Does your Life Insurance Company keep you informed?


Posted on 14th November 2011 by DianaBuchmann in Life Insurance |NCL News & Events

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By Diana Buchmann, FLMI, ACS, Assistant V.P. Policy Service and Claims North Coast Life Ins. Co.

man looking over policy

Recently I received a call from a long-time policy holder, calling in response to a notice he received about the interest rate adjustment for his Versatile Life policy with North Coast Life. This gentlemen has maintained this policy since 1984, along with the understanding the premium is not a fixed amount and may change at times. Which must have been why he so cheerfully advised us he will continue to keep his $50,000 policy in force with the additional premium required.

Once he was through the business portion of the call, he began to thank us for always keeping him informed and letting him know right away if the rates change. He has always paid the extra premiums when needed, and continues to have a strong policy. He mentioned the annual reports and the summary provided, along with any other notices of changes.

This elderly gentleman explained he recently lost his policy with another very well known Life Insurance Company. A Universal Life product, which is affected by interest rates the same as North Coast Life’s Versatile Life Product. The problem began when this other well known life insurance company failed to advise their customer that his policy may have a potential problem if the premium is not adjusted in a timely manner. Unfortunately by the time this gentleman was aware of the problem it was too late and too costly to fix.

Sadly this is a story I have heard on too many occasions. After 20 years of paying on a policy, suddenly you are given the choice of doubling/tripling your premium, or reducing the benefit amount dramatically. Another story I hear from our customers about other life insurance companies is very mind-boggling to me. It’s about how they have lost a policy after taking out a loan on the policy. The life insurance company failed to explain the interest charges and how this impacts the customers policy in the future.

Here at North Coast Life we cannot express enough to all employees including agents, the importance of advising a policy holder of all the options and consequences regarding their policy choices. This includes what may be considered the down side, such as how decreasing interest rates can affect them.

As indicated by our caller, an informed policy holder is more likely to trust the company and personnel representing that company. Customers do not like surprises after obtaining a policy. This makes customers feel blind-sided and the trust they have placed in the company and it’s representatives begins to erode.

North Coast Life’s Policy Service Department continues to maintain well-trained staff who make sure there will be no surprises at a later date for our customers. And we are always happy to go over an Annual Report or another matter to clarify questions or concerns for our policy holders. Therefore we advise and give written information regarding loans or withdrawals from accounts, and inform of any tax consequences incurred when surrendering a policy or closing an account.

Well-informed policy holders are more likely to maintain and keep their policy in place, while those who do not fully understand their policy tend to become angry when the unexpected happens and are more likely to terminate the policy. In the long run this may not be good for the customer. (This person is now older and may have medical issues which prevents them from obtaining a new policy with the same company or another company).

The bottom line… get the information you need about your life insurance policies. If you don’t understand your policy ask your agent or the company to explain it to you. You may even need to ask if I was to cancel my policy today what are the consequences…. and if I decided to reinstate the policy would I get the same benefits? This may help you understand your policy much better.

By Diana Buchmann, FLMI, ACS, Assistant V.P. Policy Service and Claims North Coast Life Ins. Co.

Note: This blog is designed for general information purposes only. All information presented on this site should not be interpreted as legal advice and the author assumes no responsibility or liability for the actions taken or not taken by the readers based upon such information. For legal and tax advice contact your attorney or tax adviser.

Rita Sollie, Direct Insurance Representative with North Coast Life Insurance Company (NCL). No gimmicks or schemes here, just genuine and honest service. We don’t sell insurance, we solve problems. I welcome the opportunity to show you what NCL can do for your Life Insurance and Financial needs.
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