by bhpinkston » Fri Nov 30, 2007 05:24 am
Universal Policy purchased with Allstate since 1989. Policy premium was increased last yr from $45 mo. to $85.68 mo. with add'l $200.00. This yr they say
I need to pay an add'l $1,429.24. This is addition
to what I pd. with reg. mo. prem. If I don't pay
I will loose policy. Policy is worth $84.76 they say?
The benift was suppose to be $50,259.00?? Can you
help me understand what happened to my policy and what should I do?
I need to pay an add'l $1,429.24. This is addition
to what I pd. with reg. mo. prem. If I don't pay
I will loose policy. Policy is worth $84.76 they say?
The benift was suppose to be $50,259.00?? Can you
help me understand what happened to my policy and what should I do?
Posted: Fri Nov 30, 2007 06:19 am Post Subject: All state agent
Hi there!
What might have happened to the Allstate agent ! The first thing that you sh'd do is to call him & ask for an explanation! I'm sure...I'd not like miss his version of the story!
Thanks,
ArindamSenIndies
Posted: Fri Nov 30, 2007 07:02 am Post Subject: seen people!
Hi bhpinkston, I've often seen people opting for Universal initially & then adding quite a few riders to it & eventually piling up the volume of premiums.
Are you one of them! gleecebarger
Posted: Fri Nov 30, 2007 09:59 am Post Subject:
Welcome to ampminsure, Bhpinkston….here is what I could manage from the material available on net about the universal life plan offered by Allstate.
I actually don't know what way your policy is different from the above. The likely possibility is since the policy is running for a long time may not have all the features of the modern policy incorporated in it. I would rather suggest that you have a talk with the Allstate agent and find out the actual reason.
Warm regards,
Carol
Posted: Fri Nov 30, 2007 12:52 pm Post Subject:
Sounds to me like the policy was just underfunded. Which meas that your monthly payment was smaller than your actual projected premium. Do you still have an illustration from the original transaction?? At that point you shouldve been provided with some projected numbers over the next 30 years or so. Did you have a minimum guaranteed interest rate. Perhaps the interest rate fell dramatically from the time you started this policy in 1989.
I'm not sure how old you are, but it sounds like you are having to start all the way from scratch with this policy. I would think that you would have received some sort of notice or something stating that you were exhausting all of your accumulated cash value to pay premium. I would definitely look into another policy at this point. Like I said, not sure what your age or medical status is, but if you able, shop around. See whats out there. You have nothing to lose at this point.
Posted: Fri Nov 30, 2007 01:15 pm Post Subject: I have a universal policy with Allstate that started out wit
Hi bhpinkston,
Universal Policy purchased with Allstate since 1989.
When Universal Life (UL) policies were introduced back in the early 1980's, it was designed to fight off the attack of a man by the name of A. L. Williams.
This man formed a company to attack Whole Life polices and pursuade insureds to cash them out.
When UL policies first came out, the "current interest rate" was as high as 13% or higher. This allowed people to buy large amounts of life insurance at very little premium and the projected "cash accumulation" looked fantastic.
There were actually three choices of "premium types" - (1) Minimum Premium (2) Target Premium (3) Premium to Age 100. Most agents were selling UL poicies at the "minimum premium" and that was just fine until the interest rates began to fall. When the interest rate fell to 4% or 5%, this "minimum premium" was no longer sufficient to pay for the "cost of insurance", so where did the difference in premium come from? Exactly, your cash accumulation.
This is where Universal Life policies get all their bad reputation. This type of insurance policy is a good one, if property funded, like knig188 has already told you.
I don't know your age or the condition of your health, but you may want to consider the purchase of another life insurance policy. Your agent actually sold you the right policy, but he just didn't show you what would happen if the interest rate fell to the "guaranteed rate", which is normally about 3%.
Did you not get annual statements showing the progress of your policy?
It's standard in the industry that insurance companies send out statements around each policy anniversary, so if changes need to be made, they can be made before someone ends up in your type situation.
Universal Life policies are flexible, but with each change to the policy, comes some consequence.
Did your insurance agent contact you each year for an annual review?
I don't know if any of this has helped you better understand what has happened, but the agent and the insured both share some responsibility in maintaining a sound life insurance program.
Posted: Fri Nov 30, 2007 05:52 pm Post Subject:
Then again, you might just want to call or message someone who has investigated and/or sued Allstate more times than he can recall for many years for things like Breach of Contract, Vanishing Premium Fraud, Premium Misdirection, Breach of Fiduciary Duty, etc., etc.
I'm available whenever you'd like to chat.
Posted: Fri Nov 30, 2007 05:57 pm Post Subject:
Oh, I forgot something. Here's a bit of trivia; In 1996 and 1997, an organization called The Insurance Fraud Prevention Network voted Allstate the most corrupt company in America. To date, I don't know that any company has won since this prestigious title two years in a row.
Posted: Fri Nov 30, 2007 09:10 pm Post Subject:
thats hilarious ins investigator maybe i will use that on some of my prospective clients coming in from that company
Posted: Sat Dec 01, 2007 07:51 am Post Subject:
If you're not very fond of Allstate, here is the place to go.
http://www.outofthedark.com/CorporateWars/WarLinks.html
Link deactivated
Posted: Fri Apr 22, 2011 09:21 pm Post Subject:
like most companies, for every 10,000 things they do right, the press and attornies will find the 1 thing where they dropped the ball. I guess the press and attorneys have to make money too. Super sized lawsuits, catastophic claims, and fraud have made most insurance companies really watching their behinds. I've sold policies and adjusted claims for several of the top companies, they all have their good and their bad, what large corporation doesnt? But as a whole, Allstate is a good company. As one of the largest insurance companies, its makes good press when they drop the ball. You never hear the good things they do.
InsMaze is dead on on how the UL works and what is happening w/ the policy. You get annual statements that reflect the performance of the policy. I cant imagine watching my investment portfolio continue to drop for severale years and not pick up the phone and call my advisor, I wouldnt think that one would continue to do the same on the life policy. I am guessing at some point a large withdrawal was taken out of the policy and never put back; now there's not enough cash value to continue the policy as originally structured. The UL is much more sensitive to interest rate changes and cash withdrawals than a whole life policy. It should be reviewed every couple years or so and adjustements made as needed.
Good agents try to get their clients to review their needs on a regular basis to watch for these types of issues. The problem is most people think they can educate themselves, they buy online and from 800#'s and save a dollar and a little time. The other's are "too busy" to come in a sit down w/ thier agent.
A lot has changed in the last 20 years, call your local agent and sit down w/ them so they can best explain what is going on with your specific policy, review your options, and see if you can come up with a solution.
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