Legal Question in Insurance Law in Indiana

Life Insurance Denial

My mother recently went shopping for better life insurance rates. She met with a new agent, filled out applications on both her and my father on 4/7. Recieved a thank you letter on 4/8. Received a "summary of Insurance" package on 4/27. Called agent to expain this. He said that was an explanation of my father's new insurance..face value, premium amount etc. She asked what she should do about her old policy. Was told to find out what type it was. She found out, called back saying old was whole life, he told her that he could conver thier new policies to whole life if they needed to and that the policies were on the way. Mom cancelled old coverage. on 6/1 received a letter denying my father coverage. They were told it was a done deal. Old company won't reinstate policy...left with no insurance.

I believe they were led to believe that it was a done deal (premium paid and told policies on the way) I feel like they were snowed. Is there any way to pursue this?


Asked on 7/22/99, 1:29 pm

1 Answer from Attorneys
Steven Murray Steven W. Murray, APC

Re: Life Insurance Denial

Yes. You may be able to force the new insurer to

honor the policy based on the material sent to your

father. Did your father give the agent a check, and

if so, was it cashed?

The advice from the agent was less than candid, and as

an agent of the new insurer, it may be bound by

what he did and said since your parents relied on

the representations.

As for the old policy, if your father did not yet

receive the refunded cash value of the policy, it

may be possible to reinstate it. You may need to

force this issue with higher ups at the old company,

but don't just give in.

And finally, your state probably has a law against

"twisting," which is what happened to your father.

It is illegal in many states to replace insurance just

so the agent can get a commission.

The paperwork must be reviewed, and you should have

a reasonable possibility of straightening this out.

If not, a lawsuit may be required.

Read more
Answered on 7/23/99, 8:15 pm


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