Life Insurance Policyholders Accuse Lincoln National of Incorrect Billing, Unauthorized Charges

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Lincoln National Corp. and Lincoln National Life Insurance Co. have been hit with a proposed class action lawsuit that claims the companies deceptively handled their life insurance policies to induce lapses of coverage.

The two named plaintiffs, a husband and wife, allege in the 178-page complaint that the defendants incorrectly billed them for over fifteen years and then demanded a $44,000 “catch-up payment” followed by significantly inflated monthly premiums in order to maintain their coverage. The complaint claims the “catch-up” payment was not correctly calculated and included $2,767.12 more than the plaintiffs supposedly owed. Even after the plaintiffs paid the requested amount, Lincoln allegedly sent them several deceptive account statements that shortened the agreed-upon length of their policy, the suit says. They argue that the insurance companies breached the terms of their contract and failed to provide coverage as originally promised.

The suit takes further issue with the defendants’ demand for “Expense Charges,” also referred to as “Premium Load Charges,” in the plaintiffs’ monthly payments that it claims were never explained or authorized under the terms of the policy.

Finally, the complaint alleges that the defendants unlawfully increased the plaintiffs’ cost of insurance (COI) by over 91 percent based on “impermissible considerations.” According to the suit, the increase in COI rates was the defendants’ attempt to “recoup past losses” and cause policyholders to surrender their coverage.