First Death Claim

[HoosierLife]

So I had my first death claim this week. Obviously, it was still in it's contestibility period (I've only been selling FE for 5 months).

It was a lady that bought a small RNA policy. I really thought her husband would pass first, he was on O2, COPD, recent HA and still smoked.

I thought it would feel nicer, but when I had to explain the contestibility issue to her daughter and hear her say, "So were not going to have money for the funeral," it didnt really help any. It wasn't a replacement, so no worries there.

But on that subject, do you guys explain the 2 year contestibility issue with all sales. I've started to, but back when I sold this policy, I don't think I did.

 

[GMDM100k]

I don't go into the contestibility during the presentation. I used to hand deliver my policies and go over it then. But now I just don't have the time.

Now i have them call me when they get the policy in the mail and I go over it on the phone. We review the policy for accuracy and I explain the contestiblilty and what our options are if they pass within the two years.

I haven't had very many contestible claims. The ones that I did have the company had an option where they would advance the claim if I assumed the risk of it not being played out. Which I did.

Not something I would recommend for you even if they would give you that option. It could put you out of biz.

Its just a little somethin somethin I do for my clients because they are special

 

[rousemark]

So I had my first death claim this week. Obviously, it was still in it's contestibility period (I've only been selling FE for 5 months).

It was a lady that bought a small RNA policy. I really thought her husband would pass first, he was on O2, COPD, recent HA and still smoked.

I thought it would feel nicer, but when I had to explain the contestibility issue to her daughter and hear her say, "So were not going to have money for the funeral," it didnt really help any. It wasn't a replacement, so no worries there.

But on that subject, do you guys explain the 2 year contestibility issue with all sales. I've started to, but back when I sold this policy, I don't think I did.

I don't make a big deal out of it but during the sales process I will say, this plan will pay for any type of death..accident, heart attack, cancer whatever.. The only time it wouldn't pay would be for suicide or if you lie on the application but after you have had the plan for two years it will even that is covered.

When filling out a death claim, I don't mention it at all. Why upset the beneficiary over something that probably isn't going to be a problem 99% of the time. If there is a delay in paying the claim because the company is investigating then I explain the reason for the delay.

The exception to that is a couple of times that I have had clients die prior to the policy being issued. Then I explained to the beneficiary that the company would continue the process as if the insured was still alive and if they found they would have issued the policy, they will go ahead and issue it postmortem and then pay the claim. In each case, the claim was paid.

 

[HoosierLife]

I don't make a big deal out of it but during the sales process I will say, this plan will pay for any type of death..accident, heart attack, cancer whatever.. The only time it wouldn't pay would be for suicide or if you lie on the application but after you have had the plan for two years it will even that is covered.

When filling out a death claim, I don't mention it at all. Why upset the beneficiary over something that probably isn't going to be a problem 99% of the time. If there is a delay in paying the claim because the company is investigating then I explain the reason for the delay.

The exception to that is a couple of times that I have had clients die prior to the policy being issued. Then I explained to the beneficiary that the company would continue the process as if the insured was still alive and if they found they would have issued the policy, they will go ahead and issue it postmortem and then pay the claim. In each case, the claim was paid.

So you don't even tell them when they die during the contestability period? Unless they ask??? Seems kinda important to me to bring up, if they're expecting the money to bury them and all.

In this case the daughter asked when I told her RNA would be sending a packet for them to fill out and mail back in. She asked if the check would be included and I told her about the contestability period then.

 

[rousemark]

So you don't even tell them when they die during the contestability period? Unless they ask??? Seems kinda important to me to bring up, if they're expecting the money to bury them and all.

In this case the daughter asked when I told her RNA would be sending a packet for them to fill out and mail back in. She asked if the check would be included and I told her about the contestability period then.

If asked, I explain.. If they ask when to expect the check, I explain.. However, in most cases, the contestable claims I have had have been paid almost as fast as the incontestable claims so I see no need to upset the beneficiary necessarily. The key is to underwrite at time of application and to never encourage a client to shade the truth. It is better to give the HO underwriters more info than they request than not enough.

 

[Newby]

So you don't even tell them when they die during the contestability period? Unless they ask??? Seems kinda important to me to bring up, if they're expecting the money to bury them and all.

In this case the daughter asked when I told her RNA would be sending a packet for them to fill out and mail back in. She asked if the check would be included and I told her about the contestability period then.

It's very rare for a healthy person that really qualifies for preferred rates to die during the 1st 24-months. I've only had a few of them. The company has paid off on all but two. One filled a prescription for an inhaler at the VA every year but failed to disclose any lung disorder. The other took a prescription for dementia (daughter was with him through the whole app) but answered that question no. He lived 23-months.

You can't blame the insurance companies for not paying off if the app questions were not answered honestly.

 

[HoosierLife]

It's very rare for a healthy person that really qualifies for preferred rates to die during the 1st 24-months. I've only had a few of them. The company has paid off on all but two. One filled a prescription for an inhaler at the VA every year but failed to disclose any lung disorder. The other took a prescription for dementia (daughter was with him through the whole app) but answered that question no. He lived 23-months.

You can't blame the insurance companies for not paying off if the app questions were not answered honestly.

I don't blame them. Now I just feel I should make them more aware of this fact during the sale/maybe at delivery. Definitely to any couples I sell for sure.

And the lady was relatively healthy other than the weight. Daughter said she went into renal failure and had a blood clot, but didnt know which one was cause of death.

 

[jdeasy]

I blame the companies. They are so eager to get the business on the books that they will short the underwriting process on the front end and then they will go the far ends of the world to find a reason to deny payment. Even to the point of denying payment for something that wasn't even asked on the applicagion.

I had one company tell me that we should "never" tell people that coverage is immediate.

I asked them to read me their advertising literature where it had plastered all over it "immediate benefit". They said that they could not be responsible for what the advertising dept did.

It should be rare for a claim to not be paid. I know many comanies in the FE business where it's a shock if they do pay a contestable claim.

It's very rare for a healthy person that really qualifies for preferred rates to die during the 1st 24-months. I've only had a few of them. The company has paid off on all but two. One filled a prescription for an inhaler at the VA every year but failed to disclose any lung disorder. The other took a prescription for dementia (daughter was with him through the whole app) but answered that question no. He lived 23-months.

You can't blame the insurance companies for not paying off if the app questions were not answered honestly.

 

[rousemark]

I blame the companies. They are so eager to get the business on the books that they will short the underwriting process on the front end and then they will go the far ends of the world to find a reason to deny payment. Even to the point of denying payment for something that wasn't even asked on the applicagion.

I had one company tell me that we should "never" tell people that coverage is immediate.

I asked them to read me their advertising literature where it had plastered all over it "immediate benefit". They said that they could not be responsible for what the advertising dept did.

It should be rare for a claim to not be paid. I know many comanies in the FE business where it's a shock if they do pay a contestable claim.

I certainly hope that I am not representing any of them..

 

[Josh]

If asked, I explain.. If they ask when to expect the check, I explain.. However, in most cases, the contestable claims I have had have been paid almost as fast as the incontestable claims so I see no need to upset the beneficiary necessarily. The key is to underwrite at time of application and to never encourage a client to shade the truth. It is better to give the HO underwriters more info than they request than not enough.

Am I missing something? If the client doesn't lie, doesn't suicide, carrier is still on the hook for the claim, right? If a carrier is going to want to investigate a claim when I hit a deer with my car, why wouldn't a carrier want to investigate a death claim before they pay?