Generally speaking life insurance is not perceived to be an aspect of life particularly prone to attract criminal interest.
There has actually been the odd story of people using life insurance and dark, dodgy methods to make a few bucks. A good life insurance policy can have some pretty hefty payouts. I guess there are people that figure if you can cash one in, without paying the price yourself, you’ve pretty much hit the jackpot.
Only recently in LA, there was the story of two elderly women who were accused of taking homeless men into their home and ‘caring’ for them. As part of the care, they took out life insurance policies on the men. Most life insurance policies have a contestability period during which any expected payout can be argued by the insurance company. The story goes that the two women waited for this period to expire and then had the men killed via hit-and-run car crashes, thus enjoying the significant payouts.
This kind or extreme and terrible plan can come into fruition, but for all those with a conscience, there are other methods of getting the most out of life insurance policies that insurance companies aren’t so keen on, like Viatical settlements, which have recently caused problems.
A viatical settlement involves the purchase of a life insurance policy from an elderly or terminally ill policy holder. The holder sells the policy, including the right to name the beneficiary to a purchaser for a price discounted from the policy value. The seller has cash in hand, and the purchaser will gain the proceeds of the life insurance policy. Meanwhile, the purchaser continues to pay the premiums.
Though both parties have agreed to the settlement, insurance companies have not. Insurance companies calculate their rates on the assumption that a certain portion of policy holders will seek to redeem the cash value of their insurance policies before death. They also expect that a certain portion will stop paying premiums and forfeit their policies. However, viatical settlements ensure that such policies will with absolute certainty be paid out. Some purchasers, in order to take advantage of the potentially large profits, have even actively sought to collude with uninsured elderly and terminally ill patients, and created policies that would have not otherwise been purchased. Likewise, these policies are guaranteed losses from the insurers' perspective.
The whole point of life insurance is that is prepares for the unexpected, and therefore most of us would not plan on taking out a life insurance policy, merely to sell it to a third party, but in the event of the unforeseen happening, it’s impossible to say. The most that can be expected is that we get the best possible deal, and in order to achieve that it’s advisable to look at a wide range of companies offering a wide range of policies in order to get the best possible deal for you. I would recommend ASDA Finance life insurance as a place to begin your search, for a morally sound and reasonable way of getting life insurance. As long as you remember it’s essentially a selfless gift – meant for others not yourself – you should find it easy to stick to the straight and narrow.
