INN: PennMutual lawsuit article

[DHK]

FOUND IT! It is on TikTok. I tried to find the same video on YouTube, but it's not there.

So I downloaded it and put it on my Vimeo account.

 

[PrivClientSG]

Co-branding is not the issue. The material they co-branded, is the issue.

Setting up multiple charitable organizations purely to provide a tax deduction to the business. Using all of the revenue of that charitable org to buy WL. Somehow flowing that into the pockets of the client for even more tax deductions. Using existing assets as collateral to premium finance all of that. And all of the premium financed policies imploded within the first 7 years according to the complaint. Which means there was little to zero oversight from Penn's UW team.

Im sure half of the charges are borderline. But if even 25% of the charges are true, its a big issue for Penn.

There are a total of 43 claims/charges against them.

I get that. Nomenclature. Personally, part of my interest is always the cause and effect scenario. Not that one will ever find out, and in the end it doesn't matter, however, who prompted who, who pushed, who solicited, etc.

I see the underwriting side of this. This is nothing new. Premium finance and the games on applications, with underwriting, etc., has been going on for 25 years, or more. However, I also see the marketing side of this. That's where this can get very dangerous as well. Even professionals in our industry don't connect the dots all the time. When people talk about IUL being "poorly sold" or "incorrectly sold" -- think about it. Go further down the road and you can land here in this case.

 

[PrivClientSG]

Maybe I am missing something. I looked at the pdf's that are part of the complaint. I don't see anything there with the attorneys or the carriers name, endorsement, etc. As far as oversight from the carrier, that is going to cut both ways. I am sure the carrier's defense -- if they don't get removed/dismissed -- is going to start with cut and dry estoppel. With almost every premium finance litigation I've seen, the carrier's position, not to oversimplify it, is we issue a policy. We don't have anything to say, do, etc., with the lender, the loan, collateral, etc. We issue life insurance.

Even with fraud, they stand on same. If someone else fraudulently induced a person into lying on the application, buying a policy, etc., as long as the company can show standards, all they did was issue a policy. Ironically, the complaint says a lot, but I don't see a lot of supporting documentation in the pdf's; at least not to extend liability to the attorney's and the carrier. The advisor? Obviously this is a scam. LOL.

 

[Tahoe Ray]

I don't see anything there with the attorneys or the carriers name, endorsement, etc.

INN: PennMutual lawsuit article

I'm looking at that file. How did you come to that conclusion? If PennMutual was to create any marketing, it would have PennMutual in the disclaimers at the end. No mention here: The only mention I saw was this (which could've been any insurance company): If Penn was to have created...

www.insurance-forums.com

 

[DayTimer]

This whole thing just reenforces the principle that life insurance should always, first and foremost, be sold as life insurance. Other benefits may be more important to the prospect, but it is still life insurance, and that death benefit, however one may use it, is why you buy it, imho.

 

[scagnt83]

Maybe I am missing something. I looked at the pdf's that are part of the complaint. I don't see anything there with the attorneys or the carriers name, endorsement, etc.

As I indicated before, it is not in the pdfs. It is specified in one of the 40+ charges against them.

Those PDFs are "exhibit A". Only the first piece of evidence. Not the only piece of evidence.

 

[scagnt83]

as long as the company can show standards, all they did was issue a policy.

If that were true. Approval Committees would not exist for NQDC cases. Why even have a RFP if the underlying Plan doesnt matter?

And Penn did not do that, according to the charges.

They routinely disregarded their UW guidelines for this 1 advisor who was bringing them $5m a year in premium.

They had knowledge that he was using falsified business valuations and financial reports.

The whole reason they are a part of this, is because they did not stick to normal and customary standards of UW for these clients/advisor.

 

[scagnt83]

When people talk about IUL being "poorly sold" or "incorrectly sold" -- think about it. Go further down the road and you can land here in this case.

I think that should 100% fall back to the carrier in certain cases.

They know.

You dont sell an Accumulation IUL at Target, and not know. Not if you are the carrier.

Hell, I could say the same for G with Q at 90% and minimum PUA, ran at current rates.

In my opinion, those types of designs, should receive extra scrutiny from suitability. Especially the IUL. At least the WL has nonforfeiture and the underlying WL DB that is guaranteed.