Banner and William Penn Raise Cost of Insurance Charges on Universal Life Insurance Products
ATTORNEY NEWSLETTER
California insurance fraud attorneys warn that consumers with universal life plans through Banner or William Penn should be aware that their cost of insurance (COI) rates may be increasing. As of August 1, Banner and William Penn will raise the COI rates for select universal life plans.
Policy owners who are part of the August 1 increase would have been notified July 15, and those scheduled for September 15 COI increases will be notified September 1. Other plans, including Crusader 1 and 2, Life Umbrella Series products, and Capitol UL, are also being evaluated for potential rate increases later in the year.
Rate changes are dependent on plan, age, sex, and underwriting class subject to the policy’s guaranteed maximum cost of insurance rates, but rate increases will be “significant” for some customers, according to Legal & General America, the parent company of Banner and William Penn.
Life insurers have the ability to raise expenses within non- guaranteed life insurance products (whole life, universal life, variable life and index universal life insurance), although California insurance fraud attorneys say that this practice is not common. Legal & General America cite various reasons for the rate increase, including all-time lows in investment returns, lower credited interest rates than assumed in pricing, and unfavorable average mortality.
Policyholders should request current inforce illustrations from William Penn or Banner which will reflect the forthcoming rate increases and discuss potential funding alternatives. Policyholders should be sure they know what they are actually being charged for COIs, and whether they have been increased. According to the National Association of Insurance Commissioner, 62 percent of people with life insurance policies do not know quite what they purchased or why.
Evans Law Firm, Inc. handles insurance fraud and annuity fraud lawsuits, as well as other consumer fraud cases. If you purchased a life insurance policy through Banner or William Penn and want to know if it was a suitable investment for you, please contact Evans Law Firm, Inc. at 415-441-8669 or via email at info@evanslaw.com.
