Archive for December, 2007
There are nearly 2000 companies in the US that purport to be life insurance companies. When you work your way through all of the “sort of’s” and “wanna be’s”, and get down to those companies that are serious about the products they offer and their approach to underwriting, the field narrows to maybe 50, at the most. When it comes to narrowing the field down to the serious life insurance companies I can offer a few helpful hints.
- Stay away from property/casualty (car/homeowner) insurance companies. These agents will always be glad to take your money, but the majority truly don’t have a clue that their products aren’t competitive (really, really not competitive), and they don’t understand life insurance underwriting. A little like going to a boat mechanic to get your car fixed.
- Steer clear of life insurance companies that attempt to bulk mail you into submission. Like most bulk mail offers, if they were truly worthwhile, they wouldn’t have to keep mailing it over and over and over.
- Steer clear of advocacy group offerings. AARP is not the senior’s friend when it comes to life insurance. Gerber’s life insurance products aren’t a good deal for your children’s life insurance. The AOPA is padding their own pockets at the expense of private pilots that sign on for their life insurance program.
So, where should you turn? Put as simply as possible, an online independent life insurance agent is your best bet for meeting your needs. They offer all the life insurance products you could possibly want or need. They have the education and experience to help you decide what is appropriate and affordable. They are independent, so they truly have no allegiance to a company, freeing themselves up to represent you 100%.
Bottom line. There are some legitimate reasons to be declined for life insurance, but the majority of declines are the result of your situation being handled by the wrong agent and the wrong insurance company. I’ve seen hundreds of declines turned into reasonable offers. Don’t take a decline as the industry answer to your life insurance needs. Get a second opinion.
December 26th, 2007
Since studying and becoming more active in the life insurance needs of people with mood disorders, it has become apparent that many life insurance agents and companies have a knee jerk reaction to anyone with bipolar disorder. And those knees aren’t jerking in favor of the clients.
I would not be blowing things out of proportion to say that 99% of insurance companies will not even consider life insurance on someone with bipolar. More than 99% of agents don’t even have any idea what bipolar is or what questions to ask. When the agent doesn’t know how to present an impairment to underwriters it will almost always end in a decline.
At the very basic level, those companies that don’t go screaming into the dark at the mention of bipolar want to know that the person is compliant with treatment and is leading a stable life. There is an underwriting difference between bipolar 1 and 2. Bipolar 2 is less debilitating and rarely causes major disruptions in a person’s life. The still have the highs and lows, just not as frequentlty and not to the extreme of type 1.
That is not to say that type 1 is out of control. Type 1 and 2 can both be controlled, in most cases, quite well with medication allowing the patient to lead a reasonably normal life, probably to the point where they and their immediate famiy are the only people who are aware that there is a mood disorder.
Bottom line. Just like any impairment, from a life insurance standpoint, bipolar is viewed through the compliance and control microscope. If a person is taking care of themselves and leading a stable life, there is no reason that very fair rates cannot be attained. If you find an independent agent that continues to ask questions after you mention bipolar, you are probably on the right track.
December 24th, 2007
During this time of year when the focus should be all about family, fun and the joy of having survived another one (year that is), there looms an annual health challenge that can ruin all the plans and hopes of the season.
The Christmas/New Year’s season is also the peak of heart attack season. It’s been known for a long time that the instance of heart attacks is higher in the winter than any other season, but recent studies
have shown a marked increase in and around the holidays.
This should really come as no surprise if you analyze the risk factors for heart attacks and stack them next to the normal Christmas season. It doesn’t seem like a time of year when stress should creep into our lives, but more than any other time of the year, it does. The stress of entertaining, stretching your budget, and if you’re in business, dealing with the stress of year end issues, can all add up.
Add to that the insanity of the Christmas season diet and you’re beginning a cardiac slide. First we all eat more than we normally do during this time of year. On the surface it doesn’t seem like a few weeks of packing it in ought to make that much difference, but consider for a moment what we pack in. Turkey and ham are high fat, high salt foods. Chocolate, while good for us in small amounts, is generally attacked en masse at this time of year. And Baclava seems to have been invented to clog arteries.
Add to that the tendency to celebrate. Yes, a bit more drinking than usual happens in December. When you factor it all together, it isn’t going to stop the heart of someone who starts the season with no cardiac risk factors, but if a person has a few factors working against them already, this can be the push over the edge.
Bottom line. Approach the season with a plan for moderation. All the temptations will be there. They are every year. Take the time to breathe deep, enjoy the love and especially the children. Don’t push things and make this a time of year when your family and I have to discuss the other end of life insurance. Have a blessed Christmas.
December 24th, 2007
Bariatric surgery, such as gastric bypass, has usually been reserved for people who would qualify based on body mass index as morbidly obese. A body mass index of 40 or more qualifies as morbidly obese.
Newer thinking is leaning toward broadening the criteria. While a BMI of 40 or more is certainly one criteria that should be looked at seriously, many doctor believe that overweight people with health issues such as heart disease should be given consideration even if they don’t meet the BMI criteria.
A recent study indicated
that a higher BMI doesn’t necessarily mean a higher chance of heart disease than say, someone with a BMI of 30 might have. The conclusion was that bariatric surgery may be worth considering at lower BMI’s. Current guidelines suggest surgery with a BMI of 40 or more, 35 or more if there is life threatening disease already in place.
Bottom line. Obesity can be the tip of the iceberg with a host of health issues hiding beneath. Health evaluations should be taken even more seriously if you are overweight. Letting things get out of control can often be an irreversible cycle. Life insurance underwriting, while fair, does treat obesity with a deserved seriousness. Whether through bariatric surgery or diet and exercise, weight loss is seen by underwriters as taking control of your lifestyle and stopping a potential health down turn.
December 21st, 2007
I follow Adam Aircraft with particular interest because their planes are built not too far from here in Colorado and also because George Adam is a life insurance client of mine from a time when we (Bill Fanning from the Pilot Insurance Center assisted me) had to fight the insurance companies to accept him at preferred rates even though his, at the time A500, was still experimental.
With the A500 now certified with the FAA and the A700 on something of a fast track for certification, it is safe to say that Adam Aircraft is over that experimental stigma and hump.
Life insurance companies have long had a hang up about experimental and homebuilt aircraft often rating their owners as if they were bush pilots. While the homebuilt planes have not made much gain, factory built aircraft, even though not yet certified, have been getting a little fairer treatment as long as they have shown consistent reliability and are working diligently toward certification.
It seems from an underwriting standpoint that insurance companies are finally recognizing that certification, or lack of, is on a time frame that is simply not controlled by the aircraft manufacturer. This had left many, like Adam Aircraft, in a category that really didn’t reflect the quality level and safety of the airplanes.
Bottom line. Using an independent life insurance agent who understands the challenges that private pilots face can be rewarded with rates that are far better than industry average. While the average agent might come through with average treatment for pilots, preferred and preferred plus rates are available if your agent knows where to go.
December 21st, 2007
There’s that saying about beating a dead horse. Some days I wonder if the saying came about before me or because of me.
Early detection of cancer is so critical to a good outcome, that I will continue to beat the horse, even though it’s dead, in hopes that a few people will get it and schedule those screening tests. Whether it is a mammogram for breast cancer, a PSA test and yes, a DRE (digital rectal exam) for prostate cancer, or a colonscopy for colon cancer, the benefits far outweigh the hassle.
Having your breast smashed or having someone stick their finger or a long probe up your rear isn’t exactly what I would ask for my birthday, but it beats finding out about cancer a little too late. There is a direct and very eye opening correlation between early and late stage colon cancer for instance.
When the difference with colon cancer 5 year survival for stage 1 (early) is 90% and for stage 4 (late) is 5%, I guess it really all comes down to how much you want to live. There are always going to be those that believe they are bomb proof and don’t care about survival rates because they truly believe that only other people get cancer. It is this group that has caused the phenomenon of women rolling their eyes just about every time a guy talks.
Guys, 1 in 6 of us will get prostate cancer before age 70. I have read more than one article that indicates that virtually all of us will have prostate cancer before we die. It’s almost like prostate cancer is a natural part of the aging process. Caught early, the survival rate is awesome. Detected late, it is simply not easy to stop.
Bottom line. Post cancer life insurance underwriting always starts with, “what was the stage and grade?” Early detection improves the treatment options and out come and is directly reflected in how your medical history will be treated when acquiring life insurance. Take the time. Make the effort. Set aside your bomb proof ego and get regular testing.
December 20th, 2007
DCIS (ductal carcinoma in situ) is a form of breast cancer that very rarely progresses to the point where it invades any neighboring tissue or spreads to other parts of the body. DCIS is never life threatening. In fact it is considered to be a precancerous condition.
The most common treatment for DCIS is lumpectomy. In up to 15% of cases where lesions are removed by lumpectomy, breast cancer occurs in the next 10 years. A recent study in San Francisco has uncovered a way to determine, at a molecular level, which women with precancerous DCIS will and which will not develop cancer at a later stage.
This can be enormously important for patients and doctors, not only in helping formulate post lumpectomy treatment or monitoring plans, but also, in most cases, giving the patients some level of confidence that they won’t be facing the challenge again.
As it stands right now, because doctors have not had a way to determine which cases may develop into cancer, standard protocol after a lumpectomy has been treatment with radiation. Many women, because of the unknown, choose to have a radical mastectomy. In a previous post I had talked about the fact that even a mastectomy does not guarantee that there won’t be future breast cancer. With the new ability to determine future changes at the molecular level, many women will be able to confidently sidestep some of the more aggressive treatments.
Bottom line. Catching breast cancer early, as in the case of DCIS, means that life insurance is available sooner and at better rates. With this new testing being able to rule out a future return of breast cancer, underwriters may be able to be even more aggressive in the future.
December 19th, 2007
A little more than 6 years after 9/11, private pilots can once again land at Reagan Washington National airport…………sort of.
The first landing since private aviation was banned into the airport happened today. The pilot was treated to a free wash for his plane as he taxied between two fire trucks that were creating a water arch. But, before you load your suitcase and head off to Reagan, you may want to consider some of the restrictions.
It probably won’t come as any surprise that there’s gonna be some rules. Background checks for all pilots and crew are mandatory. You also have to have an armed security guard, or in some cases an actual federal sky marshall on board. I guess that’s so if you come too close to someplace you shouldn’t, they can just shoot you and end the threat.
No thanks guys. Think I’ll just keep the plane out west and not take chances with an overly zealous sky marshall.
Bottom line. There are some great prices on life insurance for private pilots right now. I have written recently about the return of preferred plus rates for IFR and VFR at least on universal life and great offers on term as well. We’ll see what the underwriters have to say about an armed security guard on your plane. It would be one thing if he was there to protect you, but when his job is to make sure, by whatever means, that you don’t stray into the wrong area, well……
December 19th, 2007
There are times when diet and exercise just never seem to accomplish what’s needed. There are times when morbid obesity becomes life threatening and a radical approach to control the situation is needed.
Bariatric surgery, mostly commonly gastric bypass or lap band surgery, is that radical last choice. When things have gotten so out of control that the obesity is causing other health issues, radical becomes necessary. The good news is that bariatric surgery appears to have a direct positive impact on mortality experience.
I think most would agree that gaining control of weight through diet and exercise is preferable, but when dealing with extreme obesity, the ability to exercise is substantially crippled by the weight and dieting is often a slow arduous undertaking that fails when frustration sets in. With bariatric surgery the diet scenario is removed and the weight loss is dramatic enough that getting down to a weight where exercise is more plausible, happens very quickly.
At that point, keeping control of the vastly improved situation with a regular exercise program becomes far more likely.
Bottom line. Bariatric surgery is never recommended unless obesity is simply out of control. If the surgery can help avoid or control diabetes or heart disease, it can ensure the return of a quality of life that had been lost. When health improves and weight is controlled, life insurance becomes far more affordable. Do keep in mind that for most companies a 1-2 year period of weight stability after surgery is needed before they will accept the weight loss as permanent and give full underwriting favor to the new you.
December 18th, 2007
My recent post about Suze Orman’s lack of life insurance knowledge struck a chord with another life insurance professional, Jack Bobo. While I disagree with the premise of his article “The Tired Tirade Continues” in National Underwriter Magazine, it was refreshing to hear someone other than me with a long history in the business, taking Ms Orman to task for her attempts to dole out oversimplified advise.
Mr Bobo makes his case for whole life insurance by citing a number of instances where the cash value from whole life policies has saved the day. From people who had never been able to save money that suddenly discovered that they had been, by building cash value to Walt Disney using cash value from his life insurance to finish building Disneyland.
There is no doubt in my mind, because I’ve seen it over and over, that if someone buys whole life insurance, there will come a day when they discover that is has cash value and they will use it.
I guess what I wonder rather outloudly is, if a person wasn’t paying those high premiums for whole life insurance, wouldn’t they have money to put into savings? If Walt hadn’t been putting all of his available cash into whole life insurance, is it possible that he would have had even more funds available than what had accumulated in his policies?
Mr Bobo kind of makes the case that if you aren’t buying whole life insurance, you won’t put money aside for a rainy day. That may be true with some people. But if those same people are shown a different way to reach the same objective by an agent who isn’t stuck in a whole life rut, they might just find they have far more cash in their lives than whole life insurance could have ever provided.
Bottom line. If, as Mr Bobo asserts, whole life is a kind of force savings plan, two things come to mind. If a person hasn’t got the ability to budget for a savings plan, what are the chances that their budget for an overpriced whole life policy will work over the long haul? The second thing is, is whole life really the answer for temporary life insurance needs, and if the needs are permanent, shouldn’t they really be addressed with a more cost efficient universal life policy with a no lapse guarantee?
PS. I am not taking Suze Orman’s side. I still think she should go back to insurance kindergarten and start over.
December 18th, 2007
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