A federal court recently ordered an employer, WellStar Health System Inc., to pay $750,000 to a former employee’s widow for breaching its fiduciary duty in administering its group life insurance plan.

The case Erwood v. Life Ins. Co. of N. Am., 2017 U.S. Dist. LEXIS 56348 (W.D. Pa. 2017) serves as a good reminder to employers that they must understand and properly administer conversion procedures under their group life insurance policies.  It is one of the most overlooked or misunderstood administrative requirements by HR and benefits professionals, and failure to provide the information can result in significant financial consequences.

Published in Blog

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