EDITORIAL: Insurers need to pay up

May 27--What is it with Florida and insurance companies?

After multiple hurricanes battered the state and caused billions of dollars in damage more than a decade ago, property insurers fled Florida, leaving a majority of homeowners, especially new homeowners, with no coverage option but a taxpayer-backed entity created by the Legislature. Their reason: to not lose money.

This month, state insurance regulators announced that 15 health insurers have petitioned for an average rate hike of 17.7 percent on plans offered through the Affordable Care Act. That comes after the state endorsed a 9.6 percent rate increase last year. Their reason: to not lose money.

Now, four life insurance companies -- United Insurance Co. of America, Reliable Life Insurance Co., Mutual Savings Life Insurance Co. and Reserve National Insurance Co. -- are suing Chief Financial Officer Jeff Atwater's office over a new state law that requires them to search federal death records back to 1992, and annually going forward, to determine if any policyholders had died and if so, to locate their beneficiaries to pay the claim. Their reason: to not lose money.

In April, Atwater and former state insurance commissioner Kevin McCarty appeared on the TV news magazine "60 Minutes" to explain how companies had not paid death benefits, even though they knew a policyholder had died and the policy was in good standing. Insurers cancelled policies -- and, oh yes, kept the money -- when beneficiaries did not file claims, often because they didn't know they existed. It was a matter of what they don't know we won't tell them.

Atwater told "60 Minutes" that audits uncovered hundreds of thousands of policies dating to the 1960s, worth billions, yes, that's billions of dollars, that were not paid to the survivors of deceased Floridians. McCarty called it "unconscionable, indefensible behavior." "It's tantamount to stealing," McCarty said. We could not agree more.

High-profile Tallahassee lawyer Barry Richard, representing the insurers in the lawsuit, counters that the new law is unfair because the legal burden has always been on beneficiaries. To go back a quarter-century would be costly and unfair, he told WFSU.

Sorry, but people pay insurers so they can find help at the most miserable times of their lives. By and large most insurers do the right thing. Yet on this issue, these companies have knowingly profited for years off unsuspecting folks, and now they're complaining that they don't want to take the time and expense to give them their due.

We applaud Atwater and McCarty (although he no longer is with the state) for leading on this fundamental issue of right vs. wrong. People who buy insurance so they can leave their spouses and families something after they are gone should not be stiffed by greedy insurance companies because those companies do not want to be inconvenienced with having to track beneficiaries down. They had no problem collecting the premiums all those many years; they should have no problem paying up. That said, we borrow from McCarty: unconscionable and indefensible about sums it up.

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