Delay and deny: How this insurance company avoided paying for nursing home care

MINNEAPOLIS (FOX 9) – Minnesotans who planned to use their long-term care insurance to pay for nursing homes and other long-term care have instead faced a pattern of delays, denials and inadequate communication, according to hundreds of complaints reviewed by the FOX 9 Investigators.

Hundreds of complaints against insurance company Transamerica 

Why you should care:

Tens of thousands of Minnesotans purchased long-term care insurance in the 1990’s and 2000’s. The appealing benefit was offered through some of the largest companies in the state, including 3M, Wells Fargo and Mayo Clinic. It was also offered to county and state employees, and through the teachers’ union.

Carol and her husband purchased their long-term care insurance from Transamerica in 2002 before retiring from teaching.

“We wanted to have peace of mind,” said Carol, who did not want to share her last name out of fear of retribution from the insurance company. 

“We just wanted to make sure that we just weren’t a burden on other people.”  

Carol believed her insurance would cover the cost of care when her husband was diagnosed with Alzheimer’s disease and moved into an assisted living facility. Instead, Carol told the FOX 9 Investigators she faced a “horrific” process involving delayed and denied claims, which continued even after her husband’s death. 

“I think the biggest theme is delay, delay, delay,” said Elizabeth Wrobel, an attorney who helps policyholders like Carol navigate the claims process. 

Wrobel described that process as “confusing” and “complicated.”

What they’re saying:

Hundreds of complaints filed against Transamerica reviewed by the FOX 9 Investigators detail a pattern of frustrations. 

“Even now as I’m writing this, I fall apart,” one person wrote about the multi-billion-dollar Iowa-based company. “This has put me in severe financial trouble.”

Transamerica was previously  fined $600,000 by the state after a surge in complaints.

“It was solely focused on claims handling,” said Jacqueline Olson, assistant commissioner at the Minnesota Department of Commerce.

But despite a consent order mandating changes, complaints against the company continued to grow.

One described their experience with Transamerica on behalf of their parents, writing in a complaint that “there’s no way an elderly person could navigate this bottomless pit… please help.” 

Critics say Transamerica is ‘crying poor’ while raising insurance rates nationwide

The other side:

A spokesperson for Transamerica ignored an  interview request but provided a statement that said, in part, “our customers are our top priority.” 

However, during an investor’s presentation by its parent company Aegon, the company highlighted efforts to raise costs significantly for those consumers. 

“Transamerica has taken several actions to strengthen its capital position… achieving additional long-term care rate increases,” said Aegon CEO Lard Friese. 

 Financial records reveal the company’s plan to raise insurance premium rates across the U.S., which is projected to rake in $700 million. 

Other insurance companies have also requested large rate increases in recent years, leading to allegations that they are trying to drive people out of policies they paid premiums on for years. 

“I think corporations cry poor all the time and then somebody else is expected to pay the price,” said Wrobel. 

Dig deeper:

Policy holders can file complaints against companies like Transmamerica if they feel their claims are mishandled or wrongfully denied. But that’s about it.

Minnesota law currently prevents people from suing an insurance company if they act in bad faith. 

Repeated efforts to lift that immunity for insurance companies have been blocked by the insurance industry at the Minnesota Legislature.

“We do not think more litigation is the answer here,”  said Robyn Rowen of the Minnesota Insurance & Financial Services Council during a 2024 legislative hearing. “Insurance companies absolutely need to keep their promises and the vast majority do.” 

What’s next:

 Minnesota state Rep. Kelly Moller (DFL – Shoreview) said she continues to hear from constituents about what she calls “predatory” practices, and is working on new legislation.

“We’re looking at putting this in the consumer fraud statutes instead, which I hope will alleviate that concern that this is like a slippery slope for all insurance companies,” Rep. Moller said.

“It’s not fair to deny them in their most vulnerable time of their lives, to deny them this coverage.”

What you can do:

If you are facing problems with your insurance provider, you can file a complaint with the state commerce department here: 

FILE A COMPLAINT: