Washington, DC - Rep. Gene Green (D-TX) released the following statement today at a press conference regarding H.R. 4551, the Life Insurance Employee Notification Act (LIEN) Act, and corporate-owned life insurance.

 

“I introduced the LIEN Act back in April after it was brought to my attention that some of our nation’s largest corporations are making money from the deaths of their employees.  Within two weeks time, I had over forty of my colleagues signed on to the bill, and now there are fifty-one cosponsors, including both Republicans and Democrats.

 

“Unfortunately, we have not been able to have a hearing in the Energy and Commerce Committee.  Companies buying secret life insurance policies on the lives of their rank-and-file employees is wrong and I think it is important that people know about these policies.

 

“The LIEN Act is a sunshine bill that forces companies to disclose to the employee that a ‘dead peasant’ policy has been purchased in their name.  HR 4551 stops corporations from hiding these policies and requires them to let their workers know that their employer stands to gain hundreds of thousands of dollars if they die.

 

“I support the free enterprise system and I want companies to make money, but they shouldn’t be reaping profits from the deaths of their employees or former employees.  In some cases, corporations engaged in this activity have as much as 16 percent of their profits generated through the holding of ‘janitor’s insurance.’

 

“Corporate-owned Life Insurance (COLI) has a legitimate business purpose, if you are ensuring high-level employees who will affect the company if they die.  However, this is not the case with rank-and-file employees and they have the right to know the company has placed a price on their head.  The LIEN Act requires companies to tell past, current, and future workers about the existence of these policies and finally pulls this issue from the shadows.

 

“State insurance regulators, Wall Street, and most importantly the employees will know about a company’s use of ‘dead peasant’ insurance.  It is my hope that all the States will follow the example of Texas and simply regulate COLIs through an “insurable interest” standard.  But until that happens, we can at least require companies to stop hiding COLIs and inform employees and family members that have these policies taken out on them.

 

“I will be pushing for the Energy and Commerce Committee to schedule HR 4551 as soon as possible."

 

# # #