Life Insurance Quote Overview

Nationwide Life Insurance will pay $650,000 in consumer restitution and consumer aid and will change its sales practices to resolve allegations that the company deceived consumers into buying policies beyond their financial means. The agreement stems from a settlement with Massachusetts Attorney General Tom Reilly.

Nationwide, through local brokers who operated as New England Advisory Group (NEAG), allegedly misled consumers about the investment benefits and premium costs of its life insurance policies. As a result, many Massachusetts consumers watched their policies collapse over time because they could not keep up with the premiums.

"Insurance companies must be up front with their customers and clearly disclose the terms and agreements of the products they are selling," Reilly said. "This settlement requires this company to correct its sales practices and repay those consumers it misled."

The alleged violations of the Massachusetts Consumer Protection Act are outlined in an assurance of discontinuance filed in Suffolk Superior Court.

Affected consumers identified by Reilly's investigation will be paid directly by Nationwide, according to the terms of the assurance. The consumers, who purchased the life insurance policies between 1997 and 2001, did not discover that they had been misled until much later, when the products failed to perform as originally presented.

Under the terms of the assurance, Nationwide will pay $600,000 to affected consumers and $50,000 to the Local Consumer Aid Fund.

Reilly offers the following advice to consumers purchasing life insurance:

• Carefully review the terms of any new insurance policy. If any of the terms contradicts what the company or broker initially told you, or you are being asked to pay more, contact the insurer's consumer complaint division, which is usually located in the company's corporate headquarters.
• Scrutinize your annual statements. If your policy is not performing as originally represented, contact the company.
• Keep careful records and keep your policies in a safe place.
• Shop around before you buy. There are different types of insurance and it is important to determine which product best meets your needs. You should also compare prices since different companies offer similar products at varying prices.

If you have identified a problem with your policy, seek help. Consumers can contact the company's consumer complaint division or their state insurance commissioner.

Referred from: (http://www.consumeraffairs.com)