Weird Life Insurance question...

[MurphyTex]

What is the name of your state (only U.S. law)? Texas

I'm guessing my situation isn't a usual one?

My wife took out a Group Graded Benefit Life Insurance policy for herself. At the time she was battling cancer. The terms were that if you die during the first or second year of the plan your received your premiums back plus 25%. If you passed away, for any reason, after two years from the Certificate Effective Date then you received $17,000.

My wife wife passed away from her battle with cancer exactly one day short of two years of the Certificate Effective Date. At the time, I didn't give this much thought, the rules are rules and I wasn't concerned with money, I just wanted my wife back. The insurer paid out the premiums plus 25%. I hadn't given it much thought since then, she passed away a couple years ago.

But this week, I was cleaning out a desk and found were my wife made a copy of the enrollment form she signed. I hadn't seen this before and didn't know it existed. She accepted the terms of the policy, dated and signed the enrollment form on September 19, 2007. She mailed that enrollment form to the insurer who issued the policy with a commencement date of September 21, 2007. My wife passed away on September 20, 2009.

So...my question is, what legally should be the commencement date of the policy? I just assumed she signed the Enrollment form on September 21, 2007. It seems to me that the commencement date for the policy should be the date she signed, September 19, 2007. Using the date that she signed, I should have been eligible to collect the $17,000 since it was a day more than two years. Using the date the Insurer selected, I received a bit over $1000 in returned premiums.

I hope this all doesn't seem petty but $16,000 is somewhat of a big deal. Can I actually contest the date the Insurer issued the contract? The Enrollment form was never notarized, it was an offer extended to us by a large national retailer using a Life Insurance company they are affiliated with. The offer actually came with our credit card bill from the retailer and the only document my wife ever signed (to my knowledge) is this Enrollment form I just found. Any advise would be greatly appreciated!What is the name of your state (only U.S. law)?

 

[justalayman]

She mailed that enrollment form to the insurer who issued the policy with a commencement date of September 21, 2007

the policy was issued on the 21st. When she signed it is irrelevant. What if she signed the form and never sent it in? Would you expect the policy to be in effect before the insurer was notified of the acceptance? What if she held it for a month and then sent it in. Do you believe they would have to make the policy retroactive to the date she signed it, even though they did not have notice of acceptance?

For the contract to be in effect, there must be delivery of acceptance. That did not take place until she sent in the acceptance notification. If you could prove she sent it on the date she signed it, you could argue that placing it in the mail constitutes delivery unless the contract stated it was not in effect until actual delivery to the insurer. Can you prove the actual date she mailed it? Do you know if there was a statement limiting the effective date to the actual date of receipt?

 

[Betty]

The date the application/enrollment form is signed is not necessarily the effective date of the coverage. The effective date would be the effective date noted in the policy/on the certificate. It's always on the certificate or in the policy. Generally you would have a cert. for group ins. & a pol. for individual ins.

 

[MurphyTex]

Thank you for the responses, they are very helpful.

It does make sense that the Policy goes into effect when received by the Insurer. The point about holding the Enrollment form for an amount of time and then expecting them to 'backdate', thereby shortening the 2 year period to the customer's advantage, is well taken. But I think the fact that my wife's signature was 9/19 and the Insurer issued the policy 9/21 shows that wasn't the case. It also shows that the Insurer was prompt to issue the policy, to their credit.

On the Enrollment Form, there is a sentence under her signature that states,"My coverage will become effective on the date stated on my Certificate Schedule Page". I'm not sure where that document is but I imagine that date is 9/21/2007.

 

[Betty]

I'm not sure where that document is but I imagine that date is 9/21/2007.

I imagine it was also. (just about 100% positive)

 

[jmatos]

What is the name of your state (only U.S. law)? Texas

I'm guessing my situation isn't a usual one?

My wife took out a Group Graded Benefit Life Insurance policy for herself. At the time she was battling cancer. The terms were that if you die during the first or second year of the plan your received your premiums back plus 25%. If you passed away, for any reason, after two years from the Certificate Effective Date then you received $17,000.

My wife wife passed away from her battle with cancer exactly one day short of two years of the Certificate Effective Date. At the time, I didn't give this much thought, the rules are rules and I wasn't concerned with money, I just wanted my wife back. The insurer paid out the premiums plus 25%. I hadn't given it much thought since then, she passed away a couple years ago.

But this week, I was cleaning out a desk and found were my wife made a copy of the enrollment form she signed. I hadn't seen this before and didn't know it existed. She accepted the terms of the policy, dated and signed the enrollment form on September 19, 2007. She mailed that enrollment form to the insurer who issued the policy with a commencement date of September 21, 2007. My wife passed away on September 20, 2009.

So...my question is, what legally should be the commencement date of the policy? I just assumed she signed the Enrollment form on September 21, 2007. It seems to me that the commencement date for the policy should be the date she signed, September 19, 2007. Using the date that she signed, I should have been eligible to collect the $17,000 since it was a day more than two years. Using the date the Insurer selected, I received a bit over $1000 in returned premiums.

I hope this all doesn't seem petty but $16,000 is somewhat of a big deal. Can I actually contest the date the Insurer issued the contract? The Enrollment form was never notarized, it was an offer extended to us by a large national retailer using a Life Insurance company they are affiliated with. The offer actually came with our credit card bill from the retailer and the only document my wife ever signed (to my knowledge) is this Enrollment form I just found. Any advise would be greatly appreciated!What is the name of your state (only U.S. law)?

Hi, I am an Insurance Agent in the State of Arkansas. In most cases these type of policies do not go into effect until the policy is accepted by the company and issued to the proposed insured. However, the policy should provide an effective date. This effective would have been the date of issue. I hope this helps you out.

 

[Betty]

Agree & would be the 9-21 date.