Compromise Proposed To Resolve Insurance Claims

A proposal to have an independent monitor oversee European insurance companies’ efforts to pay all outstanding Holocaust-era policies appears to be gaining traction among major Jewish organizations.

Menachem Rosensaft, general counsel of the World Jewish Congress, said he suggested the proposal after hearing survivors plead with Congress for the right to sue insurance companies they believe have withheld death benefits on the policies of those killed in the Holocaust.

Rosensaft said his organization supports the proposal because it wants to see survivors collect their benefits now. He said he fears that even if Congress passed legislation giving survivors the right to sue the insurance companies, “at most it would be a pyrrhic victory” because they might not live long enough to see their court cases decided.

Representatives of several major Jewish groups that oppose the legislation for the right to sue said this might be a good compromise.

The U.S. Justice Department has successfully argued in court that survivors do not have the right to sue European insurance companies because it would interfere with American foreign policy.

Survivors appear split on the proposal. One argued that as a matter of “principle” she should have the right to sue just like other citizens, but another said he favored it with certain modifications if it “would shorten the process” of getting death benefits to survivors.

Stuart Eizenstat, a special negotiator for the Conference on Jewish Material Claims Against Germany and a special adviser to the U.S. Secretary of State for Holocaust issues, said he found Rosensaft’s proposal “interesting.”

“I need to check with the State Department and the insurance companies,” he said. “It’s an interesting idea — certainly better than the legislation.”

Eizenstat was in Washington this week helping with Claims Conference-German negotiations that resulted in Germany agreeing to pay about $3,100 to each of 80,000 Jewish victims of Nazism, most living in the former Soviet Union. The one-time payment, which totals more than $250 million, was not previously available to most residents of the former Soviet bloc.

In addition, Germany agreed to equalize all pensions it pays through the Claims Conference. As of Jan. 1, it will be 300 euros or about $367 a month. It agreed also to reduce from 12 to six months the length of time Holocaust survivors had to have lived in hiding or under false identity under Nazi occupation in order to be eligible to receive German pensions administered by the Claims Conference.

Rosensaft’s proposal has been voted upon and endorsed by the American Gathering of Jewish Holocaust Survivors and their Descendants, according to Max Liebmann, its senior vice president. He said the group viewed it as a “good compromise.”

Andrew Baker, director of European Affairs at the American Jewish Committee, said he viewed it as “a sensible approach.”

“Our view has been that legislation is unnecessary and unhelpful,” he said, referring to a letter submitted to Congress by virtually all of the major American Jewish organizations. “If this would bring assurances to individuals who believe their only alternative is legislation [for the right to sue], then this could potentially dissuade them from it.”

A spokeswoman for B’nai B’rith International said the group is following Eizenstat’s lead.

Leo Rechter, president of the National Association of Jewish Holocaust Survivors, said he believes “there is a possibility of working out a compromise. … Anything that would shorten the process [would be helpful].

“We realize that the judicial way is a long and painful process,” he said. “But some of those who want to go to court say their parents had factories and that it stands to reason they also had insurance policies. Even poor people had dowry policies. Where did all that money go?”

Survivors contend that a program established in 1998 to process and pay all Holocaust-era insurance claims failed to pay all valid claims. They also say that those who were paid received only a fraction of the policies’ true worth.

Rechter said the proposed independent monitor should be “someone of stature we would have faith in.” But he said also that he believes the proposal should be modified to state that European insurance companies would conduct a search of their Holocaust-era policies and make a good faith effort to find the heirs of all unpaid policies rather than simply responding to claims. He noted that many people are not aware they are heirs.

The State of New York began such a policy a year ago, involving all insurance companies that do business in the state. Millions of dollars in death benefits have since been paid, Rechter pointed out.

Asked about that idea, Rosensaft said: “We’re not deciding now about whom the monitor should be or what the procedures should be used — let’s just start talking about a compromise solution. Those who have the survivors’ interests at heart will be willing to explore it. …

“Leo is bright. He is a former banker and he understands that if survivors go to court [against the insurance companies] and have to comply with the federal rules of evidence, their chances of prevailing are very slim,” Rosensaft said, adding, “We have to find a [different] mechanism that works, and we’re trying to learn about things that have not worked in the hope we can find something that will work.”

But not all survivors are willing to abandon their desire to sue the insurance companies.

“We’re fighting for a principle here,” said Renee Firestone, 88, of Los Angeles. “I and other survivors don’t want to die as second-class citizens in this country. We are not fighting only for the money — we are fighting for our rights. We don’t want to die like prisoners in Auschwitz but as free people with the same rights as others in this country.”

Josh Rogin, chief of staff of Rep. Ted Deutch (D-Fla.), a supporter of the legislation, noted that this was the fourth time it has been introduced and that it has consistently been bottled up in committee.

“If they put it on the floor of the House it would pass,” he said.

Rogin said Rosensaft’s proposal has “some significant problems” because it lacks a “mechanism to force companies to honor the policies — and it requires an individual to sort through thousands of policies. It would cost a lot of money and take many years and get us no closer to a resolution.”

But he said Rechter’s suggestion of emulating New York and requiring insurance companies to conduct their own search of Holocaust-era policies is something Deutch would endorse.