but how can they know if the applying parent didnt have 4x the amount if they didnt ask for policy numbers? Can they ask for it in lets say 5 years, what happens if they are being pushed back if they ask for it, can they force to give it for them?
That's an excellent question. They could go to court and then you might be forced to show proof.
The other thing that could happen is that this might be handled by the NYS insurance department, and then you are dealing with a government agency that will be telling Allstate that they are required to reduce the face amount of the kid's policy to $50,000 unless Allstate can show proof that the parent had 4x the amount of insurance.
So that would make it a different story, Allstate will tell you that they are being asked by the state to reduce the policy to $50,000 unless you can prove that you had $1,000,000 at the time they issued the policy. What do you do then? We recommend that everyone keep proof of the insurance they had at time of application, including temporary insurance receipts, etc. Keep that proof along with the Allstate policies just in case this everything comes back.