[DRAFT] Repeal "Ban Profits on Workers' Deaths"

[Mosktopia]

Repeal "Ban Profits on Workers' Deaths"
Category: Repeal | Target: GAR #233

The General Assembly:

Observes that General Assembly Resolution #233, "Ban Profits on Workers' Deaths," seeks to increase welfare by heavily regulating a very narrow aspect of the insurance industry;

Troubled that GAR #233 fails to understand the difference between insuring a business against the loss of an important employee and "profiting" off of that employee's death;

Aware that "dead peasant policy" is not a fair name for accidental-death insurance - which exists to save a business from bankruptcy in the event of the tragic loss of a critical employee - and that there are a number of situations in which it is a good practice for a business to insure itself against the loss of a valuable employee, including:

1. Law offices, where the loss of an important lawyer would result in the impairment of several cases and potential malpractice lawsuits if the law firm is not properly insured against the loss;
2. Small businesses whose existence depends on the work of a critical employee (such as bakers, carpenters, plumbers, cooks, and nearly every small scale service business), where the entire business would be shut-down and its employees left destitute if the loss of the critical employee was not covered by insurance;

Recalls that clause 2 of GAR #233 states: "The employee’s free, fully informed, uncoerced consent shall be required for the validity of any life-insurance wherein her/his employer is a beneficiary. Other beneficiaries of the employee’s own free choosing shall receive at least half the benefits of any life-insurance policy, present or former, in which the employer is or was a beneficiary."

Confused as to why businesses seeking to insure themselves against the loss of an employee should be forced to pay "at least half" of the benefits of that policy to someone else;

Believes that by forcing businesses to give away at least half of the benefits of any life insurance policy, GAR #233 effectively guarantees that businesses will either (a) receive far less than the amount they need to survive a loss, or (b) have to buy unnecessary additional coverage at great expense just so the necessary insurance will be available if needed;

Shocked that GAR #233 requires businesses to give away at least half of the benefits of any life insurance policy even if the business has already provided comprehensive life insurance to the employee as a job benefit;

Notes that while accidental-death insurance policies should not be kept secret from the employee, that objective could have been accomplished without also crippling the effectiveness of such policies;

Disappointed that GAR #233 uses incendiary language and outrageous rhetoric to unfairly attack and cripple the practice of insuring a business against accidental death;

Hereby repeals General Assembly Resolution #233, "Ban Profits on Workers' Deaths".

Repeal "Ban Profits on Workers' Deaths"
Category: Repeal | Target: GAR #233

The General Assembly:

Observes that General Assembly Resolution #233, "Ban Profits on Workers' Deaths," seeks to increase welfare by heavily regulating a very narrow aspect of insurance law;

Troubled that GAR #233 fails to understand the difference between insuring a business against the loss of an important employee and "profiting" off of that employee's death;

Aware that "dead peasant policy" is not a fair name for accidental-death insurance - which exists to save a business from bankruptcy in the event of the tragic loss of a critical employee - and that there are a number of situations in which it is a good practice for a business to insure itself against the loss of a valuable employee, including:

1. Law offices, where the loss of an important lawyer would result in the impairment of several cases and potential malpractice lawsuits if the law firm is not properly insured against the loss;
2. Small business whose existence depends on the work of a critical employee (such as bakers, carpenters, plumbers, cooks, and nearly every small scale service business), where the entire business would be shut-down and its employees left destitute if the loss of the critical employee was not covered by insurance;

Recalls that clause 2 of GAR #233 states: "The employee’s free, fully informed, uncoerced consent shall be required for the validity of any life-insurance wherein her/his employer is a beneficiary. Other beneficiaries of the employee’s own free choosing shall receive at least half the benefits of any life-insurance policy, present or former, in which the employer is or was a beneficiary."

Confused as to why businesses seeking to insure themselves against the loss of an employee should be forced to pay "at least half" of the benefits of that policy to someone else;

Believes that by forcing businesses to give away at least half of the benefits of any life insurance policy, GAR #233 effectively guarantees that businesses will either (a) receive far less than the amount they need to survive a loss, or (b) have to buy unnecessary additional coverage at great expense just so the necessary insurance will be available if needed;

Notes that while accidental-death insurance policies should not be kept secret from the employee, that objective could have been accomplished without also crippling the effectiveness of such policies;

Disappointed that GAR #233 uses incendiary language and outrageous rhetoric to unfairly attack and cripple the practice of insuring a business against accidental-death;

Hereby repeals General Assembly Resolution #233, "Ban Profits on Workers' Deaths".

Repeal "Ban Profits on Workers' Deaths"
Category: Repeal | Target: GAR #233

The General Assembly:

Observes that General Assembly Resolution #233, "Ban Profits on Workers' Deaths," seeks to increase welfare by heavily regulating a narrow aspect of insurance law;

Troubled that GAR #233 fails to understand the difference between insuring a company against the loss of an important employee and "profiting" off of that employee's death;

Recalls that clause 1 of GAR #233 states: "Defines, for the purpose of this resolution, “Dead peasant policy” as when an employer secretly buys a life-insurance policy in an employee’s name, designating the employer itself as a beneficiary, collecting or expecting to collect benefits after the death of said employee;"

Aware that "dead peasant policy" is not a fair name for tragic-loss insurance, and that there are a number of situations in which it is a good practice for a business to insure itself against the loss of a valuable employee, including:

1. Small doctors' offices, where the loss of a principle nurse or medical assistant would doom the business to fail if the office is not properly insured against the loss;
2. Large law firms, where the loss of an important lawyer would result in the impairment of several cases and potential malpractice lawsuits if the law firm is not properly insured against the loss;
3. Every small business whose existence depends on the work of a critical employee (i.e. bakers, carpenters, plumbers, cooks, etc.), where the entire business would be shut-down and its employees left destitute if the loss of the critical employee was not covered by insurance;

Recalls that clause 2 of GAR #233 states: "The employee’s free, fully informed, uncoerced consent shall be required for the validity of any life-insurance wherein her/his employer is a beneficiary. Other beneficiaries of the employee’s own free choosing shall receive at least half the benefits of any life-insurance policy, present or former, in which the employer is or was a beneficiary."

Confused as to why a business seeking to insure itself against the loss of an employee should be forced to pay "at least half" of the benefits of that policy to someone else;

Believes that the second sentence of clause 2 betrays a complete misunderstanding of tragic-loss insurance - which exists to save a business from bankruptcy in the event of the loss of a critical employee - and that forcing business to give away at least half of the benefits of their insurance effectively guarantees that the business will not receive all of the funds it needs to survive the loss;

Notes that while such insurance policies should not be kept secret from the employee, that objective could have been accomplished without also crippling the effectiveness of such policies;

Disappointed that GAR #233 uses incendiary language and outrageous rhetoric to unfairly attack and cripple a legitimate business practice;

Hereby repeals General Assembly Resolution #233, "Ban Profits on Workers' Deaths".

Repeal "Ban Profits on Workers' Deaths"
Category: Repeal | Target: GAR #233

The General Assembly:

Observes that General Assembly Resolution #233, "Ban Profits on Workers' Deaths," seeks to increase basic welfare by heavily regulating a narrow aspect of insurance law;

Notes that "Ban Profits on Workers' Deaths" contains several inflammatory phrases, not the least of which is its title, and that GAR #233 uses bold and italic formatting to highlight suspect words and phrases, such as "the corporations themselves," "dead peasant policy," and "secretly;"

Believes that GAR #233 uses such inflammatory language as a tool to outrage voters into supporting GAR #233's provisions, and that GAR #233 does this because it is weak on the merits;

Recalls that clause 1 of GAR #233 states: "Defines, for the purpose of this resolution, “Dead peasant policy” as when an employer secretly buys a life-insurance policy in an employee’s name, designating the employer itself as a beneficiary, collecting or expecting to collect benefits after the death of said employee;"

Recognizes that these so-called "dead peasant policies" involve insurance claim benefits, and have nothing to do with "profiting" from a worker's death as the title of GAR #233 leads one to believe;

Aware that there are a number of situations in which it is a good practice for a business to insure itself against the loss of a valuable employee, including:

1. Small doctors' offices, where the loss of a principle nurse or medical assistant would doom the business to fail if the office is not properly insured against the loss;
2. Large law firms, where the loss of an important lawyer would result in the impairment of several cases and potential malpractice lawsuits if the law firm is not properly insured against the loss;
3. Every small business whose existence depends on the work of a critical employee (i.e. bakers, carpenters, plumbers, cooks, etc.), where the entire business would be shut-down and its employees left destitute if the loss of the critical employee was not covered by insurance;

Convinced that the practice of buying a life insurance policy on a critical employee is not so vile as GAR #233 suggests, and may even be necessary for some businesses to survive a calamitous event;

Recalls that clause 2 of GAR #233 states: "The employee’s free, fully informed, uncoerced consent shall be required for the validity of any life-insurance wherein her/his employer is a beneficiary. Other beneficiaries of the employee’s own free choosing shall receive at least half the benefits of any life-insurance policy, present or former, in which the employer is or was a beneficiary."

Confused as to why a business seeking to insure itself against the loss of an employee should be forced to pay "at least half" of the benefits of that policy to someone else;

Believes that the second sentence of clause 2 betrays a complete misunderstanding of tragic-loss insurance, which exists to save a business from bankruptcy in the event of the loss of a critical employee;

Notes that forcing business to give at least half of the benefits of their tragic-loss insurance away effectively ensures that the business will not receive all of the funds it needs to survive the loss;

Convinced that GAR #233 purposefully overstates its case against a practice that is good for both employers and their employees, and that GAR #233 includes benefit-sharing requirements that are unwarranted and unreasonably hamper the ability of businesses to insure themselves against disastrous losses;

Hereby repeals General Assembly Resolution #233, "Ban Profits on Workers' Deaths".

This turned out kinda long. If folks agree with the intent, I'd really appreciate thoughts on how to make this more concise.

[The Dark Star Republic]

"Excellent. This is one of the resolutions we had been targeting for repeal, but my staff hadn't got around to preparing a draft on the subject.

"That said, I do feel the length works against you here. By far the strongest argument against the original resolution is the 'at least half' provision, which is completely ridiculous. In your repeal, that argument is buried about ten lines deep, and while that may help with the flow of the argument, it means that a little weariness has set in by the time we come across that point.

"For example:

Convinced that the practice of buying a life insurance policy on a critical employee is not so vile as GAR #233 suggests, and may even be necessary for some businesses to survive a calamitous event;

"I agree. However, the original resolution only concerns instances where the policy is bought 'secretly'. So it's not a particularly strong argument, as you can still continue to buy such policies even with this legislation in place - you simply need their knowledge and consent.

"By contrast, there is no way around the fact that if someone whose work would have made the company large properties, and into which the company has already put significant investment - the most obvious example being a research pharmacist - dies, under the terms of this the employer cannot recover the lesses of their investment, instead having to pay out half of all insurance policy returns to the dependents of the subject of the policy.

"My concern about your repeal is that those who oppose dead peasant policies will likely oppose your argument. That's unhelpful to securing its passage given the original resolution passed by a majority vote. What you should concentrate on is gaining the support of both those who support or are neutral on dead peasant policies, and those who oppose such but have technical problems with the original resolution.

"To that end, I think your repeal would be best served by concentrating on the latter clauses.

"In any case, I'm glad to see a repeal project for this damaging legislative mistake being considered."

~ Ambassador to the WA Inky Fungschlammer

[Mosktopia]

*snip*

Quick turn around on a (shorter) second draft, taking DSR's points into consideration.

[Grays Harbor]

Considering our long standing opposition to the resolution in question, we believe you could have a text describing the sound a duck makes when it farts in the water, and you would have our full support for the repeal effort.

[Point Breeze]

I don't support dead peasant policies, and (maybe its just because my liberal education has made me immediately suspicious of business) I'm not sure I agree with the principle of tragic- loss insurance either.

However, I can agree the clause dictating an employee must pay half of their policy to the employees family is absurd and should be removed. (This clause may force employers to buy significantly larger policies to ensure they receive enough benefits. In turn, families would get a bigger half and depending on the size of the policy, might not eben have to buy coverage themselves).

I support the repeal, but only if there's a replace effort that keeps the same values as the original.

[The Two Jerseys]

Considering our long standing opposition to the resolution in question, we believe you could have a text describing the sound a duck makes when it farts in the water, and you would have our full support for the repeal effort.

"What he said." -Ambassador J.R. Ewing

[The Last Homely House]

I really like this repeal. While it may be a little long-winded, it is extremely good. If you really want to cut down the length, you don't have to rewrite entire clauses of the old resolution and just say "clause one has these issues..." (with better wording of course)

[Chester Pearson]

While I am all for protecting workers rights, this resolution was written based on RealLIfe issues... I am FOR, due to these facts, and because I don't like the Christian Democrats...

[The Dourian Embassy]

This has been on my radar for quite some times(mostly thanks to The Dark Star Republic), but I'm glad to see someone tackling it.

[Mosktopia]

Shortened again. New draft up.

[The Dark Star Republic]

"I recommend trying to get one of the good pencil-whippers to take a look at this, as there seem to be a few grammatical issues. Not really my forte, though, so for now I'll concentrate on the argument:

Observes that General Assembly Resolution #233, "Ban Profits on Workers' Deaths," seeks to increase welfare by heavily regulating a very narrow aspect of insurance law;

"I'm not sure this is a good argument, at least in the sense that I wouldn't be in favour of significantly broader legislation on the insurance industry along the same lines. Also, I find the construction 'regulating...law' to be a little odd, though not necessarily incorrect. If you're going to keep this argument, I would suggest 'regulating a very narrow aspect of the insurance industry'.

Believes that by forcing businesses to give away at least half of the benefits of any life insurance policy, GAR #233 effectively guarantees that businesses will either (a) receive far less than the amount they need to survive a loss, or (b) have to buy unnecessary additional coverage at great expense just so the necessary insurance will be available if needed;

"Sorry if it feels like I'm banging on about the 'half of the benefits' clause, but an additional point you could make is that even without paying out such an amount, it would still be possible for a company to well compensate the family. A drug company would probably be willing to pay several times the salary of a key innovator, whose policy would nonetheless cover for a far greater loss. Thus requiring the 'half of all benefits' is a drastic overreach.

Notes that while accidental-death insurance policies should not be kept secret from the employee, that objective could have been accomplished without also crippling the effectiveness of such policies;

"I like that line. It's a succinct way of summing up the basis of the problem with the proposal.

Disappointed that GAR #233 uses incendiary language and outrageous rhetoric to unfairly attack and cripple the practice of insuring a business against accidental-death;

"This is a good strike. I'm wondering whether it would be better to move it earlier in the document, but maybe it's good to have as the last line before the form 'Repeals...' part."

~ Ambassador to the WA Inky Fungschlammer

[Mosktopia]

Updated. Bumping for final pre-submission comments.

[The Eternal Kawaii]

We originally supported this resolution on the grounds that moral hazard in the insurance business should be outlawed. We could be persuaded to support this repeal, though, if the repeal author can make the case that the resolution is genuinely flawed rather than just re-instituting moral hazard as a supposed economic freedom.

Also--is the author planning a replacement that would continue the ban on moral hazard?

[Mosktopia]

We originally supported this resolution on the grounds that moral hazard in the insurance business should be outlawed. We could be persuaded to support this repeal, though, if the repeal author can make the case that the resolution is genuinely flawed rather than just re-instituting moral hazard as a supposed economic freedom.

Also--is the author planning a replacement that would continue the ban on moral hazard?

I am not planning a replacement myself. I have tried to make it clear in the repeal text that I agree with the premise that accidental-death insurance policies should not be kept secret from the employee. I could support a replacement with that objective.

But the practice of insuring a business against accidental death is sound, and the resolution takes the unnecessary step of requiring business to pay out most of those benefits without clearly explaining why that's appropriate. If the goal is to ensure that such policies are not made in secret (that word is bolded in the resolution text), then forcing the business to give up more than half the benefits doesn't make sense. It's just a punitive stab (even against business that take out policies with the employee's blessing) that could end up bankrupting some small enterprises.

So this isn't about "re-instituting moral hazard," it's about clearing away an unwise and unwarranted clause that creates a serious financial hazard, mostly to small-to-medium-sized service businesses.