Life Insurance

no prob..

it all depends on your situation. if the house your living in cost 1.5mil to payoff that leaves 750k for each and the child has many years left. plus you have to figure C.O.L. increases into the equation. so going back to our example if a healthy 26 year old pays $250mo. for 2 mil of no lapse life insurance and dies at age 82, they paid in 162k and the policy paid 2mil of a GUARANTEED TAX FREE death benefit. I don't know of any guaranteed investments that have that kind of return.

 

 

That is a better return than I would have expected. Every financial planner I have ever talked to has also said to buy term and invest the difference. Thank you for the education. Back to your healthy 42 year old example, how much would a guaranteed $5mil policy cost?

 

 

that's exactly right. like I said earlier you NEVER want to buy a VUL or UL that does not have a lifetime guarantee or no lapse rider. back in the 80's agents sold UL/VUL based on current interest rates/cash values and when interest rates dropped $hit hit the fan and carriers were increasing premiums causing policies to lapse. with a no lapse product premiums/death benefit are locked in forever no matter what happens. (and backed by D.O.I. in most cases)

 

 

I see what you are saying. Makes good sense to me.

so going back to our example if a healthy 26 year old pays $250mo. for 2 mil of no lapse life insurance and dies at age 82, they paid in 162k and the policy paid 2mil of a GUARANTEED TAX FREE death benefit. I don't know of any guaranteed investments that have that kind of return.

Me neither!! How does the insco make any profit with a policy like that?

 

Me neither!! How does the insco make any profit with a policy like that?

 

My guess is they bet one policy holders missing payments, making the policy void. Once policy is voided, they revaluate the individual and premiums go up.

I think there are several problems with life insurance. Most of them are the salespeople. To buy the correct life insurance you have to first off determine why you are getting this. How much you need, how long you need it for, and set realistic goals of where you will be financially.

 

for example. You said you are 30. Lets assume you have kids that are 2 and 5. In 20 years they will be 22 and 25. Is the purpose of your life insurance policy so that they can hit the lottery when you die? or is it so that your family can go on living their existing lifestyle without change? At 22 your kids might still be in college.

 

Everyone on here plans to save up millions in their own 401K, personal savings and everything else, it doesn't always pan out that way. What happens when you get that 20 year policy at 30 and die at age 53? Policy is now expired, wife has another 30 years of living. How much is it going to cost for her to live for 30 years or more?

 

Also when you think about insurance, I am the bread winner, if I die, my wife has no income, if she dies, I now don't have someone buying Louis Vuitton all the time, and other expensive stupid shit. Hell I hate to say this, but if she died, I would have WAY more money. People will argue that I now need to pay for day care, nanny, etc. That is true, but it is way cheaper, than my current costs. We gave my wife a $25K policy and it all goes to her adult son.

 

I have several policies with different terms bought at different times. I have also bought from different companies. What if you need $3Mil in term and you get it all from one company. You get in a car wreck and that company determines you have been racing and you get nothing. Maybe if you had split it up with 3 companies than 2 would pay out and 1 wouldn't.

 

I have several term policies expiring at different times, got a 20 when I was 30 got a 30 when I was 35, got a 20 when I was 40 (mainly because we just had 2 young girls that we weren't planning on).

 

I have looked at some Whole life, Universal life, and many other, the premiums were VERY high and yes you keep the equity, but if you could rent a lambo for $50 a month why would you pay $3000 a month to buy it. It would take SOOO many months for it to make sense. I would be interested in getting more information on the long term life policies, but so far they have never made any financial sense to me. My CPA was trying to get me into a $30Mil whole life policy as a sort of tax deduction, I thought it was totally stupid. Oh BTW, his son was the one who would sell me the policy.

My guess is they bet one policy holders missing payments, making the policy void. Once policy is voided, they revaluate the individual and premiums go up.

that's exactly right. most of the profit comes from the term policies that either lapse early by missed premium payments or short term policies that expire ex.5-15 year policies for mortgage protection, loan protection required by banks etc.. its just a numbers game for the company. the larger the pool of policies the larger the profit is.

some of the permanent products are actually losers for the carrier, because they all have to pay sooner or later.

I have a half million dollar policy where I put in $5k a year into. MassMutual.

I think there are several problems with life insurance. Most of them are the salespeople. To buy the correct life insurance you have to first off determine why you are getting this. How much you need, how long you need it for, and set realistic goals of where you will be financially.

 

for example. You said you are 30. Lets assume you have kids that are 2 and 5. In 20 years they will be 22 and 25. Is the purpose of your life insurance policy so that they can hit the lottery when you die? or is it so that your family can go on living their existing lifestyle without change? At 22 your kids might still be in college.

 

Everyone on here plans to save up millions in their own 401K, personal savings and everything else, it doesn't always pan out that way. What happens when you get that 20 year policy at 30 and die at age 53? Policy is now expired, wife has another 30 years of living. How much is it going to cost for her to live for 30 years or more?

 

Also when you think about insurance, I am the bread winner, if I die, my wife has no income, if she dies, I now don't have someone buying Louis Vuitton all the time, and other expensive stupid shit. Hell I hate to say this, but if she died, I would have WAY more money. People will argue that I now need to pay for day care, nanny, etc. That is true, but it is way cheaper, than my current costs. We gave my wife a $25K policy and it all goes to her adult son.

 

I have several policies with different terms bought at different times. I have also bought from different companies. What if you need $3Mil in term and you get it all from one company. You get in a car wreck and that company determines you have been racing and you get nothing. Maybe if you had split it up with 3 companies than 2 would pay out and 1 wouldn't.

 

I have several term policies expiring at different times, got a 20 when I was 30 got a 30 when I was 35, got a 20 when I was 40 (mainly because we just had 2 young girls that we weren't planning on).

 

I have looked at some Whole life, Universal life, and many other, the premiums were VERY high and yes you keep the equity, but if you could rent a lambo for $50 a month why would you pay $3000 a month to buy it. It would take SOOO many months for it to make sense. I would be interested in getting more information on the long term life policies, but so far they have never made any financial sense to me. My CPA was trying to get me into a $30Mil whole life policy as a sort of tax deduction, I thought it was totally stupid. Oh BTW, his son was the one who would sell me the policy.

 

some of the info you were told is 100% incorrect. ex.no matter how you die (after the 2 year contestability period) the carrier has to pay the claim. as long as you are 100% honest when filling out the app you will never have a problem

 

from LIMRA article.... "AFTER TWO YEARS, the policy is said to be “incontestable”. You can die any way want (including suicide), and the insurance carrier still has to pay out. I read about a case recently where a person with HIV successfully purchased a life insurance policy.

He was able to do so by lying on the application about his condition, and having a friend show up for the medical exam, giving blood and urine in his place. When he died four years later, even though he had committed fraud, the insurance carrier had to pay out" (criminal charges might follow)

 

I agree some life sales guys are only worried about commissions, but I think you will find this with any commission driven business. there are still a few good agents that put clients before comp.. lol we have 5k+ agents across the country and some still put their clients before commissions.

you also have to realize, there are thousands of products to choose from and some are very over priced and pay HUGE commissions. but a portion are very consumer friendly where the agent doesn't make much. a good agent should show you both types.

as far as your CPA pitching life ins and having his son make the sale. that is 100% a conflict of interest IMO

I have a half million dollar policy where I put in $5k a year into. MassMutual.

great carrier and sounds like a WL plan. savings account + death benefit

without knowing all the details, this seems like a smart decision.

some of the info you were told is 100% incorrect. ex.no matter how you die (after the 2 year contestability period) the carrier has to pay the claim. as long as you are 100% honest when filling out the app you will never have a problem

 

from LIMRA article.... "AFTER TWO YEARS, the policy is said to be “incontestable”. You can die any way want (including suicide), and the insurance carrier still has to pay out. I read about a case recently where a person with HIV successfully purchased a life insurance policy.

He was able to do so by lying on the application about his condition, and having a friend show up for the medical exam, giving blood and urine in his place. When he died four years later, even though he had committed fraud, the insurance carrier had to pay out" (criminal charges might follow)

 

I agree some life sales guys are only worried about commissions, but I think you will find this with any commission driven business. there are still a few good agents that put clients before comp.. lol we have 5k+ agents across the country and some still put their clients before commissions.

you also have to realize, there are thousands of products to choose from and some are very over priced and pay HUGE commissions. but a portion are very consumer friendly where the agent doesn't make much. a good agent should show you both types.

as far as your CPA pitching life ins and having his son make the sale. that is 100% a conflict of interest IMO

 

 

I know about the lying on the application, but they asked if I ever raced and I said no. I mean I wasn't racing that day was I? I know that after 1 or 2 years they have to pay you on the suicide, but I could just see them trying to fight it and my wife just doesn't have the ability to deal with it, so it was a just in case thing.

 

I wouldn't mind talking to you more about some of the other policies at a later time.

I know about the lying on the application, but they asked if I ever raced and I said no. I mean I wasn't racing that day was I? I know that after 1 or 2 years they have to pay you on the suicide, but I could just see them trying to fight it and my wife just doesn't have the ability to deal with it, so it was a just in case thing.

 

I wouldn't mind talking to you more about some of the other policies at a later time.

lets say they asked a question about racing on the app and you answered no and then 5 years later you die street racing. the company has to pay the claim.

now lets say you race every Friday night at the local moroso race track and you answer the question no.

and you die 1 year later racing at moroso. the carrier would have to prove that you were racing the time the app was taken. if they had black and white proof, they can contest the claim and return premiums that were paid into the policy.

 

now lets say you weren't racing the time the app was taken and you decided to start racing 3 months later and died 6mos later. the company has to pay the claim. (as long as they couldn't prove you were racing at the time the app was taken)

 

I always suggest being honest when answering the questions and you will never have any problems.

no problem, let me know if you have questions...

also keep in mind, even if you tell the underwriter that you do track days once a month that doesn't mean you will get declined. it just means you might get dropped a class. ex. preferred instead of preferred best etc..

Great info in here and book marking for later. Bill can you do business in PA?

Great info in here and book marking for later. Bill can you do business in PA?

thanks and yes i am licensed in every state in the U.S.

also keep in mind, even if you tell the underwriter that you do track days once a month that doesn't mean you will get declined. it just means you might get dropped a class. ex. preferred instead of preferred best etc..

CAN YOU EMAIL ME PLEASE A BREAK DOWN OF OPTIONS I WAS THINKING OF BUMPING UP , I MADE SOME INVESTMENTS BUT I WILL CASH THEM OUT AND ENJOY SOME RELAXATION IN MY FUTURE YEARS (NOT YET HA) MY PARENTS BOTH PASSED YOUNG AND NO LIFE INSURANCE, I HAVE WORKED TO GET HERE!! NOT THAT IN DONT WANT MY KIDS TO BE GO GETTERS HOWEVER IT WOULD BE NICE TO KNOW MY FAMILY IS STRESS FREE IF THE BIG MAN TAKES ME AS EARLY AS MY PARENTS [email protected] IM IN NJ

THANKS

STEVE

CAN YOU EMAIL ME PLEASE A BREAK DOWN OF OPTIONS I WAS THINKING OF BUMPING UP , I MADE SOME INVESTMENTS BUT I WILL CASH THEM OUT AND ENJOY SOME RELAXATION IN MY FUTURE YEARS (NOT YET HA) MY PARENTS BOTH PASSED YOUNG AND NO LIFE INSURANCE, I HAVE WORKED TO GET HERE!! NOT THAT IN DONT WANT MY KIDS TO BE GO GETTERS HOWEVER IT WOULD BE NICE TO KNOW MY FAMILY IS STRESS FREE IF THE BIG MAN TAKES ME AS EARLY AS MY PARENTS [email protected] IM IN NJ

THANKS

STEVE

smart/responsible thinking!

yes ill shoot you an email.