Yesterday the insurance brokerage that wrote my current term policy 2 years ago contacted me to see if I would like to replace the policy. Obviously they want to generate a new commission by churning my existing policy.
We talked about them writing a new 20-year term to replace the 18 years left on my current policy, which has a premium of about $129/month.
The agent suggested that if I can "act quickly" and get the application started he will be able to back date the application to November.
Because my birthday is in May, having the application dated in November would put the application date closer to my last birthday than my next birthday, which would drop the premium from $145/month to $126/month. If issued, I would be responsible to paying the premiums for the those months at the issuance of the policy, but I would obviously save over the lifetime of the policy.
Is this ethical and an accepted practice in the industry? Or does this indicate a shady operator that I might not want to do business with? I am not concerned about the company actually backing the policy, but the independent broker.