# Who knows about life insurance ?



## TJW (Mar 20, 2012)

About 2 months ago, I received a check from my life insurance company. It was attached to a letter which made very little sense to me. It used the word "cancellation".... I have not cashed or deposited the check. I made no attempt to change this policy in any way.

I received, subsequently, the usual statement I receive yearly. It is a universal life policy. For many years, I paid in extra money every quarter so that it would accumulate a cash value. I never withdrew any of the money, but at one point about a decade ago, I saw that the interest I was receiving more than covered the cost of insurance.

Now, decade later, the cash value is dwindling to the point that I will have to pay premiums again to keep the policy in force, about a year from now. 

First, I tried to call my agent. I learned that the company office where he worked is now closed. I could not find him, I have no idea of his whereabouts now. I haven't spoken to him for a very long time.

So, I called the company main office, explained my situation, and they directed me to someone who explained to me that the company had reached a point where it could no longer receive premium payments on the policy. The company representative used a word which I cannot remember, but it began with the letter "g" - he said the policy is "on" "g".

The fact is, I have made no premium payments for years. The representative said I should cash the check, and wait for a letter from the company telling me I should return to making premium payments. He half-explained, in what sounded like double-talk to me, that they were required to report this to the IRS, and that the point of "g" was to prevent money-laundering..... the representative did, however, know the exact amount of the check without being told....

Does anybody know what is going on here ? I am not executing on the check. I am afraid this is an attempt to buy my policy out for a few hundred bucks......


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## jonty30 (Oct 23, 2021)

I'm guessing the insurance company is cancelling policies that are not profitable to them. 
I wouldn't cash the cheque unless you have run out of options. 
I would probably go see a lawyer that deals with insurance policies to see if you can get your money for all your premiums and everything.


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## recovering2018 (Sep 9, 2021)

Hopefully this opinion isn't against TAM policy, but I don't think this is a great forum for this topic. Try bogleheads.org for thousands of people who live and breathe this stuff.


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## No Longer Lonely Husband (Nov 3, 2015)

TJW said:


> About 2 months ago, I received a check from my life insurance company. It was attached to a letter which made very little sense to me. It used the word "cancellation".... I have not cashed or deposited the check. I made no attempt to change this policy in any way.
> 
> I received, subsequently, the usual statement I receive yearly. It is a universal life policy. For many years, I paid in extra money every quarter so that it would accumulate a cash value. I never withdrew any of the money, but at one point about a decade ago, I saw that the interest I was receiving more than covered the cost of insurance.
> 
> ...


Contact your state‘s commissioner of insurance. They can tell you how to handle.


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## Diceplayer (Oct 12, 2019)

Universal Life is a ripoff insurance policy. The extra money paid in premiums earns a tiny fraction of what it would have earned if invested in mutual funds. Cash the check and dump this piece of crap. If you need life insurance, you can get a term life insurance police with the same coverage for a fraction of the cost.


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## Hoosier (May 17, 2011)

The fact that you received a check and the annual statment is not unusual. Even if a policy cancels they still issue the statement many times. I wish I knew what "g" is. But obviously the policy is canceled. contrary to some earlier statements made here, a company can not just cancel a policy or even a group of policies, not without going out of business. Best advice to you, find an insurance agent, preferably someone with the CLU designation after their name (John Agent, CLU. for example) Have them look over your information. Many policies were sold back in the day with the idea that the interest earned would cover future premiums, but no one thought that we would see less than 1% rates of return, and those policies are crashing and burning, but unusual to not accept payment on a policy. Go seek QUALIFIED help.

Hoosier

Insurance Agent for 35 years.


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## Chet8625 (Jul 13, 2010)

You say you haven't paid premiums in years. Sounds like they were paying the premiums out of the cash value of the policy and at this point there's not enough value to pay the premium. Since you haven't paid and they can't deduct any more from the policy, they cancelled it and sent you the few dollars left over.


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## Pam (Oct 7, 2010)

Could the "g" thing be a 1099-G? That is for income not covered by a W-2, I believe.


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## ThatDarnGuy! (Jan 11, 2022)

Cash value life insurance policies are in my opinion a huge ripoff. They are basically the payday lenders of the insurance world.... Get a term life insurance policy and be done.


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## Kanietonne (1 mo ago)

This is a typical story about unprofessionalism. Shouldn't the insurance company have notified the customer of the cancellation of the policy in advance? I thought the customer should receive the cancellation letter at least three months before the decision implementation. Also, I am sincerely surprised by the situation with your agent because no self-respecting company would close the office without notifying the people who took out insurance there.


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## MattMatt (May 19, 2012)

"Second Zombie thread this evening? Is this a trend?" asked Zombie Cat, closing it down,


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