- 407
An actual question I got: "if a client dies a day after paying the annual premium on a life policy, will the unearned premium be refunded?" If not, why pay annually?
"unearned" Premium Returned at Death??
- Thread starter Pete Cormie
- Start date
- Staff
- #2
no....they get the death benefit.....now if it was foul play or misrepresentation on the application and the insurance company investigates and denies the claim they will get all the premium back.......why pay annually....it is cheaper than paying monthly....
- 26,134
My experience is yes they get the unearned premium, also interest from date of death to the date the claim is paid out.
And paying annual is typically the cheapest way to pay. By how much depends on the mode and product.
Lee
- 4,872
You are correct..................
- 26,134
Man, that makes twice this year. I am rolling.
- 15,041
Umm, what does it matter? Unless we are taking final expense or fully maxed out cash value policies here, who cares? You got a really big check, and the insurance company got to keep a really small check. Does it matter that they did or did not give you back part of that really small check?
"Your honor, yes the insurance company did write me that check for $2 million. But my dad paid annually. He happened to die two days after the premium was paid. I really want that extra $2,000 too."
"Your honor, yes the insurance company did write me that check for $2 million. But my dad paid annually. He happened to die two days after the premium was paid. I really want that extra $2,000 too."
- 17,072
Yes. Annual payers will get a refund of the premiums if they die mid-year.
Some annual premiums are quite substantial. You really think people don't care about that?
Some annual premiums are quite substantial. You really think people don't care about that?
- 15,041
It is all relative. 2,000 against 2,000,000, it isn't really a big deal. 20,000 against 2,000,000 matters a lot more. 200,000 against 2,000,000 really matters.
Also, it isn't just annual premiums, but any premium. Unless there is an earned premium clause, all premium beyond the date the policy was terminated.
Vol: People must be different in your part of the state.. Around here many would cut your throat over a nickle. It wouldn't matter if they got $2 million, if they thought they were owed another $20 they would go to war to collect it..
If pennies matter to an insurer, then why shouldn't dollars matter to an insured?
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