.

According to this recent article from Insurance News Net, an August decision from the U.S. District Court for the District of Montana will allow a 2024 filed lawsuit to proceed for Montana funeral directors who claim a “premium financing scheme cost them millions”.

• Again, according to the article, the plaintiffs operate the Stevenson and Sons Funeral Homes in Miles City, Montana.  The family alleges they were misled into purchasing high-risk financial products that caused substantial financial losses.

• The plaintiffs also believe that had they been advised of what they now believe is a greater financial risk of the policies a financial catastrophe could have been avoided.

• The lawsuit was initially filed in July 2024 and lawsuit centers on the sale of $67.5 million worth of premium-financed life insurance policies. Defendants include MassMutual Life Insurance Co. and Penn Mutual Life Insurance Co.

• According to the article, the debt service on the premiums and the premiums paid have outgrown the value of the policies by $8 million.

• With this recent decision by the District Court judge, the lawsuit continues to move forward.

Related —  There is more information on this lawsuit that can be found, including a very good “Case Overview”, at the Beck, Amsden, and Staples PLLC website that is dated August 27,2025.  You can access that website here

Related — Here is the definition of “Premium-financed insurance policies” as given from Gemini Artificial Intelligence:

“A premium-financed life insurance policy involves borrowing from a third-party lender to pay the premiums for a large life insurance policy, typically for high-net-worth individuals, allowing them to keep their own capital invested while securing the coverage. The life insurance policy itself, and its cash value, serves as collateral for the loan. The borrower then repays the loan with interest, anticipating that the growth of their invested assets or the policy’s cash value will outperform the loan’s interest rate.”

 

Related — Here is the website for the Stevenson and Sons Funeral Homes

Funeral Director Daily take:  I’ll have no comment on the merits of this case on either the plaintiff or defendent side.  I’ve included this information in today’s Funeral Director Daily article simply under the “There’s probably something to be learned from this event” banner.

In my opinion, and I’m a licensed life insurance agent, life insurance in its differing forms, and the methods used to pay for the coverage can be a very complicated business transaction.  It can also be a very useful tool for many financial situations.

Over my life I’ve owned policies and found suitable uses for term life insurance, whole life insurance, universal life insurance, single premium life insurance, and period certain annuities.

Now that I’m aware of this case it will be interesting following it to see how it turns out.  I’m hopeful that I can let Funeral Director Daily readers know how it all works out as the matter proceeds through America’s legal system.

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