by MissJAJohnson » Thu Jul 05, 2012 08:19 pm
Doing a time of duress and under a lot of stress. I cancelled my term life insurance policy. Unemployed, broke and unable to pay the premium I cancelled the policy. I was also told that I would receive my dividends which I desperately needed to survive. I did NOT receive the dividend. My situation has improved as I am getting ready to start a new job. It has been less than two months since I cancelled the policy. Is there any way that I can re-open that policy?
Posted: Sun Jul 08, 2012 04:17 pm Post Subject:
I was also told that I would receive my dividends which I desperately needed to survive. I did NOT receive the dividend.
Although a remote possibility, it is highly unlikely that you had a term life policy known as "participating", and would therefore have no "dividends". Who told you that you would receive dividends?
Is there any way that I can re-open that policy?
It depends. Did you contact the company and tell them to cancel the policy or did you just stop paying the premiums?
You are asking about REINSTATEMENT of a policy. The contract will tell you all about that. If your coverage lapsed because you stopped paying premiums, you will be entitled to file for reinstatement. If you actually wrote a cancellation letter, you might not be able to reinstate. Your contract will tell you.
If you are eligible, all you need to do is submit an application for reinstatement and complete underwriting (any medical or other testing required). Since your policy has only been lapsed for a couple of months, you will only have to pay a few months' worth of premiums with your application or when the policy is issued (all the past due premiums, the current month's premium, possibly or or two additional months' premiums, and, perhaps, some interest on the missed payments). Again, your contract will tell you what will be required.
If you prove insurability, the benefit of reinstatement is that you will get back the same contract you had together with all of its provisions and riders (unless a particular rider is not subject to reinstatement), with the same premium, and for the remainder of the term as the original policy.
Posted: Wed Jul 18, 2012 10:46 am Post Subject:
I'm sorry to hear about what you went through. You should speak with your agent about this, because it varies from company to company. If you don't have a sympathetic agent, dial the insurance company and speak to someone on the other end about your predicament. I'm sure with the economic downturn, this would be something they'd be willing to consider. If you are in good health, you can always reapply for a new policy, even if its term life. The coverage will get extended, even though premiums might be higher than what you were paying on the older policy. Also, dividends are not paid out on term life policies, so there's a little confusion about that there. If you need to shop again for life insurance, try starting at an aggregator website. With a limited budget, it's probably the best place out there to get a free life insurance quote, information and experienced non-pushy agents to help you start over.
Pat Cassidy
Disclaimer: I work for AccuQuote and this is my personal opinion.
Posted: Wed Jul 18, 2012 02:53 pm Post Subject:
You should speak with your agent about this, because it varies from company to company.
I have never seen an individual life insurance policy that did not include a REINSTATEMENT provision. The length of time permitted in which to reinstate is typically three years, but is not regulated by law. I have seen policies that permit reinstatement up to ten years following a lapse.
The OP does not need to apply for "new" insurance unless she chooses to do so. The advantage of reinstatement is getting the original policy, all its terms and provisions, and the original premium which was based on the insured's age at the time the policy was first issued. That alone could save a person thousands of dollars over the life of their policy.
try starting at an aggregator website. With a limited budget, it's probably the best place out there to get a free life insurance quote, information and experienced non-pushy agents to help you start over.
Based on some of the past "personal opinions" posted by persons who work for AccuQuote, I'm not entirely sure you would find "experienced" agents there. Non-pushy? Well . . .
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