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Report: Military Bases a Preying Field for Insurance Agents

June 20, 2004

The military is made up of hundreds of thousands of men and women, who are often times young and not yet financially savvy. According to a New York Times investigation, several financial services companies or their agents have been using questionable tactics on military bases to sell insurance and investments that are unnecessary. Since almost all service members purchase low cost insurance through the military, 94 percent of servicemen and women carry the maximum coverage of $250,000, according to the Defense Department.

Despite this, the New York Times six-month examination has exposed insurance agents making misleading pitches and sometimes posing as counselors or independent financial advisers on veterans benefits. They have also been reported soliciting soldiers in their barracks or while on duty, which are violations of Defense Department regulations. These practices have been occurring since the Vietnam War; but the Times has found the Pentagon, while aware of the problem, has failed to stop these deceiving practices because of industry lobbying, Congressional pressure, weak enforcement and the Pentagon's ineffective oversight. Military employees monitoring insurance agents have reported the problem has escalated since the beginning of the Iraq war because of the increasing death toll attracting agents viewing the war as a selling opportunity.

Individual accounts and base investigative records show insurance agents rushing servicemen and women through paperwork and pointing out where the signatures were required. They have not allowed time for the individuals to properly read through the documents, and copies of the paperwork have not been supplied.

If you have been affected by misleading insurance pitches while in the military service, please contact a consumer fraud lawyer from our firm.