Know the Signs of Life Insurance Fraud

Most people who buy a policy and deal with a life insurance agent come away with a positive experience. There are, however, times when that experience can be frustrating and even downright unlawful. Do you, as a consumer, know the signs to look for when it comes to life insurance fraud? If not, there are a number of tips to assist you so that you do not become the victim of fraud:

First, it is important not to ignore notices from the insurer, especially if your agent informs you it's a "mistake" and there is nothing to worry over. Always follow up on any notices to make sure your policy is legitimate and intact.

If you come across a life insurance policy - whether it's term life insurance, whole life insurance, or something else - stating that it guarantees "vanishing premiums" or promises you a premium-free policy for a set period of time, question it immediately.

It is also important that you not be pressured by an agent, especially if you're told that you have to meet an impending deadline.

Just like any insurance policy, never purchase coverage that you fully do not understand. Remember, it is up to the agent to explain the terms so that you know them and know what you are purchasing.

In order to back up any questions/requests you have, be sure to save all pieces of paper that explain your coverage. It is important to keep them on file with your policy so that you can revert to them if necessary.

In the event that a new policy takes effect over an old one, be sure the prior coverage is not canceled until the new policy is issued and effective.

Would you take needed law advice from someone who is not or was not a licensed attorney? Of course you wouldn't. The same holds true when buying life insurance.

Be sure not to buy acquire life insurance as an investment if you do not understand that a portion of your investment is going towards paying for your coverage.

In the event an agent attempts to sell you life insurance as an investment with a great return, make sure you demand that you are shown that specific promise in the contract language. Be careful if you are offered an opportunity to turn in a small policy for a bigger one without paying much more.
Most of these tips are common sense, but make sure you follow each and every one of them for maximum protection and peace of mind.

Most of these tips are common sense, but you'd be surprised how many consumers don't use just that.