Questions About Dead Peasants Insurance?

[LGilmore]

"Would this have been a big deal if from day 1 they had simply told their employees? Then it is what it is. If the employees go nuts then ditch it. "

I think from reading it had more to do with the tax advantages they were getting. They basically redefined "keyman insurance" to meet everybody who could fog a mirror as "key" to the company. Which in Walmart's case is stretching it a bit much. Also there were cases where employers kept coverage inforce "after" the employee quit, was fired or retired.

Kinda kills the "keyman" argument if the "keyman" doesn't work there anymore.... and if you fired him...

 

[arnguy]

Geez, I'm really glad for all the explanations. I was thinking that this would equate to the Dead Poets Society! I must get out of my cave more often----I never heard of the term before. I'm waiting for a snide remark from somarco (just kidding, Bob).

 

[GoCubsGo]

"Don't see how it infringes on any of my rights"

Well that's probably why you're in insurance rather than a judge or legal scholar. Apparently it does infringe, as these companies have yet to win a case in this matter that I could find and they have abandoned the practice. When challenged they fold up.

Really? Most of the cases have been with the IRS for getting the proceeds tax free which the IRS doesn't think they should.
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What companies like Walmart don't get is it's about disclosure - stop operating under a veil of secrecy.

Would this have been a big deal if from day 1 they had simply told their employees? Then it is what it is. If the employees go nuts then ditch it.

It's the difference between "we're allowed to make money on this" and "should we make money on this."

I agree, stop the secrecy and disclose. Tell employees this is what we do. If they don't like they are free to work somewhere else.

 

[Crabcake Johnny]

Does Walmart have any kind of public relations department they run stuff past before they make asinine decisions?

 

[VolAgent]

Does Walmart have any kind of public relations department they run stuff past before they make asinine decisions?

I swear I recall hearing that at one point, Wal-Mart employed roughly 1 million Americans. You consider turnover, a large part of the workforce was covered under one of their policies.

That kind of profit potential, who cares what PR says.

 

[Crabcake Johnny]

Arguably, they are becoming or have become to big to fail. It's not like they're Circuit City and Best Buy can come along and clean their clock.

In many, many areas of the country they have next to no competition - no Target's, Kmart's ect...nearby.

When you get to a certain size, you don't follow the rules, but make them.

 

[VolAgent]

Arguably, they are becoming or have become to big to fail. It's not like they're Circuit City and Best Buy can come along and clean their clock.

In many, many areas of the country they have next to no competition - no Target's, Kmart's ect...nearby.

When you get to a certain size, you don't follow the rules, but make them.

Saw that first hand. Wal-Mart was going to bring in another store and a Sam's Club. Going into a very large new development. One of their conditions was no Target. Closest Target was maybe 50 miles or more away. Developers gave in to get two anchors for the development.

 

[Crabcake Johnny]

We have a similar situation going on down the street from me, but not Walmart. Wegmans.

What’s Up with ‘Waugh Chapel South?’ - Crofton, MD Patch

Wegmans, if you don't know, is a "food mall." They will not just open a "store" but a "complex." See above.

Already, local grocery stores are sh*tting their pants.



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Want cheese? Visit their "cheese pavilion"



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[LGilmore]

"Really? Most of the cases have been with the IRS for getting the proceeds tax free which the IRS doesn't think they should."

Actually, if you follow up on the link you gave me and look a bit further you'll find it's a combo of private and IRS suits against it. More often than not, attempts were made to settle before rulings. The guy you listed has a bunch of documented cases he cites, and he ain't working for the IRS.

He cites cases on his pages, copy and paste them to google, bunch of stuff comes up.

 

[Crabcake Johnny]

Doing a lot of reading on this today - some interesting stuff. Judges have ruled against Walmart citing that there's no insurable interest on low level employees therefore the policies are illegal.

Further more, Walmart actually borrowed money from the insurers to pay the premiums which was an illegal tax dodge.