Archive for July 20th, 2007
It occurred to me after reading a study that many retired people might be missing an opportunity to increase their inheritance without any investment risk.
This study indicated that the majority of retired people die with significant cash assets untouched. Whether that is in annuities or just left in a bank, there is cash that is going to their heirs because they just didn’t need it. The study also indicated that many retired people who are still around can identify large amounts of cash that they know they know they won’t need in their life time.
For the sake of this thought, let’s say that the amount of cash they have that fits into this category is $50,000 (the average was actually much higher than that). What if, rather than letting that sit around making 5% interest, you put the money into a single pay universal life policy. Depending on your age and health it might buy $150,000 or more of life insurance. The policy is guaranteed, so once that premium is paid the policy will absolutely stay in force with any further payments until your death. Upon your death it will go to the beneficiaries income tax free.
Bottom line. Evaluate your assets and see if they wouldn’t be more valuable as a way to buy life insurance than as an anchor in an investment account. Worth a thought!
July 20th, 2007
The life insurance industry has had a love/hate relationship with private pilots going way back.
Most of the companies hate to insure them. A handful love to insure them.
For most insurance company’s underwriters there must be this sense that the only way a small airplane can come down is nose first. Somehow they have forgotten that the airplanes have wheels and even if the wheels give way, most of the time they seem to slide to a pretty painless stop.
If you are a private pilot and have shopped for life insurance, you know that it can be tough hunting out there. This is one area where there is no doubt that being in the hands of an independent agent with aviation underwriting experience is a must. How do you tell if they have experience? As with most health issues, if you tell an agent that you are a private pilot and they don’t ask a lot more questions, relevant questions, you’re probably on the phone with the wrong person. You can alway ask what percentage of their clients are pilots. If the agent doesn’t know what to ask and where to place the business, he won’t end up with many pilot clients.
Be aware that most companies that are pilot friendly still have guidelines that they want to see met. They want to know that you are flying enough, not just to keep your rating current, but to keep your skill level current. What they are a little leary of is someone who is only flying 5-10 hours annually. Most companies want to see a minimum of 26 hours annually. There can be a little give in that requirement depending on total hours. The more experienced you are, the more you might be able to get an exception if you only flew say 20 last year.
Most companies will only allow flight in certified aircraft for their better rates. Helicopters and experimentals almost always incur a flat extra although there has been some loosening of the noose on that one in the last few years. Some of the experimentals that have been around for a long time and have a great track record, like the Vans RV series, have been getting favorable underwriting. A few companies have loosened up on helicopters as long as it is for private use only. Again, an independent agent with aviation underwriting experience will find that favorable rate. Your State Farm agent won’t. Selectquote won’t.
One area where we haven’t made a lot of progress is our friends in Alaska who think any spot on the ground wide enough to fit an airplane or any sandbar in a river that doesn’t have a bear on it, is an airstrip. But we work on those underwriters all the time. We may yet see a breakthrough there one of these days. Until then, be careful out there!
Bottom line, private pilots, can get great rates as long as they pick the right agent to shop with.
July 20th, 2007
While the word cancer mostly causes distress to the average life insurance agent, many independent agents are well educated and connected to help survivors of breast cancer and many other types of cancer find affordable life insurance.
The key for you as a consumer and for the agent you choose, is knowledge of the specifics of the cancer. Through all the trauma of diagnosis and treatment, many types the small details are not remembered. It is these details that can help you to once again beat the odds and end up with good insurance rates.
With breast cancer the most important underwriting information, which also is the information needed to get initial insurance quotes that you can count on, is the stage and grade of the cancer, the treatment specifics and a post treatment pathology report. Armed with this information a good independent life insurance agent has the best possible chance of obtaining agressive (low) quotes and ultimately an approved policy that is the same as the quotes.
Staging of breast cancer has been made rather intimidating by all the variations. This is how the American Cancer Society explains breast cancer staging.
“The T category describes the original (primary) tumor. The tumor size is usually measured in centimeters (2 and 1/2 centimeters is about 1 inch) or millimeters (10 millimeters = 1 centimeter.)
- TX means the tumor can’t be measured or evaluated.
- T0 means there is no evidence of primary tumor (the primary tumor cannot be found).
- Tis means the cancer is in situ (the tumor has not started growing into the structures around it).
- The numbers T1–T4 describe the tumor size and/or level of invasion into nearby structures. The higher the T number, the larger the tumor and/or the further it has grown into nearby structures.
The N category describes whether or not the cancer has reached nearby lymph nodes.
- NX means the nearby lymph nodes can’t be measured or evaluated.
- N0 means nearby lymph nodes do not contain cancer.
- The numbers N1–N3 describe the size, location, and/or the number of lymph nodes involved. The higher the N number, the more lymph nodes are involved.
The M category tells whether there are distant metastases (spread of cancer to other parts of body).
- MX means metastasis can’t be measured or evaluated.
- M0 means that no distant metastases were found.
- M1 means that distant metastases were found (the cancer had spread to distant organs or tissues.)”
The good news is that for life insurance purposes you really won’t have to understand or memorize all of this information. It is all contained on the post treatment pathology report. Supply a copy of the report to your agent.
The grading of the cancer is a bit less onerous, but just as important. Again, the American Cancer Society provides a synopsis of the different grades.
“The American Joint Committee on Cancer (AJCC) recommends the following cancer grading classifications:
- GX: Grade cannot be determined
- G1: Well-differentiated (the cancer cells look a lot like normal cells)
- G2: Moderately well-differentiated (cancer cells look somewhat like normal cells)
- G3: Poorly differentiated (cancer cells don’t look much like normal cells)
- G4: Undifferentiated (the cancer cells don’t look anything like normal cells)
The lower the cancer grade the better the prognosis. G1 cancers are linked to the best outcomes. G4 is associated with the worst outcomes and the others fall in between.”
Bottom line. Get a copy of your pathology report and know that as a breast cancer survivor you can also join the ranks of life insurance underwriting survivors.
July 20th, 2007
My grandfather used to do that. He would smoke them and chew them and spit and……well, he had a nicotine habit. Use of nicotine with life insurance companies is a pretty clear cut issue. If you use it, you are in the same rate class as a cigarette smoker. There are a few exceptions to that rule.
Some companies will allow an “occasional cigar” and not punish you. They might define that as not more than 4 a year, some might say no more than 1 a month. One company stands out on this issue as the only company that will allow cigar smoking at non smoking rates with no requirement for occasional use or lack of nicotine in your labs.
Just to give you an idea what that might mean in rates, if you got the best possible smoking rate on a 54 year old male for $500,000 of 20 year term insurance, you would pay $4055.00 annually. If you have an independent agent who knows where to take your cigar habit you could pay $2285.00 annually for the same policy.
This also happens to be a company that stands out as a giant for private pilots and prostate cancer survivors. You may have read my post last week concerning Prudential and their stance on sleep apnea. Prudential, it seems, is one of the last hold outs for sane underwriting.
Bottom line. Have your cake and eat it too if you happen to enjoy more than an occasional cigar.
July 20th, 2007
