Life Insurance

[summer2007]

I want to get a life insurance policy on myself. It's something that I have thought about for years but I never went through with it.


I'm in my 30's and I I'm totally clean living...I never smoked drank or did drugs and I'm thin. So I think I should qualify for preferred status.

I'm just looking for suggestions on good companies to look at buying a policy for myself through.

Jim

 

[73ss454]

What's the reason for the LI, are you married with kids?

Only buy term, I bought a few whole life policies and they all ended up in litigation.

 

[OAG]

USAA gets my vote - and ONLY TERM.

 

[Bimmerbill]

USAA had good rates and it was pretty smooth for me. I just picked up $500K thru them for 20 year term for $38 a month. Watch out, they try to upsell a child rider tho.

I called a few weeks ago to bump it up to $750K since I cancelled my insurance thru work (FEGLI) and have not heard from their med company. I guess I need to call them and complain.

 

[ziggy29]

What's the reason for the LI, are you married with kids?

If you expect you might be some day, you may want to lock in a term policy while it will be very cheap and you know you can get the best rates. Normally single people with no dependents don't need life insurance, but if you want to protect against becoming uninsurable in the future even as you may have a new family that needs you to be insured, it may be cheap insurance (pun intended).

 

[summer2007]

Thanks Everyone

I will look into USAA

One of my big wake up calls was when I was at a funeral for a guy that was a year younger than me. One of the guys I was talking to at the funeral home says to me "can you believe this guy did not have life insurance!" I told him I didn't have life insurance either and he said "you should".

Jim

 

[normaldude]

I think USAA is only for military people.

I posted this on another message board..

In this recession and credit crunch environment, I'd stick with the safest, AAA-rated life insurance companies (rated by S&P/Moodys/AMbest). Among the ones that deal with the general public, I know of..


- New York Life / newyorklife.com - AAA/Aa1/aaa
- TIAA-CREF.org - AAA/Aaa/aaa
- Northwestern Mutual Life Insurance / Nmfn.com - AAA/Aaa/aaa


You wouldn't want to pay for a life insurance policy from a shaky company, and then watch them go bankrupt.

 

[jug]

Thanks Everyone

I will look into USAA

One of my big wake up calls was when I was at a funeral for a guy that was a year younger than me. One of the guys I was talking to at the funeral home says to me "can you believe this guy did not have life insurance!" I told him I didn't have life insurance either and he said "you should".

Jim

Out of curiousity, what state are you in, and how old are you.

The purpose of Life Insurance is to take care of others. If you have no dependents that would be in financial dire straights, or do not intend to be in such position, then it is not necessary.

Also, term is the best deal, cheap when you are younger, goes up every 5 to 10 years. The thing is, when you approach retirement age, the kids are gone, so less insurance is needed, maybe just for a spouse.

Whole life, universal, and such are a bit confusing and incorporate a cash buildup plan are more expensive. You can buy term much cheaper.

As for the company, it really doesn't matter who you go with, since most states have a guarantee fund if the company goes broke but in most cases the state insurance department will merge a weaker company into a stronger one. It's very very rare for a life company to go broke. OK I know, AIG, but even in these dire circumstances you hear nothing about AIG's life policy holders being in danger.

Jug

 

[normaldude]

As for the company, it really doesn't matter who you go with, since most states have a guarantee fund if the company goes broke

1) States can go broke. And unlike the federal government, the individual states can't print money to pay off their debts.

2) State insurance guaranty levels vary, but most cover $300,000 of life insurance death benefits. If you want more than $300,000 in life insurance coverage, it may make sense to get two policies, each under $300,000.

It's very very rare for a life company to go broke.

3) It's also very rare to have a national housing market crash. We're entering a very rare & unusual economic time period.

 

[Koolau]

Good advice I see so far is basically to decide WHY you want LI. That will help you decide what kind and how much.

I'm a bit of a heretic here. While term is definitely the cheapest way to go (pure insurance without any cash-value component) it is not flexible like some of the other types. If you don't yet know which way your life is headed (kids, house, career, retirement date, etc.) flexibility may be more important than the lowest price. DO research companies and plans.

Agree that NOW is the time to get at least SOME LI while you qualify for best rates. Personally, I had term through my employer (gone at retirement) but also had $200K between DW and I in universal. The cash value portion has grown as much as most of my other cash-like investments, so don't look at it as a major blunder. Thank goodness I didn't need it but it sure felt good to have the coverage while the kids were still dependent upon us. Now that they are on their own, I look at the insurance as a way to fill in the gaps in DW's survival plan if I die first.

Also, I can borrow against the policy anytime I need cash - suspenders, belt, elastic waist band, heh, heh.

 

[normaldude]

Mar 10, 2009 -- What happens when a life insurer fails?

What happens when a life insurer fails? Unlike banks, insurance companies are regulated at the state level -- not the federal level. A state guarantee association is the last line of defense in the event of a failure.

Unfortunately, state guarantee associations often mean that policyholders are left waiting and wondering if and when they'll get their money back. There often isn't even a clear-cut timeline about anything, according to Clark.

In the latest example, Shenandoah Life recently failed and is now in receivership after being seized by the state of Virginia.

Clark's longstanding advice is to only buy life insurance or long-term care from insurers that are rated A++ by A.M. Best. Well, Shenandoah Life had a B++ rating!

Don't be tempted by low premiums when you're shopping around. Stick with insurers of top strength -- even if you have to pay more for it.

Finally, there are caps on the protection you can receive under state guarantee associations that vary from $100,000 to $300,000 by state. So if you're going to buy substantial insurance or annuities, be sure to have it split up with different insurers to be proactive about protecting yourself.

What happens when a life insurer fails? on clarkhoward.com

 

[GatorBuzz]

My wife and I have term policies through USAA. If you can't join USAA, I'd look into SelectQuote. They are a sort of clearinghouse for several major life insurance companies. They look at all your history, do the medical check up, etc. and then tell you which company would have the best rates for you. I didn't use them, but a couple friends did and were happy with the service. Here is their website: Term Life Insurance | SelectQuote

Obviously, you'll want to research the companies they recommend, but most of the insurers they work with are big or well known companies, for whatever that's worth.

 

[kaneohe]

I think USAA is only for military people.

Unless they've changed their policy, I don't think this is true. I have both life insurance and investments w/ them.

 

[REWahoo]

I think USAA is only for military people.

Unless they've changed their policy, I don't think this is true. I have both life insurance and investments w/ them.

From the USAA website:

Who is eligible?

Membership is open to:

• Active-duty officers and enlisted personnel.
• Children whose eligible parents have or had a USAA auto or property insurance product.
• National Guard and Selected Reserve officers and enlisted personnel.
• Officer candidates in commissioning programs (Academy, ROTC, OCS/OTS).
• Former military personnel:
  
  • Retired officers and enlisted personnel.
  • Former officers and enlisted personnel who separated from the military on or after Jan. 1, 1996.
• Former USAA members who had USAA auto or property insurance.

 

[ziggy29]

Unless they've changed their policy, I don't think this is true. I have both life insurance and investments w/ them.

I believe anyone can use their banking and investment products, but you need to qualify for their insurance products. I was eligible because my dad (ex-Air Force) was once insured with them.