Oct. 2003 – Insurance firm blames widow

Des Moines Register. Frank Santiago. October 30, 2003

Insurance firm blames widow: Lyon’s medical files needed before payment is made

A Chicago-area life insurance company that carries a $100,000 policy on slain Warren County farmer Tom Lyon blamed his widow Wednesday for a decision to delay payment.

Officials at Zurich Life said an investigation of the claim has been hampered by Ronda Lyon, who will not allow the release of her husband’s medical files.

Meanwhile, Federal Kemper Life Assurance Co., a division of Zurich Life, has filed a federal lawsuit in Des Moines to force the Lyon estate to release the records.

“As part of any routine investigation, the insurer examines all medical records of the insured before they pay the claim,” said Julie Crothers, spokeswoman for Zurich Life.

Lyon was killed in a land dispute with neighbor Rodney Heemstra on Jan. 13. Heemstra, who claimed self-defense, was found guilty earlier this month of first-degree murder.

If Lyon had a medical condition not disclosed in the application, the company contends, it might not have issued the policy, which was purchased in June 2001.

The payment delay outraged lawyer Donald Beattie, who represents Ronda Lyon.

“Our position is they refuse to pay out. They want the medical records to avoid paying the claim,” Beattie said. “Does anybody want to give a blank check to an insurance company to get into their records, especially a widow whose husband had been massacred?

“They could do anything they want to do with those records.”

Beattie said Lyon’s medical records were sealed during the trial by Judge William Joy. He said the request had been made by prosecutors, the family and doctors.

“If this was a death where he died of cancer or some cause like that, we wouldn’t be doing this,” he said. “The guy was murdered. They are trying to find an excuse not to pay.”

Zurich Life’s Crothers said Beattie’s claim “that we refused to pay is untrue. The investigation is still going on and there have been no decisions made.”

Tom Alger, spokesman for the state insurance division, said Iowa and “a great majority” of states have laws that allow insurance companies to delay payment while they check for fraud in policies less than two years old.

He said his agency will investigate the dispute.

“We can’t comment further because it’s a matter under investigation,” he said. “Usually these situations take care of themselves.”