5 Reasons Why You Should Get Affordable Life Insurance

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PostPosted: Mon Jul 19, 2010 3:49 pm   Post subject: 5 Reasons Why You Should Get Affordable Life Insurance  

Ever think to yourself that maybe you should get affordable life insurance, but haven't actually yet jumped on that thought and made it happen? A lot of people have considered doing the same. Some have actually tried it. Most others have gotten bogged down with the negatives somewhere and never started.



Hmm. Are they really valid reasons? Did they really consider the positive side? Did we look at the "pro" side or simply the "con" side? Before we let the negatives rule, the positives deserve a reasonable hearing. Let's look at 5 reasons for you to get affordable life insurance sorted out right now, and stop delaying any longer, or procrastinating when actually getting the situation satisfactorily resolved is much easier then you might think.



Lets take a look at those reasons in turn...



1. First, you will be doing your best for your family in an extremely tangible manner, and will no longer be faced with the thought of what will happen to them if you aren't about to take care of them. Sure, I am aware of your objection that you will have to spend out money on this, that times are tough, budgets are tough, and that this is an expense that you could well do without. Yes, this is a valid observation, but look at it this way, If you don't get this sorted out then you will be faced with the prospect of having your family go uncovered and not being able to pay the bills. Not a nice thought. In addition, consider that it is actually much cheaper then you might realise to get this sorted out. And it becomes clear that this isn't a good reason not to act



2. Second, that whilst you may think of life insurance as a luxury, in reality it isn't, and you need to get it just as readily as you would pay for your gas bill. It is simply a normal expense that has to be paid. The primary reason for that could be that you need a slight mindshift in the way you look at life insurance. But nevertheless, you should bear this in mind. Plus it isn't as hard to sort out as you have been told



3. Third, once it has been sorted out then you can forget all about it, and get on with the business of life. And in addition its nice to know that you have done your part in securing the future of your family!



4. Fourth, the range of insurance policies that are available is now much wider, and so you can get whole life insurance, term life insurance or many others. So you can really get one that is tailor made to your circumstances.



5. And Fifth, you can then move onto something more important once you have arranged it. You can get the affordable life insurance cover in under 10 minutes, so it is hardly an arduous process!



Within all of the above info lies a very good group of reasons in favor of getting affordable term life insurance sooner rather than later.



If you look at all the reasons and evaluate them, you will have to admit that a very compelling case can be made for beginning to consider how you can get this particular aspect of your financial affairs arranged, and not have to unduly dwell on it.



Just consider it. Maybe, just maybe, you really, in all seriousness, should get onto the internet right now and at the very least see the wide range of policies that are available, and how they could potentially do a good job of protecting your loved ones.



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PostPosted: Tue Jul 20, 2010 12:17 am   Post subject:   

Quote:
once it has been sorted out then you can forget all about it, and get on with the business of life




Quote:
You can get the affordable life insurance cover in under 10 minutes,




Just read any of the posts wondering who's getting the death benefit when someone dies and never changed the beneficiary . . . and you might begin to realize life insurance is not a get-it-and-forget-all-about-it product.



I'd like to know where someone can get life insurance in force in just 10 minutes. Care to provide an answer to that?



PLEASE!! Learn your craft before you harm someone with your misinformation.


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PostPosted: Tue Jul 20, 2010 2:40 am   Post subject:   

Well, there's two ways to read this person's forum name.



Perhaps it's help you guys like I'm going to help you guys.



Or maybe it's more like help! ...You Guys!

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PostPosted: Tue Jul 20, 2010 9:21 am   Post subject: Life Insurance  

The reality is that there can be a big gap between getting a term life insurance policy that you are only half-hearted about, and getting one that you are totally happy with. So, getting a term life insurance policy that you are totally happy with is a process.

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PostPosted: Wed Jul 21, 2010 3:32 am   Post subject:   

Never knew it was about making someone "happy."



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PostPosted: Fri Jul 30, 2010 2:34 pm   Post subject:   

William . . .



If you are relying on the information in Reasons 3 and 4 above in the original post,



Quote:
once it has been sorted out then you can forget all about it
and
Quote:
you can get whole life insurance, term life insurance or many others




I have to warn you that no insurance policy is a "get it and forget about it" thing. Some policies require that you read your annual statement and understand it to know that you might have to start paying more money each month to keep it going or you will lose it and all the money you paid for it (Universal Life). Others require that you pay close attention to what is happening in your cash accumulation and reallocate your money accordingly, or your death benefit may continue to decrease (Variable Life). Even term insurance, which is probably the easiest to understand of all, is not a get it and forget it product.



We see posts here all the time about beneficiary problems. If nothing else, all life insurance policies require that the owner keep the beneficiary statement up to date. It is probably the single most forgotten aspect of life insurance.



Why? Because someone gave the client the impression that "All you have to do is get it, and then you can return to your happy life. Just pay your money every month and your family will be taken care of."



It's not always as simplistic as that.


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PostPosted: Mon Aug 30, 2010 5:05 am   Post subject:   

Thanks helpyouguys for your informative article.

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PostPosted: Mon Aug 30, 2010 3:02 pm   Post subject:   

Caveat emptor when it comes to the advice from helpyouguys. Notice he/she has not posted anything new since then.


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PostPosted: Mon Nov 01, 2010 10:06 am   Post subject: Choose affordable and right plan  

Quality of cover When you choose a life insurance provider, it’s important to look at the quality of the plans on offer. Most life insurance plans are similar, however there can be differences. For example, one might have exclusions that other insurers don’t, or there might be provisions in the policy that make it simple for the insurer to cancel the cover should they wish to. So it’s vital to check plans side by side to make sure the life insurance policy you choose is quality and doesn’t have unfavorable features.



Financial Stability

Also vital is the financial stability of the life insurer. A way to check this is to compare the financial strength rating (for example the insurer’s Standard and Poors rating or AM Best rating). These will show you that the insurer has a certain level of stability – and also gives you a way to compare insurers against each-other.



Claims

Making sure that the insurer responds quickly and fairly if a claim is needed is another key consideration.

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PostPosted: Thu Nov 04, 2010 1:09 am   Post subject:   

Huh? What variance in exclusions are you referring to? I'd love to see some examples.



Cancelation? Really?



While financial stability is potentially important, it's well worth noting that the life insurance industry has been well known for it's long standing practice of burrying its dead. So while it's good to know my company is safe and secure, I can point to no examples where insolvency has left a beneficiary high and dry.

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PostPosted: Thu Nov 04, 2010 5:28 am   Post subject:   

Quote:
I can point to no examples where insolvency has left a beneficiary high and dry.




If you mean entirely without a death benefit, then you are correct. But beneficiaries have been left with less than the full face amount of insurance when the death claims have been paid by the state Guarantee Association.


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PostPosted: Fri Nov 05, 2010 11:19 am   Post subject:   

Quote:
If you mean entirely without a death benefit, then you are correct. But beneficiaries have been left with less than the full face amount of insurance when the death claims have been paid by the state Guarantee Association.




I know of zero examples of someone not getting paid 100% of a death benefit on a life insurance contract when an insurance company became insolvent. Can you please give us one example.

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PostPosted: Mon Nov 08, 2010 1:55 am   Post subject:   

Max, I wanted to bump this so that we could get a response from you.


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PostPosted: Wed Nov 10, 2010 5:35 pm   Post subject:   

If you mean giving you the name of a specific person, the answer is no, and if I could, I wouldn't, it's unethical.



But, in the failure of Executive Life Insurance Company, I can tell you that death claims were not paid at 100%, but as the State of California continues to receive money from various lawsuits surrounding the whole fiasco, people who received death benefits are continuing to receive little bits of additional money from time to time. And they will likely never see 100% of the policy face amounts.



And that's not the only example. You can do the research yourself to discover the facts. But here's the reality:



When a death claim goes to a Guarantee Association and is paid by the Association (not taken over by another insurance company, which happens frequently), you can believe it will ONLY be paid according to the state laws governing the Association. Unlike other states where the numbers are slightly different, but not much, California's Life and Health Insurance Guarantee Association will only pay a maximum of $250,000 on any one life (and, again, in California, that payment may be further limited to a maximum of 80% of the face amount), UNLESS . . . there are additional proceeds available that, when divided amongst all the claims payable, would allow everyone to receive the same dollar-for-dollar increase (not a percentage increase).



Other states have a maximum of $300,000 (or more, and without the 80% limitation). So if a $500,000 death claim came in to, say, the Colorado Guaranty Association, and it did not have enough money from the liquidation of the insurance company to pay all claims at 100% of the face amount, and it could not find another insurance company willing to take over the claims at 100% (or could not obtain reinsurance to cover the claims at 100%) then, as the National Organization of Life and Health Guaranty Associations (NOLHGA) says on one of its webpages ( http://www.nolhga.com/policyholderinfo/main.cfm/location/questions ):



Are all policies fully protected?



Not always. Like the FDIC, state guaranty associations have maximum benefit limits. These limits are established by state law and can vary from state to state, but most states provide at least:



* $300,000 in life insurance death benefits

* $100,000 in cash surrender or withdrawal values for life insurance

* $100,000 in withdrawal and cash values for annuities

* $100,000 in health insurance policy benefits



The overall benefit “cap” in most states for an individual life is $300,000, although some states have maximums that are much higher.



If my policy values are higher than the benefit limits, do I lose that money?



Not necessarily. The value in excess of guaranty association benefit limits is eligible for submission as a policyholder claim against the estate of the failed insurance company, and the contract holder may receive distributions as the company’s assets are liquidated by the receiver.





And here's what the actual Colorado statue (10-20-104) states (in pertinent part):



(3) The benefits for which the association may become liable shall not exceed the lesser of:

(a) The contractual obligations for which the insurer is liable or would have been liable if it were not an insolvent insurer; or

(b) (I) With respect to any one life, regardless of the number of policies or contracts with that insurer:

(A) Three hundred thousand dollars in net life insurance death benefits, and no more than one hundred thousand dollars in net cash surrender and net cash withdrawal values for life insurance;

(B) For health insurance benefits: One hundred thousand dollars for coverages not defined as disability, basic hospital, medical and surgical, or major medical insurance, including any net cash surrender and net cash withdrawal values; three hundred thousand dollars for disability insurance; or five hundred thousand dollars for basic hospital, medical and surgical, or major medical insurance;

(C) One hundred thousand dollars in the present value of annuity benefits, including net cash surrender and net cash withdrawal values; or

(D) With respect to each payee of a structured settlement annuity, one hundred thousand dollars in present value annuity benefits, in the aggregate, including net cash surrender and net cash withdrawal values.

(II) The association shall not be liable to expend more than three hundred thousand dollars, in the aggregate, with respect to any one life under sub-subparagraphs (A) to (D) of subparagraph (I) of this paragraph (b); except that, with respect to benefits for basic hospital, medical and surgical, and major medical insurance under sub-subparagraph (B) of subparagraph (I) of this paragraph (b), the aggregate liability of the association shall not exceed five hundred thousand dollars with respect to any one individual.

(4) The liability of the association is strictly limited by the express terms of such covered policies and contracts and by the provisions of this article and is not affected by the contents of any brochures, illustrations, advertisements, or oral statements by agents, brokers, or others, used or made in connection with the sale of such covered policies and contracts. The association is not liable for any extracontractual, exemplary, or punitive damages, attorney fees, or interest other than as provided for by the terms of such covered policies or contracts. (emphasis added)





So, tell me what YOU think it means? This last paragraph says, to me, no matter what anyone else thinks or says, the limits are the limits unless we can find additional money from the liquidation of the insolvent insurance company to pay more money to each claimant. Because that's the truth.



For additional help in understanding what the Guaranty Associations are all about, and how things might work out, get the PDF from NOLHGA at this address:



http://www.nolhga.com/resource/file/2009GABrochureFINAL.pdf



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PostPosted: Wed Nov 10, 2010 6:22 pm   Post subject:   

Quote:
And that's not the only example. You can do the research yourself to discover the facts. But here's the reality:




Max, I'm asking the question because in my research, I have failed to find any examples of a person not getting 100% of their life insurance death benefit due to an insurance company insolvency.



If you can't point us to a person, how about pointing to an article or a court case, or anything? I'm not claiming that it can't happen. I simply can't find an example of this ever happening.



So, according to my research, I'm correct. If your research shows differently, let us know. Many life agents believe exactly what I believe. "All death claims of Executive Life were paid 100%."



If I'm wrong, that's fine, but I want to know. Please show me that I'm wrong. I would greatly appreciated it. If you can't, just let me know that.

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