New State Regulated Life Insurance Program: A Bold-Face Lie 
There is no truth to the existence of state-regulated life insurance programs.
These mailers are not affiliated to or endorsed by any government entity and represent a deceptive marketing strategy utilized by insurance companies to increase their sales.
If you respond to these cards, you’ll find a life insurance agent knocking on your door.
While the phrasing of these mailers may vary slightly from place to place, they all essentially come with the same purpose. Here are some of the most popularly used subject lines:
- New funeral expense benefit
- State-regulated life insurance program to pay for your final expenses
- New state-regulated life insurance program
Local insurance agents use these mailers as prospecting tools to generate sales leads. If you were to respond to one, the following situations are likely to take place:
- You may find agents knocking on your door and coaxing you into buying insurance plans.
- You may also receive a call from an agent requesting you to schedule a time for an in-person meeting.
These leads are frequently distributed to multiple agents for months or even years. As a result, you start receiving repeated calls from a bunch of agents trying to sell you life insurance for final expenses.
Are These Sponsored By The Government?
None of these offers are associated with any government agency or state-run program. At the bottom of each of these mailers, you will most likely find a fine print disclaimer stating that it is not linked with any government agency.
“Is there any government entity that covers the cost of funeral expenses?” This is one of the most frequently asked questions among policy buyers.
Well, the truth is that no state or federal benefit offers thousands of dollars for a person’s funeral.
The only money provided for end-of-life expenses by any government entity is $255 from Social Security.
That leads us to the question, “Why do these insurance companies use the term state-regulated when it’s actually not the case?”
It doesn’t take a rocket scientist to figure it out. These are simply deceptive marketing strategies used by insurance providers to gain the trust of prospective buyers and make them believe the government is offering such benefits.
The truth is that most individuals have a high level of faith in the government. It’s highly unlikely that a government entity will misuse your identity or steal your money. When you call the IRS or Social Security, you don’t hesitate to give them your SSN since you know it’ll be safe.
Notwithstanding the fact that government entities have their own share of flaws, you can be confident that they won’t trap you in some illegal scam. It is the level of trust people have in the government that makes all the difference.
As a result, the whole perception of government-sponsored insurance plans dramatically increases the number of sales leads. While it’s never an honest way to sell policies, most providers reap the benefits within a short period.
What does the term 'State-Regulated' actually mean?
Simply put, the term ‘state regulated’ commonly used in these mailers is just a half-truth and merely a play on words.
Here’s how we can explain it:
All insurance is governed at the state level. All insurance companies require prior approval from your state’s insurance department to sell an insurance product in the concerned state legally.
Details related to the rates, application, and a slew of other financial information must be presented before the government during the approval process. The product will be approved by the insurance department if and when it meets the prescribed requirements.
This is the origin of the term ‘state regulated’ that you find so often in these mailers.
While it’s technically not a lie, insurance companies twist this fact to mislead people into thinking that some government entity manages the program being offered. Rest assured that nobody at any level of the government has any idea about this “offer.”
Your State Does Not Matter
You will likely find specific references to your state in several of these mailers.
They may include catchy subject lines, such as:
- 2022 benefit information for North Carolina citizens only
- Benefits information for Mississippi citizens only
- Or Virginia, Texas, or any other state…
Such deceptive marketing strategies are often characterized by changing the state’s name for each bulk mailing campaign. This enhances the disguise even further and improves the possibility of developing trust among people that state authorities actually regulate these programs.
Truth be told, it doesn’t even matter where you live. Remember that none of these advertisements that include the name of your state is affiliated to or endorsed by your state government.
These “benefits” are not limited to the state they are mailing. Most life insurance policies are available in almost all states, with certain exceptions.
Mentioning the name of the state is just another deceptive mechanism used by providers to make people believe a particular state government specifically offers it. That’s definitely not the case.
Are These Mailings Legitimate Or Scams?
While these mailers are certainly dishonest and unethical business practices, they are definitely not a scam.
Let’s take a look at both sides of the equation:
If you return one of these, you will be bombarded with multiple insurance agents attempting to sell you life insurance.
Since they’ll be fully licensed agents, you don’t necessarily need to be worried about your identity or money being stolen.
That, however, is just one way of looking at it. You need to ask yourself: ‘Do you really want to do business with an insurance company that uses such deceptive advertising techniques to mislead customers into buying plans?
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