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Not that long I dropped the Trans bomb that, well gosh, they were going to have to the raise the rates on a bunch of their old universal life policies and my reaction was one of those “Don’t tell me I haven’t been telling you for years” things. And I kid you not, just as I have kidded you not for years and years, this is just the tip of the iceberg. The only thing dicier than the actual universal life cash value products sold between the late 80’s and now is the pigs for agents that either had no idea what they were telling people or were just out right lying to them in order to make the sale.

There were several problems when these policies were sold.

  1. Agents told clients that they were going to make $Millions but that was based on assumptions, very brave assumptions, and not guarantees.
  2. Agents told clients that they could pay into the policies for several years and then quit paying and they would have life insurance forever. Again, that was based on assumptions, occasionally wild ass guesses, and not guarantees.
  3. Agents showed the clients the assumed values and represented them as guarantees, never actually showing them the guarantees.
  4. Companies encouraged agents to sell these cash cow (for the company) by paying high commissions, bonuses and renewals.

And now comes Voya, aka ING Reliastar, aka Reliastar Life Insurance. Call their customer service line sometime and you will find out that they self proclaimed themselves the “Most ethical company” for 2014. Today we got notice that they are going the way of Trans in this notice.

“The Voya Life Companies periodically evaluates costs associated with providing life insurance coverage. As a result of a recent review, some of the charges assessed on a limited number of “universal life” policies purchased prior to 2009 will be adjusted, effective October 2015. The adjustments for each client are specific to the product and version purchased and may involve one or more changes to the non-guaranteed elements in their policy.
As a courtesy, we want to give you advance notice of the upcoming change. Beginning the week of August 31, a communication will be mailed to servicing agents with a copy of their client’s letter and Frequently Asked Questions (FAQs). Client letters and FAQs will be mailed to each policy owner starting the week of September 7.
Clients have several options as a result of this change. They may choose to take no action, pay additional premiums, reduce their death benefit or surrender their policy. In order for agents and clients to understand their options related to the change, in-force policy information and/or illustrations will be available starting September 28. Additionally, we have set up a special support team to answer any questions.”

Clients understand their options? Voya is going to mail out the bad news to them now and then wait a month to start producing illustrations? Basically what Voya is offering is exactly what Transamerica did, a rather short menu of how you would like to be served, uh, well, your screwing. I will never be able to scream loud enough for the millions that will be affected to hear. If you have a cash value universal life policy purchased ever, you should have an in force illustration reviewed by someone other than the agent who sold it to you. Traditional universal life is collapsing and imploding at a rapidly increasing rate. They misled you once and have even more reason to now. You could sue their rears off.

Bottom line. From the Presidents of all of the insurance companies who sold these products to every state insurance commissioner to every agent who knowingly or unknowingly misrepresented cash value universal life products, you are all party to a criminal act. You have bilked hard working Americans out of their money and all you have to say is, “how can we screw you“. If you have questions or want an independent, honest, forthcoming review of your universal life policy, call or email me directly. My name is Ed Hinerman. Let’s talk