I recently discovered something surprising… My grandfather took out a life insurance policy for my child when she was born, but he passed away about ten years later without ever mentioning it to me. Occasionally, I would receive mail from MassMutual, but I didn’t understand what it was about and foolishly ignored it, assuming it would just lapse due to non-payment.
When I finally logged in, I found out that there’s a loan of $1,700 against the policy, likely because it was used to cover the premiums! Now I’m unsure what to do. If I cancel it, would I be responsible for repaying that amount? As the child’s mother, I had no idea he set this up without my consent! What are my options?
It sounds like you’re in a bit of a complicated situation. First, it’s important to gather all the information you can about the policy. Here are some steps you can take:
Contact the Insurance Company: Reach out to MassMutual directly. Explain your situation and ask for details about the policy, including its status, the implications of the loan, and how you can manage it going forward.
Understand the Policy Terms: Clarify whether the loan can be repaid, how it affects the policy’s cash value, and what would happen if you decide to cancel the policy.
Check for Options: Ask if there are options to reinstate the policy or if you can settle the loan amount in a way that makes sense for you. Knowing your options will help you make an informed decision.
Consult with a Financial Advisor or Attorney: If you’re unsure about the legal implications or financial responsibilities, it might be helpful to seek professional advice.
Review the Length of the Policy: Since you weren’t aware of the policy initially, it might have specific clauses regarding cancellation or any consequences, so check those with the insurer.
Make a Decision: Once you have all the information, decide whether to keep the policy and pay back the loan, or cancel it and address any outstanding amounts.
It’s important to act promptly since insurance policies can have time-sensitive conditions. Don’t hesitate to ask questions until you feel comfortable with the understanding of the policy and your responsibilities.