Insurance policy does not fall under Pre-Need Act

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A Marion Superior Court correctly ruled that a company that sells an insurance policy with the option to assign it to a trust to use the funds for funeral services is not subject to the Pre-Need Act, the Indiana Court of Appeals ruled.

The State Board of Funeral and Cemetery Service issued a cease and desist order to Settlers Life Insurance Co. after it determined the company was selling insurance policies that are simultaneously assigned into irrevocable funeral trusts that restrict dispersal of trust funds to funeral expenses designated as pre-paid services or merchandise by I.C. 30-2-13-8 without the certificate of authority required by I.C. 30-2-13-33. The issue came to the board’s attention from Frain Mortuary in Winamac – the mortuary believed Settlers was in violation of the Pre-Need Act.

Evan Hughes bought at $10,000 insurance policy from Settlers, payable upon proof of her death. Because she did not have the funds to pay for her burial, she opted to assign the policy irrevocably to a National Guardian Life Insurance Co. Trust. Upon her death, the insurance proceeds could only be paid for funeral and burial goods and services as listed in the trust.

Frain Mortuary received Hughes’ policy on transfer from Settlers.

After the board issued its order, Settlers filed a petition for judicial review, in which the Marion Superior Court overturned the order, and issued a declaratory judgment stating that the Pre-Need Act does not apply to the type of policy Settlers sells.

The plain language of the Pre-Need Act supports Settlers’ argument that its at-need product is not covered by the Act, Judge John Baker wrote in State Board of Funeral and Cemetery Service v. Settlers Life Insurance Company, 49A05-1307-PL-365. Settlers’ product does not obligate it to provide pre-paid services or merchandise; instead, it pays a death benefit for funeral expenses that may be used at any mortuary. Settlers isn’t defined as a seller under the Act, and its product is not designed to cover pre-need purchases, the court held.

“While we agree that Settlers’s product may not meet the needs of those who wish to prepay their funeral expenses, it is because we find that Settlers sells a product that fulfills a different purpose than pre-need products. It is not a product for those who wish to pre-purchase their funeral services; it is a product that is meant to provide funds to purchase funeral expenses on an at-need basis,” he wrote.



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  1. If a class action suit or other manner of retribution is possible, count me in. I have email and voicemail from the man. He colluded with opposing counsel, I am certain. My case was damaged so severely it nearly lost me everything and I am still paying dearly.

  2. There's probably a lot of blame that can be cast around for Indiana Tech's abysmal bar passage rate this last February. The folks who decided that Indiana, a state with roughly 16,000 to 18,000 attorneys, needs a fifth law school need to question the motives that drove their support of this project. Others, who have been "strong supporters" of the law school, should likewise ask themselves why they believe this institution should be supported. Is it because it fills some real need in the state? Or is it, instead, nothing more than a resume builder for those who teach there part-time? And others who make excuses for the students' poor performance, especially those who offer nothing more than conspiracy theories to back up their claims--who are they helping? What evidence do they have to support their posturing? Ultimately, though, like most everything in life, whether one succeeds or fails is entirely within one's own hands. At least one student from Indiana Tech proved this when he/she took and passed the February bar. A second Indiana Tech student proved this when they took the bar in another state and passed. As for the remaining 9 who took the bar and didn't pass (apparently, one of the students successfully appealed his/her original score), it's now up to them (and nobody else) to ensure that they pass on their second attempt. These folks should feel no shame; many currently successful practicing attorneys failed the bar exam on their first try. These same attorneys picked themselves up, dusted themselves off, and got back to the rigorous study needed to ensure they would pass on their second go 'round. This is what the Indiana Tech students who didn't pass the first time need to do. Of course, none of this answers such questions as whether Indiana Tech should be accredited by the ABA, whether the school should keep its doors open, or, most importantly, whether it should have even opened its doors in the first place. Those who promoted the idea of a fifth law school in Indiana need to do a lot of soul-searching regarding their decisions. These same people should never be allowed, again, to have a say about the future of legal education in this state or anywhere else. Indiana already has four law schools. That's probably one more than it really needs. But it's more than enough.

  3. This man Steve Hubbard goes on any online post or forum he can find and tries to push his company. He said court reporters would be obsolete a few years ago, yet here we are. How does he have time to search out every single post about court reporters and even spy in private court reporting forums if his company is so successful???? Dude, get a life. And back to what this post was about, I agree that some national firms cause a huge problem.

  4. rensselaer imdiana is doing same thing to children from the judge to attorney and dfs staff they need to be investigated as well

  5. Sex offenders are victims twice, once when they are molested as kids, and again when they repeat the behavior, you never see money spent on helping them do you. That's why this circle continues