What Happens to Your Insurance When Your Insurance Company Stops Selling It?

{2 minutes to read}  What happens to your insurance when an insurance company stops selling a line of business that you have? Lately, there’s a trend in which many insurance companies have stopped selling traditional long-term care and others are ceasing to sell life insurance.

There are two things that I think are very important for you to be aware of. When a company ceases to sell a line of business, it usually does not provide the best service and communication to the policyholder.

Recently, a client contacted me to say that the rate for their long-term care insurance had increased for the third time. As the writing agent, I was not made aware of it, nor was any communication sent to me. I spoke to the general agency that I used to secure that business and they were not notified either.

This causes a great problem because it doesn’t allow the advisor who’s working with the client to help them make decisions. I went on the insurer’s website today and there was very little information. So now, I have to devote time to getting someone on the phone so that I can give my client all the information they need.

When you choose to do business with an insurance company, choose a company that has a solid long-term financial rating and a commitment to a line of business. That way if this happens in the industry, you’ll be with a company that can continue to give you the level of service and communication that you — and the advisor that sold you the product — need in order to get the best result.

I’ve seen this happen too many times. Once a company stops selling a line of business, those products are not supported because the company doesn’t make as much money on them. This positions the client in such a way that they’re not getting the best information or the best service possible. Certainly calling the company cannot hurt but the service that is provided in these situations sometimes leave much to be desired.

If you have any questions or have run into this problem and would like to discuss it, please email me at michael@swanwealth.com or give us a call at (631) 262-9254. Thank you.

Registered Representative offering Securities through American Portfolios Financial Services, Inc. (APFS) Member FINRA/SIPC. Investment Advisory Services are offered through G&G Planning Concepts, Inc. which is not affiliated with APFS.  Strategic Wealth Advisors Network and Gassman Financial Group are not affiliated with APFS.

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