What to know before considering whole life Insurance
If you’re like most people, you’ve considered buying whole life insurance. By and large, it’s a responsible way to provide for your family, and most policies allow you to withdraw money in case of an emergency. But many people don’t realize that there are many types of life insurance available, and not all of them will serve the needs of everybody who buys one. It may be that the policy you’re looking at, or have already purchased, contains fees, penalties, or other problems that can make it worse than useless to you when you need it most. So before you invest in a life insurance policy that may end up hurting more than helping, look out for these clauses in your contract, or ask an experienced California insurance fraud attorney to review the contract first.
Liquidity charges
Sometimes, companies charge you money to access the funds in your policy. If you need an expensive medical procedure, or have to make a down payment for a home or car, you may end up losing more than you expected. Insurance companies like to know exactly how much of your money they have, and they may punish you for trying to get some of it back.
Surrender charges
Sometimes, even when you just want to be done with a policy and get some money back, companies take one last bit out of your money. Trying to cut costs or invest in a new, more suitable policy can, ironically, end up costing you. This can be especially bad when you’re expecting a certain amount back and make plans based on that, only to find out when you get the check that it’s coming up short.
Death Benefits
Ultimately, a life insurance policy is designed to provide for your loved ones if you pass away. That’s why it’s particularly galling to have some of the payout of your policy taken out after you die. It can be a serious problem if the numbers don’t match up, and unless you spend the time when you first buy the policy to read through the fine print, you may discover that the number you were shown when you paid are not the numbers you get when you want some money back.
Rates of return
Once again, you often only see the most optimistic numbers, and they often don’t include the penalties and fees that will be exacted as your policy matures. Unless you check in regularly with your broker and keep close tabs on your policy, it’s likely that you will have some issues down the road.
Life insurance is a profitable business in California and throughout the United States, and it got that way by making sure that the companies keep a healthy portion of your money. It’s not a charity, of course, but it’s important to make sure that you’re not getting ripped off. Insurance companies and broker may not disclose competitors’ costs, and the overall opacity of the industry can make it difficult to get a fair price comparison when you buy.
Major Sellers of Whole Life Insurance include:
- Northwestern Mutual Life Insurance Company
- New York Life Insurance Company
- State Farm Life Insurance Company
- Massachusetts Mutual Life Insurance Company
- Guardian Life Insurance Company of America
- Penn Mutual Life Insurance Company
- American Family Life Insurance Company
- COUNTRY Life Insurance Company
- MetLife Insurance Company USA
If you feel that you may be the victim of an improperly sold or administered life insurance policy, speak with an attorney at the Evans Law firm in California by calling (415) 441-8669 or emailing info@evanslaw.com. Our firm’s practice areas include insurance, annuity, and banking fraud, financial and physical elder abuse, healthcare fraud and nursing home abuse, and qui tam and whistleblower law.
