Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
I just learned that my father has fallen victim to a predatory insurance agent who sold him a whole life policy in May. My dad is 70 years old, has substantial savings accumulated, has no dependents, and has no need for life insurance of any kind, let alone whole life.
My dad previously had a long duration term life insurance policy, which recently expired. He got a letter from the insurance agent about the expiration, which prompted him to contact the agent. The agent proceeded to convince him that he still needed life insurance, and that he should buy a $100K whole life policy. My dad trusted the agent (it's a small town, where everyone knows everyone) and purchased the policy. After discussing it with my dad, it's clear that he had no idea how the policy really works.
My dad paid an initial premium of almost $4K for the policy in May. The agent admits that he pocketed a commission of $1K from selling the policy. Unfortunately, I just learned about this, and Ohio regulations only seem to permit getting your money back within 20 days of buying the policy. It has been between 60 - 90 days.
What recourse does my dad have, if any, to cancel the policy and get at least some money back? The agent claims that nothing can be done, and that the cash value of the policy is (of course) $0.
I am thinking about filing a complaint against this agent with the Ohio Department of Insurance. Is there anything more I can do? I'm furious that this guy ripped off my dad, but even if I can't get the money back, I still want to prevent this huckster from ripping off more people.
Thanks for any advice.
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If you have the time and energy, go ahead and at least get your revenge. You could write to the company explaining that it is not suitable and possibly giving them a short time to fix it before giving them all as much negative publicity as you can. Also watch for newspaper or TV personalities that like to expose this kind of thing. Granted you might expect repercussions living in a small town. As you say, you probably don't have the law with you unless he is obviously mentally challenged as it is not against the law to sell life insurance. I am not sure it is worth the effort (except writing to the company) for the money involved since it is legal. I would not pay any more on it and not deal with that insurance person for anything. Word of mouth may be the best revenge (as long as you are honest so you don't get sued for libel).
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Many of us have made the mistake of trusting such individuals.
You are very unlikely to get anything back. You also arent that likely to get the attention of the state insur comm unless you can show false representation or that your father is impaired. They arent required to sell you what's best for you. The agent likely is making more than 1k. Given that he was still carrying term at his age, i think they would be able to deflect this pretty easily but im not a lawyer or in any financial industry. If he does surrender the policy right away then frequently they claw back the comission from the agent.
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Have your dad call the company and cancel the policy and ask for a refund of unearned premium.
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BuckeyeState wrote:The agent proceeded to convince him that he still needed life insurance, and that he should buy a $100K whole life policy. My dad trusted the agent (it's a small town, where everyone knows everyone) and purchased the policy...Is there anything more I can do? I'm furious that this guy ripped off my dad, but even if I can't get the money back, I still want to prevent this huckster from ripping off more people.
Thanks for any advice.
Small towns are wonderful in that gossip spreads like wildfire. The best revenge will come from your dad telling everyone he knows in that town how the insurance agent ripped him off. Since these policies are purposefully made so they are difficult to understand, make sure your dad can make the explanation of how he was ripped off simple enough for a three year old to understand.
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