ALBANY - U.S. Sen. Charles Schumer is seeking to enda practice in which insurance companies hold the death benefits ofsoldiers killed in action to collect interest while doling outsmall amounts to survivors.
In the widespread, legal practice first reported by BloombergMarkets magazine, insurance companies provide a small amount ofinterest to grieving families and provide a checkbook to withdrawfunds. Meanwhile, the companies that hold the benefits collectgreater interest.
The New York Democrat says he is crafting a measure that wouldrequire the Department of Veterans Affairs and the federalpersonnel office for all federal workers to contract with companiesthat offer a lump sum payment for a death benefit as the default.
There was no immediate comment from Veterans Affairs.