Life insurance scams are unfortunately common. In fact, they’re one of the most common types of insurance fraud. And while life insurance scams can take many different forms, there are a few that are more common than others. So if you’re looking for life insurance, it’s important to be aware of these scams and how to avoid them. In this post, William Schantz of Mid Atlantic Financial, LLC covers some of the most common life insurance scams and what you can do to protect yourself from them.
List of Common Life Insurance Scams
There are a number of life insurance scams that have been around for many years. While some of these scams are more common than others, it is important to be aware of all of them in order to protect yourself and your family.
One of the most common life insurance scams, says William Schantz, is known as the “churning” scam. In this type of scam, an insurance agent will encourage a policyholder to cancel their existing life insurance policy and replace it with a new one. The agent will often receive a higher commission for doing this, while the policyholder ends up paying more in premiums. This type of scam can be especially harmful if the policyholder is not able to keep up with the higher premiums and ends up losing their coverage altogether.
Another common life insurance scam is known as the “bait and switch” scam. In this type of scam, an insurance agent will lure a potential customer in by offering them a low premium. Once the customer has signed up for the policy, the agent will then switch them to a more expensive policy with a higher premium. This type of scam can be very costly for the policyholder, as they could end up paying much more than they originally bargained for.
Finally, another common life insurance scam is known as the “deceptive sales practices” scam. In this type of scam, an insurance agent will use high-pressure sales tactics to convince a potential customer to buy a life insurance policy. The agent may also lie about the benefits of the policy in order to get the customer to sign up. This type of scam can be very costly for the policyholder, as they could end up paying for a policy that does not provide them with the coverage they need.
While there are many different types of life insurance scams, these are some of the most common, according to William Schantz. If you think you may be a victim of any of these scams, it is important to contact your state’s insurance department right away. You may also want to file a complaint with the Federal Trade Commission. By taking these steps, you can help protect yourself and your family from these harmful scams.
The Concluding Thoughts
As a consumer, it is important to be aware of the different life insurance scams that are out there. Fraudsters may try to take advantage of you in many ways, so knowing what to look for can help protect you from being scammed. Remember, if something seems too good to be true, it probably is! So always do your research before signing up for any policy. If you have been scammed or think you might have been scammed, William Schantz recommends contacting your state insurance department immediately. They can help guide you through the process of filing a complaint and getting your money back.