Policy Buyer Says Brokers Dead Wrong on Mortalityinsurance: Investor claims firm misrepresented health of insured. Monday, April 28, 2014
Dennis Gilbert has been one of the most powerful agents in baseball history, a top insurance salesman to Hollywood stars and a bidder for the Los Angeles Dodgers and Texas Rangers. But now a much more arcane venture, selling current life insurance policies to third-party investors, has a former client saying he’s responsible for millions in losses.
The conflict arises from Gilbert and former partner Michael Krupin’s alleged sale of insurance policies on the secondary market to Mark Kress, a marketing wizard who made millions selling jewelry on QVC and cosmetic products for thinning hair.
Like many other transactions in the multibillion-dollar industry known as life settlements, the deals involved an investor buying other people’s life insurance policies in order to collect money upon their death.
But Kress claims that he bought policies of people who turned out to be much healthier than Gilbert represented, costing him millions of dollars.
Gilbert isn’t known for his involvement in life settlements; most of the major players in the industry are in New York state and Florida. But he is among a wave of local insurance agents who have stepped up involvement in the secondary life insurance market, and he’s certainly among the highest-profile agents in Los Angeles to be linked to it.
“Most any successful insurance agent in town is doing this,” said Alan Kaye, a Beverly Hills agent with expertise in life settlements. “We have a book of clients who may have had a change in need regarding insurance. If you’re one of the top in the field of selling life insurance, by circumstance you also would be at the top in helping people sell them.”
Gilbert and Krupin, through their attorneys, called the accusations “meritless” and “specious,” respectively, but would not comment further.
Kress declined to comment.
Gilbert is one of the biggest names in life insurance in Los Angeles, both because of his work in the industry and his success outside of it.
A former minor league baseball player, he began selling insurance in 1971, pitching doctors at hospital cafeterias and newlyweds outside the Hall of Records.
“I ended up best man at a couple hundred marriages,” he told the Business Journal in a 2011 interview.
He moved his way up the ladder to pick up celebrity clients, including Nicolas Cage, Madonna and Rod Stewart.
He then got involved in the business side of baseball in the 1980s through a friendship with Bobby Brett, the brother of Major League Baseball star George Brett, his first baseball client. Gilbert became known for his glitzy Hollywood style and soon attracted the biggest names in the game. During the 1990s, he set then-major league salary records on behalf of clients three times in three years, negotiating multiyear deals for Jose Canseco ($23.5 million), Bobby Bonilla ($29 million) and Barry Bonds ($44 million).
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