About Me

My photo
SEEKONK, MASSACHUSETTS, United States

Sunday, March 19, 2017

WORTHWHILE OR WORTHLESS- A CONSUMER GUIDE TO AVOIDING SCAMS AND SCOUNDRELS. INSURANCE- ONE OF LIFES UNGLAMOROUS NECESSITIES. PT 2.

Ashtray, Cigarette End, Smoking

So What did you decide?  Some People think the Answers are Obvious, and are Shocked when they find out They're wrong.

This Leads to the First Rule to Always keep in Mind When Choosing any Form of Insurance, and Filing an Application:

AN INSURANCE POLICY IS, AT ITS HEART, A CONTRACT, AND IS SUBJECT TO ALL THE PENALTIES AND GUARANTEES OF ANY CIVIL AGREEMENT.

In Our First example, we had a man apply for and receive a Life Insurance Policy.  However, he Lied about being a Smoker to Reduce his Premiums.  Some Time later he is killed in an Accident, where his Smoking was not considered to a Contributing Factor in his Death.  The Insurer refused to Pay Out the Death Benefit, and the Family Sued.

SO WHAT HAPPENED?

THE COURT RULED IN FAVOR OF THE INSURANCE COMPANY. WHY?  THE MANNER OF DEATH WAS IMMATERIAL BECAUSE BY LYING AND DECEIVING THE INSURANCE COMPANY, THE INSURED OBTAINED THE POLICY UNDER FRAUDULENT MISREPRESENTATION.  THIS VOIDED THE CONTRACT, AND NO PAYOUT WAS AUTHORIZED.

IF the Mistake had been Minor, perhaps incorrect address or phone number, the Decision may have been different.  But the Health and Lifestyle of the Applicant is of Primary Concern to the Insurance Company.  APPROVAL AND DENIAL OF COVERAGE, AS WELL AS COST, RELY ON HONEST INFORMATION BY THE APPLICANT.

We'll look at the Second Example in the next Segment.