LICAC - Life Insurance Consumer Advocacy Center

  • Brian Brosnahan
  • Dick Weber
  • Case in Point: Bob B. Example from LICAC
    • Bob B. of Berkeley, California bought a universal life policy from First Colony Life Insurance Company, a predecessor of Genworth, in 1991, when he was 52 years old. The policy had a death benefit of $500,000 payable to Bob’s wife upon his death.  The nonguaranteed values columns in the policy illustration showed Bob paying a planned premium of $4,793 every year, maintaining the death benefit in force and maintaining cash value into Bob’s 90’s.  That sounded good to Bob, so he bought the policy. See First Colony Illustration.
    • Fast forward to 2018.  Bob was 79.  He had faithfully paid $4,793 in premiums every year since 1991.  But then Genworth told him the cash value of Bob’s policy had declined to nearly zero, and in order to keep the policy alive until age 95, Bob would have to start paying premiums of $28,000 per year!  
    • lifeinsuranceconsumeradvocacycenter.org/lack-of-transparency/hidden-fees/
      • Bob's Illustration - [link]