Graded Policy Replacement

[TPAAgent]

Just spoke to a client I wrote 1 year ago- another agent re-wrote her graded death policy for a cheaper premium and told her that as long as he filled out the replacement form she can grandfather her year of the old policy into the one he wrote her... Is this true?

 

[Todd King]

I guess there's a first time for everything, but in this case I'll call BS.

 

[SportsNut]

Wouldn't it be great to have a CD (or iPod download) filled with quotes of all the stupid and heinous things that agents say and have said on FE appts...? Would be a great Xmas gift for Ins agents that you know... kind of like a comedy club recording, except that these statements can be so harmful to the client.

Again, not likely to be true, but the agent really, really needed the money... and It is Xmas time too.

 

[jdeasy]

Just spoke to a client I wrote 1 year ago- another agent re-wrote her graded death policy for a cheaper premium and told her that as long as he filled out the replacement form she can grandfather her year of the old policy into the one he wrote her... Is this true?

No, this is not true. Graded and ROP plans are always graded and ROP. Even here in Ky where a replacement of a policy out of contestabilty cannot have a new contestability a graded or ROP plan is still graded or ROP.

 

[Mark]

Just spoke to a client I wrote 1 year ago- another agent re-wrote her graded death policy for a cheaper premium and told her that as long as he filled out the replacement form she can grandfather her year of the old policy into the one he wrote her... Is this true?

I dont believe this is true. Find out who is the company also.

 

[donamese]

I thought I had heard of a state where the contestible period would continue to the new policy but could be wrong. Doesn't seem to make sense unless the underwriting was exactly the same which is never the case.

 

[VolAgent]

No, this is not true. Graded and ROP plans are always graded and ROP. Even here in Ky where a replacement of a policy out of contestabilty cannot have a new contestability a graded or ROP plan is still graded or ROP.

So what is to stop agents from clean sheeting replacements that should have been graded or ROP?

 

[jacobtn]

So what is to stop agents from clean sheeting replacements that should have been graded or ROP?

hey I think you may be on to something there. Good question. Maybe that's why JD has been so busy lately? (haha just kidding!)

 

[rousemark]

So what is to stop agents from clean sheeting replacements that should have been graded or ROP?

Years ago on of the debit companies came out with a two year ROP plan. The local DM told his agents, "Now we can do legally what we have always done" They would clean sheet the apps, there were no MIB,Script Checks, etc. in those days. And companies did not do inspections on Industrial plans so agent just answered the questions, "no, no, never, none, had the flu in 61." If the client revealed a serious medical problem, most agents would just say," Well, that is really not important"..

Others were a little more honest with the clients, telling them, "I'll answer no but if you die during the first two years, the company will just refund your premiums if they find out the answer should have been yes. However, after only 24 months, they are obligated to pay the full amount when you die. They won't be able to cancel the policy and your premium will never go up. But, that is a lot better than if I answer the question yes, because if I do that you won't be able to by any insurance to protect your family.. I just need you to write your name here to put the plan in effect as I have explained it to you."

 

[VolAgent]

Years ago on of the debit companies came out with a two year ROP plan. The local DM told his agents, "Now we can do legally what we have always done" They would clean sheet the apps, there were no MIB,Script Checks, etc. in those days. And companies did not do inspections on Industrial plans so agent just answered the questions, "no, no, never, none, had the flu in 61." If the client revealed a serious medical problem, most agents would just say," Well, that is really not important"..

Others were a little more honest with the clients, telling them, "I'll answer no but if you die during the first two years, the company will just refund your premiums if they find out the answer should have been yes. However, after only 24 months, they are obligated to pay the full amount when you die. They won't be able to cancel the policy and your premium will never go up. But, that is a lot better than if I answer the question yes, because if I do that you won't be able to by any insurance to protect your family.. I just need you to write your name here to put the plan in effect as I have explained it to you."

Rather like all these non-tobacco users running around...