What defines a misstatement?
Insurance pros!
I'm studying for my Life license and two questions came up regarding misstatements on applications;
1. If a person starts a policy as one gender and later changes their gender, is that considered a misstatement if they die without having alerted the insurer?
2. If someone changes genders and wants to update their policy information what is the protocol?
Our underwriters gave me an answer I can't publish but I would love to hear your thoughts.
Thanks for taking the time.
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Answers (1-10)
I'm not an underwriter but it is the client's responsibility to inform the company of changes of address etc. I would think a change of gender would be an important change to let the company know about. But if the client doesn't it would be up to the individual company to decide if that is a breach of contract (misrepresentation) or not.
As to protocol each company would have it's own way of doing things and it's own requirements. The client (or their agent) would have to contact the parent company to find out what proof is needed for such a change.
This makes me very happy we only do commercial lines p &c.
Good question. I have never encountered it as such. Ownership should be effected either. As most policies are based upon age and sex then I think in best to get a legal opinion from lawyers of any of the top 4 companies, for clarification. Let me know how I can help? Sponsorship, leads and or marketing ideas? Peter
When an application is taken for insurance the statement made on the application pertain to the client situation at that point in time. Insurance companies can't look forward they only look Back. As far as a gender change it is the same situation. normally once as policy is issued the rate are based on the client current age at the time of application. It normally has no benefit to restart a policy due the fact of contestability and underwriting review
As long as the application answers were true at the time of the application, I don't think that a gender re-assignment would matter. Most states have a two year contestability period. Outside of the contestability period, insurers have to pay benefits, regardless of the veracity of application answers.
2 the insured may update name if they change it, however the insurer is not required to change the gender because the insureds gender at birth is their real and true gender. the fact that a person no longer wants to be the gender they are born with, is irrelevant as far as a life insurance policy is concerned.
The conditions at the time of applications were correct, so no misstatements. Once contestability clause period is completed the policy is all good.
I don't thing so since you started the policy with your current gender at that time. For the second one, in my opinion you have to call companies' head office to know how the company has decided to make the process in those cases.
" misstatement meaning: 1. the act of expressing a fact that is not correct, or an example of this: 2. the act of stating something that is false or not accurate: "
1) The answer would be "no" , it is not a misstatement if the insured failed to alert the insuring carrier. ( I am sure somewhere in the insurance contract, their is a "duty to notify" of any material changes that could affect the original underwriting and acceptance of the contract (policy ) and I am sure would affect or reduce payment of benefits for a failure to notify.
2) At this point, I seriously doubt if any insurers have a specific form pertaining to "gender reassignment" in reference to life /health benefits or those who " identify" as a different sex ( or race ) . I would assume that an insurance carrier would require the request of "change" be supported by medical documentation of various types and could be handled by the original producer/broker/agent and /or direct with the insuring company.
...and thank goodness I specialize in property-casualty insurance and our benefits department can deal with these types of matters.