I have had a 10 year term life insurance plan to act as “Mortgage Insurance” on my house (no it is not really a Mortgage Insurance product (that is a rip off (IHMO)), and the 10 year term is about to expire. I received a letter informing of this and how that if I wanted to renew for 10 years more, my monthly premium would be 3.45 times higher than it is.
This perturbed me a bit, but I decided that since this wasn’t going to happen until July I’d have time to shop around and maybe find something cheaper or decide whether I need this policy any more.
Heck 50 Looks Big in Print
I received a phone call from TD Life Insurance (the Policy provider) it was a licensed TD agent calling asking if I had read the letter and whether I had any questions. I said I wasn’t happy with the rate increase, but knew it was going to go up but not by that much. The agent sounded sympathetic and then she said that there was another option. At that very moment my “here comes another one for my horse” incident in my life, and I was not wrong.
Evidently if I buy a NEW policy I could have a rate increase of only 50% monthly, however, since it is a new policy I’d have to answer a medical questionnaire and sign forms stating I was telling the truth about my current health.
My guess is this is the Insurance Company attempting to cover itself, assuming an old guy like me, might have picked up some disease or bad lifestyle choices, so they want to be sure I have a clean(er) bill of health than most 50 year olds. This is the risk you take buying Term Insurance and not “Whole Life”, and I fully realize this, however, a quadrupling of my rates does seem a little punitive (just my opinion).
I think I’ll shop around a bit more but I haven’t decided my next steps just yet.
“My guess is this is the Insurance Company attempting to cover itself, assuming an old guy like me, might have picked up some disease or bad lifestyle choices, so they want to be sure I have a clean(er) bill of health than most 50 year olds.”
I have a different theory. After watching the exposes on CBC about insurance companies not paying out, it seems that it takes a doctor and a lawyer to interpret the policy and whether the questionaire has been answered correctly. This is their “gotcha”; any discrepancy between your answers on the questionaire and something they dig up in your medical records can make the policy invalid when time comes to pay out, regardless of whether the discrepancy had anything to do with what you were treated for or died from.