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gruffydd

Dead Peasants Insurance Usa

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I watched "Capitalism - a love story" last night and it talked about this insurance.

Featured a family where the woman had worked in Walmart for 18 months but then died of an asthma attack leaving 3 young children, a husband and $100k of medical expenses.

Family got $0

Walmart got $81k

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Does this practice have any negative consequences for the 'peasants' themselves? If someone is unknowingly covered by such a policy, does it become more difficult and/or expensive for them to insure themselves as well, for example?

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Year 2100.

Walmart employs 50% of US population and supplies 50% of its food and takes out massive insurance policy on its staff.

Mass poisoning event occurs and Walmart end up the richest company on the planet by a factor of 10 (if not 100).

:ph34r:

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Guest DissipatedYouthIsValuable

Oh wow, this is such a cool new innovation from the Land of the Free.

I suggest we adopt it immediately in Britain without thinking.

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Guest DissipatedYouthIsValuable

Perhaps we've already got it?

Wouldn't be surprised.

If this is what societal development means you might as well put me in a burka and give me a three-legged goat and a pile of dust to farm.

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I already commented on this when 'Capitalism' was broadcast recently.

I don't get this. Insurance companies are in it for profit too, and employ very well-paid actuaries to calculate risk and set policy prices accordingly. Spread over a large number of policies, they make a profit.

So why would these corporations expect to ultimately profit overall from insuring many or most of their employees? Why do they presume to outguess the insurance companies with regards to their employee mortality?

I don't think these companies are intending to work their employees to death, and even if they were, this would show up in the statistics and they would have to pay higher insurance premiums.

I can understand 'key man' insurance, where a the loss of a particularly skilled employee would damage a business, but not insuring ordinary people on the shop floor.

If large corporations were profiting overall from life insurance on employyes, why would the insurance companies go along with it?

I'm guessing that there is a tax -break on the payouts or premiums somewhere that makes it profitable. So it's indirect tax avoidance; the people who 'pay' for these profits are the American taxpayers.

The practice seems distasteful, and possibly upsetting if the bereaved hear about it, but it does not appear to cause a direct loss to the insured as far as I can see. Dead peasant insurance is indeed a cynical tax-avoidance scheme; that's where the 'crime' is.

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I may be missing something here but I cant see whats wrong with this.

In the UK companies can arrange 'Key Man' insurance to cover them against the deather of a key employee. Whats so different about this?

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In the UK companies can arrange 'Key Man' insurance to cover them against the deather of a key employee. Whats so different about this?

That we're not talking about 'key' people (i.e. people with specialist and not-easily-replaceable) skills or knowledge needed for the functioning of a business. As the product's nickname implies, we're talking about low-skilled workers, the cost of whose replacement in nowhere near what they're being insured for. Hence when the 'peasants' die, their employer trousers a fat profit.

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That we're not talking about 'key' people (i.e. people with specialist and not-easily-replaceable) skills or knowledge needed for the functioning of a business. As the product's nickname implies, we're talking about low-skilled workers, the cost of whose replacement in nowhere near what they're being insured for. Hence when the 'peasants' die, their employer trousers a fat profit.

So they are betting and (paying a premium fo)r on the mortality of their staff. Big corps bet their cash balances on the overnight market another bet they can undertake.

Bit whiffy maybe but not as bad as you make out the money never was promised to the family otherwise it would be in the employment contract wouldn't it?

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So they are betting and (paying a premium fo)r on the mortality of their staff. Big corps bet their cash balances on the overnight market another bet they can undertake.

Bit whiffy maybe but not as bad as you make out the money never was promised to the family otherwise it would be in the employment contract wouldn't it?

Cool, then you won't mind me taking out an insurance policy (and paying premiums) on your house, work premises and car without your knowledge.

Bit whiffy maybe but you know, money trumps human decency any day....

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This gets even better - you can keep the policy going even after the peasant leaves > I know - sack the peasant, write the crappest reference ever - aren't jobless and incomeless people more likely to meet with an early death? Yo! Crack open the champers!

http://www.theamateurfinancier.com/blog/when-companies-get-really-creepy-dead-peasant-life-insurance/

Edited by gruffydd

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I can't see who in their right mind would take the other side of this insurance policy.

The only reason a company would take it out is it they think, due to working conditions, (stress etc) their employee will snuff it.

So why would anyone offer them insurance?

Who would offer insurance where the person taking it out can negatively influence the outcome?

Oh wait... commission based fund managers. :rolleyes:

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  • 152 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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