If you have been a follower of my Blog, you know that I talk a lot about how to get the best Life Insurance Premiums & Rates with the best Life Insurance Companies. I  have created a new page on our website about getting the best Life Insurance Premium & best Life Insurance Rates.

There has been some controversy about the temporary Insurance agreement, so I included a blurb from Manulife Financial, that explains the importance of the TIA, and the do’s and don’ts. This is especially important when buying Life Insurance Online.

By Isabelle Dailly, FALU, Underwriting Consultant
and David Gillis, Underwriting Consultant
Temporary insurance … why the cheque can’t be in the mail
We’ve all heard the joke about the cheque in the mail … but it’s no joke when it comes to temporary insurance.
Why? You and your client are depending on temporary insurance for peace of mind. If the cheque’s in the mail, there’s no temporary insurance in effect and no peace of mind.
It’s not always easy to see why you need to get the cheque when your client signs the application.
It helps to understand two key dates and points in time.
There are only two dates when you can accept a payment from your client for an insurance application:
Date 1 – The day that …
• the temporary or conditional insurance questions are answered
• the application is signed, and
• your client meets all of the conditions required to be covered by temporary insurance.
Date 2 – The day that …
• you deliver the contract in a province where you are licensed as an insurance agent
• you obtain all of the delivery requirements, and
• you ensure there’s been no change in insurability since Date 1 above.
Why only those two dates?
Because there are only two points in time when the insurer is fully aware of your client’s insurability:
1. When your client has just answered the insurability questions on the application.
2. When your client verifies that there have been no changes in insurability since then.
Here’s what could happen …
On Friday afternoon, you complete an application and the temporary insurance questions with your client.
Because it’s corporate insurance, your client needs to get a cheque from the company, so your client asks you if his accountant can send you a cheque next week. You say “yes.”
On Tuesday, the cheque is delivered to your office and you send it to Manulife with the application.
On Sunday, however, although you don’t know it, your client had a heart attack.
Without realizing it, you have placed Manulife at risk for an unacceptable risk because you did not ask the insurability questions again when you accepted the cheque. Which is why we must return your client’s cheque if you accepted it at any time other than on the two key dates.
Risky Business, Individual Insurance Underwriting April 2009
Risky Business, Individual Insurance Underwriting April 2009
On an exception basis, we may accept a cheque dated one or two business days from the date the application was signed; however, we require a cover letter explaining the reason for the delay. At this time, we can only accept cheques as payment for temporary insurance.
More to consider
As well as getting the payment dates right, there are other conditions to meet before you can place temporary or conditional insurance (temporary insurance applies to life and critical illness insurance; conditional insurance applies to disability and long term care insurance).
Those conditions range from age and coverage maximums to exclusions and certain other restrictions. It’s important for you to carefully review those conditions which are outlined on the temporary insurance certificates in our insurance applications. The links below will take you to the applications, if you want to review them now.
Life and critical illness application (see pages 15-17)
Disability insurance application (see pages 14-15)
Long term care insurance application (see pages 7-8)
Following these tips will help you be confident
temporary insurance is in place when you expect it to be.
For more information about temporary insurance, you can read:
Signed, Sealed and Delivered
Risky Business (January 2009 issue)
For past issues of Risky Business just click on the link.
Or see Resource under Insurance, New Business & Underwriting