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Will Insurers Tell Michael Jackson's Tour Promoters to 'Beat It'? UPDATED: Investigators May Be Treating Death As Homicide
Michael Jackson's death has already led to considerable attention and, now, an investigation by officials in California. Insurers are also likely to investigate, and the facts that are uncovered may determine not only who pays the cost of the now-abandoned "This is It!"concert tour but also whether any party will receive payments under certain insurance policies.
Some questions that investigators may consider include the following:
Consider these hypothetical situations: the third party is an individual with a criminal past, or a company with ties to organized crime, or an organization with the ability or opportunity to control life-sustaining -- or life-ending -- medical treatment for the person whose life is insured.
In the world of life settlements, there have been many instances of insurance fraud; some have gone so far as to spin tales of life settlements policies that were sold to those who then murdered the policy-holders in order to gain a higher profit. (See here for an episode of a television series, "Medium," where actor Kelsey Grammer portrayed an insurance broker who offed life settlements policy-holders.)
Then consider a situation where the policy-holder happens to be worth more dead than alive for other reasons -- because the person is an entertainer whose catalog of material will increase greatly in value upon his death.
These are some of the things going through my mind, as I view the massive level of media attention on Michael Jackson's death. As a Michael Jackson fan myself, I could not help but find myself drawn in. As a lawyer focused on the life insurance industry, I found my interest in Michael Jackson's tragedy directed toward what most would find mundane and definitely not worthy of night time television -- the insurance.
Michael Jackson's life was insured by, among others, AEG, the tour promoter for the This Is It! tour, that was scheduled to begin this month. AEG has not said much about the insurance for the tour, except AEG's Phillips told AP Music Writer Nekesa Mumbi Moody, "We had pretty good coverage, but a lot of it is going to depend on the toxicology results," he said. "We need to know what the cause of death was." AEG has also stated that it agreed to reimburse Mr. Jackson for the cost of a full time cardiologist, Conrad Murray, to reside with Mr. Jackson to assure he would perform the tour. AEG characterized those costs as "part of the production costs" of the tour. The Los Angeles Times reported that Dr. Murray was present with Mr. Jackson died, and unsuccessfully tried to revive him.
Chris Rackliffe, of Beazley Group, told Insurance Journal that Michael Jackson's "prior history, the fact of his health and the difficulties he has had in his life over the last few years means that, from our point of view, he would have been a very high risk."
AEG did reveal to AP, though, that "sometime in February, Jackson submitted to 'five-plus hours of physicals that the insurance underwriter insisted on. We were told he passed with flying colors."
Now, notwithstanding the fact that Mr. Jackson was said to have passed rigorous insurance physical examinations only four months ago, media reports have included allegations of Mr. Jackson's long-term drug abuse, including his use of operating-room anesthesia, oxygen masks, and prescription pain medication -- and some stories have said these items were strewn about Mr. Jackson's living quarters.
As the Jackson family waits for the results of the second autopsy, also waiting is AEG. The insurance carriers will consider those results when determining whether to pay AEG.
Based on some of the reports, it is not hard to imagine that multiple insurance carriers will be involved in litigation, possibly for years to come, over the policies -- and whether, for example, the policies were void ab initio based on drug abuse or preexisting conditions.
Lloyd's of London told Insurance Journal that "its member corporations had underwritten some insurance taken out for the Jackson concerts, but said AEG is likely to have had multiple policies with several insurers, who would each have taken on a portion of the risk."
A spokesman for Lloyd's, Bart Nash, also speaking to Insurance Journal, said that any such policy "would likely cover the death of an artist, costs of canceling the events, including funds spent on sets already built, promotion and publicity, and, possibly, estimated earnings from the concerts."
According to Guardian.co.uk, Ray Waddell of American Music magazine stated that "One entertainment insurance industry insider says that if Jackson died from a drug overdose or a pre-existing condition, the producer could be on the hook for any loss -- which would include any money already sunk into the production, as well as the considerable cost of refunding consumers for the 750,000 tickets already purchased."
Even if the medical records, autopsies and toxicology reports do not indicate drug abuse or preexisting conditions, insurers will also likely investigate the financial interests of various parties.
Posted by Katherine Scanlon on 07/16/2009 at 06:59 AM in Life Settlements |
http://www.secondaryinsurancemarketblog.com/
Kathy has broad experience in commercial litigation with an emphasis on life insurance, annuity product litigation and ERISA litigation. Kathy is also an accomplished appellate lawyer, with experience in federal and state appellate courts in various jurisdictions. She is an active publisher on topics related to life insurance, annuities and the secondary market.
Kathy is a graduate of the University of Connecticut (B.A.) and the University of Connecticut School of Law (J.D.). After graduating law school, she served as a Law Clerk at the Connecticut Appellate Court.
http://secondaryinsurance.typepad.c...ercial-litigators-who-have-received-nati.html
to bad it seems she wasn't informed about the insurance covering overdose... I would have liked to know what she'd think about such a policy really. But generally it seems she's expecting the insurance very much to investigate on their own before paying... I so hope they will. On the other hand they will then follow their interest again... well follow the money.
Michael Jackson's death has already led to considerable attention and, now, an investigation by officials in California. Insurers are also likely to investigate, and the facts that are uncovered may determine not only who pays the cost of the now-abandoned "This is It!"concert tour but also whether any party will receive payments under certain insurance policies.
Some questions that investigators may consider include the following:
- Did Mr. Jackson have any pre-existing conditions that could lead insurers to successfully challenge the validity of any insurance policy?
- Did Mr. Jackson use drugs to the point of abuse -- which, again could lead insurers to successfully challenge the validity of any insurance policy?
- Did the concert tour promoter transfer any portion of its interest in its insurance coverage to a third party?
Consider these hypothetical situations: the third party is an individual with a criminal past, or a company with ties to organized crime, or an organization with the ability or opportunity to control life-sustaining -- or life-ending -- medical treatment for the person whose life is insured.
In the world of life settlements, there have been many instances of insurance fraud; some have gone so far as to spin tales of life settlements policies that were sold to those who then murdered the policy-holders in order to gain a higher profit. (See here for an episode of a television series, "Medium," where actor Kelsey Grammer portrayed an insurance broker who offed life settlements policy-holders.)
Then consider a situation where the policy-holder happens to be worth more dead than alive for other reasons -- because the person is an entertainer whose catalog of material will increase greatly in value upon his death.
These are some of the things going through my mind, as I view the massive level of media attention on Michael Jackson's death. As a Michael Jackson fan myself, I could not help but find myself drawn in. As a lawyer focused on the life insurance industry, I found my interest in Michael Jackson's tragedy directed toward what most would find mundane and definitely not worthy of night time television -- the insurance.
Michael Jackson's life was insured by, among others, AEG, the tour promoter for the This Is It! tour, that was scheduled to begin this month. AEG has not said much about the insurance for the tour, except AEG's Phillips told AP Music Writer Nekesa Mumbi Moody, "We had pretty good coverage, but a lot of it is going to depend on the toxicology results," he said. "We need to know what the cause of death was." AEG has also stated that it agreed to reimburse Mr. Jackson for the cost of a full time cardiologist, Conrad Murray, to reside with Mr. Jackson to assure he would perform the tour. AEG characterized those costs as "part of the production costs" of the tour. The Los Angeles Times reported that Dr. Murray was present with Mr. Jackson died, and unsuccessfully tried to revive him.
Chris Rackliffe, of Beazley Group, told Insurance Journal that Michael Jackson's "prior history, the fact of his health and the difficulties he has had in his life over the last few years means that, from our point of view, he would have been a very high risk."
AEG did reveal to AP, though, that "sometime in February, Jackson submitted to 'five-plus hours of physicals that the insurance underwriter insisted on. We were told he passed with flying colors."
Now, notwithstanding the fact that Mr. Jackson was said to have passed rigorous insurance physical examinations only four months ago, media reports have included allegations of Mr. Jackson's long-term drug abuse, including his use of operating-room anesthesia, oxygen masks, and prescription pain medication -- and some stories have said these items were strewn about Mr. Jackson's living quarters.
As the Jackson family waits for the results of the second autopsy, also waiting is AEG. The insurance carriers will consider those results when determining whether to pay AEG.
Based on some of the reports, it is not hard to imagine that multiple insurance carriers will be involved in litigation, possibly for years to come, over the policies -- and whether, for example, the policies were void ab initio based on drug abuse or preexisting conditions.
Lloyd's of London told Insurance Journal that "its member corporations had underwritten some insurance taken out for the Jackson concerts, but said AEG is likely to have had multiple policies with several insurers, who would each have taken on a portion of the risk."
A spokesman for Lloyd's, Bart Nash, also speaking to Insurance Journal, said that any such policy "would likely cover the death of an artist, costs of canceling the events, including funds spent on sets already built, promotion and publicity, and, possibly, estimated earnings from the concerts."
According to Guardian.co.uk, Ray Waddell of American Music magazine stated that "One entertainment insurance industry insider says that if Jackson died from a drug overdose or a pre-existing condition, the producer could be on the hook for any loss -- which would include any money already sunk into the production, as well as the considerable cost of refunding consumers for the 750,000 tickets already purchased."
Even if the medical records, autopsies and toxicology reports do not indicate drug abuse or preexisting conditions, insurers will also likely investigate the financial interests of various parties.
Posted by Katherine Scanlon on 07/16/2009 at 06:59 AM in Life Settlements |
http://www.secondaryinsurancemarketblog.com/
Kathy has broad experience in commercial litigation with an emphasis on life insurance, annuity product litigation and ERISA litigation. Kathy is also an accomplished appellate lawyer, with experience in federal and state appellate courts in various jurisdictions. She is an active publisher on topics related to life insurance, annuities and the secondary market.
Kathy is a graduate of the University of Connecticut (B.A.) and the University of Connecticut School of Law (J.D.). After graduating law school, she served as a Law Clerk at the Connecticut Appellate Court.
http://secondaryinsurance.typepad.c...ercial-litigators-who-have-received-nati.html
to bad it seems she wasn't informed about the insurance covering overdose... I would have liked to know what she'd think about such a policy really. But generally it seems she's expecting the insurance very much to investigate on their own before paying... I so hope they will. On the other hand they will then follow their interest again... well follow the money.
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