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Bait and Switch! Most commonly run across in advertising or in sales pitches when a price is presented that the agent or agency knows is either inappropriate or unattainable. The truth, the switch, in life insurance is usually only brought to the surface after a long underwriting period.

Another type of bait and switch occurs when the underwriter decides that an original quote should be changed for legitimate reasons, but doesn’t give all of the reasons to the agent. “Relating to use of bait and switch (offering one attractive exchange initially, but not honoring the offer) in business, politics, and elsewhere.”

Let me paint a scenario for you that just happened. I have an existing client who wanted to replace an old policy with a new 15 year term insurance policy. We applied 5 months ago and the company came back with a standard plus approval because he was 3#’s over preferred weight at 5’10, 205# (which they would have waived), and his GGT, a common liver function test used by insurance companies, was just over twice the normal limit.

He decided at that time to not accept the policy, see his doctor and see if he could get to the bottom of the GGT issue and get it under control. After several lab and office visits he called and said the doctor couldn’t find anything abnormal causing the elevated GGT, so we shopped it with the elevated liver function and Prudential came back with a trial offer of preferred as long as his weight was the same and the GGT was still no more than twice normal. So he applied and took another exam.

After a month in underwriting the approval came back at standard plus citing a build of 5’9, 211 as the reason. When I noted to the underwriter that the client was 5’10 on the previous exam and was pretty sure he had never been 211, he suggested we get a new build done at his doctor’s office. We then presented Pru with his doctor’s height and weight showing 5’10 and 204. They said to give them 5 days for a reconsideration of their decision.

Five days later they said, in spite of the height and weight appearing to fall well within preferred limits, he was still approved at standard plus due to his cholesterol being 251, a cholesterol ratio of 7.1, his GGT at 105 (less than twice normal, but still elevated), an ALT of 45 (another liver function elevated) and elevated triglycerides of just over 300. Excuse me? They told me a week prior that his weight was the issue, not his weight and this and that and these other three things.

This is one of those practices that could hang on the “You just can’t fix stupid” wall of shame. The truth is, for the company there is nothing to be gained by not providing all of the information up front. The more accurate and complete the information is, the better the chances that a customer will see logically why they don’t qualify for a better rate. In fact, what they managed to do was make the customer furious….at me.

Bottom line. These situations happen pretty rarely so the wake up call is really for me. Going forward if a client is approved at a higher rate than expected I will be sure to ask for all factors that play into that situation.