Life Insurance Contracts
If you have life insurance, you’d better know this….
Do you know what a “contract of adhesion” is? You may not know but I can almost guarantee you have experience with one.
Thefreedictionary.com defines it like this:
“A type of contract, a legally binding agreement between two parties to do a certain thing, in which one side has all the bargaining power and uses it to write the contract primarily to his or her advantage.”
An example of an adhesion contract is a standardized contract form that offers goods or services to consumers on essentially a ‘take it or leave it’ basis without giving consumers realistic opportunities to negotiate terms that would benefit their interests. When this occurs, the consumer cannot obtain the desired product or service unless he or she complies to the “form of contract.”
Kind of stark isn’t it? Many read that and think: “Hey, I’d never agree to anything like that!” Really? Guess again. There are many forms of adhesion contracts. A lease agreement is a great example. Another example is, you guessed it, insurance…including the life insurance policy in your filing cabinet. I am not suggesting that anything adverse is going on as many types of contracts are of the adhesion variety out of necessity to make them viable to offer to the public.
Thank goodness, life insurance is not very controversial and has escaped much of the bad press affecting other areas of insurance (health insurance comes to mind). That being the case, however, you should always at least be aware of what the terms are so there are no surprises. This is, after all, your family we are talking about.
Life Insurance Questions
- How can you be sure your life insurance is what you think it is?
- Do you know what it is that you actually bought or what you actually need?
- Do you have Living Benefits?
- If you get very sick, can you convert your term plan at any time to any permanent product they sell at that time?
- Are you sure they (Insurance Company) didn’t write some additional “flexibility” into your policy?
Life Insurance Review
Life insurance is unlike any other insurance. If it doesn’t operate the way you think it should, it does not just cause an inconvenience, it will be a tragedy. Your life insurance is the last utterance you will make to your family in this life.
They are counting on you.
Ronald Reagan said it best (although about a different topic): Trust, but verify.
Heed these words, call a reputable agent, and get a life insurance review today.