I received an email today from a person that says he was deceived by his life insurance agent about the length of the guarantee on a UL. I have no way to authenticate the email since my reply came back undeliverable and there was no phone number given.

So, while the facts may be in question it is not a scenario that is all that far fetched so I would like to address a few of the issues and how a person can avoid them. Here is the email.

“About six years ago I purchased a universal life policy from Genworth for $30k and had a fixed monthly premium for around 72.00 guaranteed for life. I was rated preferred best after a medical exam. In 2008 I decided to increase the value of the policy from 30k to 50k. Once again I had a medical exam and was rated preferred best. I was told by numerous Genworth reps that a monthly premium of $122.37 would carry the policy for life. My agent also assured me of this. I kept all the correspondence from Genworth and my agent. I made it perfectly clear to them that I would only buy this policy with a guaranteed monthly premium that would continue for life. I was never told until a month or so ago that because I increased the value of the policy that I could no longer have a guaranteed monthly payment that would carry the policy for life. I believe that Genworth did not disclose the true facts about the terms of this policy. I would never have increased the value of policy if I knew that I would be subjected to this nonsense, Do I have any options ? I actually believe that they lied to me Thank you for your input. I was 67 when I bought this policy.”

Again there is no way to authenticate the email, but it does raise the question of how you protect yourself from something like this actually happening. Every universal life policy has an illustration that goes with it. It has to be signed either with the application or upon delivery of the policy by you. In the illustration are several pages that will have a title something like “Tabular detail of Illustrated Values and Benefits”. On these pages there will be at least two columns of numbers each with 3-4 rows. The one on the left will always be the guaranteed values. This is what the company will guarantee to do no matter what happens as long as you pay the designated level premium. One of those rows is for premium, usually one for cash value and one for death benefit.

As long as the death benefit goes on as long as you were made to believe it should, count on it. It’s guaranteed. The policy may have all zeros for cash value and there may be a point where the premium is no longer required and that’s OK. But if the premium goes up or the death benefit disappears before you expect it to in that illustration on the guaranteed side, don’t give them any money. If you have given them money, ask for a refund. They have to give it to you by law.