I really think it says something about the morals of our country when people will potentially put their family protection through life insurance at risk by lying and attempting to defraud the company that is willing to help protect their family’s future.
I guess the good news, for me, is that it happens often enough that I ran completely out of naive some time ago. It no longer shocks me when clients tell me they don’t smoke, apparently oblivious to the fact that if the lab results don’t shoot down their lie, their medical records will.
I’m no longer caught off guard when a client answers no to all of the cardiac questions only to have a 4 vessel bypass surgery show up in their records. Their pathetic defense! “I didn’t know you were talking about things that happened more than 5 years ago”. That flies real well when I asked “Have you ever been diagnosed with or treated for whatever”?
And suppose you actually pull it off and get a policy issued? What happens if no one catches your lies? It’s certainly possible that a company will not catch you and actually issue a policy under more favorable terms than you deserve, but you have just set yourself (and your family) up. You have damaged the goods and then bought them.
If you pass away during the first two years of the policy, the incontestability period, the company will investigate the claim and recheck everything that was used during underwriting and in most cases, dig even further. If they find that information was withheld or materially misrepresented, they can deny the claim. If they find that you used fraudulent information in order to obtain the policy, the claim will absolutely be denied.
It is that mindset that all you have to do is bend the truth a bit (I only have a few drinks a few nights a week), well, lie, that is becoming far too pervasive. Fraudulent applications. Fraudulent claims.
Bottom line. If the honest answers cause you to have to pay more for life insurance, it is far better than the fraud you will have perpetrated on your family when they file that life insurance claim.