I’ve often shared how frustrating it is from my perspective to be helping a client who is having trouble getting life insurance, and have them compound the seriousness of the work by lying to me, or being less than candid. Well hang on to your shorts life insurance liars. American General has started what I hope will be an industry wide trend, and said that if people are not honest on their applications they cannot reapply with the company for at least two years. Being less than candid is a huge problem in impaired risk life insurance. Clients will often, at least the first time around, try just not mentioning their health problems. And in all fairness there is no lack of life insurance agents that will either not ask the questions or find a way to present answers to a life insurance company that are, again, less than candid.
But let’s call it what it almost always is, lying. I say almost always because when important information is not put into the process by a client there are rare occasions when they just didn’t understand the question or had forgotten about something. I was going to say that most often it is a decision to not answer a straight forward life insurance question honestly by the client, but I think there are enough dishonest life insurance agents out there that is probably a problem that is split 50/50. So how will this bold move by American General help the application process get better? First let me tell you that I don’t think it will make a big difference until more of the best impaired risk life insurance companies are on board with this kind of stance. But what if they were? Then the word would spread rapidly through the life insurance industry and I think the potential client base that spilling your guts is far better than trying to skirt around something. Agents would become much more aggressive about asking all of the health questions and at the end of those questions, asking the client if there is anything else that could potentially come out when the company looks at their medical records and the records of any doctor or mental health person your doctor has referred them to.
In other words, even though the application doesn’t ask you if you’ve had a stem cell transplant, doesn’t mean it isn’t relevant. Maybe it is or maybe it isn’t, but the underwriter is the one that should decide that. If you don’t tell them and they find out from your medical records then they, and the agent if he asked about anything else in your medical records, have a legitimate beef with you. I don’t know about all of those other agents, but I take my seriously and when I go to work for someone I work hard for them. Losing the business because I’ve been lied to is a real slap in the face.
Bottom line. My applause for American General and them finally putting something out there to try to slow down the dishonesty from clients and bad agents. If you have any questions, or if you’ve used an agent that has kind of indicated that the truth isn’t absolutely paramount, call or email me directly. My name is Ed Hinerman. Let’s talk.