Too many households neglecting life insurance – National Consumers League

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By Sally Greenberg, NCL Executive Director

A recent industry review of Americans purchasing life insurance showed a startling trend: the number of American households with life insurance was at its lowest in 50 years.  The drop in insurance is tied directly to the economic downturn, Today only 44 percent of households have an individual life insurance policy, and 30 percent have no individual- or employer-provided life insurance. The study was done by LIMRA, an industry life insurance think-tank and research arm. The study found that 11 million households with children younger than 18, which are the families with the greatest need for coverage, have no life insurance.

Life insurance is part of a social safety net. It protects surviving spouses and children when the sole breadwinner or other income earners in a family dies. Ironically, the cost of life insurance has dropped over the past several decades. A 35-year-old healthy male can purchase life insurance for $25 a month for a 20-year-term policy that would pay $500,000 upon his death, according to statistics from ING. But nevertheless in tough economic times, life insurance seems like a luxury. In truth it is not. It is a necessity for all working families trying to watch out for unforeseen events.

Insurance companies need to do outreach, to let consumers know that term life insurance is affordable. But insurance companies need also to guarantee that premiums and fees will be reasonable and that consumers can make a good investment without fearing they will be ripped off in any way.

This is an area of great concern: ensuring that consumers are taking advantage of relatively inexpensive life insurance to protect their families in the event that they will no longer be around. The life insurance industry has a lot of work to do to get the word out – and to work closely with consumers so that they can understand the critical importance a good solid life insurance policy can have on protecting the interests of American families.

NCL statement on passage of the FDA Food Safety Modernization Act, H.R. 2751 – National Consumers League

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December 21, 2010

Contact: (202) 835-3323, media@nclnet.org

Washington, DC— Today, the U.S. House of Representatives passed the FDA Food Safety Modernization Act, H.R. 2751, clearing the final hurdle and sending the bill to the President’s desk, where Mr. Obama has pledged to sign it. The legislation will enable consumers to ring in the New Year knowing that the U.S. food supply of the future will be safer.

With today’s vote, the House finished a circuitous process that started nearly a year and a half ago, when the body passed the first version of the food safety bill. In the interim, there have been numerous twists and turns that called into question whether landmark food safety legislation would pass. But indeed, the Senate took up a bill Sunday evening with a new bill number,and it passed by unanimous consent.

“Consumers have waited far too long for an overhaul of outdated food safety laws that do not adequately protect Americans from the threat of foodborne illness. We applaud the members of the House and Senate for overcoming the partisan gridlock and adopting this important measure. This holiday season, there are families in America feeling the absence of those they have lost due to foodborne illness; the FDA Food Safety Modernization Act will protect countless Americans – and their loved ones – from the perils of unsafe food,” stated Sally Greenberg, NCL Executive Director.

The FDA Food Safety Modernization Act shifts the focus of the Food and Drug Administration from responding to foodborne illness outbreaks to preventing those outbreaks in the first place. Among other measures, the bill gives the agency the authority to recall contaminated products, develops new requirements for product traceability, and establishes a minimum inspection frequency for domestic food processing facilities. The legislation also increases oversight of imported foods, holding items produced abroad to the same safety standards as those that originate in the United States, and requires farmers and food processors to institute measures to prevent contamination.

The National Consumers League would like to thank Senators Durbin (D-IL), Harkin (D-IA), Dodd (D-CT), Gregg (R-NH), Burr (R-NC), and Enzi (R-WY), as well as Representatives Waxman (D-CA), Dingell (D-MI), DeLauro (D-CT), and Pallone (D-NJ) for their leadership in getting this legislation over the finish line. The League also extends its appreciation to Senators Reid (D-NV) and McConnell (R-KY) and Speaker Pelosi for enabling H.R. 2751 to come to the floor for votes in their respective chambers this week.

As a member of the Make Our Food Safe coalition, the National Consumers League joined other consumer organizations, public health organizations, and groups representing the families of victims of foodborne illness in supporting passage of the bill.

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

Consumer groups call on Microsoft to grant Americans the same browser choices as Europeans – National Consumers League

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December 21, 2010

Contact: (202) 835-3323, media@nclnet.org

Washington, DC –Consumer advocates are asking Microsoft to give American consumers browser choices beyond Internet Explorer when purchasing a Windows operating system.

In a letter to Microsoft CEO Steven Ballmer, the American Antitrust Institute (AAI), Consumers Union, the National Consumers League (NCL), and Consumer Action express “ongoing concerns that American consumers do not have access to the same choices among browsers that are today available to our European counterparts.”

When the United States settled its antitrust litigation with Microsoft nine years ago, it allowed Microsoft to continue bundling the Internet Explorer web browser with the Windows operating system. Last year’s European Union settlement with Microsoft unbundled Internet Explorer from Windows and gave consumers a software ballot asking them to choose which browser to install from a list of 12 options.

“European consumers are choosing browsers other than Explorer,” said NCL Executive Director Sally Greenberg. “We would expect similar behavior in the U.S. market should consumers be given a choice.”

The letter cites earlier discussions the consumer advocates had with Microsoft on this issue, “In fact, we did ask this question to a Microsoft representative some months ago, but the reply was that the settlement in Europe was forced on the company and is a bad idea because consumers really don’t want choices and those who care enough can learn how to change their settings in order to use a different browser. This seems like the wrong response for a company that views itself as innovative and consumer-friendly.”

“Our aim is not to choose winners or losers in the marketplace, but to ensure a competitive process,” said AAI President Bert Foer. “It in fact may be procompetitive for a consumer to choose Internet Explorer in an environment where other choices are available; but it is anticompetitive for a consumer to use Internet Explorer because he or she was not given a choice. This holiday season, we are asking Microsoft to give American consumers a much deserved and appreciated holiday gift; the gift of choice.”

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About the American Antitrust Institute

The American Antitrust Institute is an independent non-profit education, research and advocacy organization. Since its formation in 1998, the AAI’s mission has been to increase the role of competition, assure that competition works in the interests of consumers, and challenge abuses of concentrated economic power in the American and world economy. To learn more about the AAI, please visit www.antitrustinstitute.org.

About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

About Consumers Union

Consumers Union (CU) is an expert, independent, nonprofit organization whose mission is to work for a fair, just, and safe marketplace for all consumers and to empower consumers to protect themselves. The organization was founded in 1936 when advertising first flooded the mass media. Consumers lacked a reliable source of information they could depend on to help them distinguish hype from fact and good products from bad ones. Since then CU has filled that vacuum with a broad range of consumer information. To maintain its independence and impartiality, CU accepts no outside advertising and no free samples and employs several hundred mystery shoppers and technical experts to buy and test the products it evaluates. Visit www.consumersunion.org

About Consumer Action

Consumer Action has been a champion of underrepresented consumers nationwide since 1971. A nonprofit 501(c)3 organization, Consumer Action focuses on financial education that empowers low to moderate income and limited-English-speaking consumers to financially prosper. Our diverse staff provides expert commentary on key consumer issues supported by solid data. We offer access to victim testimony, as well as expertise on current financial issues affecting low to moderate income and limited-English-speaking consumers. Visit www.consumer-action.org

Happy Winter Solstice! Are you ready? – National Consumers League

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In many parts of the country, late fall has resembled some of the worst winters on record. For those of us who live in colder climates — or even for those of us with more moderate winters and the occasional cold snap — winter weather can mean significant and sudden drops in temperatures and very serious winter storms. It is important to be prepared so that you can stay safe and healthy during the winter months. Infants and elderly are among the most vulnerable to life-threatening health problems when the temperatures drop.

Dangers range from power failures to icy sidewalks and snowy roads. Indoors, space heaters and fireplaces also add new dangers, as they increase the risk of household fires and carbon monoxide poisoning.

Everyone should be prepared for winter. Even if you live in a warmer climate, sudden drops in temperature that are near freezing are considered extreme cold and can be harmful to your health. 

Fed delays on alcohol labeling stymieing national policies on alcohol and obesity – National Consumers League

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December 20, 2010

Contact: (202) 835-3323, media@nclnet.org

Washington, DC–The National Consumers League (NCL) has once again called on the Alcohol and Tobacco Tax and Trade Bureau (TTB) to issue a final rule to improve alcohol beverage labeling.

“The drinking public needs certain basic information on beer, wine, and spirits labels,” said NCL Executive Director Sally Greenberg. “With a severe nationwide obesity epidemic, there is no excuse for not having calories listed on all alcohol beverage labels. Consumers also need clear information about alcohol content in order to drink responsibly.”

Seven years ago, the National Consumers League petitioned TTB to require an “Alcohol Facts” panel on labels of beer, wine, and distilled spirits. More than 3 years ago, TTB proposed a watered-down version of “Alcohol Facts,” which it called “Serving Facts,” but has still not issued a final rule.

“The Alcohol Facts panel was intended to provide all the information consumers need in one location, clearly and concisely,” said Greenberg. “It would be like the Nutrition Facts panel on food labels, except that it would provide the information relevant to alcoholic beverages.” NCL asked that the “Alcohol Facts” panel include serving size, the number of calories per serving, alcohol content information (including the amount of alcohol per serving, the definition of a “standard drink,” and the number of standard drinks per container), and ingredient information.

“The nine college students who went to an emergency room for alcohol poisoning after drinking too much of a caffeinated alcoholic beverage earlier this year may not have realized just how much alcohol they were consuming,” added Greenberg. “Maybe if the standard drinks per container had been required to appear on the labels, they wouldn’t have made that mistake.”

TTB’s inaction on Alcohol Facts labeling is also interfering with other important public health objectives. A new law requires nutrition labeling of foods and beverages served in chain restaurants and bars, including alcoholic beverages, but there is no approved method for measuring certain nutrients in alcohol and TTB has provided the industry with no guidance. If the Alcohol Facts panel were required, restaurants and bars could simply use the information on the product label.

The lack of calorie and alcohol information on beer, wine, and spirits labels is also an obstacle to application of the Dietary Guidelines for Americans. The Departments of Agriculture and Health and Human Services will soon issue the 2010 Dietary Guidelines, but, without calorie and alcohol information on product labels, consumers still will not be able to follow its recommendations on weight control and alcohol consumption.

“Label reform for alcoholic beverages is a no brainer,” according to Greenberg. “What is TTB waiting for?”

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

Exciting developments from LifeSmarts.org – National Consumers League

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By Lisa Hertzberg, LifeSmarts Director

LifeSmarts is an established program in its 17th year, but it is also a program that strives to be “flat and flexible.” Our goal is to make LifeSmarts and all of our educational resources easily adaptable to meet the needs of the students and educators who use the program.

We regularly hear from creative LifeSmarts coaches who use the program in many different ways:

  • Infusing LifeSmarts into their business, economics, family and consumer science, math, or vocational education curriculum
  • Using it as an extracurricular activity with clubs or groups such as FBLA, FCCLA, 4-H, and others
  • Using LifeSmarts in the classroom but allowing students to self-select whether they wish to advance to live competitions, and then practicing with the team outside of the school day
  • Initiating teams at the community level with community educators as coaches

One new tool with many applications is the TeamSmarts online activity, which provides a 100-question quiz each month that students work on collaboratively. Educators can use TeamSmarts in the classroom or with small groups in extracurricular settings. This LifeSmarts practice tool allows students to compete against other teams from across the country, learn about a new LifeSmarts topic each month, and strengthen their teamwork and leadership skills. You can get started at TeamSmarts here.

We have some exciting new projects in the works as well. Our 2011 plans include producing a new LifeSmarts topic list (scope and sequence), an activity box, a LifeSmarts Toolkit, and a comprehensive vocabulary list. All of these components will be designed to help educators easily adapt the “flat and flexible” LifeSmarts program for various groups and settings. Stay tuned for more exciting developments!

Mandated health insurance ruled unconstitutional – National Consumers League

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On Monday, a federal judge in Virginia ruled that a central provision of the new *Affordable Care Act that mandates that most Americans obtain health insurance is unconstitutional. Since the law passed earlier this year, there have been more than 14 challenges to the law; this is the first instance where the case was not dismissed or the law was not upheld.

History tells us that major new laws often face legal challenges. The Civil Rights Act, Social Security Act, and Voting Rights Act all withstood legal challenges. Proponents of the health reform act argue that the new law falls well within Congress’s power to regulate economic activity under the Commerce Clause, the Necessary and Proper Clause, and the General Welfare Clause.

The mandate for most Americans to obtain health insurance is one of the key provisions of the Affordable Care Act that will help extend coverage to more than 30 million people currently uninsured.  Paired with rate regulation, the addition of healthy people to the insurance rolls should make it more affordable for the system – payors, providers, and patients – to treat more expensive and chronic conditions.

The Virginia court found that the mandate that all Americans carry a minimum level insurance by 2014 – exceeds Congress’ power to regulate interstate commerce since it compels individuals without health insurance to involuntary enter the stream of commerce to purchase health insurance. However, individuals who choose to go without health insurance are “voluntarily” deciding to pay for health care out-of-pocket or to seek uncompensated care. Every year millions of those who have chosen to go without health insurance actively seek medical care. Thus, people who make an economic decision to forego health insurance do not opt out of the health care market, but instead shift their costs to others when they become ill or are involved in an accident and cannot pay.

The judge in the Virginia case, Judge Hudson, agreed that the implementation of the health care reform law should continue uninterrupted. In the nine months since the health reform law was passed, there has been progress to strengthen our health care system, including implementing a new patient’s bill of rights to end some of the worst insurance company abuses, such as banning insurance companies from discriminating against people with preexisting conditions.

The Justice Department is considering whether to appeal the ruling to the 4th Circuit. As this case and others make it through the appeals process, ultimately the Supreme Court will likely decide the constitutionality of the health reform act, and the reach of Congress’ power to regulate interstate commerce.

*Links are no longer active as the original sources have removed the content, sometimes due to federal website changes or restructurings.

NCL warning consumers to steer clear of ‘Grandparent Scam’ – National Consumers League

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December 15, 2010

Contact: (202) 835-3323, media@nclnet.org

Washington, DC – The National Consumers League’s Fraud Center today put out an alert to consumers to be aware of scam artists using variations on the so-called “Grandparent Scam” this holiday season. The alert comes in response to a number of consumer complaints that the Fraud Center has received recently regarding attempted and successful frauds by unscrupulous scammers.

In a typical Grandparent Scam, a con artist calls or emails the victim posing as a relative in distress or someone claiming to represent the relative (such as a lawyer or law enforcement agent). The scammer may frantically tell the victim a variation of “Grandma, it’s me,” followed by a description of the problem in which they have found themselves (arrested, in an auto accident, in need of a lawyer, etc.). The victim is then instructed to wire money to the scam artist with the claim that the funds will be used for bail money, lawyer’s fees, hospital bills, or other expense. The victim is urged not to tell anyone, such as the parent of the “grandchild” because they do not want them to find out about the trouble they’ve gotten themselves into.

“Scam artists will stop at nothing to defraud consumers, many of whom are often elderly and living on fixed incomes,” said John Breyault, NCL Vice President of Public Policy, Telecommunications and Fraud. “The scary part about this scam is that it preys on our natural inclination to want to help a loved one who is in distress.”

To detect and avoid the Grandparent Scam, NCL’s Fraud Center recommends the following tips:

  • Beware of any urgent solicitation of funds, especially if it is needed to pay for unexpected bills, such as bail money, lawyer’s fees, or doctor bills
  • Before sending funds, independently contact the relative (or parent of the relative) the scam artist is claiming to be (or represent) at a known phone number to verify the details of the story.
  • Scam artist’s payment method of choice is the wire transfer. Any urgent request to wire money should be treated suspiciously.
  • Be aware that fraudsters attempting the Grandparent Scam” may call late at night to confuse potential victims.
  • Consumers who have been victims of this scam should immediately report it to local law enforcement, their state attorney general and NCL’s Fraud Center at www.fraud.org.

“Consumers with older relatives should be sure to warn them about this scam,” said Breyault. “These fraudsters are cunning and know how to push all the right buttons to separate victims from their money.”

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

NCL issues tips for jolly holiday gift returns – National Consumers League

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December 15, 2010

Contact: 202-835-3323, media@nclnet.org

Washington, DC—With just 10 shopping days left until Christmas, holiday shoppers who are lucky enough to have completed the purchases can relax momentarily before gearing up for the day after Christmas — when stores are flooded with consumers lining up for post-holiday sales and returns. To help ease the burden of returns, the National Consumers League, the nation’s oldest consumer group, offers advice for increasing the chances of successful — and painless — holiday gift returns.

“As surely as people buy holiday gifts, they also return holiday gifts,” said Sally Greenberg, Executive Director of NCL. “Returning merchandise successfully — and getting a refund you’re satisfied with — can pose a few challenges any time of year, but there are a number of things consumers can do before the return, or even before the purchase, to reduce stress, ease the process, and increase the odds of a successful transaction.”

Tips for easy holiday gift returns:

  • Know a store’s return policy before you buy. When you buy, know what you’re getting into — whether the return will be in the form of cash or store credit, at full price, the price that was paid by the purchaser, or some more recent marked-down price. Know whether having the receipt factors into this so you can decide whether politely going back to the gift giver to ask for the receipt is warranted.
  • Keep a paper trail. Go to the trouble of saving receipts from the beginning and keeping them handy in case there’s a need for a return. Having a receipt dramatically increases the chances of an outcome that’s to your liking.
  • As a gift-giver, give items in their full packaging. And as a recipient, don’t open the packaging of anything you know you don’t want to keep, particularly electronics. Policies that don’t allow returns for opened electronics items are common. If they do take it back, they may withhold a certain percentage of the return price and call it a “restocking fee.”
  • Spend your gift cards. They may lose value over time, so look at the fine print and spend them before they expire.
  • Prepare yourself for the worst. Stores have been tracking customers’ return habits for years. Some retailers subscribe to services that keep track of what consumers are purchasing and bringing back in an attempt to curb consumer return fraud — the returning of stolen goods. For honest consumers, this can cause problems, as some stores limit the amount of return activity to a certain number or value of annual merchandise returns. There’s a possibility if you’ve returned a lot of merchandise, you’ll be denied.
  • Be smart. Don’t wear it. Don’t damage it. Increase the chance of having a successful return by taking care of the item on its way back to the store and being a pleasant, polite customer. The post-holidays are stressful enough. Don’t contribute with a less-likely-to-be-helped attitude.

Check out the return policy of an online purchase. You may be able to bring it in-person to the brick-and-mortar store. You may have to pay to send it back, or the vendor may have provided you with a pre-paid postage slip. Or you may not be able to return it at all. Read the delivery information and return instructions for anything you purchase online, particularly if it’s meant to be a gift.

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About the National Consumers League

Founded in 1899, the National Consumers League is America’s pioneer consumer organization. Its mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. NCL is a private, nonprofit membership organization. For more information, visit www.nclnet.org.

The Kardashians’ teachable moment – National Consumers League

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By John Breyault, Vice President of Public Policy, Telecommunications and Fraud

Recently, the Kardashian sisters, of reality TV show fame, released a prepaid debit card to significantly less-than-rave reviews. Why? The card, labeled the “Kardashian Kard,” and marketed to teen viewers of “Keeping Up with the Kardashians” was so chock-full of fees that users of the card essentially lost money on the card before they even had a chance to use it, according to a November 26 letter from Connecticut Attorney General Richard Blumenthal (former NCL Trumpeter Award recipient) to University National Bank, the issuer of the card.

A sampling of the fees levied on the Kardashian Kard included:

  • $7.95 per month maintenance fees
  • $5 minimum deposit
  • $9.95 card purchase fee
  • $1 fee to add value to the card
  • $1.50 fee when the user contacts a live operator
  • Bill pay fee of $2.00 per transaction
  • $9.95 to card replacement fee
  • $6.00 fee to close the account

To their credit, the Kardashians agreed to have the cards removed from the market in response to Blumenthal’s inquiry and the resultant firestorm of negative publicity. However, this episode illustrates the pitfalls for consumers of these prepaid debit cards, one of a fast-growing portion of the consumer credit market. According to the Boston Consulting Group, the U.S. market for branded prepaid cards is expected to nearly quadruple by 2017 to more than $440 billion.

One factor that may be driving the explosive growth of this market is that reloadable prepaid debit cards like the Kardashian Kard are exempted from the gift card rules established by the 2009 CARD Act. For consumers, this means that these cards may have unexpected fees that traditional gift cards do not. In addition, reloadable prepaid cards are not required to provide fraud protection. Whereas with debit cards, the cardholder’s liability for fraudulent purchases is limited to $50 (or $500 if the loss is reported more than two business days after the loss), reloadable prepaid cards offer only voluntary protections provided by the issuing bank.

So how can consumers protect themselves from the hidden fees on these cards?

Our colleagues at Consumers Union have provided a great list of consumer tips regarding prepaid cards like the Kardashian Kard:

  • Consider a regular bank account instead—you get a debit card, a monthly statement, and full consumer protections. Don’t opt in for “overdraft protection” to avoid costly overdraft bank fees.
  • If you decide you want to use a prepaid card, find and read the fee schedule before you buy one. Your cost will vary widely depending on which prepaid card you pick. Make a list of how you will use the card and compare the fees. Try to figure out the costs for two months so that you can get a better idea of the full cost of using the card.
  • Keep track of your balance –you might face high fees for going over. Sign up to receive a written statement in the mail to keep track of your money.
  • Don’t get a prepaid card that comes with a credit line or overdraft loan to avoid overspending and going into debt.
  • Do not use prepaid cards to purchase gas at the pump, for hotels or rental cars. If you do, you may find you will not have access to more funds than the purchase and for a long period of time.
  • See if your card has different fees to choosing signature instead of PIN, or selecting the “credit” option instead of choosing the “debit” option.
  • Don’t rely on a prepaid card to build a credit record because most prepaid card issuers don’t report customer information to the major credit reporting agencies