The reason post claim underwriting isn’t illegal is that not enough people are acually affected by it. The thing is that very very few term life or mortgage life insurance policies actually result in a claim. Chances are you will outlive the policy. That is why they are so inexpensive in the first place (There is a reason why someone can get a T10 of $100,000 for $10-$20/month). Because there are so few claims, there are very few post claim investigations. But of those claims, I’m sure there is an astronomical difference between the percentage of declined payouts between fully underwritten and post claim underwritten policies. So in reality, very few people are actually affected by post claim underwriting, but many COULD be.

Post claim underwriting just gives the insurance company a reason not to pay for anyone who has ever experienced any kind of health or lifestyle “incident”.

This should be illegal, but don’t forget, insurance companies are paying hight taxes so the goverment doesn’t really care about you and me, all they care about the taxes.

Everything you should know about Life Insurance: http://www.thefinancialpower.com/category/life-insurance/