“State Regulated Life Insurance” Is Not What It Appears To Be. Here’s The Truth

Written by Anthony Martin Founder & CEO | Licensed Agent | Forbes Author

Fact checked by Brian BarberLast updated on December 7, 2021

Did you get an offer in the mail that says there is a government program available that will pay for all your final expenses?

These mailers are not what they seem.

Today, we’ll explain what they really are, so you know the truth.

Please Note: Choice Mutual did not send you this mail, and we have no affiliation with whoever did send you one of these cards. We have never, nor will ever, send out mailers (let alone ones like these). This article is meant to help you understand what these offers through the mail really are. Again, we did not send you these postcards.

What Is State Regulated Life Insurance?

There is no such thing as a state regulated life insurance program. These mailers are a very deceptive form of marketing to sell you life insurance. They have no connection to any government entity. If you return these cards, a life insurance agent will show up at your door.

While these mailers may be worded slightly different depending on where you live, they are all essentially the same.

Some common examples are “new funeral expense benefit”, or “new state regulated life insurance program”, or “state regulated life insurance program to pay for your final expenses”.

These mailers are prospecting tools to generate sales leads for insurance agents in your area.

Below are two such examples.

If you were to send one back in, you can expect the following:

Agents will show up at your door and attempt to sell you life insurance.
Agents will call you to book a time to meet with you to sell you life insurance.

Often times, these leads will be disbursed to multiple agents for months or even years on end.

In the end, mulitple agents will attempt to sell you life insurance for final expenses. And that would go on for quite a while.

Are These Sponsored By The Government?

In no way shape or form are any of these offers affiliated with any government agency or state-run program.

All of these mailers will have a disclaimer at the bottom in fine print that indicates it’s not affiliated with any government agency (like the example shown).

We get asked all the time, is there any government entity that gives you money for funeral expenses?

There is no federal or state benefit that provides thousands of dollars in cash for someone’s funeral.

The only money any government agency provides for end of life expenses is $255 from Social Security.

Now

You might be wondering… Why do they say things like “state regulated life insurance program to pay final expenses”?

The answer is simple. It’s to gain your trust by making you think it’s from the government.

The truth is most people naturally trust the government to a high degree. Everyone knows a government entity will not steal your identity or steal money from you.

When you call the IRS or Social Security, you give them your SSN without hesitation because you know it’s in safe hands.

Government is far from perfect. There’s no doubt about that. However, what can be said with the utmost confidence is they won’t scam you in some illegal way.

At the end of the day, the whole government affiliation perception directly increases the number of people who send the cards back in.

This results in more sales leads. That’s why they do it.

It’s kind of clever, but not in an honest way.

Here’s What They Mean By “State Regulated”

When these cards use the words “state regulated”, it’s really just a play on words.

Allow us to explain.

All insurance is governed at the state level. When an insurance company wants to offer an insurance product in your state, they must get prior approval from your state’s department of insurance.

The insurance company must provide them with the rates, application, and a host of other financial information on the product.

Ultimately, the department of insurance will approve the product once its requirements have been met.

This is where the “state regulated” comes from.

It’s technically not a lie. However, it’s absolutely misleading to make people think there is some government body in your state that is managing this program and “regulating” it.

Nobody at any government level knows anything about this “offer”.

Your State Does Not Matter

Many of these mailers will reference your specific state.

They’ll say things like…

2022 benefit information for North Carolina citizens only
Benefit information for Mississippi citizens only
Or Virginia, Texas, or any other state…

When they mail these ads, many of them will put in the name of the state they are mailing to in order to further enhance the disguise that it’s associated with a government body.

Just know

None of these ads that include the name of your state are endorsed or affiliated with your state government in any way.

Oh and one more thing.

These “benefits” are not exclusive to whichever state they are mailing to. The various life insurance policies being offered are actually available in nearly all states!

It’s just another mechanism to make you think it’s related to the government (your state government to be more specific). It’s definitely not.

Are These Mailings A Scam Or Are They Legit?

To put it plainly, no these mailers are not a scam.

Are they honest business practices? No definitely not.

Here’s the deal

If you mail one of these back, you will simply get inundated with insurance agents who are trying to sell you life insurance.

They will be licensed insurance agents who do actually sell life insurance. You don’t necessarily need to be wary that they are going to steal your identity or your money.

The real question to ask yourself is…

Do you want to do business with a company that advertises in such a deceptive way?

If You Need Life Insurance To Cover Your Final Expenses Here’s A Better & Safer Way To Find It

Look, if you do need some kind of funeral expense life insurance to make sure your family is not burdened by your burial costs, there’s an easy and safe way to find it.

You don’t need to mail in a deceptive card and wait for an agent to show up at your door.

Here’s how you do it…

You need to find a reputable independent agency that is licensed in your state. Make sure they represent 10 or more insurance companies, so they can shop around to find you the best deal.

Here are some things you can do to ensure you find a reputable agency to help you.

Check for online reviews (Facebook, Google, Yelp, Trustpilot, etc)
Verify they are accredited and A rated with the BBB
Look at your state department of insurance website to verify they are licensed

Once you find a qualified agency, tell them your needs and let them go to work for you!

It’s that simple.

Choice Mutual Can Help

If you’re in the market for final expense insurance, give us a chance to earn your business.

Final expense coverage is all we do, and we work with over 20 highly rated companies.

We are licensed in all 50 states and DC, and we have hundreds of 5-star reviews online from very satisfied customers.

We treat people with respect and never pressure people.

So if you want some expert friendly help, give us a call at 1-800-644-2926.

Or you can run quotes on our website and apply with whichever company interests you. Then one of our agents would contact you to answer all your questions and help you get approved.