Migliaccio & Rathod LLP is investigating whether J.P. Morgan premium-financed life insurance arrangements exposed borrowers to undisclosed or understated risks involving loan interest, collateral calls, and policy underperformance.
Reported Issues
Consumers report:
- Using private-bank lending to finance large life insurance premiums.
- Being told premium financing was an efficient estate-planning or liquidity strategy.
- Facing increased borrowing costs after interest rates rose.
- Being required to post additional collateral.
- Experiencing losses when policy growth failed to keep up with loan costs.
J.P. Morgan describes life insurance premium financing as a way to finance high-value life insurance premiums, but its materials state that loans and lines of credit are discretionary, subject to credit approval, and that securities-collateralized loans involve risks and may not be suitable for all borrowers.
Why Individuals Should Be Concerned
Potential claims include:
- Negligent misrepresentation
- Failure to disclose financing risks
- Fiduciary breach by advisors
- Loan-disclosure violations
- Economic loss from interest and collateral calls
- Rescission or restitution
Signs You May Be Affected
- You financed life insurance premiums through J.P. Morgan.
- You were told the policy would outperform the loan.
- You faced collateral calls or higher interest costs.
- You had to add cash or securities to keep the strategy alive.
- You believe rising-rate scenarios were not adequately explained.
If you have encountered these issues, we would like to hear from you. Please complete the contact form on this page, send us an email at [email protected], or give us a call at (202) 470-3520.