It’s Friday — time to catch up on some of the week’s most interesting, and sometimes puzzling, news in the world of personal finance.
1. Thought you had health insurance? Hah! The Washington Post ran a great story Monday about how insurance companies have canceled the health insurance policies of thousands of people after those policyholders have filed for claims related to expensive medical problems. The cancellations, known in the trade as “rescissions,” are ostensibly justified by policyholders’ failure to disclose previously existing medical conditions — think of someone who survives a heart attack who doesn’t admit to cardiac problems when applying for health coverage the following year. The problem, according to the Post, is that rescission has become not only a tool for fighting fraud, but an excuse for insurance companies to weasel out of paying claims. One such case: After a woman filed a claim for emergency gallbladder surgery, her attorney alleges, her health insurer canceled coverage for her and her husband because he had failed to mention his high cholesterol.
2. No rest for the retired: Forty-four percent of retirees surveyed by Charles Schwab admit to supporting at least one individual financially. Of these givers, 53% are giving dough to children, 37% to grandchildren, and 12% to their own parents.
3. Bizarre Madoff story of the week: The Los Angeles Times reports that after a California couple, ripped off by Bernard Madoff, surrendered their Malibu beachfront home to their bank to help satisfy debts, an executive at the bank started spending long weekends at the home and used it to host parties. Furthermore, a local real estate agent alleges that the bank declined to permit the $12 million home to be shown to interested buyers.
4. Unemployment: The Good, the Bad and the Ugly: The good news: The Federal Reserve said Wednesday that the economy is showing signs of stabilization. For the bad and the ugly news in graphic detail — make that detailed graphics — go to the always-entertaining EconomPic blog for a visual representation of how tough the job-hunting market is nowadays.
5. Bullish on America: The New York-based Westrock Group, which operates a brokerage and a wealth management unit, has been acquired by the Lower Brule Sioux Tribe of South Dakota, according to the trade journal Financial Planning. The deal, says the magazine, creates the first financial services firm to be wholly owned by a Native American tribe. Is this an alternative to a casino, or the same thing under a different name? You be the judge.