MIB Plan F - Anti Stacking of Policies

[rousemark]

Looks like companies have a new way of preventing a person from buying several SI policies in order to avoid underwriting requirements for a larger policy. Wonder what companies will consider excessive.

Also look for more charge backs as companies get new info from MIB 18 -24 months down the road and rescind the policy claiming the orginal app was not accurate.

MIB Group - Checking Service

 

[Rearden]

I can understand rescinding a policy at death during the 2-Year Contestability period.

But the idea the carrier is stalking my placed, alive business for 2 years after the policy was approved?

I don't think any agent should stand for that.

What's even the point of simplified issue anyway, if the policy guarantees mean nothing?

 

[jdeasy]

I can understand rescinding a policy at death during the 2-Year Contestability period.

But the idea the carrier is stalking my placed, alive business for 2 years after the policy was approved?

I don't think any agent should stand for that.

What's even the point of simplified issue anyway, if the policy guarantees mean nothing?

If you were on the call last Friday you heard me say that I didn't like insurance companies when I got into this business and now learning about them I like them even less now.

Stuff like this is just one of those reasons.

 

[Newby]

I agree 100%. Companies need to underwrite BEFORE they approve the policy. Then if they find obvious clean-sheeting they need to investigate the agent and cancel him out if he is obviously writing bad business.

Recision should only be used in the case of death in the 1st 24 months if it is proven that the person did not qualify for the policy. Or if there is outright fraud.

We all have seen real obvious fraud and scams in the field. Insurance companies are trying to protect themselves from this garbage.

In the past week I have seen or heard from one of our agents:

1. A Medicare Supplement getting approved for a lady with current cancer. Agent clean-sheeted the app.

2. A lady impersonating her sister on an FE phone interview to buy a policy on the sister. Claims the selling agent came up with the scam. He may have, who knows?

3. An agent that went on a day of field training with a manager/recruiter for a captive FE company. They made three sales that day. The only thing was the manager paid the first months premium for all three of them. He explained that when people are on the fence, it's better to pay the 1st premium for them than to have a 2nd appointment. You make over 100% anyway.

Companies need to find ways to cut out rogue agents rather than pick apart individual cases. This would save them a lot more in the long run and wouldn't run off their good agents the way an aggressive recision program will.

 

[newtothegames]

I agree 100%. Companies need to underwrite BEFORE they approve the policy. Then if they find obvious clean-sheeting they need to investigate the agent and cancel him out if he is obviously writing bad business.

Recision should only be used in the case of death in the 1st 24 months if it is proven that the person did not qualify for the policy. Or if there is outright fraud.

We all have seen real obvious fraud and scams in the field. Insurance companies are trying to protect themselves from this garbage.

In the past week I have seen or heard from one of our agents:

1. A Medicare Supplement getting approved for a lady with current cancer. Agent clean-sheeted the app.

2. A lady impersonating her sister on an FE phone interview to buy a policy on the sister. Claims the selling agent came up with the scam. He may have, who knows?

3. An agent that went on a day of field training with a manager/recruiter for a captive FE company. They made three sales that day. The only thing was the manager paid the first months premium for all three of them. He explained that when people are on the fence, it's better to pay the 1st premium for them than to have a 2nd appointment. You make over 100% anyway.

Companies need to find ways to cut out rogue agents rather than pick apart individual cases. This would save them a lot more in the long run and wouldn't run off their good agents the way an aggressive recision program will.

so what happened to the manager?

 

[jdeasy]

so what happened to the manager?

I'm gonna guess nothing happened. Maybe he got promoted? It's systemic with many companies. Look at the Bankers agents. No company could be unlucky enough to hire all the dishonest agents. It's how they are trained.

 

[newtothegames]

I'm gonna guess nothing happened. Maybe he got promoted? It's systemic with many companies. Look at the Bankers agents. No company could be unlucky enough to hire all the dishonest agents. It's how they are trained.

so cynical! i wonder why?

 

[donamese]

I agree 100%. Companies need to underwrite BEFORE they approve the policy. Then if they find obvious clean-sheeting they need to investigate the agent and cancel him out if he is obviously writing bad business.

Companies need to find ways to cut out rogue agents rather than pick apart individual cases. This would save them a lot more in the long run and wouldn't run off their good agents the way an aggressive recision program will.

If they don't look at the individual cases then how do they make a case against an agent? Think of it this way...you write 10 people and clean sheet them. For simplicity, all were noted as 60F non smoker and you sold Foresters at $34 per month. All of these ladies had serious health issues but managed to sneak through without being detected on MIB. Company collects $34 x 24 months x 10 lives = $8160. 3 clients die in the 3rd year and company pays out $30,000...now there is statistical data to go back to check into you as the rogue agent but they are already $21,840 in the hole not even considering the commissions you received.

The company could demand full underwriting but that will piss off a large percentage of agents as most don't even like sitting around for a 15 min phone call. This would also drive up costs for the exam which in turn raises premiums.

I don't personally like the idea of it but I can see it from the companies perspective. I don't think they will be very common if I am doing my job when making the sale.

----------

I can understand rescinding a policy at death during the 2-Year Contestability period.

But the idea the carrier is stalking my placed, alive business for 2 years after the policy was approved?

I don't think any agent should stand for that.

What's even the point of simplified issue anyway, if the policy guarantees mean nothing?

They are trying to do the rescission before the contestibility runs out. Not sure how you are ok to rescind when they die but not before. I would rather tell the client they lied and we need to find something they qualify for than tell a beneficiary sorry for your loss and by the way, you don't get s*&# because your mom lied on the app.

 

[jdeasy]

so cynical! i wonder why?

I am not cynical by nature but this business has turned me that way about the business practices of many companies.

Bankers, for example, every agent I've run across that represented Bankers have been dishonest. Now you could say it's this one office nearby or the 3 offices that run into agents from, Evansville, In, Bowling Green, Ky and Indianapolis, In. It could be that they are under the same director or something?

Then I get on the forum and I see agents from all over the country saying that Bankers agents are doing the same things in their areas as they are here. That leads me to think it's a systemic problem.

 

[benwrigh]

I am not cynical by nature but this business has turned me that way about the business practices of many companies.

Bankers, for example, every agent I've run across that represented Bankers have been dishonest. Now you could say it's this one office nearby or the 3 offices that run into agents from, Evansville, In, Bowling Green, Ky and Indianapolis, In. It could be that they are under the same director or something?

Then I get on the forum and I see agents from all over the country saying that Bankers agents are doing the same things in their areas as they are here. That leads me to think it's a systemic problem.

I'm not a final expense agent, but just last week had a p&c client call about a guy from Bankers that tried to sell him a policy. This guy has had cancer, amputation due to diabetes, overweight, and has heart trouble. No doubt that the agent was going to have to cover some of this up. Luckily I think the client smelled the stench.

I am in IN by the way too.