THERE IS NO WAY TO LOSE THIS MONEY BEFORE YOU DIE
There is no way to lose this money before you die.
If you were given that assurance by someone offering you a financial product, would you take it?
It’s funny how many of us don’t. Why not?
- We want a bigger return and are willing to incur risk.
- We think we have saved up enough to pay our bills, leave something to our kids, pay the estate taxes, and/or enable our business partner to buy our share of the business.
- We think we are going to be able to keep earning until we retire, and that our nest egg will carry us through retirement until we pass.
- We assume our spouse/children will be capable of earning a decent income if we predecease them.
- We assume our medical insurance will cover whatever treatment we need and not leave us destitute.
- We don’t figure the impact of rising taxes on our investments and savings.
- We just really don’t like to think about it.
What is this financial product that is assured to pay out the money when you die?
IT IS LIFE INSURANCE
Caveat: Premiums payments must be current, or you must have a paid up policy, to collect the death benefit at time of death. Also, if death occurs during the first two years (the contestability period), the insurance company may review your medical records to assess whether the application was filled out without errors or omissions that would have affected eligibility.
Yes, I know there is skepticism. I will try to address some of that here.
What if the insurance company goes broke?
- According to the Journal of Risk and Insurance, the maximum aggregate loss to policyholders during the Great Depression was less than .006% (six tenths of one percent). Compare this to 4% losses of ALL bank deposits during the Great Depression, with nearly 10,000 banks failing.
- A safety net is provided my NOLHGA in most states. It does not cover all face amounts.
- Nothing is completely safe, not even hiding your money under your pillow. But insurance companies are highly regulated and do have a good track record for safety.
I don’t trust the insurance company to pay my claim.
- There are only a couple reasons a life insurance company can refuse to pay a claim (see my caveats above). Most life insurance companies bend over backwards to get the death benefit to the Beneficiary upon death of the Insured.
- Rating services such as AM Best, S&P, Moody’s and Weiss rate insurance carriers on their customer service and claim paying abilities, so you can review the carrier ahead of time for their history of claim payments.
If I buy Term insurance, I won’t get anything back on my money.
- Term life insurance is pure risk protection. It is not intended to accumulate cash value. However, even permanent policies such as Whole Life and No Lapse Guaranteed Universal Life allocate part of your premium to pure risk. Term insurance generally costs less because it does not charge more to build up money within the policy. Both Term and Permanent life insurance are good choices, depending on your needs and budget.
- If you have an active Term life insurance policy and pass away during that time, your beneficiary will get back your money. And most likely, they will get much more than you paid in. Granted, some graded Term policies can end up costing more than they pay out, over the course of many years. But most people pay far less in premiums than their Term policy pays out in the case of untimely death.
Life insurance is too invasive / too much work / too annoying / too expensive
- It has never been easier to compare life insurance costs than in this internet age. Digital applications also sometimes make it easier to apply. The proliferation of online life insurance agencies has also benefited local agents through this increased awareness. Yet that same desire to get instant information can be an impediment to actually purchasing life insurance.
I have had several calls from family members who saw that their loved one had contacted me for a life insurance quote. With hopeful voices, they asked whether that policy was purchased. It was terribly difficult to tell them that he/she had not continued the application process. And I would never be so heartless to tell them that the reason was not expense; it was not wanting to put forth the time it took to do it.
Try taking out a $500,000 loan these days. You will sign a stack of papers a mile high. Yet many people think getting a $500,000 life insurance policy (a benefit that the beneficiary never has to pay back!) should include an application that does not ask any personal questions or be more than a page long. That rationale may make a person feel better about not buying a policy, but it certainly does not do anything for their loved ones when they pass.
Q: Why is Life Insurance is the most likely source to provide money to your survivors when you pass?
A: Because it does not pay out until you pass.
Think about it.
Get your free quote at www.outlooklife.com or call 866-866-0242. We will make sure you get something in place and make the process as comfortable as possible.