Using Cash Equivalents for Premium or Other Payments

Does your client use a cash equivalent (money orders, cashier’s checks, etc.) to make a payment on their National Life Group (“NLG” or the “Company”) insurance policy?  If you answered yes, please continue to read about changes National Life Group will be making to the amount allowed beginning on July 1, 2025.

What is Changing?

Effective July 1, 2025, the amount of cash equivalents (“CE”) allowed per household will be decreased to $5,000 in a rolling 12-month period.  Additionally, if NLG learns the client has a personal bank account, those individuals will no longer be allowed to use CE to make payments on their insurance policies.

Why is the Change Occurring?

NLG is making this change to provide additional protection to the client, you, and to the Company.  Payments using CE are only received in the mail, may go to a lockbox first, and may not be deposited in a timely manner.  Payments sent via mail are also at risk from being lost or stolen.  Making payments via EFT is the safest and most efficient way to make a payment and offers more protection for the client.

In addition to the above, the Company has regulatory reporting requirements when it identifies red flags for potential money laundering.  Failure to adhere to these reporting requirements puts the Company at risk both reputationally and for regulatory fines.  Several money laundering red flags are presented when clients use CE to make payments on their insurance policies.  Those red flags include, but are not limited to:

• Potential tax evasion when the policyowner operates a cash business;
• Potential cash proceeds derived from other criminal activity;
• The policyowner has a bank account but continues to make payments with CE or ‘structures’ payments – using a combination of CE and money from a personal bank account to make payment; and/or
• The policyowner has exceeded the CE amount allowed multiple times.

The Company is in the process of reaching out to potentially impacted agencies and agents.