• Do I Need Life Insurance If I Have It Through My Employer?

    You probably do. Most group coverages aren’t portable, which means if you lose or quit your job, you also let go of your insurance coverage. Most importantly, group coverage doesn’t offer sufficient protection and typically offers two or three times your yearly income, which by all accounts, isn’t enough. (The recommended amount is 10 times yearly income.) My advice is to get it through your job if it’s free or at a reasonable price and supplement it with life insurance outside your workplace.

  • Do I Need to Buy Life Insurance for My Parents?

    That depends. You should ask yourself these questions first.

    • What is the policy’s purpose? Burial, asset protection, or estate planning?
    • Are you taking care of them?
    • Will you suffer financial loss if they die?
    • Do they have assets you can use to pay for burial expenses?

    If you only need burial insurance for them and you have the money to cover it, or they have enough assets to pay for it, skip the policy and call it a day. You don’t need it. You can also read more here.

  • What Is Universal Life Insurance?

    Universal life insurance, also called UL, is a permanent type of coverage that provides guaranteed death benefit payment to heirs, cash value accumulation on a tax-deferred basis, and the ultimate advantage of flexibility. A portion of your premium payment goes to cover the cost of insurance (COI), and the remainder is parked in a designated account to earn interest.

    Most companies give you three to four different accounts from which to choose based on your comfort level and financial goals. Most coverages are rigid. In essence, term life offers great costs but short duration, whole life provides a lifetime’s protection but with astronomical prices. UL provides the flexibility to skip premium payments or to adjust the face value in the future (increase or decrease) should you want to.

  • What Is Key Person Life Insurance?

    Key person life insurance is protection a business owner can purchase on key employees to cover premature death. A key employee is a valuable asset to a company because he/she holds a special talent or skill that is hard to replace. For instance, if you own a tech company and have a highly skilled developer whose death would essentially cause your business to diminish overnight, you may consider key person life insurance.

  • How Much Does Life Insurance Cost?

    This is probably the most commonly asked question. I hate to disappoint you, but it depends. I need to know your age, gender, tobacco use, family medical history, and current health. Additionally, I need to know the requested face amount and policy type just as a starting point.

    Here is a post I wrote about life insurance sample rates which reveal costs based on age and gender. Keep in mind that if you aren’t in good health, the prices will be inaccurate.

  • Why Do Insurers Ask Me About My Family History? I Thought I Was Applying, Not Them!

    As mentioned before, life insurance underwriters specialize in assessing mortality risks. Unfortunately, some diseases, such as cancer, cardiovascular, diabetes, or stroke found in parents can increase the likelihood of you developing the same conditions. Keep in mind that most companies are only interested in death before the age of 60 of an immediate family member, and you will not be denied coverage if this is the only risk you pose. Instead, you will be charged a higher rate.

  • What Is Mortgage Life Insurance?

    Mortgage protection insurance or MPI is a type of life insurance which pays your mortgage balance in the event of your death. The beneficiary is the lending institution and not your immediate family. Additionally, the face value will diminish over time in direct proportion to your mortgage balance.

  • If I Stop Smoking Today, Will I Get a Non-Smoker Rate?

    Nice try! You probably know that smokers pay two to four times as much as non-smokers do, but this trick wouldn’t work. To get the best non-smoker rate, you must abstain from tobacco for three to five years (each company has a different underwriting guideline).

    Some companies will give you a standard non-smoker rate after one year of abstinence. It’s worth mentioning that you should never lie about your smoking habits to the insurer.