MOO Disability Rider on IUL was misrepresented - now what?

[Allen Trent]

This rider is automatically issued with all policies that do not include the LTC Rider. There is no cost to have this rider included with your policy. Charges will only be assessed if you choose to use the rider benefits

While this could be true he could file a chronic illness claim, he may get pennies on the dollar because of his young age. These free, non underwritten versions of the rider don't charge at time of purchase, but charge via a discount of the claim. IE an 85 year old filing 200k claim might only have 205k of the face amount accelerated due to elevated age & life expectancy. But a 40 year old filing a 200k claim could have 350k-400k of the policy death benefit used because the death benefit is being paid 3 to 4 decades prior to life expectancy.

 

[Tahoe Ray]

Hi @ManyLeads ,

I looked at Page 9 of the Illustration you attached:

"Riders provide extra benefits not included in the basic policy. Riders may affect your policy's accumulation values."

"Disability Waiver of Policy Charges Rider"
"If the insured becomes disabled before the policy anniversary following the insured's 60th birthday and the disability continues for at least six months and the insured is unable to perform for pay or profit any activity for which they are qualified by training, education, or experience, United of Omaha Life Insurance Company will waive the payment of the monthly deduction amount (cost of insurance charges and expense charges) during the continuance of the disability while the policy is in force or until the Rider terminates, whichever occurs first. (The cost of this Rider is $174.15 in policy year 1 and increases thereafter. This cost is deducted from the accumulation value when due.)"
,
I also looked at MOO's Producer only "IUL Portfolio Overview" flyer, which states:

"Early Access to the Death Benefit for Long-Term Care, Terminal and Chronic Illness"
"Terminal and Chronic Illness Riders are issued with the policy at no additional cost and with no additional underwriting. Clients also have the option to purchase a Long-Term Care (LTC) rider.3"

"3 Clients age 30-79 are eligible to apply. If the policy is issued with the LTC Rider, the Chronic Illness Rider will not be included."

I also looked at MOO's Consumer Brochure, which also states:

"Accelerated Death Benefit for Chronic Illness Rider"
This feature allows you to access a portion of your death benefit early if you are chronically ill, as defined in the rider. This money can be used to help cover the costs of long-term care, although there is no nursing home confinement required.
This rider is automatically issued with all policies that do not include the LTC Rider. There is no cost to have this rider included with your policy. Charges will only be assessed if you choose to use the rider benefits.

"Accelerated Death Benefit for Terminal Illness Rider"
If you're diagnosed with a terminal illness and have a life expectancy of 12 months or less, this feature allows you early access to a portion of your death benefit. This money can help provide a little more comfort during a difficult time.
This rider is automatically included with all policies at no additional cost."

The above are also on Page 10 and 11 of your Illustration.



1) If you look at your IUL Insurance Policy Application (that is included in your Insurance Policy Contract), you can check if the "Disability Waiver of Policy Charges Rider" option is selected (that would be on Page 1 of your Application Form) and check if the "additional cost of $174.15 in policy year 1" is included (or not) with your monthly premium of $674.40.

If you have been paying the additional $174.15 for the "Disability Waiver of Policy Charges Rider" (with the other conditions specified and highlighted in bold above), then that should be in effect. If not, then you still have the two other riders below that are in effect and should be able to help you.

2) For your monthly premium of $674.40, it includes, at no extra cost, the "Accelerated Death Benefit for Chronic Illness Rider" and the "Accelerated Death Benefit for Terminal Illness Rider", which you can apply for if you want or need to.

3) You can also take out loans from the Accumulated Value of your IUL. (Don't withdraw, just take loans). On Page 18 of your attached Illustration, Year 5 row, it shows a Cash Accumulation Value of $21,744 (Guaranteed Values), $30,604 (Alternate Scale Values, page 22) or $32.698 (Non Guaranteed Values, page 22) . You can also view the exact Cash Value of your IUL when you login to your Customer Portal at MOO, they also post it there, so you can know how much you can borrow.

Sorry you are going through some challenges right now. It's wise that you have put this policy in place for yourself to protect your family. IULs have living benefits like the ones I outlined above. There is hope :-)

MOO is a solid company and their Customer Service line always tries to help. (I also have an IUL with them).

Praying for your healing. :-)

Cris


"The Lord bless you and keep you; the Lord make His Face shine upon you and be gracious to you; The Lord lift up His countenance upon you, and give you Peace." - Numbers 6:24-26.

Very helpful post.

I think the main thing that the OP is upset with is the disability waiver chosen ONLY waives policy charges and not the full specified amount as illustrated.

Had that rider been in effect (which Omaha has last I checked), the policy would continue to overfund, even while they're disabled.

 

[ManyLeads]

Yes, you nailed it Tahoe Ray. It was just such a burden on me and my wife since I wasn't able to work, and she had to still pay for my insurance out of her pocket. We thought we would be fully covered - and only had the smaller portion of my premium waived.

 

[ManyLeads]

Thank you for this thought

Hi @ManyLeads ,

I looked at Page 9 of the Illustration you attached:

"Riders provide extra benefits not included in the basic policy. Riders may affect your policy's accumulation values."

"Disability Waiver of Policy Charges Rider"
"If the insured becomes disabled before the policy anniversary following the insured's 60th birthday and the disability continues for at least six months and the insured is unable to perform for pay or profit any activity for which they are qualified by training, education, or experience, United of Omaha Life Insurance Company will waive the payment of the monthly deduction amount (cost of insurance charges and expense charges) during the continuance of the disability while the policy is in force or until the Rider terminates, whichever occurs first. (The cost of this Rider is $174.15 in policy year 1 and increases thereafter. This cost is deducted from the accumulation value when due.)"
,
I also looked at MOO's Producer only "IUL Portfolio Overview" flyer, which states:

"Early Access to the Death Benefit for Long-Term Care, Terminal and Chronic Illness"
"Terminal and Chronic Illness Riders are issued with the policy at no additional cost and with no additional underwriting. Clients also have the option to purchase a Long-Term Care (LTC) rider.3"

"3 Clients age 30-79 are eligible to apply. If the policy is issued with the LTC Rider, the Chronic Illness Rider will not be included."

I also looked at MOO's Consumer Brochure, which also states:

"Accelerated Death Benefit for Chronic Illness Rider"
This feature allows you to access a portion of your death benefit early if you are chronically ill, as defined in the rider. This money can be used to help cover the costs of long-term care, although there is no nursing home confinement required.
This rider is automatically issued with all policies that do not include the LTC Rider. There is no cost to have this rider included with your policy. Charges will only be assessed if you choose to use the rider benefits.

"Accelerated Death Benefit for Terminal Illness Rider"
If you're diagnosed with a terminal illness and have a life expectancy of 12 months or less, this feature allows you early access to a portion of your death benefit. This money can help provide a little more comfort during a difficult time.
This rider is automatically included with all policies at no additional cost."

The above are also on Page 10 and 11 of your Illustration.



1) If you look at your IUL Insurance Policy Application (that is included in your Insurance Policy Contract), you can check if the "Disability Waiver of Policy Charges Rider" option is selected (that would be on Page 1 of your Application Form) and check if the "additional cost of $174.15 in policy year 1" is included (or not) with your monthly premium of $674.40.

If you have been paying the additional $174.15 for the "Disability Waiver of Policy Charges Rider" (with the other conditions specified and highlighted in bold above), then that should be in effect. If not, then you still have the two other riders below that are in effect and should be able to help you.

2) For your monthly premium of $674.40, it includes, at no extra cost, the "Accelerated Death Benefit for Chronic Illness Rider" and the "Accelerated Death Benefit for Terminal Illness Rider", which you can apply for if you want or need to.

3) You can also take out loans from the Accumulated Value of your IUL. (Don't withdraw, just take loans). On Page 18 of your attached Illustration, Year 5 row, it shows a Cash Accumulation Value of $21,744 (Guaranteed Values), $30,604 (Alternate Scale Values, page 22) or $32.698 (Non Guaranteed Values, page 22) . You can also view the exact Cash Value of your IUL when you login to your Customer Portal at MOO, they also post it there, so you can know how much you can borrow.

Sorry you are going through some challenges right now. It's wise that you have put this policy in place for yourself to protect your family. IULs have living benefits like the ones I outlined above. There is hope :-)

MOO is a solid company and their Customer Service line always tries to help. (I also have an IUL with them).

Praying for your healing. :-)

Cris


"The Lord bless you and keep you; the Lord make His Face shine upon you and be gracious to you; The Lord lift up His countenance upon you, and give you Peace." - Numbers 6:24-26.

Thank you for this thoughtful post. Thankfully I'm now in remission and not terminal. Very grateful for being able to be here! Now I'm motivated to use my story to help others get insured.