Replacement Form

Feb 28, 2016

  1. jemelton
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    jemelton Guru

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    I always mark on the app if it asks if they are considering replacing but are there rules to when the actual form has to be submitted?

    A lot of the time the person is not 100% sure on how much or the exact type of insurance they are going to choose especially if they have some health conditions. We are simply underwriting a death benefit Amount and putting a plan together once I have a rating (this is on fully underwritten over 100k). One of my carriers is on me about submitting the replacement form when I submit the app but often this won't be accurate because they may change plans based on underwriting class. Is there a rule it has to be submitted with the app or later on after they choose what plan they are going to go with?
     
    jemelton, Feb 28, 2016
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  2. Tahoe Ray
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    I always submit one if there is even a chance that a policy will be replaced.

    I know that NY considers a new policy as a replacement if the original policy lapses up to 6 months afterwards.

    Better safe than sorry.

    And to add, just fill out the form as applied for. If something changes as far as coverage, let the carrier guide you as to whether or not they need an updated form.
     
  3. jemelton
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    I always fill out the form if I'm replacing but it's normally at the end of the process
     
    jemelton, Feb 28, 2016
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  4. Tahoe Ray
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    I normally just take it at the time of app.
     
  5. jemelton
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    But is there any kind of regulation that says you have to?
     
    jemelton, Feb 29, 2016
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  6. LGilmore
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    LGilmore Guru

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    May depend on your state. Mine does. A replacement form doesn't mean a replacement is automatic as it still depends on underwriting and the insured may decide to carry two policies. A replacement notice gives the company being replaced a chance to save their business.

    It is wiser to do a replacement form if there is any question. Saves you time and money by not having to come back to get it.
     
    LGilmore, Feb 29, 2016
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  7. bill3173
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    NC requires a replacement form, if the PI has any existing life or annuities, regardless of whether the intent is to replace the existing policy.

    If I get busted for something, it's not going to be that item. It only takes a few minutes to question the applicant, and get the sigs.
     
  8. jacobtn
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    Yep, all NAIC states do that. NC, SC, VA, KY, WV, MS are a few that come to mind. At least it's not as bad as Oklahoma they required two signed replacement forms one they have to mark whether they want their existing carrier to be notified or not and then the other is just the standard form.
     
    jacobtn, Mar 2, 2016
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