Have you heard of the stranger-owned life insurance scams?
Be careful is a stranger offers to buy you or your loved ones life insurance as a rick-free way of making a lot of money.
It is illegal, and here is how it works:
A scammer will offer an elderly, wealthy person a fairly surprising deal: The older person agrees to purchase a $10 million life insurance policy, and the scammer lends them the money to pay the premiums for two years. The may even throw in cash up front for the hassle of applying and going through a medical exam.
The insured pays nothing during that time, not even interest. If they die during that time, their family gets the death benefit, minus the cost of the loan. If they don't die at the end of two years, they can keep the policy and pay back the loan plus interest. Or, they can sell the policy and use the money to pay back the loan, or transfer it to the lender and pay nothing.
Seniors are hurt in several ways by this scheme. They may lose the ability to buy additional insurance. The money they receive from this illegal transaction is taxable, putting them in the double-bind many criminals encounter; pay taxes, thereby exposing the scam, or not pay taxes, and face tax evasion. They could also end up being charged with theft or sued by the issuing insurance company.
Larry King, was actually hit with this type of scam hatched by the Maryland-based Meltzer Group!
Have you been subjected to a Life Insurance Scam? Help us create a Life Insrance Broker BlackList by commenting her with your story!
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