Lincoln National Targeted in New Lawsuit Challenging Insurer’s Checkbook Practice

Lincoln National Corp. March 15 was slapped with a proposed class action which alleges the insurer violated federal benefits law by issuing checkbooks, rather than lump-sum distributions, to life insurance beneficiaries (Spataro v. Lincoln National Corp.).

At least four other life insurance companies have been sued in similar lawsuits in the past couple of years.

The latest lawsuit, filed in the U.S. District Court for the Southern District of New York, alleges that Lincoln National and its associated companies violated the Employee Retirement Income Security Act’s prohibition against plan fiduciaries dealing with plan assets in their own interest. ...