Claims Conference Weighing Options As Restitution Issue Drags on and on

The president of the Claims Conference says the organization could withdraw from agreements protecting German insurance companies from lawsuits if the firms don’t speed up restitution payments to Holocaust survivors.

Agreements signed two years ago protect the firms from being sued by Holocaust survivors or their heirs. The agreements were key to beginning payments from a $5 billion German restitution fund.

Given a delay in payouts, however, the Claims Conference now is weighing its options, Israel Singer said last week at the group’s annual board meeting here.

But Wolfgang Gibowski, spokesperson for the German government and industry foundation Remembrance, Responsibility and the Future, said the German insurance firms are not dragging their feet at all.

“Up to now they do not have the claims,” Gibowski said in a telephone interview.

He said Singer should be addressing his concerns to the International Commission of Holocaust Era Insurance Claims, a group established four years ago by U.S. insurance regulators, Jewish organizations and five insurance companies. ICHEIC, he claimed, has been causing the delays, though he did not speculate about the reasons.

Singer should tell ICHEIC that “it is time to finish these long negotiations,” Gibowski said.

“I know Singer very well and appreciate him as an honest and fair person,” Gibowski added. “I can only think that he is not well-informed.”

At the Luxembourg meeting, Singer said his group could reject the funds from the German firms and inform U.S. Federal Judge Michael Mukasey “that we reject the granting of closure and that they will have no business in the United States.”

Several years ago, during reparations negotiations, it was implied that U.S. insurance regulators could withdraw licenses from German firms.

“We are not threatening anything now,” Singer said. “We are holding out a hand in friendship and saying, ‘Have the generosity to pay the people while they are still alive.’ “

Gibowski, however, said there is “no reason” to withdraw legal closure.

“We are doing everything on the German side. The foundation is there, the money is there. So what is the reason?” he asked.

Gibowski explained that the insurance companies have nothing to gain by postponing payments, since they do not have to lay out additional funds.

Gibowski suggested that claimants or those with questions might do better by going directly to the German insurance companies or to the German Insurance Association than to ICHEIC. He said it made sense to test the system by transferring 1,000 claims or questions directly to the German companies, to see how fast they were handled.

ICHEIC has been criticized for its high administrative expenses and its poor oversight of the agencies hired to handle inquiries from survivors and process insurance claims.

The Claims Conference board meeting marked the 50th anniversary of the signing of the Luxembourg Agreement on reparations, a contract signed by the West German government with Israel and the Claims Conference.

In the ensuing half century, the Claims Conference has succeeded in distributing more than $50 billion in reparations for more than 500,000 survivors.

Insurance policy restitution is among the more recent arrangements worked out by the Claims Conference, the 10-year-old World Jewish Restitution Organization and the State of Israel.

It involves primarily German and Italian insurance firms, along with some Swiss and French firms.

According to Gibowski, many Nazi-era bank and insurance claims were settled in the immediate postwar years. Many German Jews were poor and had very small policies, if any, he said.

In the summer of 2000, German insurance firms agreed to pay about $225 million as part of a $5 billion fund from German government and industry.

The last hurdle in creating the fund, which deals primarily with reparations to former slave and forced laborers, had been the question of legal closure — in other words, protection for German industry and insurance companies against further lawsuits by survivors.

Aside from the Italian firm Generali, most of the affected insurance companies are not following the guidelines established by ICHEIC, a Claims Conference spokesperson said. An ICHEIC report released in May by private consultant Lord Peter Archer of Sandwell in England found that many insurance companies were too quick to deny claims.

The report, which also criticized some of ICHEIC’s internal operations, found that the insurance companies often demand impossible levels of proof from survivors or heirs of policyholders. The report said some firms have rejected claims after performing cursory searches.

The German companies are “working right now to produce lists of Germans who are Jewish and who lived in the Nazi time in Germany,” Gibowski said. “If there were a master list somewhere saying those had insurance policies and those had something else, this would be easier. We can only produce lists of names of German Jews,” and “if you think your name is on the list, you can ask your questions.”

Some 500,000 Jews lived in Germany when the Nazis took power in 1933. Gibowski said the German firms have been “asking for more than one and a half years to receive potential claims and questions” from ICHEIC “in order to check them. They haven’t received a single claim until now.”

But Claims Conference leaders said some companies are demanding levels of proof that are impossible to meet today.

“Companies have to recognize that years and years after the war it is not possible to provide the same documentation as if it were a few years ago,” said Gideon Taylor, executive vice president of the Claims Conference. “The level of frustration is enormous, particularly among Holocaust survivors.”

Survivors and their heirs have complained that neither ICHEIC nor the insurance companies is fulfilling its moral and financial obligations.

Many expect the Claims Conference to speak on their behalf, and at the Luxembourg meeting their anger was palpable.

“How long will they let” Singer “keep on saying, ‘Keep cool?'” asked Julius Berman, chairman of the organization. Singer “is putting his reputation on the line” with the survivors.

Singer noted that he had received letters of congratulations on the 50th anniversary of the Luxembourg Agreement from German Chancellor Gerhard Schroeder and from Romano Prodi, president of the European Commission.

Yet he was hardly in the mood for congratulations.

“It is truly sad,” he said, “that we are still dealing with this issue today.”