Need to Advise Client; Never Seen This Before

[Ronnie Carter]

Got a Medicare client who applied for a life policy for her granddaughter from one of those "mail-order" companies. She answered the health questions as best she knew how, but some time later re-read the questions and wondered if she had perhaps unintentionally misstated an answer, as the child was being observed for some sort of ongoing (non life-threatening) condition. She called the carrier, they said they would get back with her, and soon a letter arrived saying the policy application was now declined.

Here's the good part: The company then mailed her a policy and for several months now has taken premium payments from her bank account. (In my mind, that establishes a valid contract, with an offer, acceptance, consideration, etc., the denial letter notwithstanding.) Upon being asked, I advised her a few weeks ago to let them continue collecting premiums, and at worst, after two years they would be unable to rescind the contract. The client wants to have a small life policy on this child to give her when she grows up.

But I'm no expert on this, having never dealt with such idiotic sloppiness. Do you guys think my advice was sound? I told her not to rock the boat (again) and wait to see what happens. Thanks much in advance for your thoughts.

 

[WinoBlues]

If she is insurable somewhere else, rewrite her. If, or rather, when she dies why go through all that hassle to possibly get the claim paid or just a resinded policy and a refund. Insurance companies are not humans that you can appeal to. They are rules, procedures and lawyers.

Did you give her the advice in writing?

 

[rmhaire]

If she is insurable somewhere else, rewrite her. If, or rather, when she dies why go through all that hassle to possibly get the claim paid or just a resinded policy and a refund. Insurance companies are not humans that you can appeal to. They are rules, procedures and lawyers.

Did you give her the advice in writing?

Ditto. Re-write it.

 

[Ronnie Carter]

No, it was a verbal suggestion. I just found out she called the company and was told the policy was active and "in good standing."

I will take your advice -- don't want trouble with this in the future. I've got four of that family in Medicare plans and want to keep them happy.

Thanks kindly.

 

[WinoBlues]

No, it was a verbal suggestion. I just found out she called the company and was told the policy was active and "in good standing."

I will take your advice -- don't want trouble with this in the future. I've got four of that family in Medicare plans and want to keep them happy.

Thanks kindly.

She will probably get a better policy and a real agent. Win Win. And you solidify yourself in the home. Win, Win, Win