Third Party Payor Notice
The Company has been receiving an increasing volume of new business that involves “third party payors”, which can be defi ned as a premium payor other than the primary insured, the spouse or a business or business partner. Examples of “third party payors” would include brothers, sisters, in-laws, parents, grandparents, aunts, uncles and cousins of insured’s that are age 30 and over.
The Company has experienced problems with this type of business in terms of anti-selection, adverse claims and persistency. The Company no longer accepts applications involving premium payor relationships of this nature where the primary insured is age 30 or higher.
The specific rules regarding acceptable premium payor relationships will apply to all plans EXCEPT the senior final expense business (issue ages 50 and up). Acceptable premium payor relationships for all other business for applicants age 30 and up are as follows:
- Insured
- Spouse
- Business
- Business Partner
All others are not acceptable
A parent of an applicant up to age 29 will be acceptable as premium payor, but please be advised that additional underwriting requirements, including a telephone interview, motor vehicle report and criminal records check, will be involved for many of these applications, particularly those for applicants age 25 through 29.
Please contact the Home Office Marketing or Underwriting Departments if you have any questions.