Advisor's empathy most important, say widows

Advisor's empathy most important, say widows

  • Ami Maishlish 2013-08-04 11:33:19 AM
    This is an excellent, well written and raises important considerations. One of these is the need for intelligent life insurance planning before the event being insured for, and when clear thought is not clouded by emotions.

    One example of this is the need for insurance professionals to read, understand and clearly explain key contractual provisions of insurance contracts under consideration, and even more so when the contract provisions involve both spouses (such as in joint first-to-die contracts and combined billing discounted contracts).

    Some joint, first-to-die contracts stipulate that coverage may be continued without new evidence of insurability for the surviving life PROVIDED that the decision to continue coverage is communicated to the insurer WITHIN a specified period (usually 30-days) after the first death. Others, such as Manulife's form of joint, first-to-die (which they call "combined") have, IMO, a better approach in that the coverage automatically continues for the surviving life rather than necessitating a request for continuance within 30 days of the first death.

    In some regards, likewise for billing discounted policies where two lives are insured with the same carrier to save on the policy fee, and particularly when one life is insured as a "rider" to the other (it is for this reason that in LifeGuide, quotes for such contractual arrangements are clearly annotated with the notation "Base:Rider" to draw the advisor's attention to the matter).

    Needless to say, the time for proper and well though out planning is prior the event being insured against. I wonder how an advisor could support a claim that (s)he acted in the best interest of the clients if (s)he failed to recognize and clearly explain contractual provisions that may have the potential of causing a widow(er) to also lose their life insurance coverage shortly after becoming widowed.
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