by Insurance Maze » Sat Mar 01, 2008 05:38 pm
Someone placed an article on this subject in the "Advertise" section of the forum, but I think this subject is much more important.
How can an insurance company issue a $250,000 life insurance policy on your life if they know exactly nothing about the current condition of your health? What exactly are the terms and conditions of these life insurance policies?
Sure they may check the Medical Information Bureau (MIB), but what if you were diagnosed with cancer yesterday?
Don't you think that these web sites that advertise "No life insurance-medical exam" are attracting people with health problems who are trying to put one over on the insurance company?
A traditional life insurance exam is not really an exam at all. A para-med asks you a lot of health questions, obtains a mouth swab, and possibly a urine specimen, that's it. I really don't see the big deal.
Just how secure are these "No Medical" life insurance policies?
Are they actually underwritten at the death of the insured?
How can an insurance company issue a $250,000 life insurance policy on your life if they know exactly nothing about the current condition of your health? What exactly are the terms and conditions of these life insurance policies?
Sure they may check the Medical Information Bureau (MIB), but what if you were diagnosed with cancer yesterday?
Don't you think that these web sites that advertise "No life insurance-medical exam" are attracting people with health problems who are trying to put one over on the insurance company?
A traditional life insurance exam is not really an exam at all. A para-med asks you a lot of health questions, obtains a mouth swab, and possibly a urine specimen, that's it. I really don't see the big deal.
Just how secure are these "No Medical" life insurance policies?
Are they actually underwritten at the death of the insured?
Posted: Tue Mar 04, 2008 07:29 am Post Subject:
I will NEVER, EVER forego the responsibility of standing up in front of everyone saying that I might have been wrong.
Hadley, I had no idea you were so well-qualified within the industry.
Also, I do hold 8 professional insurance designations, and do understand both sides of this debate. Actually, I completely understand your position, most importantly being the concern for the consumer, and their well-being.
I hope this makes clear it is not a scam. I do not believe Prudential would be involved in a scam.
If you don't count the $2.3 billion churning, twisting, breach of contract and/or fiduciary duty, etc., lawsuit they lost in 1996, I think, (the largest in the history of the insurance industry) Prudential would probably be clean as a whistle.
Here's an interesting bit of insurance trivia: If you are an insurance company sued for abusing your elderly policy holders and you are ordered by the court to send each one of your victims notice of the impending action and, let's say you somehow lose the addresses for 1.4 million potential victims, thereby stripping them of their ability to be made whole in the future; do you know what that's called? Getting Pru'd. I kid you not.
You know; if I were to look at this "no-medical life insurance" gig from a more analytical standpoint, it does "kinda" make sense.
First of all, InsTeacher was right. I think we can all agree that some form of medical background check will [probably] be done - even if its just a para-med.
Secondly, I think we can all agree that if anything more serious than a hangnail is noted on the application, a more thorough background check/med will be required.
I really don't know if there would be any sort of "lien period." Why would there be? I mean, you're an insurance company who's just issued a policy on someone who's represented themself to be Preferred Non-smoker or better) and you have a 2-year contingency period to fall back on? Doesn't that sound like a bit of a numbers game from that point? Just like with any other term-type policy? Remember that less than 2% of all term insurance ever results in a death claim.
If you're a 35 year-old, preferred non-smoker, with no medical history; statistically speaking, what are the chances of you kicking the bucket in 5, 10, or 20 years? With the theory of probability on my side, I think you would be a safe bet.
By the way; if you lied on your application, all your beneficiary gets is a return of premiums - maybe.
From the standpoint of a Consumer Advocate, I don't like it. But that's just me.
Posted: Tue Mar 04, 2008 07:58 am Post Subject:
I just attempted to apply for a Pruco non-med policy and was advised that: We're sorry, MyTerm Life Insurance is available only to customers of AgStar.
Oh and the, "Not Insured by FDIC, NCUSIF or any Federal Government Agency" disclaimer jumps right out at me too.
If I lie about my relationship with Agstar, then they want to know;
Do you currently have any product(s) with AgStar? Yes No
Which product(s) do you currently have with AgStar? Operating Loan
Equipment Loan
Preferred Capital Line
Facility Loan
Real Estate Loan
Home Mortgage Loan
Home Equity Loan
Equipment Lease
Facility Lease
Other Loan or Lease
And when I lie about a Home Equity Loan, I get this reply:
"We're very sorry. MyTerm is not available in your state at this time."
The link that Hadley showed me said that policies were being issued in CA with one product only available until age 64.
In short; if it walks like a duck, and quacks like a duck.......................
Posted: Tue Mar 04, 2008 12:56 pm Post Subject: inurance
What about children, who have had medical problems, since birth??/ I would assume, this 'situation', would be pre-existing. Gosh...seems like a 'catch 22' either way you look at it.
Posted: Tue Mar 04, 2008 01:32 pm Post Subject:
Wow!! When I opened "Latest Posts", nine of the ten topics related to auto accidents. Do all the bad drivers come here?
It's that "full moon" thing"! 8)
Investigator and Teach, you two are really getting into this one aren't you?
This topic gets under my skin just a little, because I just can't understand why anyone - "good health", "bad health" or what - would go online and buy $250,000 of life insurance without knowing anything about the policy.
Just as an experiment, I took a 15 minute tour of "Life Insurance-No Medical Exam" sites all around the internet and I found some interesting stuff. None of these articles came from the same place:
One thing is for certain and that is to get life insurance and no medical exam, you do need to be young and in prefect health.
If they don't check it, how do they know? Not everything makes it to the MIB and on rare occasions, the MIB is wrong.
This no medical exam term life insurance is generally known as guaranteed issue or simplified life insurance. And because it is life insurance with no medical exam, it is an excellent alternative for people who have some health problems or who may be older and wouldn't qualify for regular term life insurance.
So, now we are talking about an entirely different type of life insurance policy. How does the average consumer know the difference?
Depending upon the severity of your health problems, we might be able to offer you term life insurance no medical exam or whole life insurance no medical exam. In some cases, the death benefit is limited for the first two years of coverage.
Does the consumer realize that during the first two years, the death benefit of their $250,000 policy will be under $1,000?
No medical exam, no blood tests or other tests are required for either type of life insurance. Our independent insurance agents can fit the right policy from the right company to your needs.
Oh, so now we are bringing in the agent. How does this part work?
You answer some brief questions (around seven) to get an instant quote online. If you like your quote you answer some additional questions about your health to apply online. If the insurer accepts your application, you may start your policy the same day using a credit card, in most cases. Full coverage may or may not begin on that day, subject to the carrier and terms of the policy.
"May" or "May Not", are we going to place the security of our family on this?
If you do not tell the truth regarding the state of your health, this will result in cancellation of your life insurance no medical exam.
Again, if they don't check it out, how will they know? Could this be full underwriting that will take place at the death of the insured?
AIG, one of the largest insurers in the world, just lost over $5 Billion dollars. MetLife went through a scandal with retirement plans for nurses. I don't care how big the insurance company is, there is a "skeleton" somewhere, so I would not base the reliability of these "No Medical" life insurance policies on the "size" of the insurance company.
All I can say is, buy your life insurance from an agent. When you get the policy, read it. If you don't understand it, go back to the agent and tell him/her that you have an hour for the policy to be thoroughly explained to you.
Please don't buy life insurance through an internet quote engine.
Posted: Wed Mar 05, 2008 01:45 am Post Subject: insurance
I appriciate the replies. Now..I've learned a bit more. Lots of 'area', concerning insurance.
Posted: Wed Mar 05, 2008 04:08 am Post Subject:
Underwriting a $250,000 life insurance policyt without at least a para-med, blood, and spec is a joke - and we should all know that. God help the poor consumers who get sucked into this diabolical scam and get financially hurt by it. I feel sorry for them.
How exactly is it a joke? Insurance carriers have very accurate statistics and it's a common fact that most term policies lapse. In addition, when you factor in the 2 year incontestability period, carriers have an easy out in case they missed something, but it's not indefinite.
Really though, how could a company ever afford to issue large policies without complete underwriting? Maybe they'll hire the Tooth Fairy to head their compliance department.
I'll send you over a legal document for you to sign and you can write me a check for $50. I'll use that money to find out about your medical history. That's how insurance carriers operate, although I'm being facetious.
We're not to a point yet we're medical records are online and accessible (Thanks to lovely HIPAA), but you would be amazed the type of medical information that can (should) be obtained. In reality, non-paramed has it's place, just like traditional term. There are a few companies that are very competitive with the traditional term products. An ethical agent will know when to use what type of product.
You have an interesting site.
Posted: Sun Jun 15, 2008 04:10 pm Post Subject:
In our country, we offer non medical life insurance policies but within the age limit and based on what kind of occupation the client is engaged in. I think the non-medical insurance policy can be issued up to the age of 50 (I'm not really sure about this). There is a reason why insurance companies can offer this kind of life insurance policy. There is what we call contestability period of 2 years. If the policy owner died within 2 years time upon approval of life insurance application, the company has the right to investigate about the cause of the client's death. If they found out that the policy owner died with cancer (for example) and the client did not state it upon application that he or she has cancer, the company can contest it and may not pay the life insurance premiums because of misrepresentation. But given fact that the policy owner died after 2 years upon application, the company cannot contest it so they would pay for the insurance proceeds.
I don't really know what is the real score about online life insurance application. When applying for life insurance online, just be careful. There are many websites that are not legitimate. Be sure to choose the right company.
Posted: Mon Jun 16, 2008 09:48 pm Post Subject:
Joven222; if I may ask, which country are you referring to in this message? Here in America, there are a number of companies which offer life insurance policies without much more than an MIB inquiry. Blood, spec, and a paramed are usually required on the majority of other plans. As you obviously know, as the face values increase, so do the requirements.
I guess I'm a bit confused by the way you referred to the Contestability Period. This is an industry standard that I'm pretty sure applies to every policy I've ever seen - or investigated.
Are you active in the life insurance industry? Are you a licensed rep?
Posted: Tue Jun 17, 2008 03:31 pm Post Subject:
Blood, spec, and a paramed are usually required on the majority of other plans.
I am from the Philippines and I have a life insurance policy but I have not undergone blood, spec, and paramed as you have stated as a usual requirement. I got it in an early age so all I need is to fill out the form and state may physical conditions.
I guess I'm a bit confused by the way you referred to the Contestability Period. This is an industry standard that I'm pretty sure applies to every policy I've ever seen - or investigated.
What made you confused about the contestability period? Am I wrong in stating the nature of it? I believe that there is a 2-yr contestability period on every plan, right?
I was an agent but now I am not. I have stopped for 2 yrs already. If I'm wrong with what I have said, please correct me. I will review my insurance policy to confirm about this. ;)[/quote]
Posted: Wed Jun 18, 2008 09:17 pm Post Subject:
Hello Joven222,
Then quite possibly, the requirements for life insurance policies sold in the Philippines are different than those of policies sold in the U.S.
No, you were not wrong in your explanation of the contestibility period.
This provision applies to life insurance sold in the U.S. as well as, I now understand, life insurance sold in the Philippines
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