An Augusta woman’s struggle to claim her husband’s life insurance has prompted legislation that would govern how insurance companies notify policy holders when their coverage has been canceled.
Rep. Donna Doore, D-Augusta, has introduced a bill that would require insurance companies to use registered mail to notify their customers of a canceled life insurance policy. The current policy only requires insurers to notify holders by standard mail.
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“When you’re ending someone’s livelihood, because it’s what is going to allow them to survive, we need a little more protection of the buyer of the policy,” Doore said.
Doore’s bill was prompted by Jennifer Neumeyer’s ongoing effort to claim a life insurance policy on her husband, Scott Neumeyer, who was 35 when he died of pancreatic cancer in December 2013. Neumeyer, a state employee insured by the Maine Public Employees Retirement System, believed the policy was active, but it in fact had been canceled in 2011 because of a skipped payment. State officials say the retirement system sent a letter notifying Neumeyer at the time the policy was canceled. Jennifer Neumeyer, who only learned of the canceled policy after her husband’s death, says her family never received the letter.
Jennifer Neumeyer is appealing the retirement system’s decision to reject her claim. She is still awaiting the findings of an independent hearing officer who conducted a hearing in November.
Attorney Daniel Dube of Lewiston, who represented Neumeyer during the hearing, has said the argument in favor of paying the claim centers on what Dube called improper notification that the retirement system had canceled Scott Neumeyer’s policy.
“There’s no record of issuance and no record of receipt,” Dube said after November’s hearing. “This whole case could have been avoided for $3 in certified mail.”
Jennifer Neumeyer, who has known Doore for a number of years and is now represented by her in the Legislature, said seeing the bill passed into law would help honor the memory of her husband. Doore is a former Augusta school board and city council member, and Neumeyer was elected to the Augusta Board of Education in November.
“I call it Scott’s bill,” Neumeyer said. “It makes sense. It makes perfect sense.”
A certified letter sent through the U.S. Postal Service requires a signed receipt of delivery. That receipt is then recorded and sent to the sender. Doore said requiring notices of cancellations to be sent by registered mail would provide a record that would protect both the person who is insured and the insurance company.
“I just want it to be fair to everyone,” Doore said.
The bill, which has a host of co-sponsors, including Sen. Roger Katz, R-Augusta, and Reps. Lori Fowle, D-Augusta, Craig Hickman, D-Winthrop, and Catherine Nadeau, D-Winslow, was referred last week to the Insurance and Financial Services Committee.
“I think it’s something we need to fix,” Doore said. “It was very devastating to her family not being able to get their life insurance.”
Jennifer Neumeyer said if the law had been in effect in 2011, she would have known about the cancellation and dealt with it.
“It would have made all the difference,” she said. “If they’d gotten mail back saying I hadn’t gotten it on my end, they would have known it never arrived.”
Neumeyer, 44, instead learned of the cancellation, which happened when the Neumeyers missed a payment while Scott was out on extended sick leave in 2011, shortly after her husband’s death.
Scott Neumeyer had a number of health maladies that started cropping up in early 2001. He was hospitalized several times for an unidentified sickness until doctors determined he had an aggressive form of ulcerative colitis. He was subsequently diagnosed with diabetes.
Scott Neumeyer, an office assistant with the Maine Department of Labor when he died, started working for the state in 2003. What is undisputed by the state or Jennifer Neumeyer is that Scott signed up for life insurance when he took the job with the state.
That policy, for $120,000 and equal to three times his yearly salary, became active on Jan. 1, 2004. The premiums were taken automatically from his paycheck.
That process was interrupted, however, in June 2011 when Scott Neumeyer broke a femur when he slipped and fell while running across a wet parking lot. He was out of work for an extended period and missed at least one paycheck, Jennifer Neumeyer has said. Missing work interrupted his health insurance payments, which also came out of his paycheck automatically. The health insurance company notified the Neumeyers of the disruption, and the Neumeyers paid $1,300 to bring the policy back up to date.
The Neumeyers didn’t know the missed paycheck also affected his life insurance policy, Jennifer Neumeyer has said. She said they never noticed the missing withholdings from Scott Neumeyer’s paycheck because his payment amounts were so irregular based on sick days attributed to his chronic illness.
John Milazzo, general counsel for the retirement system, has said that the policy was still active in July 2011 when the Maine Public Employees Retirement System received notice that Scott Neumeyer was out on unpaid health leave that began in mid-June.
The retirement system says it sent a bill to the Neumeyers’ home on Aug. 1, 2011, requesting a payment of $9.60.
Jennifer Neumeyer said they never received that letter or a second that the system claims it sent to inform them of the policy cancellation. The retirement system, which confirmed it had the correct address, said there is no indication the letters were returned as undeliverable.
Milazzo said Friday that the retirement system will not be taking a position on the bill, L.D. 220.
Jennifer Neumeyer works for the state as a secretary for the Maine Bureau of Parks and Lands. She and her 13-year-old daughter, Colleen, live in a rented house.
“There was a house I wanted to purchase if the money had come through, but it sold,” Neumeyer said.
She and the retirement system are awaiting a decision on the case by a hearing officer, a process Milazzo said could take up to three or four additional months.
For Neumeyer, all there is to do now is await that decision and do what she can to pass “Scott’s” bill. He used to tease her when she saw an injustice and made up her mind to do something about it.
“When I’d get determined he’d say, ‘Go get ’em mom,'” Jennifer Neumeyer recalled. “He wouldn’t want me to give up fighting, so I’m just going to keep fighting.”
Craig Crosby — 621-5642
Twitter: @CraigCrosby4
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