Death Claim Concerns

[jdeasy]

Thanks for the advice. Does every company use the same term, "specimen policy"?

Some call it a sample policy. It's a good idea to have sample policies of the companies you write so you can show the person what to expect. Especially if you don't deliver policies.

I deliver so it's that big of deal for me. But if I didn't deliver I would always show a sample policy to the person so they know what it's going to look like and even explain things if you feel the need.

 

[DonP]

Many CO’s put policys on eti when premiums not paid . I know great western does . Columbian does and I’ve seen Trans do it

 

[adjusterjack]

what am I missing?

The policy.

The complete, original policy that was provided to the insured.

Without it, you're spinning your wheels and (as said on TV) assuming facts not in evidence.

Ask the beneficiary to find it for you.

 

[titeye]

The policy.

The complete, original policy that was provided to the insured.

Without it, you're spinning your wheels and (as said on TV) assuming facts not in evidence.

Ask the beneficiary to find it for you.

My point was that the agent does not have a policy at the point of sale. This was news to me, just as it was to the beneficiary. After 30 years in the business, I was never trained to use the policy in my presentation. Fortunately for me, this is the first instance in my career experiencing this. Had this been my client, I would have been embarrassed having to tell the beneficiary they would not be getting any more than what they received.
Had I known about this before now, I would have been emphasizing to my clients the importance of catching up on their payments. This is a really big deal to me. I value my reputation and credibility as an agent.

I received some valuable advice on here, regarding requesting sample policies from every single one of my carriers.

 

[titeye]

Some call it a sample policy. It's a good idea to have sample policies of the companies you write so you can show the person what to expect. Especially if you don't deliver policies.

I deliver so it's that big of deal for me. But if I didn't deliver I would always show a sample policy to the person so they know what it's going to look like and even explain things if you feel the need.

Years ago, when I first started, delivering policies to the client was a requirement. In fact, the client had to sign a Delivery Receipt form. Not too long after that, there was an option to have the policy mailed directly to the client, instead of the agent. That seemed simple and less time consuming for me. I have been doing it that way now for almost 30 years. Even though my first 17 years were captive, I did not realize until this moment the value of delivering it myself, so the agent could review it with the client. I am ashamed to say, I haven't even read any of the policies on my own life. All this time, I had assumed they would pay the face amount, minus unpaid loans.

 

[jdeasy]

Years ago, when I first started, delivering policies to the client was a requirement. In fact, the client had to sign a Delivery Receipt form. Not too long after that, there was an option to have the policy mailed directly to the client, instead of the agent. That seemed simple and less time consuming for me. I have been doing it that way now for almost 30 years. Even though my first 17 years were captive, I did not realize until this moment the value of delivering it myself, so the agent could review it with the client. I am ashamed to say, I haven't even read any of the policies on my own life. All this time, I had assumed they would pay the face amount, minus unpaid loans.

I’ve been thru the same cycle. When I first started we had to deliver and get a delivery receipt signed.

Then when I got into FE and the companies would send policies I jumped all over that.

In 2012 I went back to delivering just because of problems with Monumental.

I found I was getting more referrals on delivery so I kept doing it.

I was never trained to get sample policies either. Until I met Travis Tubbs. He has taught that from day 1. I've known Travis for 15 years now so I've heard about the value of having a sample policy for 15 years.

 

[rousemark]

Many CO’s put policys on eti when premiums not paid . I know great western does . Columbian does and I’ve seen Trans do it

Columbian does not if the automatic premium loan box is checked on the app. However, Extended Term Insurance is pretty much the default no forfeiture option industry wide. I had two claims pad on ETI with Columbian last year. Paid full face as they should have.

Had one paid on reduced paid up insurance.

 

[goillini52]

They were in my bag because I do a lot of business out of state and prefer phone apps over email.
I will accept suggestions.

Aetna / Accendo.

 

[shonceman]

A beneficiary filed a claim upon the death of a parent. The client had missed a few premium payments at the time of death. There was a sufficient amount of cash value to keep the policy in force, which activated the automatic premium loan provision The face value of the policy was $15,000. The beneficiary received a death benefit of approx. $3,300. Beneficiary stated to the agent, "My mom would have never bought a life insurance policy for only $3,000."

My initial thought was that the carrier returned the premiums, plus interest. However, this Modified issued policy was beyond its 3-year waiting period. The marketing material states specifically that full benefits are payable beginning in the policy's 4th year. A CS representative for the carrier attempted to make me believe that 48 months of payments were required before it would pay full benefits. Me: "Why, if full benefits are payable beginning in, not after, the 4th year?" She further stated that the number of payments is what determines the policy year. Therefore, because the client missed a few payments, she wasn't really in the 4th year. Me: WHAT DID YOU JUST SAY!!!?

Obviously, I had to request to speak to someone whom I thought knew what they were talking about. They must have thought I would just go away. After waiting for about a week, I called back to speak with the manager, whom I was expecting to call me within a couple of days. Upon further investigation, he says the policy automatically defaulted to ETI (extended term insurance), when the client stopped making premium payments. The manager referred both, the agent and beneficiary, to the policy for this information. Nowhere in the Agent Guide, marketing material, application or any other material accessible to the agent does it state nor suggests this will be the result of nonpayment of premiums. In addition, I have never ever heard of an agent receiving a copy of a life insurance policy for training purposes, nor to use at the point of sale. This led me to begin questioning whether or not I had been misleading my own clients all these years, unknowingly.

As a result, I reach out to all my other carriers confirming my understand of how policies should pay out, in the event of missed premium payments and loans against the cash value. With the exception of this one carrier above, all of the others "said" the policy would pay the face amount, less the amount of loans via missed payments. This is not only the response I expected to hear, but also what I have been telling my clients for years.

Needless to say, I was quite taken aback by this carrier and do not feel comfortable selling them any longer. As I stated above, this ETI info is nowhere in the Agent Manual or any other material used at the point of sale. Let alone the fact that they have representatives attempting to convince people that policy year anniversary is dictated by the number of payments sent in or date payments are received, and not actual date the policy issued.
Am I guilty of overreacting due to my own ignorance?
Is anyone else selling policies by either, presenting a sample of an actual policy or what is written in the policy, versus what is provided in the product guide, Agent Manual, etc?
The policy never lapsed and never entered a grace period. Considering there was cash value sufficient to keep the policy in force, what am I missing?

I’ve never known LBL to have an automatic premium loan provision. This policy effectively lapsed due to nonpayment. Because there was cash value at the time of lapse, it went to ETI instead of terminating. The ETI face amount was based on the death benefit that would have been payable at the time the policy moved past the grace period, which was still within the 3 year modified period. The company did everything it was obliged to do under the contract. I wouldn’t dismiss LBL for this case. They’re actually one of the better companies at claim time, in my experience.

If I had been speaking with the beneficiary, I would have explained that their mother did NOT take out a $3k policy, but that the company was paying this benefit even though she had not paid her premiums for several months.

 

[rmhaire]

Aetna / Accendo.

I think I'll hook up with Accendo. Sure will save time going over my commission statements.