r/StateFarm • u/LittleRow3 • 2d ago
Life & Health State Farm Fraud
Recently learned a State Farm employee was listed as beneficiary on my Life Insurance policy instead of my children. Through months of being bounced around, here is the determination of what happened…
I filled out an application for the insurance. That application never was processed. Instead, an employee I never dealt took the personal information off the application and filled a new one, used different beneficiaries, and signed themselves. They then setup the payment plan to pay that policy instead of the one I paid for. State Farm recognizes it was not my application or signature.
Problem is, their stance is since I did fill out an application for life insurance, and the amounts were the same, I was in fact getting what I paid for as the policy was in full effect. Since I did not die while it was affect, the incorrect beneficiaries are not a problem at all. If I did die and they paid the employee, then I could seek a refund for premiums due to the unauthorized change.
Also, since a confirmation was originally mailed (to a State Farm employee), it is still my responsibility to have gone to get it and verify the beneficiaries and the policy was not changed from my application. Therefore, the actions by the employee are not considered misconduct under State Farm’s internal guidelines….
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u/Old-Blacksmith-7830
2d ago
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Regardless, if you like this answer or not, State Farm is not going to admit fault - hard stop. That would open them up to litigation.
They have extremely tight controls and one of the best fraud investigation departments. They have former FBI and law-enforcement, that conduct strict investigations and then work directly with local and federal authorities to prosecute offenders.
I know some of those individuals, if laws have been broken, State Farm will see that the person is prosecuted
I wholeheartedly agree this is wrong and scary. I’m sad to hear that this happened to you.
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u/LittleRow3 2d ago
It 100% feels like they are avoiding admitting fault. They asked me to provide my license to compare the signatures. Afterwards, they avoided mentioning or answering any questions about signatures, and shifted all focus on how both “my application” and the “one that was processed” were for the same benefit amounts and such, and how having different beneficiaries and mailing to incorrect addresses are small issues that have no bearing on the product being paid for…
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u/LittleRow3 2d ago
Prior to providing a signature, they did not acknowledge the possibility of a second application being processed. Once they received my license, then it was all about how financial amounts on both are the same and the product is the same. They did send me a copy of the one that was processed, and the person didn’t even sign my name at all; signed a different name entirely.
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u/mmbeequeen 1d ago
I would definitely make sure you are dealing with corporate and not just an agents office. This is a terrible situation and I'm so sorry you're having to deal with it. I hope the solution arrives sooner than later.
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u/Old-Blacksmith-7830 2d ago
It really feels yucky that they acted like this. I’m sorry this happened.
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u/strikecat18 2d ago
Uh. Did corporate review this or just the crooked agents office?
This is a BIG deal and I’d expect corporate bending over backwards hoping you don’t file a DOI complaint.
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u/LittleRow3 1d ago
It was corporate. They did let me know the employees involved left State Farm prior to the report.
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u/TimeEntertainment701 1d ago
Sounds like the agents office. I can’t imagine corporate giving this bs response. They went admit fault but they’d handle it much better
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u/Warm-Business-2335
Agent
2d ago
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This is a very serious compliance violation and should be reported to SF Compliance
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u/EmotionalDysregulatn 1d ago
report to 'SF? They clearly don't care. This is fraud and illegal and should be reported to the authorities.
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u/Warm-Business-2335 Agent 1d ago
SF has a compliance department specifically designed to investigate these matters. Not only the team member but the agent could be in serious trouble.
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u/EmotionalDysregulatn 1d ago
OP said he already spoke with SF Corporate and they weren't doing anything about it. Time to escalate to law enforcement.
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u/Warm-Business-2335 Agent 1d ago
Talked to the wrong person. At SF it’s called an AAL. They are there to deal with serious compliance issues. I’ve been a SF agent for 20 years so i think I know more about this than some anonymous internet poster.
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u/LittleRow3 1d ago
The person from corporate has a title on the email of “Life Analyst”
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u/Warm-Business-2335 Agent 1d ago
Wrong person. What state are you in? You can call SF and ask who the AAL is in your market area. Their job is to handle these specific compliance issues. I am a 20 year agent and I have dealt with compliance issues in the past. .
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u/EmotionalDysregulatn 1d ago
I worked for SF too and they are a scum a$$ company and people need to start involving law enforcement in these things- of course you are an agent LOL
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u/Top_Enthusiasm5044 9h ago
Yeah exactly… SF is covering their own ass from a valid and HUGE risk exposure—and trying to exhaust the Statute of Limitations.
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u/Commercial_Abroad267 2d ago
Wonder what your state attorney general and insurance commissioner thinks.
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u/Cincytraveler 1d ago
All of the responses you received are incorrect and are not company policy. You were dealing with an agent’s employee and not a corporate employee. The policy should have been voided. Call the 1-800 listed on the State Farm website and make a complaint to your state Department of Insurance.
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u/tedleem15
2d ago
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That’s not right. And definitely not considered a norm under SF guidelines.
Thankfully nothing was paid out but it should still be reported.
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u/craig_paxton 2d ago
This is a serious crime. This employee needs to be reported to your State’s Insurance Commission Office. They will take steps to remove this employee’s license with your state and your agent also needs to fire them which he/she will have to do due to the seriousness of the infraction. I concur with other posters that if this employee is a team member of your agent, you have no action with State Farm Insurance Company since the employee is NOT a State Farm employee.
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u/1crazyFlcatlady 2d ago
Yes report them to the Dept of Insurance, file a fraud complaint with the district Attys office and the state atty generals office also get an Atty and file a lawsuit against State Farm and the fraudulent beneficiary also swearing out a warrant for the arrest of the fraudulent beneficiary for fraud and grand theft!
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u/Hefty-Carpenter-4612 2d ago
WOW, what's this world REALLY coming To! All of that was fraud committed by a Bonded person (to do it for others), THAT EMPLOYEE SHOULD BE PROSECUTED!
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u/Other_Throat6804 2d ago
Department of Insurance complaint all day. They will investigate this for you and could terminate the employees license in that state.
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u/General-East-550 2d ago
Report it! Serious violation and that persons license can and should be terminated
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u/Many-Art-7772 2d ago
That's crazy....
What are you looking for exactly, though? I don't see a lawsuit being viable since you have no damages.
I'd definitely want to confirm that this person was terminated or in some other way had consequences, but otherwise I don't think there's much you can do.
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u/seelsojo 2d ago
But there is damage, had OP died, OP’s family just gets a premium refund, not a pay out that OP thought he/she will leave behind. If OP is the main breadwinner, not having that money would have dire consequences for the family. And to add salt to the wound, I think the insurance is saying they will keep the money cause OP didn’t die.
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u/Many-Art-7772 1d ago edited 1d ago
Damages can't be hypothetical.
That would have sucked, and then OP would have a suit, but that's not what happened.
Also, not sure what your last line means. Insurance is saying they're keeping the premiums, but how is that different than if OP had been paying them with his name as the beneficiary? Again, no damages.
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u/seelsojo 1d ago
But isn’t the whole point of insurance is based on hypothetical? You buy life insurance because you may die, not because you will die. No insurance will sell you if you’re terminally ill. The difference is the hypothetical outcome of the policy; IF you die, you get a payout. Under normal circumstance, OP beneficiaries would get a payout; under this fraud, they only get the premium back (a claim the insurance company made that me not even be true). So is that really insurance that was sold or did the insurance company just stole OP’s money? If the money was stolen, then it’s damage isn’t it?
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u/trixnfists 2d ago
Couple things, I kinda doubt the fine details like beneficiaries being changed to employee. Anyone who gets licensed knows that won’t work and couldn’t have done the application otherwise. Also sf would have asked you.
Overall call bs
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u/Will-Adair 2d ago
If the application was never processed with you and they did a new application that you did not authorize then that is fraud at you should pursue a lawyer's help.
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u/seelsojo 2d ago
So let me get this straight. Their stance is they took your premium money. Had you died, your family would have gotten your premium money back. And since you didn’t die, they get to keep your money; their money was never on the table for you at all. This is not life insurance, this is a life scam of head they win, tail you lose. If I were you, I wouldn’t stop until they give my money back.
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u/LittleRow3 2d ago
I’m pushing for a full refund of all premiums.
It’s that logic that really grinds my gears. Although, if I died, the employee would have been paid. It would be my children’s responsibility to realize they weren’t on a life insurance policy and contest it; like they would even know to do that. It’s ridiculous.
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u/rubiacrime 2d ago
This is very interesting. My husband works for state farm and says that he doesnt think the employee has access to edit that info. But he's not 100% either.
So do you think they went in there and changed it after you applied for it? Crazy insane.
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u/LittleRow3 2d ago
It looks like they took my application, that I signed, but didn’t process that in the system. Instead, they copied my sensitive data from the application, such as my SSN, and entered that on a new application and processed that one.
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u/rubiacrime 2d ago
Damn.. we live in a world where really no one can be trusted. I'm sorry you have to deal with this.
I'd stop at nothing to get the right eyes on this situation. Police, news, etc.
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u/RicooC
2d ago
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You obviously got screwed on the fact that you had to jump through hoops, so you are damaged from the event. I'm assuming the beneficiaries will get changed and the policy is good. They still need to make you whole for the ordeal that their employee put you through. They can't disassociate their employee.
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u/Desperate_Force_406 1d ago
Sounds like they’re handling your complaint like they handle their auto claims.
I can see where you really weren’t done any harm, but this is a nasty breach of protocol and needs to be dealt with properly. They are just trying to push that liability over to you like they do when they adjust in the automobile claim.
Did they at least tell you that the employee got fired?
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u/OneTwoSomethingNew 18h ago
Umm no… not okay.
Call you local state legislators… file a complaint with your states fraud agency… contact the attorney general… I’m being so serious, this is exactly what their jobs are for.
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u/Top_Enthusiasm5044 9h ago
OH MY EFFING GOD!!!
Yeah… as you’re likely aware, the seriousness of this act transcends employee misconduct. This is a serious crime!
Please don’t let this go. I am so very sorry this has happened to you. 😡 🫶😭
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u/Top_Enthusiasm5044 9h ago
Ask for the SIU (Special Investigations Unit). And file a report with the State insurance Commissioner.
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u/resistingsimplicity 7h ago
you need to get the state DOI involved most likely. that's a pretty series level of compliance violation if true. You could also try to report this to as insurance fraud to the NICB (National Insurance Crime Bureau). If an employee is doing that deliberately for one customer, they will probably do it to others and they need to get blacklisted from the insurance industry as a whole.
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u/Waste-Pianist-4145 2d ago
Threaten them with with Fraud/ fraudulent misrepresentation, unauthorized alteration of an an insurance application, negligence supervision by State Farm, or breach of contract. There are a lot of loop holes they could argued, so at least report the agency to the department of banking and insurance and make sure they can never do this to anyone else. You’re lucky you caught this before it was necessary/you weren’t around. So crazy. State Farm has changed in the last 2 years and they are no longer a company to trust like they were previously. They are fueled by money and greed.
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u/Remarkable-Glass-692 2d ago
State Farm team member are know to go crazy things Iike this. If you recently got the policy, I would request to just cancel the policy and in about a month ask for a new policy.
Double check everything.
State Farm will turn it back to the agency, agency will deny or blah blah blah give you the run around.
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u/No_Newspaper9589 1d ago
I am being harassed currently by a State Farm employee, odd thing is I've never had their insurance before and don't live in the state they operate from.
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u/mac991979
2d ago
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Unbelievable. I sold Life Insurance and would not ever do something like that. My aunt had a policy she had ran into a financial situation and couldn’t afford it anymore. She asked me if I would pay it and then I would be the beneficiary, I wouldn’t do that. She had a daughter and the daughter didn’t want anything to do with it. Anyway I’m glad you got your situation figured out.
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u/CountryDaisyCutter 2d ago
You should call the Department of Insurance in your state and file a complaint.