My husband doesn’t want to get , he thinks it is a waste and a scam. But if something should happen to him, me and the kids would be SOL. How do I get for us? How do I know the co. will actually pay if something does happen? Are there ways to write the policy so to protect us better?

 

  • Chris C 5:03 am on February 10, 2010

    Yes, Life insurance does pay. As long as it’s in force at the time of death. There are certain Life insurance products (IE: Group insurance through an employer or creditor insurance bought through a lender to protect a mortgage or loan) that are shady products that have a history of not paying due to preexisting conditions. If you buy an individual policy through a licensed insurance broker it will pay if it’s in force at the time of death and as long as it doesn’t fall under an exclusion (act of war, suicide within the first couple years, etc).

    The best way to make sure a company will pay is to do your research on websites like ambest.com or others and/or go through a broker. A broker can shop around and make recommendations on what companies are good and which are not.

    PS: Gaythiest has absolutely no clue what he is talking about when it comes to whole life insurance. Whole Life insurance is not an investment. Many "buy term and invest the rest" people will spout off this factless crap, when it’s clearly not true. Whole Life costs a little more than Term because it’s meant to last your whole life and is more likely to pay out than term insurance (studies have shown that less than 3% of term polices ever actually pay out due to the policies getting cancelled by the insurance company or client long before the client passes away)…the extra premiums for whole life in the early years offset the higher premiums in the later years…the years when term insurance premiums grow exponentially if you end up having to renew it. If you do the math most whole life policies will work out to be cheaper in the long run compared to term insurance (over a 25 year or longer period). Universal Life is the hybred of term and an investment, not Whole Life…there is a difference between the 2! Also, with regards to commissions, the commission structure is the EXACT same with most companies for whole life and term. Using the "greedy advisor getting more commissions" BS is like saying "buying a Lexus is a ripoff becuase the salesman gets more commissions compared to buying Honda…that’s why it’s more expensive" complete utter nonesense! Whole Life insurance has more features and is the better product when it comes to making sure it’s there when you need it to pay out. That’s why it’s a little more expensive. I’m not saying you need to buy whole life, but whole life and term insurance both have specific uses and neither should be used as a one size fits all approach! Make sure you get the facts from a broker that sells and understands both products…not just a one trick pony that will squeeze a sqaure peg into a round hole.

  • Gaytheist Buddha 5:03 am on February 10, 2010

    Term life is a good idea if the main bread winner dies and leaves a spouse or children with no income stream.

    Whole life may be what he is thinking of. Whole life is a hybrid product that combines term life insurance with an investment plan that usually earns a horrible return. Salespeople are usually pretty skilled at convincing people it is a wise investment when in most cases it isn’t. Salespeople earn a high commission from selling whole life products.

    Choose a policy from a well-known company. Insurance companies are rated by AM & Best Co., but most consumers, myself included, have difficulty understanding the ratings.

    When you buy a life insurance premium with that silly "RETURN OF PREMIUM" component after 20 years, it certainly is an investment!

    See these definitions for WHOLE LIFE that say it contains an investment component:
    http://www.google.com/search?hl=en&defl=en&q=define:whole+life+insurance&ei=goFkS7qzAYjOsQP8qe26Ag&sa=X&oi=glossary_definition&ct=title&ved=0CBQQkAE

    Read what BankRate has to say:
    Life insurance policy that remains in force as long as "premiums are paid. A built-in savings component builds a cash value. …"

    That cash value component is an investment.

  • Eddy T 5:03 am on February 10, 2010

    Life insurance from a licensed Insurance company is a good way to protect your family’s welfare.

  • primericaisbad 5:03 am on February 10, 2010

    "Whole life may be what he is thinking of. Whole life is a hybrid product that combines term life insurance with an investment plan that usually earns a horrible return."

    This is a completely incorrect statement and the author owes it to himself and people he "advises" to learn what he’s talking about. He’s obviously been through training at one particular company who is good at confusing their agents and tricking them to believe misinformation.

    As for your answer, you should find a company that’s been in business over 50-60 years with an A-rating or better. Look for companies that earn that rating ALL the TIME, not just last year.

  • StephenWeinstein 5:03 am on February 10, 2010

    Insurance only pays if there is a living person who knows where the insurance was bought. There have been several questions here from beneficiaries who were SOL because they knew that there dead relative had insurance, but not where. Life insurance is only of value if you make sure that there will be a way for the survivors to find out which company to ask for the money.

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