Universal Life Insurance

[nellieb]

Suntrust Securities sold my widowed 79 year old father a FLEXIFBLE PREMIUM UNIVERSAL LIFE INSURANCE POLICY. I need some help:

1. Does this seem an approiate thing to sell him.
2. If not where would I complain.


For some reason I think it just generated a large commission. Let me know what you think.

 

[FinanceDude]

Suntrust Securities sold my widowed 79 year old father a FLEXIFBLE PREMIUM UNIVERSAL LIFE INSURANCE POLICY. I need some help:

1. Does this seem like the proper item to sell him?
2. If not where would I file a complaint.


For some reason I think it just generated a large commission. Let me know what you think.

There's a "30-day free look" policy on all insurance policies. It starts from the time HE IS DELIVERED the policy. He can cancel it and he get all his money back. If it's past 30 days, let me know.

 

[mickeyd]

For some reason I think it just generated a large commission.

Your instincts are no doubt correct. First year commission is probably about 80%. A ULI policy on someone almost 80 years old appears to be quite questionable. What does your dad say as to why he bought it? Have you called the agent and had a conversation with him/her?

You may want to consider writing a letter to the insurance company president (with a copy to you state insurance commissioner) asking for a reversal and refund of all premiums paid. If no action (give them 14 businesses days) to that letter you can file a complaint with his (you dad's) state's insurance commissioner and they will investigate it.

 

[FinanceDude]

Your instincts are no doubt correct. First year commission is probably about 80%. A ULI policy on someone almost 80 years old appears to be quite questionable. What does your dad say as to why he bought it? Have you called the agent and had a conversation with him/her?

You may want to consider writing a letter to the insurance company president (with a copy to you state insurance commissioner) asking for a reversal and refund of all premiums paid. If no action (give them 14 businesses days) to that letter you can file a complaint with his (you dad's) state's insurance commissioner and they will investigate it.

The 30 day free look is painless. If he is past that, consider Mickey's idea...........

 

[nellieb]

I talked to one of the SENIOR insurance personel and was told that they used a very strict set of questions as a guidline to determine if this policy was right for my father. I asked them for a copy of the guildine - SILENCE. Since I have just filed the POA papers with them I was told I would have to call back in a week.

 

[FinanceDude]

I talked to one of the SENIOR insurance personel and was told that they used a very strict set of questions as a guidline to determine if this policy was right for my father. I asked them for a copy of the guildine - SILENCE. Since I have just filed the POA papers with them I was told I would have to call back in a week.

Until you are on file with them as the POA, they don't have to tell you anything.

However, ask your dad to give you the copy of the application, which the agent had to have given him. Is the policy in force at this time? Let us know.........

 

[mickeyd]

ask your dad to give you the copy of the application, which the agent had to have given him.

Good point. A photocopy of the application should be included in the policy (it is officially part of the contract) at the end on the policy. Read it and see if there are any errors or misstatements.

 

[2B]

My father and in-laws were both sold pathetic, high cost annuities. My FIL bought a whole life policy at age 67 without any estate planning purposes or need. Is there any reason question why my first response to any financially based insurance product is to assume that its over priced crap.

In dealing with my Dad and in-laws, I can certainly relate to how easily an elderly person can be led down the path to poor financial decisions by these bloodsuckers.

Unfortunately, its illegal to do what's needed.

 

[chinaco]

Do not waste your time with anyone low in the insurance company. Go up to the top. Send the CEO a letter as a complaint wit the threat of going to the insurance commissioner. Go ahead and file a complaint with the insurance commissioner... don't wait.

 

[saluki9]

Do not waste your time with anyone low in the insurance company. Go up to the top. Send the CEO a letter as a complaint wit the threat of going to the insurance commissioner. Go ahead and file a complaint with the insurance commissioner... don't wait.

That strategy isn't going to get you anywhere, sorry to tell you.

1. If somebody is the CEO of a large insurance company, they don't open their own mail, and they get a lot of nasty letters that their secretary either tosses out or gives to somebody else.

2. They aren't going to shake with fear just because you mention the state department of insurance.

3. Threatening people is a very poor way of starting a negotiation and hurts your chances of getting what you want.

Start with a lower level person and explain your problem. Don't make accusations, just explain what is going on. If you need to speak with a supervisor. In many cases you will find somebody sympathetic to your cause who will help you. If you feel that you aren't moving to a solution you can move up the chain.

Our firm once used this exact strategy to extract $300K (which was all the money in the world) for a parent of a client which was stuck in an insurance company that had just gone into receivership.

 

[FinanceDude]

Saluki is right on. When I had my little "problem" with TIAA-CREF, I wrote a letter to the supervisor of the department that was directly involved in my issue.

A week later, I got a guy who was in charge of Beneficary Services, and he was in a position to help me. When you find the right person, it goes alot smoother.

You didn't mention if you were within the 30 day free look period or not...........

 

[2B]

Our firm once used this exact strategy to extract $300K (which was all the money in the world) for a parent of a client which was stuck in an insurance company that had just gone into receivership.

I wanted to make sure all the annuity fans on this forum don't miss your last comment. The annuity is only as good as the company backing it. The really big insurance/banking firms always sell their products through a "wholly owned subsidiary" that is never backed by the "full faith and credit" of the parent. Everything looks good but when the market tanks so does the stability of the investment portfolios backing the product.

Some companies invest in very aggressive hedging stategies to juice their profits (bigger management bonuses). Here something that ultimately should be fairly minor to our overall economy (like the current mortgage shakeout) could sink a lot of annuities. Although painful to many individuals, I don't see this hurting a conservative, diversified portfolio very much.

 

[old woman]

The annuity is only as good as the company backing it. The really big insurance/banking firms always sell their products through a "wholly owned subsidiary" that is never backed by the "full faith and credit" of the parent.

My dad was in his 70s and very uneducated about investments or anything else when he decided to invest money. He knew about bank CDs and early withdrawal penalties but that was it for investing. He went to what he considered a big company Sherson American Express thinking the were Sheration American Express so a very big company and he talked to the boy. The boy sold him an annuity for 7 years, dad asked if it had an early withdrawal penalty and was told it didn't so dad thought he knew what he needed to know and bought it. Then they mailed it to him and it was an annuity in a company in CA that dad had never heard of, he was scared. He waited a year and got a statement saying how much it was worth if he took it now and how much it was worth towards the ending balance. It looked like an early withdrawal penalty to him. But he waited another year and couldn't take it anymore all the worry and anger over money so decided to cash it in no matter what it cost him. He gave my brother and I the money because he said he was too old to worry about money. They should all be taken out and shot.

 

[2B]

They should all be taken out and shot.

You are far more forgiving than I am.