NYDFS Issues Consumer Alert on Universal Life Policies

Acting NYDFS Superintendent Linda Lacewell is alerting consumers who own or are thinking about buying universal life insurance policies to carefully review their policies, the sales illustrations describing how the policy works and all required information disclosures.

The DFS is issuing the alert since it has received almost 1,400 complaints from New York consumers about universal life insurance policies over the last five years. Many consumer groups and media organizations have also reported consumer issues with universal life insurance.

The alert reminds consumers of many things, including that they should:

• Know that the premium payment amount is probably not guaranteed and may increase

• Understand how the current or potential premium payment was determined

• Ask their Agent what happens under guaranteed provisions or adverse scenarios

• Receive free policy updates (in-force illustration) each year to see the current policy status and a projection of future performance based on current conditions

• Understand that if they buy a Universal Life policy, they can cancel within 10 days under New York’s “Free Look” Provision

Please click here to read the NYDFS Consumer Alert.