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Murder for life insurance and how an unwittingly involved agent should react

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This coming December, two people in separate cases will likely be sentenced to life in prison without the possibility of parole—both for killing their spouses with the motive of collecting large life insurance payouts.

In Las Vegas on Oct. 1, a mother of four, Michelle Antwanette Paet, 33, pleaded guilty to plotting with her ex-convict boyfriend and killing her husband, a U.S. Air Force service member from Guam in Dec. 2010. Her former boyfriend, Michael Rudolph Rodriguez, 36, will get life in prison without parole when he’s sentenced separately.

Paet acknowledged enlisting Rodriguez to kill her husband with the intention of collecting $650,000 as the beneficiary of his life insurance policy.

Meanwhile in Denver, a jury convicted 59-year-old Harold Henthorn on Sept. 21 of killing his second wife by pushing her off a 120-foot cliff in Rocky Mountain National Park in Sept. 2012 in order to collect $4.5 million as the beneficiary of her life insurance coverage.

The case also led Douglas County, Colo., authorities to reopen an investigation into the death of Henthorn’s first wife, who died in 1995 on a rural county road south of Denver. She was killed when the couple’s vehicle “slipped off its jack” while helping to change a tire. The death, which prosecutors in the most recent trial said they believe happened after Henthorn pushed the car off the jack with his foot, was ruled accidental at the time, and Henthorn collected $496,000 as the beneficiary of her life insurance.

By the count of Dennis Jay, executive director of the Coalition Against Insurance Fraud, there have been more than a dozen cases filed across the country in the past year involving the death of spouses who are heavily insured.

In a Sept. 25 blog post, Jay said his organization often hears from detectives in homicide investigations, inquiring as to how they can find out if a policy exists on a person who may have died under suspicious circumstances. “Learning that a murder victim is heavily insured is crucial because it often opens the door to other motives and evidence,” Jay said in his post.

He said it’s good that cases like this receive media coverage because it sends a signal that killers get caught and punished for this crime, and hopefully that causes people to think twice.

It should also cause insurance agents who may be unwittingly involved – as in they sold the policy in question – to think twice and proceed carefully.

When the Henthorn case first came to light, National Ethics Association Chairman Steven R. McCarty weighed in on the proper course of action for an agent in these types of scenarios.

He said it would be best for an agent who might become suspicious to report those suspicions directly to the insurer (rather than the police or Insurance Commissioner), but also to assist the widow or widower in the claim filing – doing whatever he or she would normally do for a beneficiary.

“A life insurance producer is legally considered an agent of the insurance company. That carries with it a number of obligations, including full disclosure of information relating to the sales of insurance or the processing of claims,” McCarty said. “Since the agent sold the policy, he or she is duty-bound to provide the insurer with all material information regarding the claim.”

After hearing from the agent, the carrier, who might preemptively conduct its own investigation anyway before cutting a multi-million-dollar check to a beneficiary under any suspicion whatsoever, can then notify the police and support the investigation on their end.

“Once the carrier is aware of the beneficiary’s alleged role in causing the insured’s death, the insurer will put the claim on hold, and the agent will be off the hook,” McCarty said.

At that point the police may contact the agent for further information, and the agent has fulfilled his or her ethical duty in the situation.

To read more about why an agent should contact the insurer and not the police or insurance commissioner in a situation like this, please see: Client dies in mysterious accident. What would you do?