Doesn't sound high enough to lie about. I had one contestable claim not paid with CFG on a term plan. Was about 16 months into the plan when the insured died of cancer. The APS indicated he had been told he had cancer a year before the insurance was issued but never returned for treatment.
I did good yesterday... real good.
- Thread starter Life Hawk
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I meant I don't know if it's true that Columbian told their agents that. The 48% is probably accurate.
If you were a business owner you'd look for legitimate ways to not pay things . The truth is dr notes got a ton of things in them . " patient complaining of chest pain " . Might have been stress . It goes away he never went back to dr and dies . Company can use as ammunition and say was heart problems or angina . Deny claim . Few if any will sue for a $5-$15 k claim as I'd highly doubt a layer would waste his time on a 30-40% payout . Cost more in fees and expenses .
My experience with most companies I have had claims with is they look for every reason to pay a claim not the other way around. However, a company can get into trouble for paying claims that should not pay.
Proofs in the pudding . A very high % of contestable life claims arent paid .Hard to believe all those claims not paid lied .
It is not necessarily a case of the client lying.. I would say that almost as often it is a case of the agent clean sheeting. Or, possibly even being a case of the client simply not knowing or understanding or even being in denial.
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I think that may be generally true. The home service company I started with was very good about paying contestable claims. I'm pretty sure they paid many claims they could have easily denied. But that all changed once they were acquired by a much larger publicly traded company.
I only briefly worked for one more captive company after that. They had somehow gained a reputation over the years for trying to get out of a claim if they could. I don't know how true that was in reality. But, FWIW, I heard it from both policyholders and agents in two different parts of the country.
So, I was taken completely off guard when, shortly after becoming independent, I visited the home office of a small carrier located near where I live and work. I had stopped by to drop off some apps and pick up supplies. As I was talking with the receptionist, the CEO came walking through the foyer. I greeted him and asked how his day was going. He answered that he was having a really good day. I responded, "What's making this such a good day?" He answered, "Because we're paying lots of claims today."
Well, my experience over the previous few years told me that company execs don't normally get excited about paying claims! Picking up on the apparently confused look on my face, he continued, "I guess it's not a good day for someone who's lost a loved one. But it's a good day for me because it means I get to do what they've been paying me to do, which kind of validates our purpose - makes me feel good about our business!"
We became good friends after that. A few years later I asked him if he remembered that conversation. He didn't, but expressed, as you just said, "We don't look for reasons to not pay. We want to pay every legitimate claim. Of course, if there's a contestable claim where there's clearly fraud involved, we won't pay those. But on cases where it could go either way, we try to give the policyholder the benefit of the doubt and pay the claim."
He continued, "I don't know why some companies fight claims. It doesn't make good business sense! After all, it's not just that one policy. There are usually family members, friends and neighbors who also have policies with us. Sure, maybe we could save a little money by denying that claim. But how much more would we lose if we get a bad reputation in their community?
The point of that story: It makes a difference whether a company feels a primary responsibility to its policyholders and agents vs. a company who cares more about shareholders and the bottom line. And going back to what @Life Hawk was sharing, it also makes a difference whether I care more about my clients or my own bottom line!
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BTW, please forgive my loquacity on that last post!
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Given your field underwriting and placement skill set,how many contestable claims do you typically get each year ?
How long should it take for a company to make a decision?
What the maximum amount of time you've seen them take to pay one ?
On average what percentage of your's are paid ?
In all my years I have had one not paid.. That is the CFG term I mentioned. It was on my niece's husband. I have had two that died of natural causes in less than a week after the app was taken and before the policy was issued. Both were paid.
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