Right before you check out for the holidays I thought I’d give you a life insurance update. I guess Christmas came early for you.
However, this one is important. You probably are not aware that Voya, which used to be ING, is getting out of the life insurance business altogether. Any Voya/ING policies that are out there will continued to be honored, but there are things you need to be aware of.
To me the biggest issue here has to do with people that have term insurance with Voya. Some time in early 2019 Voya will stop offering term conversions because there will be no permanent products to convert to. Should someone’s health deteriorate, the ability to convert from term to permanent is perhaps the most important feature to term insurance. Losing this benefit means everyone with a Voya/ING policy needs to reevaluate, particularly anyone with a fiduciary duty (i.e. trusts, business, etc), because they are paying for abenefit they no longer have.
Typically, term insurance is not that expensive to begin with and the costs associated with switching companies would probably be negligible, all things being equal. However, the costs of a policyholder becoming uninsurable and not being able to convert their policies would be catastrophic. When it comes to making a company switch, my wife and I fall into this group and the cost of making the change worked out to be a couple hundred dollars a year more, but our policies are 10+ years old. However, I have some clients that the cost actually went down even though they’re 5+ years older.
ING used to be very big in the term insurance space, so you definitely have people that this effects. Let me know if you need anything. Have a great Christmas.