Colorado Bankers (CB Life)...

[BibH]

I just looked it up again . Most state guaranty funds insure annuity funds up to $300k .Won’t the above individual with $310k get back at least $300k back eventually? I know it could take many many yrs.As far as having a case against the agent . It’s basically his word against the agents. He’d have to have written proof the agent said that.

 

[Newby]

You might have a case against the agent if they told you it was like the FDIC. I believe that is a prohibited statement.

Also, the component you mention of 25 year maturity is likely a non issue. The maturity definition in your policy likely defines a maximum maturity date as to when you would be forced to elect a lifetime irrevocable payout annuity stream of payments. I would suspect it has no bearing on what you are going through today.

Good luck & I hope this resolves soon for you & the other clients of CBL

He would absolutely have a case against the agent if he had it recorded that the State Guarantee Fund works like FDIC Insurance. They are nothing alike. FDIC Insurance is actually government backed. Government funds guaranty FDIC Insurance.
Insurance State Guarantees are just insurance industry agreements. There is No state or federal monies that will ever pay into them. They are to be funding by other insurance companies as they come up and are settled which takes years and does not cover all policies.

 

[Allen Trent]

I just looked it up again . Most state guaranty funds insure annuity funds up to $300k .Won’t the above individual with $310k get back at least $300k back eventually? I know it could take many many yrs.As far as having a case against the agent . It’s basically his word against the agents. He’d have to have written proof the agent said that.

There are no actual funds in those associations to pay claims. After rehab & all assets of the carrier are figured out, they assess the other quality insurance carriers still standing. As you can imagine, the remaining carriers are not big fans of having to pay assessments to pay the claims of a failed carrier, especially a carrier that may have part of illegal activities or that regulators should have found issues with sooner.

I rarely mention lawsuits against an agent, but if this agent has told other clients similar things, it is possible other customers or prospects of the agent could provide affidavits to what was said. E&O carrier may decide to settle. However, that could also take years to determine as the carrier may not settle or a court award a case against agent until it is determined what, if any losses, the insured suffered after rehab & potential Guaranty Association involvement.

Because the client appears to have been taking interest or distributions, they may not be able to recover the entire $300k as some of the non-guaranteed interest amounts may have exceeded the minimum guarantees of the contract

Terrible all around

 

[Newby]

There are no actual funds in those associations to pay claims. After rehab & all assets of the carrier are figured out, they assess the other quality insurance carriers still standing. As you can imagine, the remaining carriers are not big fans of having to pay assessments to pay the claims of a failed carrier, especially a carrier that may have part of illegal activities or that regulators should have found issues with sooner.

I rarely mention lawsuits against an agent, but if this agent has told other clients similar things, it is possible other customers or prospects of the agent could provide affidavits to what was said. E&O carrier may decide to settle. However, that could also take years to determine as the carrier may not settle or a court award a case against agent until it is determined what, if any losses, the insured suffered after rehab & potential Guaranty Association involvement.

Because the client appears to have been taking interest or distributions, they may not be able to recover the entire $300k as some of the non-guaranteed interest amounts may have exceeded the minimum guarantees of the contract

Terrible all around

In my experience the state guarantees won’t pay off on the interest the annuity had accumulated. It will only pay on the principle amount paid in. I’ve never been able to find that much detail in writing and it may vary by state. But from the way other cases have settled on single premium life cases they only covered the premiums paid not face amount and not the growth of the policies through the years.

 

[David Nyman]

So how long before the insurance company is put into liquidation? Typically . I can see why insurance companies would want to delay this and use my money at 1% as long as possible. The state insurance seems more like a selling tool, but not a very good investmeny guarantee.

 

[rousemark]

So how long before the insurance company is put into liquidation? Typically . I can see why insurance companies would want to delay this and use my money at 1% as long as possible. The state insurance seems more like a selling tool, but not a very good investmeny guarantee.

It is not a selling tool as agents are not allowed to mention it at the time of sale in most jurisdictions. But we are required to give notice to the client about it at the time of policy delivery. Most times that a company is placed into receivership, the company is not liquidated but taken over by another company and the client's investment is usually (not always) protected by the assuming company.

 

[David Nyman]

The State Insurance Guaranty was definitly mentioned during and before the contract signing. Bankers Life and other Lundburg companies have been in rehab for 1.5 yrs. If some other company were going to take over, I would have thought it would have happened by now. With Lundberg raiding the cash, it leaves too much debt.
I would like to discuss this with other policy holders, but I can't seem to find a forum. Does anyone know where I can find one?

 

[shooter]

Hello All
I'm one of the stupid suckers that bought 2 - 5 year annuities with Bankers Life Insurance worth about 310 K. Its been paying me a monthly amount, same as before the rehabilitation. I'm trying to get a better feel how this is going to play out. As far as I'm concerned, they have allready defaulted on their contract with me. I was supposed to be able to withdraw 10% penalty free each year and the 310k after paying a penalty before the 5 years, then withdraw 100% after 5 years. They halted withdrawls with the rehab. When I bought these annuities I was assured that everything would be guaranteed by the Utah Life & Health Insurance Guaranty Association. I was told this was like the FDIC. NOT!!!! It seems that the rehab puts these insurance companies into limbo where they default on the annuity contract but can't be sued or forced into liquidation. Indefinitely!!! What a racket!! And nobody seems to be guarding the chickens. The NC insurance Commissioner was taking bribes from Lindburg to loosen the regulations even more so he could raid more. This annuity paid maybe .5% more than a CD. I don't think people understand the high risk that these insurance products have. The Insurance Agent set this up to not mature until 25 years later even though the intent was to take the money out after 5 years. The interest rate drops to 1% after the 5 yr guarentee period is over. How can you guys sell this crap and sleep at night knowing that there are people investing their retirement savings into this garbage???

I feel like your out of line David.
You guys didn't sell you this product, neither did we purchase it.
It wasn't designed or marketed by us either.
The state you live in, give Bankers the right to do business in your state.

As others have shared, it wasn't an insurance issue that led to this
unfortunate situation.
It was a crook masquerading a businessman.

You are upset that You made a poor decision.
Did you do your homework on the company, how state guaranty associations
work?
If it had been my retirement money, I would have looked long and
hard at all the options.

You will at some point get your Money, minus interest most likely back.
Next time check things out more closely for yourself, and don't take
someone's word for facts.

Was this sales person a relative, or acquaintance?
Did they have experience in the area they were advising you in?
I'm thinking they have worked for a bank since you keep bringing up
FDIC.
Shooter

 

[Allen Trent]

So how long before the insurance company is put into liquidation? Typically . I can see why insurance companies would want to delay this and use my money at 1% as long as possible. The state insurance seems more like a selling tool, but not a very good investmeny guarantee.

they may not be making any money on your money if your money is not available or earning anything. IE-- If Greg Lindberg diverted $2B as he is accused of diverting to his other entities, the insurer doesnt have your money to invest or earn a rate of return on

For your sake & others like you, hopefully the NC insurance commissioner can find a receivership solution & not force it into liquidation. the state Guaranty associations do not come into play unless a carrier is liquidated, which is extremely rare. I believe there has only been a couple dozen insurers to be liquidated in bankruptcy over the last 40 years & the majority of those were relatively small companies with below average Financial ratings

 

[DHK]

I'm thinking they have worked for a bank since you keep bringing up
FDIC.

Some IDIOTIC sales trainers like to believe and teach that FDIC is the same as a state guaranty association. It is NOT. But they think that it really won't matter, so what's the harm?

(ugh)