My father is 71 years old and he is receiving benefits from a long-term care insurance policy.
The policy is a reimbursement policy and it contains an exclusion
for family members as caregivers. That is, the caregiver that is paid by the insurance company to care for him
can not be a family member.
The daily benefit amount is $100.
He has had the same caregiver for the past 4 years.
Recently, he mentioned the possibility of getting married to his caregiver.
I told him that if he marries his caregiver then she becomes a family member
and she can no longer get paid to look after him.
I also told him that if she continues to be a paid caregiver after the marriage
then the insurance company could sue him for breach of contract because he would be violating the terms
of the policy.
He did not seem to understand this restriction of the long-term care policy.
In addition to breach of contract, could the insurance company sue him for civil fraud?
Also, could the district attorney bring criminal insurance fraud charges against him?
I do not want tell him he would be committing criminal insurance fraud unless that is the case.
Given that he qualifies medically for benefits under the policy, would marrying his caregiver be considered civil insurance fraud, criminal insurance fraud, or simply a breach of contract?
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1 Answer from Attorneys
You are absolutely correct that he could be sued by the insurance company for reimbursement of everything they pay out for care after the marriage, if he continues to submit claims under the policy after the marriage, unless he discloses the marriage. And of course if he discloses the marriage, then the claims will be denied. He could also be sued for civil fraud because he has a duty to disclose the marriage and failure to do so is a form of fraud - duty to disclose information and failure to do so is legally fraud even though there would be no fraud in the absence of a duty to disclose. Technically he could be charged with criminal insurance fraud as well, although unless he lives in a VERY peaceful county, the likelihood that the DA would have resources to prosecute an old man over $100/mo. is pretty slim unless it went on for a long time.
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