by Guest » Wed Sep 19, 2007 04:03 pm
Lincoln Benefit Life
2940 South 84th Street
Lincoln, Nebraska 68501-0469
I signed up for a term life policy 4 years ago that was supposed to be switched to a "whole life" policy after the first year. The way it was explained to me (because I didn't even want to sign up for the term because it was too expensive - $1200) was that after the first year I could switch to the whole life policy which cost $5000 and get a credit for the $1200 for the first year which is what I did. The insurance broker faxed me over the pages on a rush basis after the first year to switch the policy and I faxed them back to her the same day. What I believe was the terms and conditions page had been recopied so many times that you can't even read it. A few weeks later the policy book was delivered to me by the agent. The way she had described the policy was that my money would only grow so according to what she told me I should have $15000 plus interest. What I have now is nothing. I in theory have $12000 because they deduct "costs" and "expenses" - none of which she told me when she was selling me the policy. She told me the reason is because when she was explaining the policy to me her laptop computer wouldn't allow her to show me the costs and expenses. Another feature she failed to tell me about is that I have to be in the policy for 20 years! If I pull out in advance I forfeit $14300. When I received my last statement I didn't understand the costs and expenses and called up Lincoln Benefit to find out what was going on and I found out then for the first time that Lincoln Benefit (my insurance company) no longer sells whole life policies and I had been signed up for an "adjustable flexible" policy. I explained that I had never even heard my insurance broker utter those words and that she had only referred to the policy as a whole life policy. My agent had never told me about costs and expenses and never explained the $14300 default fee if I pulled out before 20 years. She did a bait and switch on me. Lincon's complaint department did an investigation and have said everything is on the up and up and I have no recourse. I was totally lied to and relied on everything she told me about this policy. I was never informed AT ALL about the $14,300 default fee or about the costs and expenses - she simply described my money growing each and every year so by now I would have the $150000 I've put in plus around 5% interest. Lincoln agreed to give me back $5000 if I terminated my policy. However, they kept my remaining $10,000. DON'T DO BUSINESS WITH THIS COMPANY IF YOU WISH TO KEEP YOUR MONEY - THEY ARE THIEVES AND LIARS. I've tried everything I can do to get my money back but it appears I would have to sue them and I just don't know what my chances would be. I work with a law firm and even the lawyers here told me they're unable to understand my policy in full. I depended on Lincoln to explain to me what I was buying and by leaving out vital details I was in fact lied to. A partner at my firm (a very intelligent attorney) told me that even he had been the victim of a similar policy so it can't be just me. I honestly don't know how they can get away with this but it appears they can. I work 13 hours a day as a secretary to support my family and the $10,000 they ended up keeping was two years of my bonuses. This was money I thought I could use in the event of an emergency and now it is all gone.
2940 South 84th Street
Lincoln, Nebraska 68501-0469
I signed up for a term life policy 4 years ago that was supposed to be switched to a "whole life" policy after the first year. The way it was explained to me (because I didn't even want to sign up for the term because it was too expensive - $1200) was that after the first year I could switch to the whole life policy which cost $5000 and get a credit for the $1200 for the first year which is what I did. The insurance broker faxed me over the pages on a rush basis after the first year to switch the policy and I faxed them back to her the same day. What I believe was the terms and conditions page had been recopied so many times that you can't even read it. A few weeks later the policy book was delivered to me by the agent. The way she had described the policy was that my money would only grow so according to what she told me I should have $15000 plus interest. What I have now is nothing. I in theory have $12000 because they deduct "costs" and "expenses" - none of which she told me when she was selling me the policy. She told me the reason is because when she was explaining the policy to me her laptop computer wouldn't allow her to show me the costs and expenses. Another feature she failed to tell me about is that I have to be in the policy for 20 years! If I pull out in advance I forfeit $14300. When I received my last statement I didn't understand the costs and expenses and called up Lincoln Benefit to find out what was going on and I found out then for the first time that Lincoln Benefit (my insurance company) no longer sells whole life policies and I had been signed up for an "adjustable flexible" policy. I explained that I had never even heard my insurance broker utter those words and that she had only referred to the policy as a whole life policy. My agent had never told me about costs and expenses and never explained the $14300 default fee if I pulled out before 20 years. She did a bait and switch on me. Lincon's complaint department did an investigation and have said everything is on the up and up and I have no recourse. I was totally lied to and relied on everything she told me about this policy. I was never informed AT ALL about the $14,300 default fee or about the costs and expenses - she simply described my money growing each and every year so by now I would have the $150000 I've put in plus around 5% interest. Lincoln agreed to give me back $5000 if I terminated my policy. However, they kept my remaining $10,000. DON'T DO BUSINESS WITH THIS COMPANY IF YOU WISH TO KEEP YOUR MONEY - THEY ARE THIEVES AND LIARS. I've tried everything I can do to get my money back but it appears I would have to sue them and I just don't know what my chances would be. I work with a law firm and even the lawyers here told me they're unable to understand my policy in full. I depended on Lincoln to explain to me what I was buying and by leaving out vital details I was in fact lied to. A partner at my firm (a very intelligent attorney) told me that even he had been the victim of a similar policy so it can't be just me. I honestly don't know how they can get away with this but it appears they can. I work 13 hours a day as a secretary to support my family and the $10,000 they ended up keeping was two years of my bonuses. This was money I thought I could use in the event of an emergency and now it is all gone.
Posted: Wed Jan 02, 2008 07:34 pm Post Subject:
Good day Steve,
I'm satisfied that we agree on the "IF" issue. You know, I 'kinda-sorta' agree on the special UL license as well but realize it'll never happen.
A few years back, I investigated a couple senior agents who were selling level term policies for a company. These agents were also selling trusts and the services of a financial planning firm in CA.
In one case, they sold an older couple a 15-year level term policy and represented that when the insurance policy reached its term, the trust would be there, the couple would begin taking minimum distribution from their financial vehicles, the grandkids would get a bunch of money via The Uniform Gifts to Minors Act (UGMA) and everyone would be happy. Sounds pretty common, huh?
The problem was that the insurance company in question didn't sell 15-year level term plans and the all-knowing senior agents had fabricated the illustration. Granted, this [probably] doesn't happen nearly as often as the cases where someone misrepresents the terms and conditions of a UL policy, but it does happen.
When questioned, the agents claimed that they thought the company sold 15 year plans and concocted their own illustration in order to save time. Should then, the powers-that-be at NAIC and the various DOI's require a special license for term policies? Or should we just accept that some agents are lying, cheating, thieves and deal with them accordingly?
I've written a good portion of the Ethics curriculum used by the State of California in the new agent licensing process and am somewhat familiar with the rest of it.
If asked to testify before a court, or anyone else for that matter, regarding U/L familiarization; I would say that every person licensed to sell insurance in the United States of America has the ability to comprehend the Universal Life product and it is up to both them and their companies to work out how this is done.
Want to know what would be really funny? Requiring an M.D. to acquire a special license to remove tonsils and another to examine a rash on your foot. Of course he'd have to have another special license to remove a hemorrhoid and yet another to deliver a baby. Anyway, we tax each license and require continuing ed on each individual subject. I'm glad I'm not a doctor.
Thanks for your input, I look forward to reading your posts in the future.
Mark
Posted: Thu Jan 03, 2008 05:56 am Post Subject:
I've written a good portion of the Ethics curriculum used by the State of California in the new agent licensing process and am somewhat familiar with the rest of it.
If asked to testify before a court, or anyone else for that matter, regarding U/L familiarization; I would say that every person licensed to sell insurance in the United States of America has the ability to comprehend the Universal Life product and it is up to both them and their companies to work out how this is done.
InsInvestigator, again right on target.
I also write ethics courses that are offered as both continuing education and law school requisites, and can absolutely state that most producers have only a basic familiarity with UL both as a product itself and the mechanics which drive the policy.
When I conduct seminars, I often state that UL is "not for the stupid or easily mislead." Especially variable UL. These can be tremendous products, but only for the right person and only in the proper circumstance. Gee- like any other product. Ya think?
I have heard, TO THIS DAY, producers state that these products are self-supporting and contain (get this) a "vanishing premium provision mandated by state law" that says that your "policy's premium will be discontinued by law when you turn age 65." You are absolutely kidding me.
Thankfully, I live in and work with many states that DO have rules and law that outlaw these and other misrepresentational acitivities. The problem is that the purchaser often has no clue as to the end-game possibilities if he is improperly (or incompetently) sold in the first place. Often, the consequences are not seen for years, and the agent is commonly long gone.
The company may be held liable, but as the plaintiff- how are you going to prove you were "mislead" unless you have the NOW required documentation as provided by GLB and state legislation? Usually, you can't. Besides, you have to pay for your lawyer, and the carriers, well, you know.
On the other hand, I have witnessed many very professional and competent sales of universal life policies, sold with honesty and need of the customer in mind, and they've worked beautifully over the years.
So...bottom line is the producer and how the product is sold. The problem isn't the laws; it's the lack of convictions and the penalties imposed by the various ruling bodies, especiallyon the federal level.
Pass all the laws you want. If you don't have the ability to mandate and enforce them, it's "another fine mess you've (the feds) have gotten us into, Ollie." :D
Just a couple of rambling thoughts as I pass the night...
InsTeacher 8)
Posted: Thu Jan 03, 2008 06:16 pm Post Subject:
Ins Teacher, thanks for the kind words.
You know; I've always worked hard and done my very best to make a difference for people who've had problems with insurance policies that weren't quite what they expected. I've personally investigated over 2000 cases, testified as an Expert, spent lots of time in deposition, etc.
I have heard, TO THIS DAY, producers state that these products are self-supporting and contain (get this) a "vanishing premium provision mandated by state law" that says that your "policy's premium will be discontinued by law when you turn age 65."
My only complaint is that life hasn't been fair to me. I don't need to win the lottery or anything like that; If only once, just once, I would like to run across a producer that said something like that - better yet - during a sting or a sit-in, my life would be complete.
Often, the consequences are not seen for years, and the agent is commonly long gone.
Or promoted to upper management.
The company may be held liable, but as the plaintiff- how are you going to prove you were "mislead" unless you have the NOW required documentation as provided by GLB and state legislation? Usually, you can't. Besides, you have to pay for your lawyer, and the carriers, well, you know.
Policy owners (plaintiffs) very seldom know what to do in this type of situation and the insurance companies know this. What they don't expect is an agent with sense of ethical responsibility, a few morals, and gonads larger than those of a goldfish to come in and figure out what happened.
The agent documents what happened, how the policyholders were mislead, how the policies were designed to work, and why the sale shouldn't have been made. Then he/she does a little research, makes a few phone calls, finds a lawyer who will take the case on a contingency basis and is retained as an advisor at rate starting at around $85 per hour. It's that easy. In fact, if a few more agents would step up and take a stand on the moral high-ground, guys like me would be out of a job.
I am ALWAYS available to help someone in that regard.
So...bottom line is the producer and how the product is sold. The problem isn't the laws; it's the lack of convictions and the penalties imposed by the various ruling bodies, especiallyon the federal level.
Hallelujah!! :D
[/quote]
Posted: Thu Jan 03, 2008 08:03 pm Post Subject:
simple solution is always to cintact the State Dept f Insurance as well as local Print, Audio, & Video media.
Posted: Mon May 26, 2008 12:45 am Post Subject:
Original Poster (gbarney04) I don't believe a single word of your post EXCEPT:
Lincoln's complaint department did an investigation and have said everything is on the up and up and I have no recourse.
EVERY cash value policy sold has to be accompanied by a signed policy illustration that shows the guaranteed values along with the current projections.
You would have had to sign that document which CLEARLY shows the year by year cash values or they would have NEVER issued the policy.
I work with a law firm and even the lawyers here told me they're unable to understand my policy in full. I depended on Lincoln to explain to me what I was buying and by leaving out vital details I was in fact lied to. A partner at my firm (a very intelligent attorney) told me that even he had been the victim of a similar policy so it can't be just me.
Well perhaps these very intelligent attorneys should attempt to obtain an insurance license so they can better understand contract language.
Here's how life insurance works...
You pay the premium and if you die while your policy is in force the insurance company pays the death benefit to your beneficiary.
Now if you would like to pay MORE in premium than just the cost of insurance the insurance company will credit interest on the excess premium and you'll build a cash value.
Any questions?
This was money I thought I could use in the event of an emergency and now it is all gone.
A life insurance policy is not a financial vehicle designed for short term emergency use. Next time try a bank savings account.
Sorry if my post reads a little harsh but your post reads as if this was a one-way transaction in which you had no responsibility whatsoever. In fact I'm surprised you haven't said the agent held a gun to your head and told you either your signature or your brains will be on the contract, just like a scene right out of The Godfather.
Lincoln Financial is a first class organization and althought I don't put much business with them they are one of the very few insurance firms out there who will bend the rules and pay claims based on the spirit of the contract's intent and not just the hard cold type written pages.
Posted: Mon May 26, 2008 09:06 am Post Subject: insurance
I've read the ENTIRE thread. I'm SOO sorry this happened. I went through something similiar, however, din't lose NEARLY as much money. The Insurance with the laptop, should have the information you needed ( costs, fees, etc). If she didn't, she should have gotten them right then and there. However..........never sign a policy if you don't understand what you're signing. I actually had a Insurance company call me because of my interest in a Life Insurance policy, for my son. He wanted to "do evrything over the phone and the Fax." He said he would explain everything over the phone and Fax me paperwork so I could sign it and Fax it back to him. YEAH..right!! He din't "have the time," to show up in person. You really think I'm gonna sign something I din't even seee?...just take HIS word for it? Some Insurance companies can be devious.
Posted: Thu Nov 10, 2011 04:18 am Post Subject:
The plaintiff in one of my most highly visible cases was a Superior Court Judge whom, later on, would rule over one of the most publicized cases in history. This Superior Court Judge had been misled by an extremely slick New York Life agent. During the judge’s deposition, the defense team was absolutely hilarious to watch. They tried so hard to be condescending, forceful, and even intimidating, which is quite typical, while literally walking on eggshells.
“Your Honor”, one of them said, “if this were in fact some sort of scam, how is it that a man of your experience and education could fall so easily for it? This stuff is not rocket science; any ordinary person would have been able to see the representations made by the agent were indeed false and could not have happened, barring of course, interest rates of around 124%”.
The judge replied "I've been in this business of law for a long time, but I don't know anything at all about life insurance. I relied on a representative of the company / agent who should be held to a higher standard - someone who should have fiduciary duty to perform in my best interest”.
This, quite literally, sums it all up. I’ve personally seen doctors, lawyers, Superior Court Judges, even guys who get paid to ride shotgun on garbage trucks get swash buckled by insurance agents who did not have their best interest in mind.
It is not, under any circumstances, a policyholder’s obligation to completely understand the terms and conditions a life insurance policy - it is, in every case, an insurance agent’s duty to act in their client’s best interest. Granted, if a policyholder had a better understanding of their product, it would make the agent's job a great deal easier. Then again, if we all had a much better understanding of medicine, it would make things much easier on our doctors.
Posted: Fri Nov 11, 2011 07:47 pm Post Subject:
When it comes to judges and the law, even US Supreme Court Chief Justices make some dreadful mistakes. When CJ Warren Burger died, he died INTESTATE. You would think the Chief Justice of the US Supreme Court would understand probate law enough not to let that happen.
Why, then, would it come as a surprise that a highly-qualified judge might not understand his life insurance contract?
Like Mark, I have helped attorneys who understand contract law learn how to read and understand life insurance contracts.
In California, at least, insurance producers ARE held to a fiduciary standard which requires that we place the best product we have available to us in the hands of the client, and at the best price, too. Our failure to do so subjects us to civil and, possibly, criminal prosecution.
Posted: Fri Nov 11, 2011 07:55 pm Post Subject:
fiduciary standard which requires that we place the best product we have available to us in the hands of the client,
Max, can you please explain further. Unlike other things, I am not trying to say that you are wrong. I am trying to understand. I thought that a fiduciary standard meant doing what is best for the client. Once the phrase, "best product we have available to us" is added, it doesn't seem like it really is about meeting a fiduciary standard.
Ex. George needs $1,000,000 of 20 year level term insurance. Max works for ABC Insurance Company. He is captive. The cost is $3,000.
With many other equally strong companies, for the same price, George can get twice as much coverage. Max knows this. Are you saying that Max meets his fiduciary duties by selling this overpriced insurance?
Posted: Fri Nov 11, 2011 08:21 pm Post Subject:
Once the phrase, "best product we have available to us" is added, it doesn't seem like it really is about meeting a fiduciary standard.
Are you saying that Max meets his fiduciary duties by selling this overpriced insurance?
Yes, that's what it means. But it's not a question of "selling overpriced insurance". That's an apples to oranges comparison.
You and I both know that no two policies from two different companies are identically priced. The captive agent does the best he can with what he has available. So do independent agents.
Where the captive or independent agent might err is when the client says, "That's awfully expensive, can't I get this for less?" The captive agent has to answer, "Yes" or he violates his fiduciary responsibility. He may not be able to provide the lowest cost product the client might find, but as long as he provides the lowest cost product he has available, he has not violated any laws. The exact same thing holds true for us as independent agents.
Most of my career was spent as a captive agent, and I knew the products I had available were not the least expensive, and I never lied to anyone about that. But they were also not the most expensive either. The fiduciary standard is not an "absolute", but it demands that whatever we do is IN THE BEST INTEREST OF THE CLIENT. There were numerous times when I had to tell the client, "I don't have what you need," and told them what they needed. Anything else would have been a fiduciary lapse.
On the other hand, like many WFG agents do, an agent might say, "I represent 30 of the largest life insurance companies in America." But when you see that he places 99% of his business with only one company, undoubtedly he is violating his fiduciary responsibility in some, if not the majority, of those applications.
Working through a IMO as I do today as an independent agent, once I have determined what type of policy a client probably needs (term, wl, ul, eiul) I literally look at 10-20 different companies and many more policies, running preliminary illustrations until I find the two or three I believe are in the client's best interest. It makes my work harder, not easier.
Could that still mean that another company, whose products I don't have access to, might have a lower price? Of course it does. But, when I can say, in all honesty, I've done the best possible job I can with what I have available, I know that I have done so. That's what fiduciary responsibility is all about.
Look, I complain about the cost of my homeowner's and auto insurance all the time. My current auto carrier was granted a 10.7% general rate decrease a few months ago. My premium went down 2%. I'm hot about that, and have complained to the CA Dept of Insurance about it. But I've also not been able to find a lower premium policy for the high limits I carry. Even the companies that advertise how I should be able to save $500 per year with them are $200-$700 more per year than my current coverage.
Don't even get me started about the now overvalued replacement cost on my homeowner's policy that "the computer" has determined is the correct amount of coverage for my property. And I was the one who originally wrote the policy four years ago. Even for the correct amount of coverage, I can't find a lower premium.
In both cases, I have obtained quotes from the companies I would want to do business with. I'm sure there are a couple of companies out there whose premiums might be lower, but I might not want to do business with them.
Add your comment