Credit: VIPDesign/Fotolia
A Chicago-area employer is saying that a benefit plan failed to pay life insurance death benefits as expected because the administrator used the policy as collateral for a loan.
General Produce Distributors, a fruit and vegetable wholesaler based in Franklin Park, Illinois, has sued the administrator, Legacy Benefit Plans, in the U.S. District Court for the Northern District of Illinois.
Recommended For You
Related: Panel consolidates Health Care Providers v. Payers in Illinois
General Produce says the company paid for a life insurance policy from Penn Mutual through Legacy in 2008.
The policy was supposed to provide $1.8 million in death benefits for Mintjal's spouse, Terri Mintjal, when he died.
David Mintjal died in January, but "Legacy has failed to pay the death benefit to the plaintiff despite demands to do so," General Produce says in the complaint.
Legacy and its owner, Jay Jensen, a fiduciary for the Legacy Employer Welfare Benefit Plan & Trust "through his manipulation and control of Legacy and the trust assets, had the insurance policy on Mintjal's life assigned to be used as collateral for a bank loan for an unknown purpose, which said loan went into default and was not repaid by the defendants," according to General Produce. "Accordingly, Penn Mutual will not pay the $1.8 million dollar policy proceeds which were intended to cover the obligation to pay the death benefit to Terri Mintjal, thereby causing her and the plan injury and damage," according to the complaint.
General Produce says Legacy and Jensen breached their duty to General Produce and Terri Mintjal under the federal Employee Retirement Income Security Act.
The company is asking for a judgment of $1.8 million for Terri Mintjal and other damages.
Attorneys for Legacy and Jensen have not yet appeared in court. They could not immediately be reached for comment.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Allison Bell
Allison Bell, a senior reporter at ThinkAdvisor and BenefitsPRO, previously was an associate editor at National Underwriter Life & Health. She has a bachelor's degree in economics from Washington University in St. Louis and a master's degree in journalism from the Medill School of Journalism at Northwestern University. She can be reached through X at @Think_Allison.
