Life Insurance Policies: How Payouts Work

Life insurance is a popular part of long-term financial planning. But to effectively incorporate this tool into your portfolio, you must understand how and when life insurance payouts are delivered to beneficiaries. This includes understanding how quickly benefits will be paid and designing the policy with the payout option that works best with your estate planning.

When Benefits Are Paid

Typically life insurance benefits are paid when the insured has died, and the beneficiaries file a death claim with the insurance company, submitting a certified copy of the death certificate. Many states allow insurers 30 days to review the claim. Then they can pay it, deny it or ask for additional information.


Most insurance companies pay within 30 to 60 days of the date of the claim, says Chris Huntley, an insurance agent and director of marketing at JRC Insurance Group in San Diego, Calif.

“There is no set time frame," adds Ted Bernstein, CEO, Life Insurance Concepts, Inc., a life insurance consulting and auditing firm in Boca Raton, Fla. "But insurance companies are motivated to pay as soon as possible after receiving bona fide proof of death, to avoid steep interest charges for delaying payment of claims."

What Could Delay Payouts

Several situations can result in later payment of a claim. If the insured died within the first two years after the policy was issued, beneficiaries could face delays of six to 12 months. The reason: the two-year contestability clause, says Huntley. “Most policies contain this clause, which allows the carrier to investigate the original application to ensure fraud was not committed. As long as the insurance company cannot prove the insured lied on the application, the benefit will normally be paid,” says Huntley. Most policies also contain a suicide clause that allows the company to deny benefits if the insured commits suicide during the first two years of the policy.

Another scenario that could delay payment, not surprisingly, is when “homicide” is listed as the cause of death on the death certificate. In this case, a claims representative may communicate with the detective assigned to the case to rule out the beneficiary as a suspect. “If the beneficiary is a suspect, the benefit will be held until charges are dropped or he/she is acquitted of the crime,” says Huntley.

New Choices in Payout Options

Since the inception of the industry more than 200 years ago, the payout to the beneficiary was always a lump-sum payment of the proceeds. The default payout option of most policies remains a lump sum, says Richard Reich, President, Intramark Insurance Services, Inc.

Installments and Annuities

Modern life insurance policies have seen a monumental improvement in how payouts can be delivered to the policy’s beneficiaries, says Bernstein. These included an installment-payout option, or an annuity option, in which the proceeds and accumulated interest are paid out regularly over the life of the beneficiary.

These choices give the policy owner the opportunity to select a pre-determined, guaranteed income stream of between 5 and 40 years. “For income-protection life insurance, most life insurance buyers prefer the installment option to guarantee the proceeds will last for the necessary number of years,” says Bernstein.

Pre-death Benefits

Traditionally, life insurance policies only pay out at the time of the policy holder’s death. “However, some life insurance companies have designed policies that allow their policyholders to draw against the face value of the policy in the event of a terminal, chronic or critical illness. These policies enable the policyholder to be the beneficiary of their own life insurance policy,” says Bernstein.

The term for this is accelerated death benefit. (For related insight, take a closer look at accelerated benefit riders.) Talk with your insurance agent about whether this option makes sense for you.

Filing a Claim

The life insurance company should be contacted as soon as possible following the death of the insured to begin the claims process. The claims representative will request paperwork to process the claim.

The beneficiary of the insurance policy must obtain a certified copy of the death certificate. This can usually be obtained through the county in which the named insured dies. If the insured died in a hospital or nursing home, the institution may have completed the certificate, says Luke Brown, a retired insurance lawyer in Tallahassee, Fla., who operates YourProblemSolvers to help consumers with insurance, healthcare and consumer issues.

“The death certificate has to be submitted to the insurance company address listed in the policy along with a statement of claim, which is sometimes called a "request for benefits," signed by the beneficiary,” says Brown.

Policies owned by revocable or irrevocable trusts must ensure that the insurance company has a copy of the trust document identifying the owner and the beneficiary, adds Bernstein.

The Bottom Line
Life insurance policies provide both policyholders and their loved ones' peace of mind that financial difficulties may be avoided in the event of a person’s death. To expedite the claims process, and avoid errors and delays, Reich stresses that accuracy is essential when submitting any documentation or communicating with the life insurance company. “A person’s life insurance agent can help make sure that the claim form is filled out correctly and help answer questions throughout the process,” he says. (For more insight, read about how life insurance proceeds are taxed.)

How Car Insurance Companies Value Cars

When your vehicle is totaled in an auto accident, your insurance company pays you for the car's value – or, more accurately, it pays you for what it claims the value to be. You can put this money toward the amount you still owe on the totaled car, or you can use it to purchase a new vehicle. Nearly everyone who has been through this process can attest that the most frustrating part is accepting the auto insurance company's assessment of your car's value. Almost invariably, the estimate comes in much lower than you anticipated, and the amount you receive is not enough to purchase an apples-to-apples replacement. For many drivers, it is not even enough to cover what they still owe on the car.

Confounding the issue is the fact most car insurance customers are clueless as to the methodology used by insurance companies to value cars. The valuation methods of car insurers are esoteric, relying on abstract data, the specifics of which they are careful not to reveal. This information asymmetry makes it difficult for a consumer to challenge a low-ball offer from a car insurance company. However, simply knowing the basics of how insurance companies value cars and the terminology they use can bring you to a more auspicious place from which to negotiate.

The Car Insurance Valuation Process

When you report a car accident to your insurance company, the company sends an adjuster to assess the damage. The adjuster's first order of business is determining whether to classify the vehicle as totaled. An insurance company may consider the car to be totaled even if it can be fixed. Generally speaking, the company totals a car if the cost to repair it exceeds a certain percentage, usually 60 to 70%, of its value.


Assuming the vehicle is totaled, the adjuster then conducts an appraisal and assigns a value to the vehicle. The damage from the accident is not considered in the appraisal. What the adjuster seeks to estimate is what a reasonable cash offer for the vehicle would have been immediately before the accident took place.

Next, the insurance company enlists a third-party appraiser to issue its own estimate on the vehicle. This is done to minimize any appearance of impropriety or underhandedness and to subject the vehicle to a different valuation methodology. The company considers its own appraisal and that of the third party when making its offer to you.

Actual Cash Value Versus Replacement Cost

A huge distinction exists between the value of your car as determined by the insurance company and the amount it actually costs to purchase a suitable replacement. The insurance company bases its offer on the actual cash value (ACV). This is the amount that the company determines someone would reasonably pay for the car, assuming the accident did not happen. Therefore, the value takes into consideration depreciation, wear and tear, mechanical problems, cosmetic blemishes, and supply and demand in your local area.

Even if you purchased a car new and only drove it a year before the accident, its ACV will be significantly lower than what you paid for it. Simply driving a new car off the lot depreciates it as much as 20%, and the insurance company dings you further for everything from the miles on the odometer to the soda stains on the upholstery accumulated during that year.

The amount of the ACV offer is also going to be less than the replacement cost – the amount it costs you to purchase a new vehicle similar to the one you wrecked. Unless you are willing to supplement the insurance payment with your own funds, your next car is going to be a step down from your old one.

A solution to this problem is purchasing car insurance that pays replacement cost. This type of policy uses the same methodology to total a vehicle, but after that, it pays you the current market rate for a new car in the same class as your wrecked car. The monthly premiums for replacement cost insurance can be significantly higher than for traditional car insurance.

Other Challenges

Not being able to afford a comparable car with the money from your insurance company after an accident is exceedingly frustrating. That being said, there is another potential situation that can compound the stress of an auto accident even further.

Often, the amount an insurance company offers for a totaled car is not even sufficient to cover what is owed on the wrecked car. This may occur if you wreck a new car shortly after buying it. The vehicle has taken its big initial depreciation hit, but you have barely had time to pay down your loan balance. This can also occur if you have taken advantage of a special financing offer that minimized or eliminated your down payment. While these programs certainly keep you from having to part with a large chunk of cash to buy a car, they almost guarantee that you drive off the lot with negative equity. This becomes a problem if you total the car before restoring a positive equity position.

When your insurance check cannot pay off your car loan in full, the amount that remains is known as a deficiency balance. Because this is considered unsecured debt – the collateral that formerly secured it is now destroyed – the lender is especially aggressive about collecting it.

Like the replacement cost issue, this problem has a solution. Add gap insurance to your car insurance policy to ensure that you never have to deal with a remaining balance on a totaled car. This coverage pays for the cash value of your car as determined by the insurance company and pays for any deficiency balance left over after you apply the proceeds to your loan. Gap coverage, like replacement cost coverage, adds to your insurance premium. You should consider, however, that if you fall into one of the above scenarios, it could make a deficiency balance more likely in the case of an accident.

How Much Life Insurance Do I Need ?

Very few people enjoy thinking about the inevitability of death. Fewer yet take pleasure in the possibility of an accidental or early death. If there are people who depend on you and your income, however, it is one of those unpleasant things you have to consider. In this article, we'll approach the topic of life insurance in two ways: First we'll point out some of the misconceptions, then we'll look at how to evaluate how much and what type of life insurance you need.

Does Everyone Need Life Insurance?

Buying life insurance doesn't make sense for everyone. If you have no dependents and enough assets to cover your debts and the cost of dying (funeral, estate lawyer's fees, etc.), then it is an unnecessary cost for you. If you do have dependents and you have enough assets to provide for them after your death (investments, trusts, etc.), you still do not need life insurance.

However, if you have dependents (especially if you are the primary provider) or significant debts that outweigh your assets, you likely will need insurance to ensure your dependents are looked after if something happens to you.

Insurance and Age

One of the biggest myths aggressive life insurance agents perpetuate is "insurance is harder to qualify for as you age, so you better get it while you are young." To put it bluntly, insurance companies make money by betting on how long you will live. When you are young, your premiums will be relatively cheap. If you die suddenly and the company has to pay out, you were a bad bet. Fortunately, many young people survive to old age, paying higher and higher premiums as they age (the increased risk of them dying makes the odds less attractive).

Insurance is cheaper when you are young, but it is no easier to qualify for. The simple fact is insurance companies will want higher premiums to cover the odds on older people, but it is a very rare that an insurance company will refuse coverage to someone who is willing to pay the premiums for their risk category. That said, get insurance if you need it and when you need it. Do not get insurance because you are scared of not qualifying later in life. (For related reading, see: How old should you be to get life insurance?)

Is Life Insurance an Investment?

Many people see life insurance as an investment, but when compared to other investment vehicles, referring to insurance as an investment simply doesn't make sense. Certain types of life insurance are touted as vehicles for saving or investing money for retirement, commonly called cash-value policies. These are insurance policies in which you build up a pool of capital that gains interest. This interest accrues because the insurance company is investing that money for their benefit, much like banks, and are paying you a percentage for the use of your money.

However, if you were to take the money from the forced savings program and invest it in an index fund, you would likely see much better returns. For people who lack the discipline to invest regularly, a cash-value insurance policy may be beneficial. A disciplined investor, on the other hand, has no need for scraps from an insurance company's table. (For related reading, see: Is Life Insurance a Smart Investment?)

Cash Value vs. Term

Insurance companies love cash-value policies and promote them heavily by giving commissions to agents who sell these policies. If you try to surrender the policy (demand your savings portion back and cancel the insurance), an insurance company will often suggest that you take a loan from your own savings to continue paying the premiums. Although this may seem like a simple solution, keep in mind that if the loan is not paid off by the time of your death, it will be subtracted from the death benefit.

Term insurance is insurance pure and simple. You buy a policy that pays out a set amount if you die during the period to which the policy applies. If you don't die, you get nothing (don't be disappointed, you are alive after all). The purpose of this insurance is to hold you over until you can become self-insured by your assets. Unfortunately, not all term insurance is equally desirable. Regardless of the specifics of a person's situation (lifestyle, income, debts), most people are best served by renewable and convertible term insurance policies. They offer just as much coverage, are cheaper than cash-value policies, and, with the advent of internet comparisons driving down premiums for comparable policies, you can purchase them at competitive rates.

The renewable clause in a term life insurance policy allows you to renew your policy at a set rate without undergoing a medical exam. This means if an insured person is diagnosed with a fatal disease just as the term runs out, he or she will be able to renew the policy at a competitive rate despite the fact the insurance company is certain to have to pay a death benefit at some point.

The convertible insurance policy provides the option to change the face value of the policy into a cash-value policy offered by the insurer in case you reach 65 years of age and are not financially secure enough to go without insurance. Even if you are planning on having enough retirement income, it is better to be safe, and the premium is usually quite inexpensive.

Evaluating Your Insurance Needs

A large part of choosing a life insurance policy is determining how much money your dependents will need. Choosing the face value (the amount your policy pays if you die) depends on:

• How much debt you have. All of your debts must be paid off in full, including car loans, mortgages, credit cards, loans, etc. If you have a $200,000 mortgage and a $4,000 car loan, you need at least $204,000 in your policy to cover your debts (and possibly a little more to take care of the interest as well).
• Income replacement. One of the biggest factors for life insurance is for income replacement. If you are the only provider for your dependents and you bring in $40,000 a year, you will need a policy payout that is large enough to replace your income plus a little extra to guard against inflation. To err on the safe side, assume that the lump sum payout of your policy is invested at 8% (if you do not trust your dependents to invest, you can appoint a trustee or select a financial planner and calculate his or her cost as part of the payout). Just to replace your income, you will need a $500,000 policy. This is not a set rule, but adding your yearly income back into the policy (500,000 + 40,000 = 540,000 in this case) is a fairly good guard against inflation. Once you determine the required face value of your insurance policy, you can start shopping around. There are many online insurance estimators that can help you determine how much insurance you will need.
• Insuring others. Obviously there are other people in your life who are important to you and you may wonder if you should insure them. As a rule, you should only insure people whose death would mean a financial loss to you. The death of a child, while emotionally devastating, does not constitute a financial loss because children cost money to raise. The death of an income-earning spouse, however, does create a situation with both emotional and financial losses. In that case, follow the income replacement calculation we went through earlier with his or her income. This also goes for any business partners with which you have a financial relationship (for example, shared responsibility for mortgage payments on a co-owned property).

Other Ways to Calculate Your Needs

Most insurance companies say a reasonable amount for life insurance is six to 10 times the amount of annual salary. Another way of calculating the amount of life insurance needed is to multiply your annual salary by the number of years left until retirement. For example, if a 40-year-old man currently makes $20,000 a year, under this approach, the man will need $500,000 (25 years x $20,000) in life insurance.

The standard of living method is based on the amount of money the survivors would need to maintain their standard of living if the insured died. You take that amount and multiply it by 20. The thought process here is the survivors can take a 5% withdrawal from the death benefit each year (which is equivalent to the standard of living amount) while investing the death benefit principal and earning 5% or better.

Alternatives to Life Insurance

If you are getting life insurance purely to cover debts and have no dependents, there is another way to go about it. Lending institutions have seen the profits of insurance companies and are getting in on the act. Credit card companies and banks offer insurance deductibles on your outstanding balances. Often this amounts to a few dollars a month and in the case of your death, the policy will pay that particular debt in full. If you opt for this coverage from a lending institution, make sure to subtract that debt from any calculations you are making for life insurance—being doubly insured is a needless cost.

The Bottom Line

If you need life insurance, it is important to know how much and what kind you need. Although generally renewable term insurance is sufficient for most people, you have to look at your own situation. If you choose to buy insurance through an agent, decide on what you'll need beforehand to avoid getting stuck with inadequate coverage or expensive coverage you don't need. As with investing, educating yourself is essential to making the right choice. (For related reading, see: Is Your Employer-Provided Life Insurance Enough?)

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Georgia Asbestos & Mesothelioma Lawyers

Georgia is well-known for asbestos use in an array of businesses prior to the 1980s. In fact, it was the first state to commercially mine asbestos, which eventually led to a series of industries using the mineral, including power plants, manufacturing facilities, automotive companies, and many more. Thousands upon thousands of residents worked around asbestos for prolonged periods of time on a daily basis, which resulted in many of these workers developing malignant mesothelioma. A total of 444 asbestos-related deaths have occurred in the state from 1999-2008 alone, leading to numerous residents retaining a Georgia mesothelioma lawyer.

If you or a loved one have been diagnosed with mesothelioma, asbestos-related lung cancer, or asbestosis, you may be entitled to substantial compensation. We invite you to fill out our form today for a free Financial Compensation Packet, filled with information about top mesothelioma lawyers in Georgia, how to get paid in 90 days, how to file an asbestos trust fund claim, and much more.

We offer assistance to all asbestos victims and their families in Georgia, including cities such as:

Atlanta, Augusta, Columbus, Macon, Savannah, Athens, Sandy Springs, Roswell, Johns Creek, Albany, Warner Robins, Alpharetta, Marietta, Valdosta, Smyrna, Dunwoody, Rome, East Point, Milton, Gainesville, Hinesville, Peachtree City, Newnan, Dalton, Douglasville, Kennesaw, LaGrange, Statesboro, Lawrenceville, Duluth, Stockbridge, Woodstock, Carrollton, Canton, Griffin, McDonough, Acworth, Pooler, Union City, Decatur, Cartersville, Sugar Hill, Milledgeville, Snellville, Forest Park, Thomasville, St. Marys Tifton, Americus, Kingsland, Suwanee, Dublin, Fayetteville, Calhoun, Chamblee, Brunswick, Norcross, Riverdale, Conyers, Perry, College Park, Moultrie, Waycross, Winder, Powder Springs, Villa Rica, Fairburn, Monroe, Covington, Cusseta, Buford, Bainbridge, Lilburn, Grovetown, Dallas, Douglas, Cordele, Loganville, Vidalia, Richmond Hill, Jesup, Cairo, Cedartown, Fort Valley, Holly Springs, Jefferson, Fort Oglethorpe, Rincon, Thomaston, Fitzgerald, Garden City, Doraville, Toccoa, Braselton, Clarkston, Swainsboro, Centerville, Hampton, LaFayette, Auburn, and more.

Job Sites Associated with Asbestos in Georgia

Although Georgia has several naturally-occurring asbestos deposits, the majority of asbestos-related deaths stem directly from occupational hazard. Manufacturing plants, in particular, put thousands of workers at risk. For example, Georgia-Pacific is well-known for using asbestos-containing materials in many products, such as cardboard boxes, papers, tissues, and more. Employees handled these materials on a daily basis. Additionally, Georgia-Pacific bought out the Bestwall Gypsum Corporation during the 1960s’, another company known for manufacturing a product that contained chrysotile.

For example, Georgia-Pacific is well-known for using asbestos-containing materials in many products, such as cardboard boxes, papers, tissues, and more. Employees handled these materials on a daily basis. In addition, Georgia-Pacific bought out the Bestwall Gypsum Corporation during the 1960s’, another company known for manufacturing a product that contained chrysotile. Per a Georgia-Pacific newsroom in 2000, a total of 232,000 asbestos-related cases have been filed against the company since the mid 1980s. Although the company claimed in the same news statement that they don’t anticipate any other lawsuits, the corporation put aside an additional $221 million in 2002 for additional asbestos-related lawsuits. Furthermore, in 2002, the company had more than 62,000 pending asbestos lawsuits.

Additionally, many of Georgia’s 13 military bases, along with several Federal buildings in Atlanta have been determined to contain asbestos. Manufacturing plants have also been associated with asbestos. In 1989, the Keebler Company in Atlanta was responsible for failing to prevent thousands of workers from inhaling asbestos fibers after the Centers for Disease Control (CDC) determined that an oven in one of the company’s plants was releasing the harmful fibers into the air.

Additional Job Sites Associated with Asbestos in Georgia

There are hundreds of job sites in Georgia associated with asbestos use. Many of these sites may have played a direct part in placing employees and/or contractors at risk for developing an asbestos-related disease, including the following:

• Charmin Paper Products Company
• Coats & Clark, Inc.
• Cobb Heating & Air Conditioning
• Coil Insulation Company
• Firestone Tire and Rubber Company
• Georgia Alabama Power Company
• Georgia Growers Distilling Company
• Georgia Power Company
• Herck & Company
• J.P. Stevens and Company
• Lykes Brothers Inc
• Merck & Company, Inc.
• Merck Chemical Div
• Miller Brewing Company, Inc
• Georgia Plywood Corporation
• J. P. Stevens & Company
• Mohasco Industries Inc
• Southeast Paper Manufacturing Company
• Brumby Chair Company
• Dobbins Air Force Base
• Georgia Manufacturing and Public Service Company
• Kennesaw Mills Company
• Kerby Saunders Incorporated
• Mckenney’s, Inc.
• Mead Container Packaging
• Mead Paper Company
• Mechanical Associates
• Merillat Industries
• Metropolitan Eye Hospital
• Miss Georgia Dairies

Georgia Laws on Mesothelioma Litigation

With an abundance of job sites containing asbestos in the past few decades, a plethora of victims have came forward, filing lawsuits in Georgia. Consequently, the Georgia Supreme Court mandated new laws in 2005 on the requirements needed before victims can file an asbestos-related lawsuit.

In the past, victims had to prove that asbestos was a contributing factor to their disease. With the new laws, however, not only does asbestos have to be a contributing factor, but it must also be proven to be a substantial contributing factor. In other words, asbestos must have been the primary cause of the disease and not just a contributing factor.

Furthermore, a medical report must be presented, approved by a physician, that states the victim’s disease did indeed come from asbestos exposure. This rule applies to all asbestos-related diseases except for mesothelioma. In addition, a physician must verify that it has been at least 15 years has passed between the victim’s first exposure to asbestos and the diagnosis.

In 2007, the Georgia Supreme Court added an additional law, stating that victims can only file if they are currently a resident of Georgia and/or were a resident at the time of asbestos exposure.

Georgia’s Asbestos Laws

The Environmental Protection Division (EPD) of the Georgia Department of Natural Resources is responsible for the state governing laws on asbestos and asbestos abatement projects in Georgia. The state of Georgia also follows certain federal NESHAP regulations.

391-3-1 of NESHAP’s Emission Standard for Asbestos is strictly adhered to in Georgia.
Rule 391-3-4-.04 (8) of the Georgia Department of Natural Resources Rules mandates that any “asbestos-containing waste” must be transported for disposal in a state-approved vehicle that has a separate compartment area to transport the asbestos in. In addition, the asbestos must be disposed of only in permitted landfills and waste areas within the state of Georgia. Furthermore, each container with asbestos must be sealed tight with the proper warning labels on the front.
Chapter 391-3-14-.01 of the Georgia Department of Natural Resource’s EPD Rules mandates that all friable asbestos must be “wettened” before removing it from the asbestos abatement project area. The asbestos must remain wet while encapsulating it for proper disposal.
Written notification must be sent to the state within seven days prior to starting any asbestos abatement project in Georgia.
For more detailed information and addition regulations involved in Georgia asbestos abatement, contact the EPD at 404-657-5947 or toll-free at 888-373-5947.

Getting Medical Help in Georgia

Victims dealing with an asbestos-related disease and finding the best mesothelioma treatments is usually not an easy task. The National Cancer Institute (NCI) makes this process easier by appointing worthy care centers and hospitals as NCI-designated facilities.

The Winship Cancer Institute at Emory University (WCI) is a NCI-designated care center with researchers, physicians, cancer experts, and healthcare specialists that focus on mesothelioma cancer and other asbestos-related diseases. WCI is the first and the only cancer center in Georgia that’s backed by NCI.

WCI is also the recipient of over $28 million in grant funding because of its advanced research and technology in developing innovative ways in fighting cancer.

It’s important to seek mesothelioma treatment from a care center that specializes specifically in asbestos-related diseases. A typical small family clinic and/or a general practitioner usually don’t have the expertise and knowledge that a physician who specializes in asbestos cancer has.

Georgia Statute of Limitations on Mesothelioma and Asbestos Cases

Under Ga. Code Ann. § 9-3-20 et seq., plaintiffs filing an asbestos-related lawsuit in the state of Georgia must file within two years of time of diagnosis or within two years of when the illness was discovered. Wrongful death lawsuits follow the same two-rule; the lawsuit must be filed within two years of the date of the victim’s death. In addition, Georgia allows asbestos-related cases to be consolidated as defined in Rule 42 (a) of the Federal Rules of Civil Procedure.

Getting Legal Help in Georgia

As previously mentioned, if you’ve been diagnosed with mesothelioma, asbestos-related lung cancer, or asbestosis, you may be entitled to compensatory damages. Don’t forget to fill out our form to get our free Financial Compensation Packet, filled with information on the leading asbestos and mesothelioma attorneys in your area. For questions and assistance, feel free to contact us at 800-793-4540. 

Workplace Injury: When You Can Sue Outside of Workers' Compensation

If you've been injured in the workplace, you've probably been told that the only compensation you can receive will come from your employer's workers' compensation insurance. Although this is the general rule, there are many exceptions -- situations in which you may be able to sue for damages caused by your injuries. For example:

• If you were injured by a defective product, you might be able to bring a products liability action against the manufacturer of the product.
• If you were injured by a toxic substance, you might be able to bring a toxic tort lawsuit against the manufacturer of that substance.
• If you were injured because of your employer's intentional conduct, you might be able to bring a personal injury lawsuit against your employer.
• If your employer does not carry workers' compensation insurance, you might be able to sue your employer in civil court or collect money from a state fund.
• If a third party caused your injury, you might be able to bring a personal injury lawsuit against that person.

Although workers' compensation can provide money and benefits to an injured worker, temporary disability and permanent disability payments are usually quite low and don't compensate the worker for things like pain and suffering. Workers' compensation also does not provide punitive damages to punish an employer for poor safety controls or dangerous conditions. That's why it's important for injured workers to understand their rights to bring a case outside of the workers' compensation system.

In addition to the lawsuits described in this article, you might obtain additional money from government benefits such as Social Security disability insurance (SSDI or SSI) if your injury is disabling and prevents you from working. For more information, see Nolo's article on Social Security Disability Benefits.

If You Were Injured by a Defective Product

When a worker is injured by a machine or piece of equipment that is defective, failed to work properly, or is inherently dangerous, the manufacturer of the machine or equipment can be held responsible for the injury if it knew of the danger and/or didn't properly warn the business or employees of the danger. In such a situation, the manufacturer would have to compensate the worker for things like medical bills, lost wages, and pain and suffering.

Example:
Bill works in a factory that produces office products. His job is to operate a punch press that punches holes in boxes. One day, when Bill puts his hand into the press to adjust a box, the foot pedal that he uses to stop the press sticks, and the press crushes three of his fingers. His fingers are no longer usable after the accident. Bill can collect workers' compensation from his employer, and he also has a possible products liability case against the manufacturer of the defective press.

If you have been injured by an unsafe machine or other equipment in your workplace, consider talking to an attorney about your rights. You can also file a complaint with the Department of Labor's Occupational Health and Safety Administration if there have been unsafe conditions (for more information, see Nolo's article OSHA: Complying With Workplace Health and Safety Laws), in addition to filing a workers' compensation claim. This is a particularly important step to take if your employer is still requiring you or other employees to use the equipment.

If You Were Injured by a Toxic Substance

Sometimes the chemicals and other substances that workers use are toxic and cause severe injuries and illnesses. These substances can include such things as asbestos, benzene, chromium compounds, silica, and radium, but any substance that harms you could possibly be the subject of a lawsuit for a "toxic tort."

Generally speaking, there are two kinds of toxic injuries: acute injuries are apparent immediately, while latent injuries may take years to appear. Examples of acute injuries include chemical burns and poisonings. Examples of latent injuries include cancers and lung diseases. Because of the time delay, latent injuries tend to be more difficult to prove than acute ones, but these cases are not impossible. Workers have been successful in lawsuits brought years after their exposure to the toxic substance. (In particular, workers who suffer from asbestosis or mesothelioma almost always succeed in lawsuits because the causation between exposure to asbestos, asbestosis and mesothelioma has been proven in many lawsuits.) When a worker is injured by a toxic substance, the worker can usually sue the manufacturer of the toxic substance and any manufacturers of safety equipment that proved to be ineffective in the handling of the toxic substance.

If you have been injured or sickened by a toxic substance, talk to an attorney about your legal rights. Especially if a great deal of time has passed between your exposure and your injury or illness, you will need the assistance of an expert to help you sort out the complicated issues involved. And even if the toxic injury was recent, an attorney can probably get you the best settlement for your injury. To find a personal injury lawyer who handles cases about toxic substances, use our tool below.

If the toxic substance is continuing to make the workplace unsafe for your or others, consider taking the additional step of filing a complaint with the Occupational Safety and Health Administration (OSHA).

If a Third Party Injures You

Sometimes when an employee is injured on the job, the fault lies not with the employer or with a dangerous substance or machine, but with another person. In such a case, the employee might be able to sue that person for damages.

Example:

Thelma drives a company car to make sales calls on her clients. While en route to a client's office, she is hit by Joe, who runs a red light. Joe is at fault in the accident and is the cause of Thelma's injuries. Thelma can bring a lawsuit against Joe for damages (and Joe's insurance company may pay out without a lawsuit).

If a third party's intentional or negligent conduct caused your injury, talk to a personal injury attorney about your rights. For help on choosing a good personal injury attorney, read Nolo's article Finding a Personal Injury Lawyer. Or you can go to Nolo's Lawyer Directory for a list of personal injury attorneys in your geographical area (click the "Types of Cases" and "Work History" tabs to learn about a particular lawyer's experience, if any, with workers' compensation and workplace injury claims).

Fatigue Leads to Many Construction Worksite Accidents

According to the National Safety Council (NSC), 69 percent of workers in the construction, transportation, and manufacturing industries say they suffer from on-the-job fatigue. The NSC recently released a report on this very serious problem, The Fatigue in Safety Critical Industries report, which delineates common causes and symptoms of fatigue, as well as the extensive associated costs.

It’s a well known fact that construction is one of the most dangerous occupations in the United States. Among the most deadly construction accidents are falls from high places (ladders and scaffolding), being struck by objects, electrocutions, and becoming caught in materials and equipment. The risk of every one of these serious accidents is dramatically increased by worker fatigue. A MA work injury attorney can help you determine how to proceed if you’ve been injured on the job.

Although nearly two-thirds of all construction workers admitted to working while fatigued, the group said they were well aware of the risks involved with doing so. The NSC is urging employers in these industries to assess the level of fatigue their workers are experiencing, and to initiate policies that reduce worker injuries and deaths related to fatigue. One fatigued worker can put an entire team at risk, and the costs associated with fatigue-related accidents are shockingly high.

Common Causes and Symptoms of Worker Fatigue

The Fatigue in Safety Critical Industries report outlined common causes of worker fatigue and the symptoms to look for in employees and co-workers:

Causes

• Lifestyle-related sleep deprivation
• Sleep deprivation related to medical conditions
• Working too many consecutive days
• Shift work
• Demands of a physical job
• Workplace and life stressors
• Monotonous, repetitive tasks

Symptoms

• General tiredness, sleepiness, or lethargy
• Loss of energy
• Slow reaction time
• Impaired decision making and judgment
• “Foggy” brain
• Loss of short term memory
• Reduction in productivity
• Excessive absenteeism
• Increased accidents and injuries

What Can Employers Do?

Obviously, employers are limited in their ability to improve the lifestyle and overall health of employees, but that doesn’t mean that it’s impossible for employers to reduce workplace fatigue. For starters, they can pay closer attention to the amount of consecutive hours and days their employees are on the clock. Double shifts, back-to-back night and day shifts, and too many days in a row can easily cause fatigue. As such, employers should limit fatigue-inducing schedules as much as possible. Also, employers can ensure that all workers (but especially those working challenging shifts/hours) have access to regular breaks during which they can rest, grab a snack, and drink plenty of water.

Workers with boring, repetitive tasks can also be plagued by fatigue. In order to reduce this risk, employers should rotate job responsibilities so that no worker is stuck with the same boring, repetitive task for too long. And any time a job is physically demanding, workers should receive frequent breaks. A Boston work injury lawyer can help you recover damages or obtain workers’ compensation if you’ve been injured in a workplace accident.

Finally, a safe work environment is key to reducing accidents, fatigued or not. Employers should ensure that all workers have access to well-maintained personal protective gear, and that everyone receives adequate training and supervision.

Altman & Altman, LLP—Work Injury Lawyers Serving All of MA

If you have been injured on the job, the skilled legal team at Altman & Altman, LLP can help. We have been protecting the rights of MA workers for more than 50 years, and we have an impressive track record of helping clients’ obtain the compensation they deserve. Our experienced, knowledgeable lawyers will ensure that you fully understand your rights and options, and we’ll remain by your side throughout the entire process. Don’t go through this difficult time alone, we can help. Contact Altman & Altman, LLP today for a free and confidential consultation about your case.

Ward Maedgen Accident Attorneys are the Personal Injury Lawyers in Dallas Offering One-on-One Legal Services to Clients

Even with legal assistance, getting compensations for injuries sustained has never been easy. While there are personal injury lawyers in Dallas, many of them delegate integral and critical elements of the legal assistance to their junior staff, leading to ineffective performances. In order to secure fair and full compensations for clients, Ward Maedgen Accident Attorneys provide one-on-one services to clients.

Ward Maedgen Accident Attorneys believes that personal injury victims should not consult with just any accident law firm just because they are in a serious situation. Making a blind decision and choosing a law firm that does not care about the needs of their clients and shirking legal responsibility due to busyness is a recipe for disaster. With the advice, support, and assistance of Ward Maedgen Accident Attorneys, client’s success is assured.

When patients sustain injuries through accidents, they suffer all the pains and losses alone until legal assistance has been provided by a tried and proven professional. Through the Law Office of B. Ward Maedgen, P.C., Ward comes to the rescue of clients, listens, and conducts thorough investigations to provide personal legal representation.

Through the years of serving clients as District Attorney, Ward developed his courtroom skills, taking on big companies to secure the required compensations for clients. Ward Maedgen Accident Attorneys is built on the fundamentals of integrity, trust, and skill; providing the fastest path settlement with parties and avoiding the courtroom where necessary.

“There’s no charge to schedule a consultation to talk to me and get your claim off to the right start. During the consultation, he will evaluate your case and provide you a plan for victory,” says a prior client. “If you retain them for your case, you’d not even pay a penny for your representation unless a settlement or claim is awarded.”

Ward Maedgen Accident Attorneys offers personal injury representation in areas such as car accidents, motorcycle accidents, truck/big truck accidents, wrongful deaths, medical deaths, brain and head injuries, construction injuries, defective products, premises liabilities, and insurance claims. The personal injury lawyer at Ward Maedgen Accident Attorneys Dallas can help with all personal injury cases.

Ward Maedgen Accident Attorneys is located at 6688 N Central Expy Suite 1000, Dallas, TX 75206. For inquiries and the best personal injury lawyer Dallas, contact them via phone at (214) 651-4288 or via email at info@maedgenaccidentattorneys.com. Visit their website for additional information regarding their services.

Attorney: Spokane developer Ron Wells among those indicted in fraud scheme

Prominent Spokane developer Ron Wells is among those indicted in federal court, accused of staging car accidents to intentionally defraud insurance companies.

Wells' attorney sent out a statement confirming his client's indictment late this afternoon.

According to attorney Kevin Curtis, Wells was cooperating with the investigation, but has been hospitalized in recent weeks.

Curtis says Wells was placed in a medically-induced coma nine weeks ago for complications from a recent surgery. Curtis says attorneys didn't know of the medical problems and "the investigation and indictment process continued without his participation and further cooperation."

According to the indictment, Wells and two co-conspirators staged an accident in 2015. The indictment details a 2015 crash in Liberty Lake. In that crash, a truck registered to Wells was intentionally driven into another vehicle, which was registered to one of the co-conspirators in the case, Christopher Frangella. The indictment says Wells and Frangella filed fraudulent insurance claims and also said they suffered injuries in the accident.

Wells and Frangella received settlement payouts of $338,266.75 from Safeco.

Wells faces multiple federal charges.

According to his attorney, "It is Mr. Wells' intention as soon as he is able to assist the government by taking all necessary steps to detail his involvement with the primary targets of the investigation, William Mize and Sandra Talento, and to take responsibility for his role. It is Mr. Wells sincere hope that the projects in which he is involved will not be jeopardized by his personal situation nor to detract from his numerous civic contributions over the years."

Wells is responsible for multiple projects in Spokane, including the renovation of the Ridpath Hotel.

He faces multiple counts, including mail fraud and conspiracy to commit mail fraud and wire fraud.

8 Essential Tips In Finding The Best Car Accident Lawyer Grand Rapids Mi

If it happens that you’re injured in a car accident, you need to find the right attorney to help you out with all legal matters.

At this point, you already understand that choosing the best from a shortlist of lawyers might be one of the crucial decisions you have to make for your entire car accident case. It’s also imperative to ensure that you’re aware of some of the qualities when hiring a skilled legal professional.

Here are eight essential tips in finding the best car accident lawyer in Grand Rapids Michigan:

1. Check on the experience of the lawyer

When you’re looking to present a compensation case to a lawyer, you might have the expectations of receiving a large amount of it from the party at fault.

That said, you should consider the experience of the lawyer when hiring one for this situation. Doing so might increase your chances of winning the case and obtain the compensation you rightfully deserve.

When it comes to their experiences, the prospective lawyer should have handled cases similar to yours in and out of the court.

They should be equipped in analyzing and investigating all aspects of your claim.
They should also know every minute details that can make or break your case.
If you want an experienced lawyer to handle your situation, check legacycaraccidentlawyers.com nearby for more details.

2. Consider the lawyer’s reputation

Try to ask yourself whether they’re famous or infamous. Therefore, it’s essential to factor in the lawyer’s reputation before making a hiring decision.

Check how they deal with insurance companies, judges, other lawyers, and court officials. For instance, an attorney who has been subjected to a disciplinary action might not be the right one to handle your car accident case. Hence, the best thing to do is to find someone who’s well-respected and has a good track record of obtaining fair settlements for their clients.

3. Know the lawyer’s area of specialization

Apart from experience and reputation, finding a car accident lawyer means looking at their area of focus. It’s paramount to choose an attorney who has knowledge and skills in the type of accident for which you’re entitled with compensation. While dealing with car accident cases that don’t have to proceed in trial, it’s best if the lawyer understands all factors at play.

4. Keep professionalism in mind

As a car accident victim, you deserve to get the best legal representation while your case is going on. Thus, you need to check on their professionalism. When you say professionalism, it means the lawyer is keeping in touch with you from start to finish. They should be able to provide updates regarding the progress of your case the soonest time possible.

5. Know the lawyer’s understanding of the court system

Make sure you pick one who has a better understanding of the court system. That’s because if you choose a new lawyer to represent you, it might be hard for them to handle your case. It’s true when you and the insurance company fail to reach a settlement agreement.

When that happens, you need to have a lawyer on your side who knows the court processes and who’s ready to defend your interests in all legal proceedings.

6. Take note of the personality

While the one you hire might be the best in town, it’s still better to look for someone who can get along with you well. Also, you need a lawyer who is more than willing to answer questions about your case.

Remember, you don’t have to be close friends with the attorney you’re dealing with. What matters is that you should have a good working relationship with them from beginning to end.

7. Factor in the lawyer’s resources

A car accident lawyer who deserves your trust and confidence is someone who has the resources which are essential to winning your case.

They should have enough support staff who will coordinate and do their best to build your compensation claim in your favor.
They should also work with medical and economic experts who will help them figure out the actual value of damages.

8. Check on the references

Reference is another important factor that you should take into consideration. It’s recommended to consider someone who is ready to give you with references from their previous clients. However, if the attorney refuses to provide you with anything, it’s an indication that you should find a new one instead.

Hiring a car accident lawyer can be a crucial step toward recovering all the compensation after a traumatic accident experience. Make sure you keep these things in mind when finding the right attorney for you.

The Principles of Captive Insurance and the Controversy

The IRS defines a captive insurance company as a “wholly owned insurance subsidiary.” Insurance can be defined by three basic tenets initially derived from Harper Group v. Comm’r [96 T.C. 45, 47 (1991)], which states that all captives must comply with the following three factors: 1) the arrangement involves the existence of an insurance risk, 2) there is both risk shifting and risk distribution, and 3) the arrangement is for insurance in its common accepted sense. United States Tax Court decisions have, over time, brought clarity to captives established in a compliant manner.

Because of the prevailing state insurance regulations in the 1950s, Reiss’s initial captive insurance company was established in Bermuda. Thus, the initial growth of the captive insurance industry was offshore, and many still believe that captives are a strictly offshore business phenomenon. The IRS initially questioned the concept of deductible “self-insurance” and, in 1977, issued Revenue Ruling 77-316, which denied the deductibility of captive insurance premiums based on what was referred to as the “economic family” doctrine. This doctrine, which called into question the basic tenets of risk shifting and distribution established in 1941, was fought in the courts and ultimately repudiated.

In 1978, Revenue Ruling 78-338 defined the number of participants in a “group” captive that were needed to create deductible insurance premiums: “A ‘group’ Captive is an insurance company formed by multiple corporations seeking to insure similar risk, i.e. … workers compensation, health insurance, employee benefits, etc.” This decision would later help clarify the risk distribution components of stand-alone captives (Revenue Ruling 2002-90).

The federal government had defined the necessary components of insurance in Helvering v. Le Gierse [312 U.S. 531 (1941)], which established the principle that both risk shifting and risk distributions are required for a contract to be treated as insurance. Many court cases followed this initial decision, but clarity is still being sought, particularly as it relates to captive insurance. This is important because, as discussed below, almost every state government sponsors the development of captive insurance companies.

The court battle over captive insurance continued for over 20 years after Revenue Ruling 77-316. In Revenue Ruling 2001-31, the IRS finally acknowledged that it would no longer evoke the economic family doctrine to challenge the deductibility of captive insurance premiums. Instead, it began to fight selective battles, believing that the basic premise of insurance as defined and understood by the courts needed further clarification.

In 2014, the IRS suffered another major defeat in Rent-A-Center, Inc. & Affiliated Subsidiaries v. Comm’r [142 T.C. 1 (2014)], and Securitas Holding, Inc. & Subsidiaries v. Comm’r [T.C. Memo 2014-225 (2014)]. Following these setbacks, the IRS responded by placing captive insurance companies on its “Dirty Dozen” list of possible tax scams. By 2016, the IRS required captives under IRC section 831(b) to be treated as “transactions of interest,” requiring disclosure by owners, managers, and material advisors as to their role in all captive transactions. IRS Notice 2016-66 required IRC section 831(b) captive owners to file a Form 8886, “Reportable Transaction Disclosure Statement,” and their material advisors to file Form 8918, “Material Adviser Disclosure Statement.”

After reexamining the risk requirements and the needs of businesses affected by IRC section 831(b), and in spite of the IRS including captives on its “Dirty Dozen” list, Congress increased the section 831(b) annual deductible insurance premium limits from $1.2 million to $2.2 million and further indexed this amount for inflation under the 2015 Protecting Americans from Tax Hikes (PATH) Act. In addition to the premium increases, the PATH Act also provided specific language preventing IRC section 831(b) captives from being used as estate tax planning vehicles. Although only a small number of captives was being used in this manner, Congress essentially decided that the ownership of each captive should mirror the ownership of the sponsoring businesses.

Captive arrangements can increase the probability of success by incorporating the use of independent advisors, including tax advisors, legal counsel, actuaries, risk managers, and captive managers.

On August 21, 2017, the Tax Court rendered a decision in Benjamin and Orna Avrahami v. Comm’r [149 T.C. No. 7 (2017)] that expanded the points made in its initial decision rendered in Harper. In Avrahami, the court denied deductions for premiums paid to an offshore insurance company and determined, among other things, that elections made under IRC section 831(b) were invalid and premiums paid did not qualify as insurance premiums for federal income tax purposes.

While the fact pattern in Avrahami is not indicative of how compliant captive insurance companies should be structured or managed, the case does bring more clarity to the use of IRC section 831(b) arrangements. This decision followed years of consistent precedent by stating the following:

• Risk distribution is vitally important. Pools that do not constitute insurance in the commonly accepted sense will not be able to provide risk distribution. Drafting coverage in a manner that precludes or eliminates meaningful actual claims is not insurance in the commonly accepted sense.
• A captive with no claims experience is a problem. From 2007 through 2013, there were no direct claims filed with the Avrahami captive insurance company. In addition, no claims were filed with the risk pool either, in spite of the fact that 50–75 clients participated in the arrangement.
• Claims review and payment methodology was not done in an organized manner. The essence of an insurance company is to handle claims when they come due; ad hoc claims treatment and inconsistent review and approval procedures are problematic.
• The court will criticize a lack of actuarial experience and inappropriate or inexplicable pricing or methodology. The Tax Court determined that “actuarial pricing of the policies issued by the Avrahami captive were utterly unreasonable.”
• Captive arrangements can increase the probability of success by incorporating the use of independent advisors, including tax advisors, legal counsel, actuaries, risk managers, and captive managers.
• Arm’s-length, bona fide arrangements and transactions must be utilized.
• Adherence to capitalization requirements as instructed by domicile regulators is essential.
• Investments and loans will be reviewed in an overall context of reserves and surplus; loans should not be encouraged. The Tax Court found that in Avrahami, “the insurance company had invested more than two-thirds of its assets in long-term, illiquid, and partially unsecured loans to related parties and failed to obtain advance approval from its regulators for such loans.”

This decision, together with the many years of history outlined above, provides a clear picture of what not to do when structuring and managing an IRC section 831(b) arrangement. But it also reaffirms years of best practices that have helped many businesses achieve a greater level of risk protection than previously envisioned.

Captives must carefully abide by all risk shifting, risk distribution, insurance pricing, claims adjudication, and state and federal compliance.

Captives must carefully abide by all risk shifting, risk distribution, insurance pricing, claims adjudication, and state and federal compliance outlined over the past decades. Only then can commercial insurance be integrated with private coverage to create the optimum risk management solution.