TransAmerica-Sets Aside $for Future PayOut?

[jdeasy]

When the client walks into a funeral home with a contestable policy what happens?Does the client's family have to set up a payment plan until the policy benefit's are paid?Is a preneed policy contestable?

There's not a funeral home in this area that will do anything with a contestable policy. And there's nothing they can do with it. It can't be assigned to one of the assignment companies and get paid.

Here's recent conversation I had with a funeral home that called me about a client that died.

Them; We understand Mr Died had a policy with you?

Me; Yes, I'll notify the company

Them; How long has he had it?

Me; Started it last August

Them; Oh no, it won't be paid then?

Me; I believe it will be but since it's contestable it's gonna take a while before it's paid.

Them; So you think it will be paid?

Me; Yes

Them; Can you guarantee it will be paid?

Me; No

Them; None of these insurance companies pay on policies that aren't 2 years old. They just return premium.

Me; That's not correct. Almost every one of them have been paid in my experience.

Them; Our experience is different then.



I've had that same conversation with many funeral homes over the years. Especially small family owned funeral homes in small towns. Seems they all believe there's no such thing as an immediate benefit life policy.

 

[Rearden]

There's not a funeral home in this area that will do anything with a contestable policy. And there's nothing they can do with it. It can't be assigned to one of the assignment companies and get paid.

Here's recent conversation I had with a funeral home that called me about a client that died.

Them; We understand Mr Died had a policy with you?

Me; Yes, I'll notify the company

Them; How long has he had it?

Me; Started it last August

Them; Oh no, it won't be paid then?

Me; I believe it will be but since it's contestable it's gonna take a while before it's paid.

Them; So you think it will be paid?

Me; Yes

Them; Can you guarantee it will be paid?

Me; No

Them; None of these insurance companies pay on policies that aren't 2 years old. They just return premium.

Me; That's not correct. Almost every one of them have been paid in my experience.

Them; Our experience is different then.



I've had that same conversation with many funeral homes over the years. Especially small family owned funeral homes in small towns. Seems they all believe there's no such thing as an immediate benefit life policy.

Hard to collect on a dead person.

Funeral homes need money now.

This is where a FCGS policy comes in handy.

/sarcasm

 

[BibH]

Does the funeral home require a certain amount down and set up a payment plan with the beneficiary?If the wife is the beneficiary she was probably there when you sold it. I bet she comes back and says" you told us this would pay the funeral home immediately and never mentioned they'd investigate if he dies within 2 yrs". It would defintely be awkward. How does a preneed underwritten policy wrote by the funeral home work when a contestable death occurs?

 

[PA Bill]

Hard to collect on a dead person.

Funeral homes need money now.

This is where a FCGS policy comes in handy.

/sarcasm

Call JG Wentworth!

 

[Newby]

What I'm confused about is the "Burial Expense" $ not being available immediately to the client. I'v been reading about this, watching videos and 9 times out of 10 the reps are reciting benefits are available "immediately" upon need(death).

I don't know that I could sell someone a policy knowing if it's within a two yr contestable period the payout rate is roughly 40%. I'm curious what the numbers are after two years.

If these numbers are true, the entire premise of the sale(burial expense[how's your family going to pay of your funeral?
]) is a farce.

I understand the other side also-a client can lie til their blue in the face about their condition and without a medical clearance, it's pretty much taken them at their word. So, a safe guard has to be in place. BUT- unless the client is fully aware of this contestable period, and the potential long delays in getting a payout(which means they don't get the "burial expense"(problem solved) that the agent promised-sold them on.

Man-this seems icky..

Before anyone jumps to the conclusion that I'm calling everyone a crook - no, I am not..not at all. How do you(any agent) justify the sale in their own mind as being 100% ethical, if the you do not tell the client the "immediate" payout for your burial expense may NOT in fact be available immediately...if ever.(40-48%?? of the time??)

I must be missing something here.. I have to be. Where am I confused?

You are worrying about something that rarely comes up. In 21- years I've never had a family upset that they bought a policy from me. I've had one policy rescinded at a death in the 22nd month. He was clearly taking dementia medication. The family understood. The return of premiums was nearly $4,000 and helped a lot. They were much happier that they had that than nothing.

If you are selling a policy where there was no coverage prior they are ALWAYS better off than before. Even if it takes a while to pay.

If you are replacing coverage be EXTRA careful when underwriting. Don't replace if the health has any gray area with the company's underwriting.

Healthy people who qualify for 1st day coverage rarely die in the 1st 24-months. I've had very few in 21-years. And most claims did get paid. They were slow but that's way better than if the person never bought the policy.

 

[BibH]

Newby since you sold preneed.How does a preneed underwritten policy wrote by the funeral home work when a contestable death occurs? If a preneed client is very sick and takes out a Gi preneed he only has to live 1 yr for a total payout vs 2 yrs with Gerber? If he passes in yr 1 does he get return of premium plus 10% like Gerber? I'd assume funeral homes are much more tolerant on contestable policy's they sell.

 

[jdeasy]

Does the funeral home require a certain amount down and set up a payment plan with the beneficiary?If the wife is the beneficiary she was probably there when you sold it. I bet she comes back and says" you told us this would pay the funeral home immediately and never mentioned they'd investigate if he dies within 2 yrs". It would defintely be awkward. How does a preneed underwritten policy wrote by the funeral home work when a contestable death occurs?

I have never had a family member come back at me on any policy, paid or not paid.

The only complaints I've fielded have been on the ones that were paid. And those complaints were about how long it took the insurance company to pay.

On the not paid ones I've never heard a word.

Seems like some agents put too much worry into this issue.

 

[Prtzl]

You are worrying about something that rarely comes up. In 21- years I've never had a family upset that they bought a policy from me. I've had one policy rescinded at a death in the 22nd month. He was clearly taking dementia medication. The family understood. The return of premiums was nearly $4,000 and helped a lot. They were much happier that they had that than nothing.

If you are selling a policy where there was no coverage prior they are ALWAYS better off than before. Even if it takes a while to pay.

If you are replacing coverage be EXTRA careful when underwriting. Don't replace if the health has any gray area with the company's underwriting.

Healthy people who qualify for 1st day coverage rarely die in the 1st 24-months. I've had very few in 21-years. And most claims did get paid. They were slow but that's way better than if the person never bought the policy.

OK - So the burial expense is available immediately for funeral expenses? Where does this 40-48% number unpaid come from?

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I have never had a family member come back at me on any policy, paid or not paid.

The only complaints I've fielded have been on the ones that were paid. And those complaints were about how long it took the insurance company to pay.

On the not paid ones I've never heard a word.

Seems like some agents put too much worry into this issue.

OK - so the numbers you were citing previously never became an issue with your clients? Correct me if I'm wrong, did you mention a 40%-48% payout rate for contestable claims?

So i have a clear picture of how this process works:

1- I die after two years in policy-
2- My beneficiaries have immediate access to the funds - which they take to the funeral home and apply accordingly.
3- I'm buried.
4- Done.
5- Left over $ get dispersed as indicated on contract.

Where am I off base here?

1- I die prior to 2yrs
2- My Ins Co contests the payout
3- Meanwhile, I need to be buried and I was told during my signing that my expenses would be taken care of IMMEDIATELY.-- so.. who pays while it's being contested?
4- As a family member do I go on a mass recruiting campaign for funeral expenses for dad?
5- Somehow, money gets collected and I get buried.
6- Long drawn out fight for payout ensues?

Where am I wrong..? Please tell me and correct me. Thank you.

 

[Mattschmidt]

OK - So the burial expense is available immediately for funeral expenses? Where does this 40-48% number unpaid come from?

----------



OK - so the numbers you were citing previously never became an issue with your clients? Correct me if I'm wrong, did you mention a 40%-48% payout rate for contestable claims?

So i have a clear picture of how this process works:

1- I die after two years in policy-
2- My beneficiaries have immediate access to the funds - which they take to the funeral home and apply accordingly.
3- I'm buried.
4- Done.
5- Left over $ get dispersed as indicated on contract.

Where am I off base here?

1- I die prior to 2yrs
2- My Ins Co contests the payout
3- Meanwhile, I need to be buried and I was told during my signing that my expenses would be taken care of IMMEDIATELY.-- so.. who pays while it's being contested?
4- As a family member do I go on a mass recruiting campaign for funeral expenses for dad?
5- Somehow, money gets collected and I get buried.
6- Long drawn out fight for payout ensues?

Where am I wrong..? Please tell me and correct me. Thank you.

som funeral homes will allow consumer to "assign" policy. As long as client doesnt lie, and medical records check out, full benefit paid to funeral home. Any remaining money paid back to clients family

You can help by telling family to gather all medical records from Dr. offices, probably dating 5-10 years back. Most offices will expedite this, knowing death claim is in the balance. All this can be forwarded to the insurance company.

If client did lie, then family will have to come up with the funds.

I've handled maybe 20 death claims in 4-5 years of selling simplified issue polices. I've spoken to funeral home directors, provided policy info. ( with clients permissions) and not one has refused to perform services for the family. ( assuming policy was an immediate death benefit)

Just my experience. It's a small sample compared to others on here.

 

[PA Bill]

OK - So the burial expense is available immediately for funeral expenses? Where does this 40-48% number unpaid come from?

----------



OK - so the numbers you were citing previously never became an issue with your clients? Correct me if I'm wrong, did you mention a 40%-48% payout rate for contestable claims?

So i have a clear picture of how this process works:

1- I die after two years in policy-
2- My beneficiaries have immediate access to the funds - which they take to the funeral home and apply accordingly.
3- I'm buried.
4- Done.
5- Left over $ get dispersed as indicated on contract.

Where am I off base here?

1- I die prior to 2yrs
2- My Ins Co contests the payout
3- Meanwhile, I need to be buried and I was told during my signing that my expenses would be taken care of IMMEDIATELY.-- so.. who pays while it's being contested?
4- As a family member do I go on a mass recruiting campaign for funeral expenses for dad?
5- Somehow, money gets collected and I get buried.
6- Long drawn out fight for payout ensues?

Where am I wrong..? Please tell me and correct me. Thank you.

If it bothers you, no problem. Just be totally transparent and explain that the worst that can happen is they get all their premiums back with 5% guaranteed interest (if ROP). I explain this occasionally as people ask once in awhile and I do not lie. Old folks know what CD's pay these days, so that sounds pretty damn good.