Monday 12th of December 2016 03:54:45 AM
My mother is 73 and is currently in an assisted living facility with advanced dementia and COPD. She has a very small ($20,000) life insurance policy through Hartford that she has paid into for years. I took over handling my mother's finances over a year ago when she became unable to do so. Currently, she is billed quarterly for her insurance policy. After much discussion with a Hartford representative over a year ago to understand how her policy worked and what I had to do to maintain it, I decided to pay a good bit more on each payment to be applied to a small loan my mom had taken against the policy. Fine, so far so good. Throughout this past year, they have misapplied my payment several times causing me to have to call to get it straightened out. Still not a huge deal. Here is the kicker.I just received a letter stating that there were not sufficient funds paid into the policy to support the monthly expense of maintaining it so I have to pay nearly $600 within one month to prevent her policy from lapsing. I called Hartford thinking this was probably an error that could easily be straightened out. Wrong! They explained that the cost of supporting a policy increases yearly and the quarterly payment does not meet that cost. The so-called monthly cost to support a $20,000 policy is now over $160. What? I have over half million dollars in coverage for half that cost. Where do they come up with that number? Thank goodness, I am in a position to be able to find a way to pay this so her coverage doesn't lapse. I asked them when they sent Mom a letter stating that her quarterly payment would need to be increased to meet the expenses and explain what was happening - they never did. All they send is an annual statement with no letter of explanation.They feel by doing this, they are meeting their obligation to take care of the insured. Now it doesn't take a rocket scientist to figure out that most older people are not going to know what the annual report states nor will they understand that they probably need to increase their billing amount. This is a very deceptive practice and I fully believe it is intentional so that they can justify cancelling policies that people have paid into for years. Halfway through the conversation, a light went off in my head. My father had a much larger life policy through Hartford years ago and this same thing happened to him. He was on a fixed income and could not afford to pay the several hundred dollars to "catch up", so he had to let the policy lapse. I have spent years trying to figure out how this had happened, and now I know. He died from cancer a year later, creating a situation where my mother could not afford to live on her own nor could she afford to stay in her home - I had to move her in with me, sell her home, and support for her for over 10 years before her dementia advanced so much that I could no longer care for her on my own. She was robbed of the dignity of being able to be independent and the strain it created for me was tremendous. I love my mother dearly and am grateful I was in a position to be able to care for her, but at a huge cost. As a result of what they have done to Mom's coverage, her quarterly billing now has to increase from $140 to $480 per quarter - all for a measly $20k policy. This type of practice is so unethical and wrong on every level and it should be criminal. Those guys aren't stupid. They know full well that the average insured is not going to understand how complicated a process handling a simple life policy is - this way, they don't have to pay a claim! I worked as an underwriter for 15 years and got out of it because of the blatant dishonest practices. I was continually instructed to do what I could to prevent having to pay a claim. I am sick to my stomach that we live in a country that allows this. I really don't have any recourse. My state's insurance commission will, I am sure, side with Hartford and technically, there has been no criminal action. But why is it that clearly unethical practices cannot be considered illegal? Out of nearly all nations in our world, our country makes it incredibly difficult for people to be able to live a decent life as they get older unless they have the foresight and ability to put away enough money to live on once they retire. Not everyone has that luxury - and it is disgraceful that so many of our elders should have to live well below the poverty level. Being older should be revered, not punished. I promise you I will never recommend these guys to anyone - and sadly, I am sure they are not the only insurance company that does this.