Holocaust Insurance Claim Deadline Gets Pushed Back

The chairman of an international commission created to resolve Holocaust-era insurance disputes has extended its deadline for submitting claims until the end of September, amid continuing tumult about whether the group can fulfill its mandate.

Lawrence S. Eagleburger, the former secretary of State who heads the International Commission on Holocaust Era Insurance Claims, took the action late last week after stormy meetings in Washington at which he resigned in frustration and then agreed to continue serving.

Eagleburger told commission members Thursday that he was pushing back the deadline eight months, from Jan. 31 until Sept. 30. “The deadline must be extended in order to allow adequate time to collect lists [of insurance policyholders] from the companies, process them through Yad Vashem [the Holocaust center in Jerusalem] and publish the names on our Web site with adequate time for the public to review the lists.”

Extending the deadline “creates the possibility that thousands more valid claims will be honored,” said Daniel Kadden of Seattle, a consultant to a survivors’ organization who attended the Washington meeting.

Insurance companies have been at odds with the commission, Jewish organizations and U.S. regulators for months over releasing information on policies sold from 1920 to 1945. The companies say there are vastly fewer valid claims than survivor advocates believe and that producing the lists would be burdensome and, in some instances, would violate European privacy laws.

Advocates of Holocaust survivors and their heirs maintain that the insurance companies are attempting to hide the true magnitude of unpaid claims.

Disclosure of the policyholder lists is the key to a fair process because nearly all Holocaust victims lost their records when they were taken to the Nazi death camps, said Nat Shapo, director of the Illinois Department of Insurance and chairman of the Holocaust Task Force of the National Assn. of Insurance Commissioners. In addition, the Nazis did not issue death certificates at the camps. Consequently, hardly any of the survivors or heirs have proper paperwork for their claims, making them dependent on insurance companies to search their files and make them public.

So far, the international commission has run up more than $40 million in expenses, while the five European insurance companies that are members of the commission have made only 1,000 offers of compensation, according to commission records. Victims’ families have accepted 275 of those, saying many offers were unjustly low.

Extending the deadline was the first move made by Eagleburger after he obtained a written agreement from five insurers that gives him “unfettered authority” to resolve thorny issues that have beset the commission.

The companies signed the letter Wednesday, about 24 hours after Eagleburger stormed out of a commission meeting at the Westin Fairfax Hotel. “Find yourself another chairman,” the veteran diplomat declared to attendees from Israel, the insurance companies, Jewish organizations and U.S. regulators, according to people who were present.

But over the next two days, after numerous meetings in his hotel suite, Eagleburger was persuaded to keep the job, which pays $350,000 a year, and was given the greater authority.

Eagleburger has criticized the insurance companies for failing to honor commitments and has expressed frustration at the degree of skepticism that survivor advocates and members of Congress have expressed about the commission, which was chartered under Swiss statutes and whose operations are not subject to U.S. disclosure laws.

Eagleburger, 71, declined to return calls. And despite his decision to stay on, he remains “very frustrated with things,” said his aide, Dale Franklin.

“The frustration does not go away with one agreement. We hope the companies will abide by the decision” to give Eagleburger more authority, Franklin said. “Everyone agrees we have not paid enough claims.”

The move to extend the deadline was praised by Rep. Henry A. Waxman (D-Los Angeles), who severely criticized the commission’s performance at a congressional hearing in November and chastised Eagleburger for refusing to provide information on certain matters.

“I am cautiously optimistic,” Waxman said Friday night. “This is going to be the last chance to fulfill the long-standing commitment to victims of the Holocaust who have insurance coverage.”

Eagleburger’s move also was lauded by insurance regulator Shapo. However, he said that extending the deadline would be meaningless unless the insurance companies cooperate.

“This is not a pretty picture,” Shapo said, referring to the long-running stalemate on how to resolve the insurance claims. The commission “is dangerously close to becoming a frivolous exercise,” he said, emphasizing that important issues remain unresolved. Among them are the publication of policyholder lists and the companies’ attempt to recoup about $30 million that they gave the commission for operating expenses.

The overall issue involves claims by heirs of people murdered by the Nazis who contend that the insurance companies have refused to pay on life insurance policies written in pre-World War II Europe.

In 1998, about a year after the controversy generated widespread publicity in the U.S., spurred by the filing of major class-action lawsuits, several of the major insurers agreed to join an international commission in hopes of resolving the conflict outside the U.S. court system.

Five major insurers--Allianz of Germany, AXA of France, Winterthur and Zurich of Switzerland, and Assiscurazioni Generali of Italy--agreed to fund the commission in return for receiving a “safe harbor” from U.S. litigation. The companies pledged to contribute $90 million, but after putting in $30 million they ceased providing funds.

At the congressional hearing in November, Eagleburger said the companies had declined to provide more money to “punish” the commission for decisions he had made. The companies have said they were concerned that the commission was spending excessively.

Many other German insurance companies have declined to join the commission despite repeated entreaties by Eagleburger and some German government officials.

So, while numerous other issues of Holocaust reparations--including reclaiming Swiss bank accounts and settling slave labor lawsuits--have been settled over the last few years, the insurance disputes appear nowhere close to resolution.

More than 16 months ago, negotiators for the U.S. and German governments linked the insurance and slave labor issues in a $4.6-billion deal funded by German industry and the German government. Last year, payments began to some of the thousands of slave laborers covered by the settlement.

About $220 million of the settlement pot was allocated to cover insurance claims. However, some key issues, including disclosure of policyholder lists, have kept the money from being distributed.

New York University law professor Burt Neuborne, who has represented survivors in several class-action Holocaust reparations cases, said he hopes a final agreement is reached soon after months of “very rocky negotiations.” After the $220 million was set aside for insurance claims, Neuborne successfully urged a federal judge in New York to dismiss class-action cases against the insurers.

However, if Eagleburger is unable to reach an accord, Neuborne said he might have to go back to the federal judge and ask him to reopen the cases.

“That might be the only thing that would shake the companies loose,” Neuborne said.