Israeli Insurance Companies Under Fire for Refusing to Pay Families of Murdered Teens

Clal Insurance says it paid in case of Shira Banki, killed at Jerusalem Gay Pride parade, but Ayalon contests claim over murdered teen from Eilat.

Reuters

Two of the country’s insurance companies, Clal and Ayalon, are facing questions regarding their refusal to pay insurance benefits to the families of a number of Israeli teens who were murdered.

Clal Insurance had been the target of criticism this week over its purported refusal to pay insurance benefits in the case of Shira Banki, the 16-year-old girl who was stabbed to death by a ultra-Orthodox zealot at last summer’s Jerusalem Gay Pride parade, as well as to the families of the victims of the 2009 shooting at the Bar Noar gay and lesbian youth center in Tel Aviv.

The insurance companies claim that the policies involved in some of the cases were for accident-related deaths, while the incidents in which some of the teens met their deaths were not accidents, although in the Banki case, Clal said benefits were in fact paid.

Clal also apparently declined coverage in the case of children whose father threw them to their deaths from the roof of a building. In addition to maintaining that they were not accidents, Clal is also maintaining that the incidents cannot be considered unforeseen events.

Now it transpires that Clal Insurance is not alone in rejecting claims filed as a result of the murder of young people. Ayalon Insurance is a party to a case pending in court in Eilat involving a 15-year-old, Dotan Abro, who was stabbed outside of a club in the city and died of his injuries. Ayalon provided student personal accident coverage for the victim, and his parents have sued Ayalon claiming that they were entitled to 141,000 shekels ($36,000) in death benefits that the policy provides for. Ayalon said the policy in question did not cover the incident, adding, as Clal had maintained in the other cases, the case did not involve an unforeseen event.

The Knesset Labor, Welfare and Health Committee convened a session on Monday that looked into the refusal by Clal Insurance to pay insurance proceeds.

A Justice Ministry legal aid division representative, Tamar Klanberg-Levy, told the panel that after an angry telephone call and threats against it to go to the media, Clal agreed to make payment of some amount. But with regard to Klanberg-Levy’s statements to the committee on the Shira Banki case, Clal issued a statement saying that she had blatantly distorted the facts, add ng that insurance proceeds were indeed paid. In connection i with the Eilat incident, Ayalon Insurance declined to comment.

For his part, Zionist Union MK Itzik Shmuli told the hearing on Monday that families face tremendous obstacles in seeking to obtain insurance proceeds from insurance companies. When it comes to student accident insurance, he said that last year 6,472 inquiries were lodged with insurance companies on student accident coverage, but they resulted in only 61 pay-outs of claims that the insurance companies deemed justified.

MK Karin Elharrar of Yesh Atid said it is the role of the insurance oversight division at the Finance Ministry to help members of the public obtain what they have coming. The Finance Ministry responded: “The Capital Markets, Insurance and Savings Division require the insurance companies to act with transparency and fairness. The division has begun an examination that will look into whether the company fulfilled the terms of the policy that was purchased as the law requires.”