There’s a report that Texas Governor Rick Perry pushed a plan to have a Swiss bank buy life insurance policies on retired teachers, essentially betting on how long they’d live, with side payments to the state of Texas.
I can’t figure out what to make of this. At first blush it just seems bizarre and creepy (and apparently the teachers thought so to, because they didn’t give their approval to letting someone else take out life insurance policies on them).
But ghoulish as it may seem, is there any harm done? Apparently some businesses have long been in the practice of buying insurance policies on their employees as a tax avoidance method. If there’s a payout, they get it, because they’re the beneficiary, and the employees descendants get no part of it. But nothing’s taken from them, because the employee never contributed to paying for the plan, and presumably had their own life insurance with their own designated beneficiaries, completely separate from whatever their employers were doing.
So…I don’t know; any thoughts?