Social Question

Ladymia69's avatar

I know corporate higher-ups can be soulless and carniverous, but how can they do this? (See details)

Asked by Ladymia69 (6867 points ) May 12th, 2011

I finally watched “Capitalism: A Love Story” and then did some after-movie research (because Michael Moore can be quite dramatic and sensationalistic). Companies like Wal-Mart, Bank of America, Walgreens, and DISNEY, for Christ’s sake, have a tradition of taking out insurance policies on their employees and shamelessly collecting on them when the poor schmuck dies…oh, yeah, and they give the family of the deceased not a crappy, worn-down penny.

First of all, has anyone here known anyone who (or a family of someone who) this has happened to? If so, how did they deal with it?

And secondly, how do these people sleep at night, and is there some special corner of Hellish eternity reserved just for them?

Sorry about my ultimate question being a bit sensationalistic and dramatic.

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54 Answers

augustlan's avatar

Are we talking about high-level or specialized employees, the type whose death would have a huge negative impact on the company? If so, I’ve heard of that before… while distasteful, it does make a certain amount of sense for companies to insure their valuable assets, even if those assets are human beings.

Now, if we’re talking about every Joe Schmoe who works for them, or maybe only the ones who work in dangerous jobs where death is more likely, then fuck that.

Ladymia69's avatar

No. One case was mentioned which involved a woman of 26 who was a cake decorator at Wal-Mart., She had a sort of freak asthma accident, so the company was paid $81,000 upon her death (paid highly because she was young and it was a strange cause of death). her family couldn’t even pay off her hospital bills and funeral. I am sure they do it often. Women are especially valuable because their life span is higher than a man’s, and if they die young the employer collects a crapload.

Blackberry's avatar

I have a hypothesis that these types of people laugh at the general public. Politicians, CEOs etc. They know we can’t do anything because we’re too busy trying to keep our lives together, and they probably think most are too fucking dumb to realize what they’re doing. It’s just a hypothesis, though lol.

JLeslie's avatar

My husband’s company has life insurance on some of their employees. They don’t do it anymore, but they still have some policies. It is a buffer for money they pay out if the employee dies. Insurance and something to do with imputed income. They don’t sit around hoping the employee will die or anything.

Ladymia69's avatar

@JLeslie No of course they don’t sit around waiting for the employee to die, that would infer that they weren’t completely indifferent towards the little people that work for them.

Ladymia69's avatar

@Blackberry I think your hypothesis is pretty well-developed. I think perhaps they don’t even think or notice that they are being evil.

JLeslie's avatar

I have insurance on my husband and I am not evil. My husband’s company is one of the fairest I know when employees have difficult times personally. Compassionate emotionally and financially. However, I wish they paid the lower rung better, and gave better interest rates (it’s a bank) with a little less focus on the bottom line. For the most part I think the majority of big corporations are fuckheads. But, it does not drive me crazy that is someone wants to pay for insurance on my head, that they collect on it when I die, as long as they don’t hasten my death in any way. They bought the policy. Well, I guess it might bother me if it loses money overall, and costs the consumer, but it must make the company money if they do it.

Ladymia69's avatar

Not talking about personal insurance. Don’t get it twisted. :)

augustlan's avatar

Cake decorators? That is really odd. That just seems like some kind of sick gambling. How do they even decide who to insure? I wonder if the insurance continues on into perpetuity, once an employee quits.

Ladymia69's avatar

I was actually hoping that some ballsy corporate Flutherer would speak up and enlighten us about how they are chosen! But let’s face it, it’s a shameful topic.

incendiary_dan's avatar

Honestly, compared to the negligent murder of tens of thousands of people by Union Carbide, which was never really penalized in any substantial way, nothing phases me.

dabbler's avatar

The original intention of policies like that is, as previously noted to offset costs to replace high-value employees – a legitimate use of insurance.
In these cases it’s a way of gaming insurance companies. The companies like Walmart have lots of information about employees and some of them will pop out of an actuarial analysis as high-risk of dying sooner rather that later. The cost of a policy is less than the likely payout so it’s a good investment. If it’s a publicly held corporation they are nearly legally bound to make as much money as possible for the corporation however that happens.
Sharing that bonanza with the employee’s family is… not on the spreadsheet, sorry.

creative1's avatar

As a former employee of Bank of America we are well aware of these insurance policies and have our own as well that were given to us for our families without costing us a dime and we had the opportunity to increase them at a small cost as well. It was also a practice of the bank I worked for that they took over which was Fleet, it is a regular practice and makes good business sense.

dabbler's avatar

@creative1 I think you’re talking abut a policy that pays to you or your family. Those are good.
The question is about policies that pay to the company excluding the family.

creative1's avatar

nope we know about the ones that pay the companies and we are well aware of them, the insurance policy was never a secret practice at Bank of America in fact we had to sign something about it.

creative1's avatar

I was also say in addition to the policy they had paying themselves they created one for us at the same time which actually gave us 2 times our salary in life insurance for free and we could up it if we want for a small amount.

creative1's avatar

Think about a company and how it works and how important its workers are, the training involved in replacing its staff members, think of how long it took to be proficient at your job, did you just come in and hit the road running or did you have to get up to speed on the projects you are on? or training to do the doing the job your doing? get training for anything? Well this insurance gives the companies the money to replace the person who passed away during their employment with them, it makes good business sense.

plethora's avatar

@creative1 is right. There is nothing whatever wrong or immoral about a company buying life insurance on its employees payable to the company. I have a very small company with only two employees and I have a load of insurance on one of them, payable to me (of which she is well aware) because it would cost me a fortune if she died. And I have no desire to collect on the policy. I’d much rather have her.

Further, no one gets to go around buying life insurance on anyone they please. Insurance companies do not want to be used as gaming intermediaries. They require that an “insurable interest” exist on every insured, i.e., a person who death would cause a financial loss to the purchaser of the policy.

WasCy's avatar

Some of y’all have very warped and twisted ideas about economics in general and capitalism in particular. I can’t say that I’m surprised.

The sole reason that a for-profit corporation has for its existence, the only reason that it should ever be brought into being and continue to exist afterward… is to make a profit for its owners. You and I and our families can have many great and wonderful purposes for our existence and reasons to go on living. A corporation has only one. One single, solitary justification for existence: that it earn a profit. Every other thing that it does or can do, and even the way it does that, is secondary to that primary focus. The rules by which it does that are pretty well codified, and are always changing because of the humans who make the rules for the corporations. No, no matter what you say or think, it’s not the other way ‘round. The people who run the corporation are required to play by those rules, and shame on them – and jail time, too – if they don’t. But the corporation itself has only a solitary reason to exist: it has to earn a profit for its owners. If it doesn’t, then it becomes a drain on its owners and on the public at large, and truly is evil – when it doesn’t earn a profit.

There’s nothing wrong with this. How great is it, really, that we humans can justify our existence in so many meaningful ways, and leave “profit-making” to entities that we can own and manage? Pretty damn great, I think. Yes, there are dangers. You can identify too closely with the corporation; you can commingle your future with its own and in effect sell yourself into it; you can believe that you are the corporation or that the corporation is you, and lose yourself that way. You can, in fact, be hurt by contact with the corporation (or any other living thing, for that matter, including your own loved ones). But that doesn’t have to happen.

When I bitch about government taking over our lives I’m often given the ‘advice’ that I should feel free to go to places that don’t have so much. I should go to Somalia. It’s time to turn that advice around, I think. If you hate corporations and capitalism so much, you should also feel free to go to places where they aren’t such an important part of everyday life… such as Somalia and Haiti.

As for the specific practice mentioned: so what? As long as no one makes me pay for life a insurance policy that doesn’t benefit people or causes of my choosing, why should I (or anyone else) care who buys it and who it benefits? The insurance company, in fact, is required to ascertain that there is an “insurable interest” in the policy. That’s good enough for me.

plethora's avatar

@WasCy Great Answer….very very good!!!

Ladymia69's avatar

@WasCy You didn’t answer the question.

Anyway, did I mention that they call them “dead peasant” policies?

Ladymia69's avatar

@creative1 and @WasCy OK, let me get this straight: you guys think it is morally right (and a good business practice) for a company to secretly take out a life insurance policy on its lower-tier employee (hard to find and train employees for lower-tier positions? I don’t think so. A monkey can push buttons and count if you train it), and then when the employee dies, they surreptitiously collect a large amount of money, not a solitary dime of which is given to the family (and the family is at this point struggling to pay the bills)?

If this is what you are saying, sit back and think about it for just a second.

No one can convince me that the corrupt practices such as these that companies indulge in are right, moral, or “make sense”. Not in the set of values that I hold. And if you have been desensitized into thinking that they are “normal”, you should probably take some time and think about what is really and truly important in this incredibly short life we are given.

Kraigmo's avatar

I’ve known about this and it never bothered me. If things got so corrupt that these companies were actually causing deaths to occur, I’d change my mind at that point. I’m more offended that (some of) these companies have crappy health care plans, treat their workers like drones, and lobby Congress to pass evil laws and not pass good laws.

If a company is otherwise really good towards its workers and partners and customers, I don’t have any problem with them buying life insurance policies and then collecting on the deaths later.

I also have no problem with people pulling gold and silver out the teeth of the dead, should the next of kin, or graverobber, choose to do so.

creative1's avatar

@ladymia69 What you don’t seem to grasp and understand is there was no secret about the policy, every employee was well aware of the policy and its existance and when it was taken out. You should get this straight from the get go.

Also with a company like Bank of America they do pay for college classes if you so choose, in fact I got my Six Sigma Green Belt through them, which is rather an expensive training and course if you are to do it on your own. Every year there are continuing training classes we were required to to take even on the Corporate side of the business which I was on. I am sorry you can say what you like about monkeys pushing buttons but in reality the job I was doing was far more than that and when I left it took months of training someone else to take over my role and they still didn’t have the Greenbelt that I took with me and can use elsewhere. Knowledge is a big thing so what I got from them was well worth any insurance policy they may have had on me, heck I didn’t pay for it.

You also have to remember the employess also got something in return they got a policy as well for their families for nothing. So in my view its a Win/Win situation and YES its just fine with me that the company re-coop their losses to replace me if I were to get killed while working there. Nothing wrong with a company protecting their interests.

You really should attend a business class to understand some basic business sense, that a company is in business to make money not loose money and a bank is a company not a non-profit organization.

WasCy's avatar

@ladymia69

I did answer your question, specifically. Apparently you didn’t read or understand my answer. Color me surprised.

JLeslie's avatar

@WasCy As you can see with my answer near the very top, I am not bothed by the life insurance, but I have to say even though I agree a corporations goal is profit, the company still has to show integrity. I don’t give a shit if they ever give a dime to charity, whcih seems to be the current gauge among corporate typed for being a company that cares about the community, I care that they pay a reasonable wage, don’t work their employees to death, and don’t cross the line when it comes to profit. Profit is good, but their comes a point where gouging customers and being horrible to employees becomes too much, too greedy, and eventually it does come back to haunt, a bubble bursts, or the market turns on them, and that in the end is bad business. Integrity counts, or should count in business too. There is morality in business, golden rule counts there too.

WasCy's avatar

Absolutely, @JLeslie. I gave you the second GA for that response. “Corporations” are not evil, and neither, for the most part, are the people who run them and set policy for them – when they stick to their own interests. But when those people get into bed with the politicians who do have power… that’s where evil starts.

JLeslie's avatar

@WasCy Getting into bed with the politicians is bad I agree, but it is not the only way business becomes evil, some business is horrible all on its’ own. Then it invites the need for government intervention or forming a union, which again I consider to be like the bubble bursting or a market backlash. If companies acted with integrity and fairness government and unions would not have to regulate them, which would be better in my opinion.

lawkes's avatar

Is it also “immoral” when Corporations made a lot of money off of the stock market crash (housing bubble) ? Or was losing all their money along with everyone else, the more honorable and “moral” thing to do?

Ladymia69's avatar

@WasCy I have reread your answer. My question pertained to specific circumstances wherein the employees noted were not told about life insurance policies being taken out on them by their employers, and the families of the deceased employees were left to suffer while the company cashed in on the dead. Everything in your answer to me amounted to a rationalization for the companies’ behavior, and an indifference to human dignity and integrity. Your callousness nauseates me. And I will not be told by such types to go to a place where capitalism isn’t if I don’t like it. I will stay here and fight.

And with that, I am abandoning this thread, so talk amongst yourselves.

incendiary_dan's avatar

Corporations functioning normally are drains on society. They behave in sociopathic and even psychopathic ways to ensure profits by externalizing costs onto the poor and middle class. They despoil countless landbases in order to concentrate wealth to themselves. Nothing about this is good for humanity or society. Industrialism is always damaging to human communities and ecosystems, and it is physically impossible for it to be any other way.

WasCy's avatar

Ah, yes, @incendiary_dan. Of course, the computer you use (daily) was handcrafted in some remote backwoods cabin in the woods of Guatemala near a rushing stream by smiling natives who carve the machines with stone tools for the simple love of the task and the sun on their backs. And you post on the internet with electricity provided by… who? ... God Itself?

I know that my peans in defense of capitalism jar on you, but you’ll have to admit someday that yours are worse: they’re hypocritical.

incendiary_dan's avatar

Wow, predictable and incorrect criticisms of critics. Big shock.

Ladymia69's avatar

@WasCy Your system is broken. One day you will understand that as well.

plethora's avatar

@incendiary_dan @ladymia69 What universe did you two come from? Oops, don’t answer that dan. I just read your profile.

@ladymia69 There is no such thing as a person’s life being insured “in secret”. There is an insurance company doing the insuring and the person whose life is insured must sign the application.

The person who pays the premium gets the death benefit….100% of it.

Sheesh!!

WasCy's avatar

Well, not to be too much of a noodge, @plethora, the person paying the premium “gets to say who” gets the benefit.

plethora's avatar

@WasCy Yes, you’re exactly right. Thank you..:)

(ps…how do you make the font small on here?)

augustlan's avatar

@plethora You put two dashes right before and right after the writing you want small.

dabbler's avatar

@lawkes ‘Is it also “immoral” when Corporations made a lot of money’
I’d say the word is ‘amoral’ because that’s the best trick of the corporation: externalize costs, such as caring about natural born persons. If it doesn’t fit on the profit/loss spreadsheet and isn’t required by the tax man and accountants, it isn’t important.

lawkes's avatar

@dabbler,

So you think being amoral is immoral?

augustlan's avatar

@lawkes I think you’re mis-reading something. I believe @dabbler is saying that morality is not a part of the equation whatsoever. The results may be immoral or not.

lawkes's avatar

@augustlan,

Morality might not be apart of the equation for a Corporation, and that is what I assumed @dabbler was saying (that a Corporations mentality is an amoral one), but my question was what do you (personally) think of a Corporation profiting off of someone else’s misfortune (foreclosures).

So am I to understand that you find this action to be an amoral one?

Or do you find this amoral action to be an immoral one?

augustlan's avatar

It’s not so cut and dried, for me. If the loan was a good one, and the borrowers had a full understanding of the possible consequences, well… shit happens. I wouldn’t blame the loaning party for doing what they must in that case. However, if they used predatory lending practices, didn’t disclose things to gullible people, if they, in essence, set the borrowers up to fail, I’d consider that immoral.

lawkes's avatar

Ah, if they’re honest in their business, it’s not immoral (shit happens) ?

Fine, then it’s safe to say that it’s not immoral (no dishonesty, just simple economics) about those few Corporations and selected others who made a lot of money off of the stock market crash in 2007, even though a lot of Americans were screwed ?

If you answer yes (it’s not immoral), then this situation is no different then the one presented by the documentary.

augustlan's avatar

Again, it depends on their business practices. If they were shady about it, immoral. If they were above-board and happened to get lucky, not.

plethora's avatar

In a debacle like the collapse of the market in 2008, it is difficult to know who was immoral, who was just stupid and who was just lucky. Politicians, from Johnson, Clinton, Barney Frank, and Timothy Geithner all committed immoral acts which caused the mortgage industry to grow and then collapse. All the little people, the so called “underprivileged” (per Clinton) got screwed by the collapse as they always do. Many in Wall Street also got screwed, some got lucky and some were immoral. Timothy Geithner’s name should top the list of the Wall Street types who either got lucky or were immoral. But then he became a politician who helped Barack Obama be both stupid and immoral.

Thus endeth the lesson. Pick your own candidates. Corporations, however, are legal entities and cannot commit stupid or immoral acts or get lucky.

augustlan's avatar

Corporations are run by human beings, who can certainly be stupid, immoral, or lucky. Sometimes, all at the same time.

lawkes's avatar

You guys are throwing immorality around to easily.

What is the standard of morality? Law? Religion? Science? Etc..

If it’s law, then there is nothing immoral about what the documentary presents, which begs the question, what moral standard are you judging by then? Religion? Your own morals?

I’m just curious where all this is coming from. I mean I’ve been told I’m immoral for being apathetic and that I’m going to hell.

It seems that we’re all going to hell one way or another because we’re violating someone else’s standard of morality.

I’m trying to keep the example specific for simplicity. If I opened up an account at a brokerage firm in 2007, and I placed my bets that the market will crash 500 points, so now I made a fortune because I made the right economical calculations, yet most Americans will suffer, am I immoral for doing this?

augustlan's avatar

Not law, and not religion, either. I’d say my own standards, but my standards are fairly universal. “Don’t be a jerk.”

In response to your edit: No. Now, if you had insider information, or if you purposely steered people to make a bad investment so that yours would be assuredly good, yes.

lawkes's avatar

I’m with you on that, but jerk can be interpreted so many ways…

augustlan's avatar

I edited, too.

lawkes's avatar

See, I think in this particular case I just made (without insider trading), @ladymia69 would still consider me immoral and I will burn in hell because I made money while most Americans got screwed.

Am I wrong @ladymia69?

If I’m wrong, my apologies, if I’m right, then how is this particular example any different then the one in your detailed question. These Corporations were securing their assets which is a wise business move, just like the market example (it was a wise move to bet that the market will crash to save your ass and make a fortune, otherwise you would be a victim to the same fate as the rest).

dabbler's avatar

@augustlan correctly describes my point to mean “morality is not part of the equation”.
@lawkes You bring up an outstanding edge of the whole matter, “Is amoral immoral”.
Is a car dangerous or safe? It depends on how it’s driven.
The results of driving a corporation have everything to do with the decisions made by the drivers. I’d say some corporations are driven immorally, causing pain and suffering through their operations that isn’t part of the profit/loss equation but is real and is a real cost to human beings.
There used to be a “Personnel” department at companies now there is “Human Resources” and while those are just labels there is something dehumanizing to the approach that makes a job a line item on a spreadsheet and the person to fill it just a fungible worker bee with all the right buzz words in their CV. Seems immoral to me, whether or not it appears to be good for the bottom line to approach it this way.

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