Accusations False, UnumProvident Ad ClaimsNov 26, 2002 | Portland Press Herald UnumProvident has gone on the public-relations offensive after a recent "60 Minutes" report said the disability insurer unfairly denies claims.
The newsmagazine segment was "a misrepresentation of the facts," the company argues in a full-page advertisement run last weekend in several newspapers.
The ad, titled "UnumProvident Responds," was in the form of an open letter by CEO J. Harold Chandler. He addressed it to the company's "customers, friends and communities." The ad ran in the Maine Sunday Telegram as well as in papers in Worcester, Mass., and Chattanooga, Tenn.
According to Linnea Olsen, a UnumProvident representative, the ad ran in areas where the company has a lot of employees. UnumProvident is headquartered in Chattanooga, and has about 3,600 employees in Portland.
In the ad, UnumProvident asserted that it does not set targets or pay bonuses to close claims inappropriately.
"To suggest that the natural stresses of our business involve pressure of any kind to close claims inappropriately is absolutely false," the ad states.
A representative of the popular CBS program stood by the segment.
"We're confident that the months-long investigation we undertook of UnumProvident yielded a fair and accurate report of what goes on there," said Kevin Tedesco of "60 Minutes." "They're welcome to draw as much attention to it as they want."
Olsen said the company plans to run more such ads in trade publications, but not in daily newspapers. Olsen said it decided to run the ad following comments by UnumProvident employees who were "pretty vocal and pretty upset about the accusations that have been made."
"We wanted to make sure the communities understand that these accusations are not true, they're false," said Olsen. "I think that because we did not go on-camera for the show that people expressed concern that we didn't defend ourselves. We knew there was no upside to going on the show."
Olsen said the company has an entire section of its Web site (www.unumprovident.com/commitment) devoted to customer testimonials and other signs of support.
"60 Minutes" carried a story Nov. 17 that alleged UnumProvident set dollar targets for claims denials by its employees and tried to reach those goals even if it meant denying valid disability claims.
The show highlighted the case of an eye surgeon, whose claim for disability was denied after he developed a tremor in his hand. UnumProvident subjected the surgeon to surveillance, saying it videotaped him playing football in his back yard. The man in the tape was the doctor's 23-year-old son.
The doctor eventually developed Parkinson's disease, sued UnumProvident and was awarded more than $36 million by a jury. To avoid prolonged appeals, he settled with the company for an undisclosed sum.
In the newspaper ad, UnumProvident said it never denied a claim for Parkinson's disease for the doctor.
UnumProvident's stock dropped more than 6 percent the day after "60 Minutes" aired the allegations that the insurer unfairly denies claims. The company's stock fell $1.15 on that day, closing at $17.40. It closed at $17.55 on the New York Stock Exchange on Monday.