Life Insurance Insights

Did I get your attention?  Ok, so here’s what I mean by this provocative question.  More than one acquaintance of my wife and me who fall into our general age category—the 70’s—have voiced a concern with the dilemma posed by this question.  That is, they want to live their retirement years to the fullest, enjoying travel and entertainment, but, at the same time, they want to leave something for their grandkids when they are gone.

The dilemma caused by this desire to live it up now while leaving a meaningful sum for kids and/or grandkids can have a strangulation effect on leisure plans and investment choices.  Even couples whose assets are sufficient to provide them with the comforts they say they want and who have provided for the potential of age related expenses with Long Term Care Insurance, seem frozen in place when it comes to spending money on themselves.  They want to make sure there is “something left for the kids.” More…

This is the final real life story from www.lifehappens.org, an excellent resource for unbiased information on life, disability and long term care insurance.

John Ogonowski grew up on a farm and never wanted to give up that life, even as he pursued a distinguished military and civilian flying career.  While a young pilot for American Airlines, John began buying land in his hometown of Dracut, Mass, and eventually developed a second career as a hay farmer.  John’s wife, Peg, was a flight attendant at American and they knew her salary would not be enough to support their three young daughters and keep their farm going if something were to happen to John.  So John bought life insurance to supplement the coverage provided by the airline. More…

This real life story is from www.lifehappens.org, an excellent resource for unbiased information about life, disability and long term care insurance.

The Yasmine Moss Story

The cosmetology classes Yasmine Moss was taking at Bladensburg, MD High School were suppose to be a way to learn a trade she could use when she needed extra spending money for clothes or going out with friends.  She didn’t anticipate that soon that would be her main means of support.

When Yasmine was 17 years old, her father, Tex, a construction worker, died of esophageal cancer, just four months after receiving his diagnosis.  In a cruel twist of fate, Yasmine lost her mother to ovarian cancer just 3 months later. More…

The following three real life stories are from www.lifehappens.org, a site sponsored by a non-profit organization supported by scores of insurance organizations.  It is an excellent resource for great, unbiased information on life, disability income and long term care insurance.

The Don Wachtel Story

Don Wachtel loved fixing and refurbishing things, so it’s no surprise that he built a thriving tile business, channeling that passion into clients’ homes.

When insurance agent Chris Manfredi met Don, he recognized a kindred spirit.  They were both in their 30’s, raising families and working hard to grow their businesses.  That’s why he made it a priority to help Don get a term life insurance policy. More…

Putting off the decision to buy life insurance is so easy to do.  What are the chances that you will die early?  There’s always more time…or is there?  In my next few entries I’ll outline some real life cases that, hopefully, might cause you to put life insurance at the top of your “to-do” list, where it belongs.

Karen

Karen was a 38 year-old office manager.  She and her husband were divorced, leaving her with a mortgage and sole responsibility for the care of her 14 year-old son, Steven.  She was aware of her financial vulnerability and decided to consult a financial advisor.  The advisor talked her through various options and devised a plan to financially protect her and Steven.  One of the features of the plan was a $500,000 life insurance policy.

Less than two years later, Karen went home from work early one afternoon with a bad headache thinking that she might be getting the flu.  Later that day she lost consciousness and was rushed to the hospital.  She had suffered a brain hemorrhage.  That evening she died without having regained consciousness. More…

A few weeks ago as Putin was on the march into Ukraine the Dow Jones average took a very large single day dive…down almost 300 points, as I recall.  That evening the television newscasters were exclaiming how people’s 401k plans were being hit with huge losses.  This type of hysteria drives me a little nuts.  There is never a discussion of how much rising stock prices have positively affected people’s retirement plans—that’s not news.  The following day when the DJ recovered just about what it had lost the day before, there was no fanfare.

The sad thing about this media hysteria is that many people are encouraged to sell their 401k assets after they have tanked and wait until they rise again to repurchase.

More…

According to recent research, women make up 49% of the workforce and 4 in 10 American households with children under age 18 now include a mother who is either the sole or primary earner for her family.  Yet only 43% of working women have life insurance and their average policy is only about $130,000.  That may seem like a lot, but when you figure that most financial advisors recommend life insurance coverage equal to 7 to 10 times annual income, that amount is pretty small.

A recent double page ad I saw in a women’s magazine placed by a large life insurance company said it all:  The photo of a concerned looking 40sh women with the caption, “Will my family be taken care of?  Will the anxiety about taking care of my family be taken care of?” More…

A rider is a benefit added to a basic life insurance policy.  Most riders require an additional premium, but some may not.  Here’s a synopsis of some of the types of riders that may be available and my comments:

Accelerated Death Benefit

This rider states that if the insured is terminally ill a portion of the life insurance will be paid prior to death.  Any amount pre paid will be deducted from the ultimate death benefit.  The definition of “terminally ill” will vary somewhat from company to company, but usually states that the insured is not expected to live for more than 3 to 6 months.  The amount paid will be a percentage of the policy’s stated death benefit with a maximum.  Typically there is no added charge to include this rider, but it usually must be requested when the policy is applied for. More…

When a life insurance agent assures you that he can do better than a policy you currently own before obtaining all the facts—beware!  If the word “may” is substituted for “can” it’s worth listening to what that agent has to say.  Otherwise it’s likely hyperbole.

The tendency to overstate or bend the truth is not unique to insurance agents.  Take the case of George H.W. Bush who said, “Read my lips:  no new taxes,” and after he was elected went on to raise taxes.  Or, Bill Clinton’s famous, “I did not have sexual relations with that woman,” who…well, you know.

It may not be unusual for a salesperson in the heat of trying to make a sale or for a politician vying for office to overstate, but the truth will come out.  More…

My very first entry referenced a statement purportedly made by Woody Allen, “There are worse things in life than dying.  Have you ever spent an evening with an insurance agent?”  It need not be that bad.  If it is, get another agent.  Here are some things to look for in an agent:

• Does the agent ask many questions before offering a policy for sale?
• Does the agent truly listen to what you have to say?
• Do you feel the agent is suggesting a policy designed for your needs, not just a boilerplate solution?
• Does the agent answer your questions in a straightforward manner?
• Are alternative solutions explored?
• Do you feel at ease with the agent’s demeanor and professionalism? More…