Ed Hinerman On Life Insurance

Women and life insurance!! What is Mellody Hobson thinking?

March 2nd, 2007

On ABC’s Good Morning America yesterday, they called on “financial contributor” Mellody Hobson to offer her thoughts on life insurance for women. After reviewing the article concerning her presentation, which you can find on http://abcnews.com/GMA, the only real common ground I found with her opinion is that women should seriously look at carrying life insurance for essentially the same reasons men should.

Her analogy of term insurance being “similar to a renter” and permanent insurance, whole life or universal life, being “similar to taking on a mortgage of a home” just shows why she is a “financial contributor” and not an indepedent life insurance agent. The whole idea that permanent policies are still used as a cash value accumulation vehicle is out of date and out of touch.

Her statement that the determination of whether to buy term insurance or permanent insurance is best evaluated by looking “at your current financial expenses” would leave a woman to believe that if she has more disposable income, she should buy more expensive insurance. Certainly no one, man or woman, should stretch their budget to the breaking point buying any type of life insurance. The budget will break. But, just because it can be afforded doesn’t mean that permanent insurance is the appopriate choice.

Mellody Hobson contends that “term insurnace is the way to go for women who have to take mortgages or tuition bills into account”. Term insurance is simply the most appropriate life insurance for the majority of needs, not just mortgages and tuition bills.

Her lean toward permanent insurance as the right product for those that can afford it left me wondering if her presentation was going to be followed by a New York Life commercial. Beware the false experts who run amuck on TV. They wouldn’t make it in the real world if they had to present, justify, place and keep in force what they claim to know all about for the sake of the audience.

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Entry Filed under: Independent agent, insurance, life insurance, term insurance, universal life, whole life