disability insurance carriers marketed policies with extensive coverage and a lot of bells and whistles. Now, in an effort to cut costs, disability insurance policies are bare bones and extremely restrictive.
However, disability insurance companies still hemorrhage cash because of the number of claims they must pay. So, many have turned to improper and illegal practices to cut disability payments to policy owners.
Our firm has pursued countless cases of bad faith by disability insurance companies. Violations often include:
- Giving greater weight to the interest of the insurance company than to the interest of the insured
- Refusing to pay claims without conducting a reasonable investigation
- Not attempting in good faith to effectuate prompt, fair, and equitable settlement when the insurance company’s liability has become reasonably clear
- Compelling insureds to sue to recover on their claim by offering substantially less than the amounts ultimately recovered through a lawsuit
- Attempting to settle a claim for less than a reasonable person would have believed he was entitled to based on written or printed advertising material accompanying the insurance application
Life Insurance Litigation
Parry Deering Futscher & Sparks, PSC regularly represents policy owners in litigation against major life insurance companies arising out of unfair and deceptive sales practices, including:
- Sale of vanishing premium life insurance
- Replacement, or churning, of existing life insurance with a new policy
- Sale of life insurance as a savings, investment, or retirement vehicle
The vanishing premium sales scheme
A vanishing premium policy promises that only one or a limited number of premiums are required for the policy to become paid-up.
In a vanishing premium sales scheme the insurance company presents the prospective purchaser with a uniform policy illustration which shows premium payments reducing to zero (that is, vanishing) after a certain number of years.
The companies do not tell the policy owner:
- There is a 100% chance that the detailed, uniform policy illustration is inaccurate after 5 years
- They used overly optimistic assumptions about interest rates, expenses, and mortality experience
- When interest rates fall, expenses increase, or mortality worsens, and the premium does not vanish
- Policy owners must pay premiums that they never expected and may not be able to afford
Often policy owners are forced to abandon the policy. To learn more read our life insurance law page.
Improper replacement of life insurance policies
Replacing one life insurance policy with another is almost never in the best interest of the policy owner. Replacement benefits the life insurance company and the agent by generating new policy fees, charges, and commissions. Usually, an insurer or agent encourages a policy owner to either surrender or borrow from an existing life insurance policy to finance the purchase of another policy. Many states prohibit such conduct.
Replacement is detrimental to the policy owner for a number of reasons. The policy owner—
- Is older when the new policy is issued, resulting in higher premiums
- Usually incurs surrender charges on the money received from the existing policy, reducing the amount placed into the new policy
- Incurs interest charges when borrowing from the existing policy
- Loses valuable contractual rights such as incontestability provisions, suicide clauses, and fixed-loan interest rates when surrendering the existing policy
As health insurance attorneys, we have seen a number of companies encourage and orchestrate massive updating campaigns by their sales force. These programs are usually nothing more than organized replacement or churning efforts.
The sale of life insurance as a savings, investment, or retirement vehicle
If you tell an insurance agent or company that you do not need life insurance, they usually try to sell you a retirement investment instead. Of course, in the end, it is still life insurance, and it is almost never a good vehicle for savings or retirement.
Some companies try to conceal that you are buying life insurance. Others disclose that life insurance is being sold but either downplay the life insurance and give undue emphasis to the savings or investment features, or represent that the life insurance is incidental to or comes with the investment. Many of these companies deceptively call your premium payments deposits and your policy values investment accounts.
Life insurance is not an investment. The insurance, expense, administrative, and commission charges built into the policy result in a diminution of your payments or deposits into the policy. These charges are in addition to charges normally associated with investment accounts.
The "checkbook instead of a check scheme"
For over a century, life insurers paid death benefits by simply writing a check for the amount that is due and sending the check to the beneficiary. Once the check was cashed or deposited, the money was gone from the insurance company forever. In the 1980s, an executive at MetLife decided that it could profit if it could retain and invest the death benefit as long as possible. Thus, the "checkbook instead of a check" scheme was devised.
Now, almost every life insurer refuses to send a check to the beneficiary when it determines that a death benefit is due and payable. Instead, the insurer retains and invests the death benefit in its general investment account and sends a checkbook to the beneficiary. Insurers created the false impression that the money has been placed in a money market account that earns a competitive rate of interest. The insurers do not disclose:
- The fact that the death benefit is not actually in a money market account;
- Where the death benefit is actually invested;
- The types of investments that are purchased with the death beneficiary's money;
- The amount of profit that the insurer is making by investing the death beneficiary's money.
We are currently litigating cases against some of the nation's largest life insurance companies in an effort to get them to account for the money that they are making when they invest funds that rightfully belong to death beneficiaries.
Fixed premium life insurance
A number of a major life insurance companies have recently begun to sell what they call "financed premium" life insurance policies. Their agents sell these policies by representing that the policy owner can borrow 100% of the premium payments that are due on the policy and that when death occurs, there will be a death benefit paid that will be sufficient to pay off the premium loans and provide a substantial additional sum for the family of the deceased.
Many of these products do not perform as promised because the financing disappears the loan interest rate rises, of the earnings on the policy's cash value is insufficient, or some combination of the above. When these policies do not perform as the insurance companies represent they will perform, the policyholder is frequently left with a huge debt and no life insurance.
Phone: 859.291.9000 Toll 
