Safeguarding Against Scams

While a Kansas life insurance policy can be crucial in saving your family from financial ruin following an expected loss, the fact is insurance is a business and there's a lot of money to be made by providers. That fact is known all too well by scam artists, who dazzle unsuspecting customers with glossy presentations and accept thousands of dollars in payments--but don't hand over the settlement when it comes time for the beneficiary to collect. From 2000 to 2002, according to the Kansas General Accounting Office, 144 bogus health and life insurers sold counterfeit policies to more than 200,000 Kansas residents--resulting in an estimated $252 million in unpaid claims.

Although the most commonly targeted victims are the elderly and small business owners looking to cut costs on employee benefits, insurance scam artists aren't necessarily particular about who they rip off. In some cases these shady companies are so slick their own agents don't even realize they're selling a phony bill of goods. So when shopping for a Kansas life insurance policy, it's up to you to look out for number one. Following these tips can make the task a little easier:

• If it sounds too good to be true ... Oftentimes people are so interested in getting a good deal, they'll willingly overlook the fact that the price they've been quoted might sound a little too good. If the price you've been quoted is more than 15 percent less expensive than the figures you've been given by other insurers, it would probably be a good idea to check up on the company before handing over a penny. The same goes for the terms of the policy--if it seems to have an unusually small number of restrictions and limitations, you should give it a second look.
• Don't rush. A tactic that's commonly employed by scammers is to push a customer into signing immediately. Their reason for doing that is the same reason you shouldn't: Given time, you might check out the company and discover it isn't everything the salesperson is making it out to be. A professional salesperson will be happy to give you time to mull things over; if he or she is trying to rush you into making a deal, consider that a big red flag.
• Trust your instincts. If something doesn't feel right about a company or the policy it's trying to sell you, politely excuse yourself and move on. Considering the importance of choosing the right policy, you have every right to feel comfortable with it.
• It's all in the name. Another red flag might be the name of the company trying to saddle you with a spurious policy. Scam companies often use names that are suspiciously similar to large, legitimate insurances. So before writing a check to "Allstake" or "Pludential," you might want to first do a little investigating.
• Shop around. Even though the first life insurance policy you're presented with might seem like the perfect one for you and your family, just remember: regardless of whether the policy you're being pitched is legitimate, the person offering it to you is a professional salesperson. While the policy might very well be genuine and well-suited to your needs, do you really think the salesperson would tell you if it wasn't? Gather as much information on the policy as you can, and then compare it to others.
• Check 'em out. Before you purchase a Kansas life insurance policy from any company, it's always a good idea to first confirm you're dealing with a reputable outfit. The Kansas Insurance Department has set up a hotline so people can verify the legitimacy of a business and check to see if it's licensed to do business in the state. The number is 1-800-432-2484.