Insurance Companies Accused of Making Money off of Fallen Soldiers

Eight insurance companies have recently come under scrutiny for underpaying the families of soldiers killed in action. According to a recent CNN article, some insurance companies have been collecting interest by holding the death benefits of fallen soldiers and only giving out a small amount of that interest to the soldiers' families.

The practices of these insurance companies have caught the attention of government officials. The New York Attorney General, Andrew Cuomo, launched a fraud investigation into the life insurance industry in order to review these practices that are believed to be shorting families. New York Senator Charles Schumer is also working with the Department of Veterans Affairs to resolve this situation.

A common practice among these insurance companies is to offer the families a lump sum payment. However, rather than sending a check to the surviving family, the money may remain in an interest bearing account.  It is alleged that these eight insurance companies pay the families a smaller percentage of the interest that is earned on the account, keeping the profit.  The insurance companies have denied any wrongdoing.