wet-ink policies

Posted: Wed Jan 14, 2009 08:56 am Post Subject:

You might be aware of viatical settlement contracts where the insurance policy of one person is sold to someone else because the policy holder either doesn't need that policy any more or can't afford to pay the premium or any other factor. When such viatical settlements are done as soon as the insurance policies are issued to a person , in other words when the insurance policies are sold while the ink is still dry and the policy owner has hardly begun paying his first premium , it is referred to as wet-ink policy and yes, it's definitely unethical.The ACLI ( American counsil of Life insurers) considers wet-ink policies as insurance frauds.

Posted: Wed Jan 14, 2009 11:35 am Post Subject:

There are insurance agents and brokers who'd urge you to sell off your policies to them. They would do this in order to ensure that more of such policies are accumulated at a cheaper price. This would enable them to enjoy a higher rate of return and gather more policies than they would be able to do when they are operating legally.

Posted: Thu Jan 15, 2009 07:32 am Post Subject:

Friends, I believe its quite unusual than within weeks after acquiring a policy an individual would find that he is terminally ill.

If that happens within a short span of time, that would be reason enough for a carrier or an agent to assume that the policy is 'clean sheeted'. Con artists would rather alter the beneficiary with the provider.

Posted: Thu Jan 15, 2009 11:20 am Post Subject:

I agree,Samoanbalboa. It'd obviously appear that details of medical history of the policy holder were intentionally not disclosed to the insurance company if some terminal illness is reported within weeks or days of acquiring the insurance policy and would be considered fraud . However, in practice this does happen , in most cases, with the knowledge of the agent.