administrator or law firm. Are the payment streams from the federal employees direct deposited into a trust or dedicated account that will then be used to make payments to the investor? In August, a California woman Hong Li filed a class action lawsuit against Pacific Life Insurance and Sky Vision Insurance Agency for allegedly deceiving her and other consumers about the performance of their IUL policies. In one examplecited by Veralytic,a person could pay $367,000 over six years on an IUL policy and get nothing back if the policy is canceled. For information on deleting the cookies, please consult your browsers help function. The crux of the complaint is both technical as well as . 269-216-9978 If you believe that what is alleged in the Indexed Universal Life Policy (IUL) Class False Marketing Class Action Lawsuit Investigation has affected you, please dont hesitate to reach out to us. (More: Universal life insurance lawsuits underscore product risk), Transamerica said in a statement that the policies permit the company to adjust monthly deduction rates up to a contractually guaranteed maximum, and that the increase was necessitated by low long-term interest rates, changes in expectations as to future mortality experience, and other factors, and in accordance with the policies contractual terms.. But the policy owner is likely to have torequalify as a borrower every three to five years, during which time the interest rate may go up while the cash value inside the policy could go down. The Los Angeles-based custodian's latest funding round was led by Insight Partners and Adam Street Partners. Others may be representing a higher growth rate of the stock index than what most financial experts would believe to be reasonable. This might include plain vanilla ones such as the S&P 500 and the Russell 500 indices. He has written multiple cover stories, hard-hitting features and executive profiles for major media outlets, and is the author of The Woman Who Rode the Wind, a novel about early flight. If an insurance company uses false marketing to overstate the benefits of IUL policies, consumers could make serious financial decisions without knowing the true risks of these policies. Click here if you want to learn about Roccy DeFrancescos favorite IUL. If you received a data breach notification or feel your Read More, Radius Health, Inc. Merger Terms May Have Harmed Stockholders An investigation into the fairness of the sale of Radius Health, Inc. (Radius or the Company) (NASDAQ: RDUS) to Gurnet Point Capital (Gurnet Point) and Patient Square Capital (Patient Square) has commenced. The three plaintiffs purchased Minnesota Life IUL products from Shurwest producers. Indexed universal life insurance is in the same class as other permanent life insurance policies, such as whole life insurance. We look forward to hearing from you all. In the case of a sudden or unexpected death, life insurance can help cover debts and provide income for bereaved family members. PacLife misleadingly marketed their PDX life insurance policies in a way that concealed the policies risks while overstating their benefits, according to the plaintiff. But the monthly policy expenses may have caused losses of several percent in the value of the policyand if it went down too muchthen policyholders got a premium call requiring them to put in more money, says Roth. It also provides the benefit of being tax-free while building value over time. Terms and Conditions. Eufy misled doorbell and camera users about how and where it stores recorded information. The goal of this section is to provide consumers with a comprehensive resource on class action and mass tort lawsuits. John may be reached at[emailprotected]. But indexed universal life would not be increasing in popularity if millions of long-term planners and families were not finding the cost of owning the product to be a good value, says ACLI spokesperson Jack Dolan. The PacLife IUL Class Action Lawsuit is Hong Li, et al. We do this by being proactive and holistic. The IUL sales structure I will talk about in this newsletter I saw a few years ago. Let me explain how this IUL (Indexed Universal Life) sales structure worked. In June 2014, a state court judge preliminarily approved a settlement to a class-action lawsuit against Fidelity & Life Guaranty Life Insurance, Co. A qualified IUL attorney can determine your eligibility for legal action. Commissions do not affect our editors' opinions or evaluations. According to Harvey Rosenfield, an attorney with Consumer Watchdog who represented the plaintiffs, Transamerica notified policyholders in 2015 that it was increasing charges by as much as 38% on universal life insurance packages originally sold in the late 1980s and early 1990s. And the insurance agent can make a commission on the sale of the structured payment and the target premium on the IUL is larger (winner winner chicken dinner)! Consumers may not know about the intricacies of IUL policies, allowing PacLife to exploit their lack of knowledge. "It's interesting because of the complaints against the agent itself and is certainly one that we're watching and we'll continue to watch.". View Guidelines. And the insurance agent can make a commission on the sale of the structured payment and the target premium on the IUL is larger (winner winner chicken dinner)! Life insurance companies that sell traditional policies like whole life insurance invest primarily in corporate bonds and government-backed mortgages where the money will be safe and generate a small, but reliable, annual return each year. About Us That plan is the best way for Shurwest to repay the aggrieved parties, its attorneys have said. Take a photo of a faulty item and add a brief description. Unfortunately, Pacific Life Insurance Company has been accused of taking advantage of the need for this insurance by trapping consumers in ill-performing indexed life insurance policies. All Rights Reserved. A lawsuit could also help enact change in the industry and stop insurance companies from engaging in these allegedly deceptive practices. Please review our Affiliate Link Disclosure for more information. Transamerica Funds. Although the new lawsuit claims millions of dollars lost by the class, the three defendants lost premiums totaling less than $50,000, Kvesic said. During this meeting, their agent Tiffany Xu reportedly encouraged them to take out an Indexed Universal Life policy based on false and misleading representations of the policys performance. After these representations, Li reportedly opted into a IUL policy through PacLife. The lawsuit addressed their IUL product - PDX. I was sold a Pacific Life PDX IUL 2 product on 06/28/2020. If a lawsuit can be filed, indexed universal life insurance policyholders may be able to recover compensation for any harm they suffered in buying these policies. The structured settlement company isnt bonded. The Forbes Advisor editorial team is independent and objective. The fact is, in a different (and better) economic environment, lessin premiums would be paid than originally planned, he notes. Minnesota Life would be sued itself by several disgruntled clients. document.getElementById( "ak_js_5" ).setAttribute( "value", ( new Date() ).getTime() ); @2023 Top Class Actions. This is ClassAction.org's current list of open lawsuits and investigations. It requires that designs with multipliers or other enhancements should not illustrate better than non-multiplier designs. Beginning in 2019, Shurwest began branding itself as The Quantum Group. Critics say that risk is not properly disclosed and is borne by the policyholder. The IUL Class Action Lawsuit is Hong Li v. Pacific Life Insurance Company, et al., Case No. Using various marketing efforts, agents allegedly targeted pensioners with the FIP strategy by offering them a lump sum in exchange for a portion of their future pension payments. Most IUL policies have a crediting floor of 0% to 1% which ensures that, even if a market consistently performs fully, the policy will grow by at least 0.5% or whichever floor is determined by the policys floor. If your insurance company misrepresented the performance potential of your indexed universal life policy, you may be able to file an IUL lawsuit. Go on and tell us about your poor consumer experience. Privacy Policy | Entire contents copyright 2022 by InsuranceNewsNet.com Inc. All rights reserved. View Guidelines. The IUL Class Action Lawsuit is Hong Li v. Pacific Life Insurance Company, et al., Case No. The buyer buys the payments at a discount and then receives them going forward. A little-known rule passed by Congress in 2010as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act exempts indexed universal life insurance from federal regulation. Please review our Affiliate Link Disclosure for more information. While its true that indexed universal life insurance offers a bigger upside than a traditional life policy in a good yearlike 2021 when the S&P index rose 26.9%and while it can protect against investment loss, the costs associated with an IUL can drain the policy of its value. A class action lawsuit, also known as a class action or representative suit, is a type of lawsuit where one of the parties is a group of people represented collectively by a member or members of that group. How To Find The Cheapest Travel Insurance, Tips for Buying Life Insurance for the First Time, What To Expect In Life Insurance Medical Exam, How To Choose A Life Insurance Beneficiary. Opposing attorneys representing the Ciofolettis and Stospal are forum shopping a proposed class action that was rejected by a Minnesota court, Kvesic said. However, the plaintiffs argued Transamerica had breached its contract and acted in bad faith by raising charges as a pretext to avoid or offset its obligation to pay the guaranteed monthly interest. When the interest rates are bound by the movement of the stock or bond market, this becomes an Indexed Universal Life, or IUL insurance policy. Indexed universal life policies are unique forms of life insurance which tie interest rates to a market index such as the S&P 500 or Nasdaq 100. Scammers pushing FIP allegedly used brokers and insurance producers to find investors -- often retired veterans, teachers and firefighters. Even if a market index performs extremely well, not all of these gains will be translated into a policys interest rate. Policyholders from all states are invited to speak to these legal professionals, though attorneys are especially interested in speaking to Arizona, California, Florida, Illinois, Michigan, Minnesota, and New Jersey consumers. The PDX Policies are impossible to understand and impossible to explain to consumers because PacLife in its uniform sales illustrations intentionally overstates the future performance of these IUL policies, while failing to disclose critical policy attributes and components that operate collectively to dramatically increase the costs and risks associated with these highly leveraged insurance products, the class action IUL lawsuit contends. status of any class action settlement claim. Get In Touch! ", Although a class-action filing, the Li/Lui lawsuit names the agent along with the insurer. Are you kidding me? It is presented Interested in articles like these? I do NOT like or trust most IMOs. This is rather unique to Transamerica, and helps your heirs plan your funeral. Class actions on "vanishing premium" sales practices reaped "huge jury verdicts, multi-million dollar class action settlements and changes that go to the very foundation of the life insurance industry." We're talking literally billions of dollars in aggregate settlements. Many of the policies were sold during a period of high interest rates, which allowed insurers to offer attractive guaranteed minimum interest rates. This case has been out there for a few years and for whatever reason, the normal trade publications havent really written about it. It isbelieved that some companies, including AXA Equitable and Pacific Life, may have used misleading financial return illustrations when selling their permanent life insurance policies. "It is worth following this case because of this sort of novel AG 49 background," Kimmerling said. Actions does not process claims and we cannot advise you on the To read one of the original complaints from 2019, click here. The plaintiffs are represented by Bonnett Fairbourn Friedman & Balint, a Phoenix law firm specializing in life insurance sales practices. Radius Health, Inc. Investigation Shareholders Potentially Harmed By Merger Terms, Aon PLC Data Breach Investigation Personal Identifiable Information Of Over 145,000 Individuals Exposed, Certain Walmart Brand Great Value Spices Found to Contain Heavy Metals. So, its no wonder that IULs are complicated. settlement administrator or your attorney for any updates regarding FIP products were notorious as early as 2015, when several state regulatory agencies investigated the FIP products and determined them to constitute illegal usurious loans, the lawsuit reads. People will buy IUL policies based on a fictional future and hit a hard reality when they have to pay substantially more than they expected in order to keep the policies in-force. roccy@strategicmp.net, Why Every Advisor Should Have a 65 License. information here is for reference only. Thousands of Illinois drivers cited for using a cellphone while driving could find themselves part of a class action lawsuit. 2023 InvestmentNews LLC. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Top Class Actions is a Proud Member of the American Bar Association, Various Trademarks held by their respective owners. If you purchased a PacLife PDX Policy and are not satisfied with how your policy has performed, you may be entitled to compensation for yourself and for other policy owners by joining this Pacific Life Insurance class action lawsuit. Is it better to let the money sit safely in a savings account? After being misled by some companies about the performance of IUL policies, some consumers have filed IUL lawsuits for false marketing. Defendants are listed as Tiffany Xu, Sky Vision Insurance Agency and Pacific Life Insurance Co. Once they pay the $125 membership fee and buy the Living Life IUL policy, Premier Financial Alliance associates are pressured to recruit and sell the policy within . Top Class Actionss website and social media posts use affiliate links. They are led to believe the policy will earn 6% or more each year, and since they can borrow the money to pay the premiums at 3% or less, they think they will make at least 3%, far better than a bank can offerand on borrowed money. So, assuming clients with money pay premiums into an IUL, the question is what to do with that money as you wait to fund the IUL over a 5-, 7-, 10-year period. The insurance company manages and buys the options, rather than the policyholder, who expects to see additional gains in value while keeping the basic policy investment safe. Interest rates are determined by the underwriter of the universal life policy but with a contractual minimum which is usually around 2%. Unfortunately, when faced with poor policy performance or mounting premiums, consumers may have been forced to surrender their policies. When policyholders live to an older age, these policies may help provide retirement income for aging seniors. 30-2020-01153426-CU-BT-CXC, in the Superior Court of the State of California in and for Orange County. A list of open investigations and When a policyholder tries to surrender the policy, the insurer might keep the entire first years premium since it has already paid the commission costs to the agent who sold the policy. These cases were consolidated and put together in the class action lawsuit. This settlement for approximately USD 88 million removes the uncertainty of this ongoing litigation for the company and its customers . John Hancock Life Insurance Co. settled a lawsuit related to UL insurance costs in July for $91.25 million. Why was it so clear to me that this structure was dangerous? Their lawsuit seeks class-action status, a request that must be approved by the court. The charges that Transamerica applied to people who owned these universal life insurance policies caused tremendous surprise and stress for the people who received them, many of whom are now senior citizens, and some of whom are quite elderly and on fixed incomes, he said in a statement. He discussed the case last week at the American Council of Life Insurers' 2020 Annual Conference, conducted virtually. The lawsuit was filed Aug. 6 in Orange County Superior Courts by plaintiffs Hong Li and Tailong Liu. You show the client how to take the money that they need to keep safe for their future IUL premiums and show them how to get a 7-10% investment return on it (vs. earning nothing or very little if kept in a savings account). 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