Unum Group changed to UnumProvident after the 1999 merger of Unum Corp and Provident Cos. As of March 2, 2007, UnumProvident began using the name Unum on the New York Stock Exchange.
The name change may be partially due to a desire on the part of UnumProvident to distance itself from its bad image. UnumProvident has been known as a company that practices bad faith insurance and has had to pay a number of large settlements to various states because of its dishonest practices.
Bad faith insurance practices are all too common in the insurance industry, with UnumProvident being just one of the more notable companies practicing it. Basically, an insurance company practices bad faith insurance when it fails to pay a claim for no reason, or if it takes a position that violates the insurance coverage policy.
There are a number of ways that an insurance provider can practice bad faith insurance. One way is by intentionally underpaying claims. Other forms of bad faith insurance include failure to properly investigate a claim, unreasonable delay in making payments to the policy holder, and reasonable termination of an insurance claim that should have been paid.
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Allegations that have been brought against UnumProvident include that the company pressured medical examiners and destroyed documents in order to deny claims; that agents were pressured to deny claims; that agents were pressured to terminate existing claims even if they were legitimate; that agents were given bonuses for closing down a certain number of claims; and that doctors were pressured to back up decisions to cancel claims.
When a policyholder signs an insurance contract with an insurance provider, the policyholder's interests must become primary in the eyes of the company. This means that the company's financial interests cannot come before the interests of the policyholder and the company must pay out on legitimate claims.