NY AG Office Negotiates Life Alert Contract Cancellations

Last Updated on June 5, 2021

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Life Alert is one of the best-known names in the medical alert industry. The company has protected the physical well-being of the elderly for decades. Unfortunately, their 36-month contract has been a thorn on the side for many of their elderly and physically vulnerable customers.

Table of Contents hide

1 AG Letitia James’ Action on Life Alert

2 36-month Contract

3 Disclosure and 7-Day Cancellation Period Required

4 Difficulties After 3 Years

5 Additional Outcomes

This latest investigation and settlement by the New York Attorney General’s office supports the legitimacy of many Life Alert customers’ grievances regarding contract obligations.

AG Letitia James’ Action on Life Alert

A negotiation undertaken by New York Attorney General (AG) Letitia James has resulted in a resounding success for elderly customers of the personal emergency response company Life Alert. The New York Attorney General’s office announced a settlement they made with the company on Mar 30, 2021.

Through the AG’s efforts, over five thousand seniors in the New York area have been released from their contracts with Life Alert. Similarly, over 700 have also received substantial refunds from the company.

The California-based business – which is marketed toward the elderly and physically vulnerable – came under scrutiny from the Attorney General after it was found that service contracts issued to customers did not contain cancellation provisions that are mandatory under New York state law.

In the press release, Attorney General James said, “When the elderly and disabled fall and hurt themselves, they trust Life Alert to come to the rescue, but Life Alert violated that trust when they refused to honor consumers’ rights.”

She added, “Today’s agreement holds Life Alert accountable and ensures they not only protect seniors’ physical well-being, but their rights as consumers going forward as well. New York’s seniors can trust that I will always fight for their best interests.”

36-month Contract

When customers sign up with Life Alert, they are expected to fulfill a 36-month service agreement and commit to a monthly fee, plus additional costs. In certain cases, this can lead to total charges of more than $3,400 for the 36-month period. See cost examples.

Controversy arose when some customers who requested to cancel their service were told by the company that they would be unable to do so. Instead, the AG office found that customers were told that the best Life Alert could do was this: to reduce the amount of their monthly payments, or reduce their contract to a total of six months.

Disclosure and 7-Day Cancellation Period Required

However, New York state’s General Business Law section 391-l obliges companies to provide potential customers with both a written and verbal notification of a seven-day cancellation period for any such contracts.

This means that customers can withdraw from the deal within the first seven days without incurring costs. Additionally, the seven-day cancellation does not legally come into effect until it is actually disclosed to the customer. According to the New York AG’s office, Life Alert failed to make these disclosures.

In effect, by this failure to disclose, the seven-day cancellation period had not begun for many customers. Customers therefore should not have been trapped in their contracts. This failure took place for at least six years (between Jan 2014 and Feb 6, 2020), affecting approximately 16,000 customers in the New York area.

Difficulties After 3 Years

The AG’s office also found that some customers experienced difficulties canceling even after their 36-month contract ended. The settlement agreement (link below, see paragraph 16) stated that Life Alert wanted documentation that the customer was now in a nursing home, or asked for six months of payment.

See NY Attorney’s Office settlement agreement with Life Alert.

Additional Outcomes

Thanks to this agreement, all qualifying New York customers of the Life Alert company will be notified of their right to cancel their service. Similarly, all qualifying customers who unsuccessfully tried to cancel the service will be offered substantial refunds to the value of up to 24 months’ worth of payments.

On top of this, Life Alert will be obliged to pay a total of $750,000 in penalties for their state law violations. This settlement has been hailed as both a victory for consumer rights and a victory for the senior community of New York.

This settlement is happening against a backdrop where the industry standard is to not require any long-term contracts. Customers are allowed to cancel when they no longer want to continue. For a comparison and to see more examples, check out some of the companies here.