Life Insurance

[MonkeyMama]

Being in a profession where I see all the time what happens when people pass way unprepared (no wills, no insurance) and having had a large number of friends lose parents very young, life insurance and getting our affairs in order was a priority in our 20s.

Anyway, I wanted to share two things in regards to my husband's life insurance.

#1 - Though my spouse is the epitome of health, he was diagnosed with a brain tumor at age 33 (almost diagnosed around age 29). After having surgery, he is perfectly fine, should never need surgery again (if it grows again they just zap it), and this should have no impact on a long and healthy life. BUT, I am looking at increasing my own life insurance, and out of curiosity I finally looked up if he is even insureable any more. The answer is NO. Apparently a tumor in the brain knocks you out of the running, no matter how innocent it is.

I had a feeling, and I can say that we had ample insurance, so it is what it is.

Why do I share? If you are waiting to get insured, what are you waiting for??? Don't do that to your family. Term life insurance is so cheap these days. I keep talking to well off people with solid finances and affairs mostly in order, but their kids are like in their teens, the mom doesn't work, and they never got wills or life insurance. ??? I know it's tough to think about, but imagine where you would be if something happens and you do not get your affairs in order.

#2 - Universal life insurance story. My MIL got universal life insurance for my hubby, when he was a baby. She got sold crap from her financial advisor. We had at some point asked to cash it out, and she got all pissy about it. So, we have had the conversation. I told her we had long-term insurance for 10 times his income. & that we had no use for the policy - rather put that money in the kids' college savings. The cash out is about $2,000 on a $20,000 policy (that she has put closer to $20,000 into over the last 30 years).

Apparently, she has forgotten our conversations, because she continually brags in front of us to other relatives how smart she was to get that policy. Maybe $20k amounted to a hill of beans when he was a baby, but there seems to be no concept of inflation here. That money would have been *far* better off invested. & though I am sure $20k might seem like a lot of money to a lot of people, considering their financial status, and ours, it's just dumb. Like she couldn't have just written me a $20k check if something happened to dh. Maybe for the expenses in regards to burial, etc? She could and she would. I strongly believe the day my dh got better insurance that she should have dropped it. she meant well, but the policy lost all its use when he was insured as a highly paid adult. I think the problem is that she put all that money into it - like hell she is settling for $2,000. She'd rather our kids get the $20k in another 40 years (more inflation - ugh).

Just a real life story about universal life insurance. This is the exact situation she bought it for - but I can't say it is useful.

For reference, I am paying $250 per year to insure my spouse for 10 times his income. For 30 years. Good deal. The younger and healthier you are, the cheaper term life insurance is. All the more reason to get this stuff taken care of sooner rather than later.

[Like2Plan]

#1 - Though my spouse is the epitome of health, he was diagnosed with a brain tumor at age 33 (almost diagnosed around age 29). After having surgery, he is perfectly fine, should never need surgery again (if it grows again they just zap it), and this should have no impact on a long and healthy life. BUT, I am looking at increasing my own life insurance, and out of curiosity I finally looked up if he is even insureable any more. The answer is NO. Apparently a tumor in the brain knocks you out of the running, no matter how innocent it is.

MonkeyMama,
I'm so sorry your DH has had a health issue and I'm glad to hear he is doing fine. I am assuming this was a fairly recent event? I wonder if you re-visit the question in a few years with a clean bill of health if his risk pool will change?

[MonkeyMama]

MonkeyMama,
I'm so sorry your DH has had a health issue and I'm glad to hear he is doing fine. I am assuming this was a fairly recent event? I wonder if you re-visit the question in a few years with a clean bill of health if his risk pool will change?

I got the impression that it doesn't matter how long ago this was - will always be an issue (or until insurance changes their policy on this). Insurers don't like brain tumors, period. If you have one, you have one. It doesn't 100% go away. I did see some people were able to fight it with certain insurers and circumstances. I was just looking out of curiosity - we don't insurance so I have no need to look into it further or fight it. If we needed the insurance, I sure would fight it.

I was surprised to see a discussion how many were also denied long-term care insurance for the same tumor. ??? Which leads me to think disability insurance would also be an issue. (There are far greater odds of disability than death, from this).

& on and on and on it goes. I had never given it any thought beyond life insurance and health insurance ramifications.

[MonkeyMama]

P.S. I really only shared as I know far more people that passed very suddenly, very young. It happens. & people tend to be unprepared.

BUT, that said, I think my dh's experience is going to be far more common. In the last two years we both had benign tumors removed, my MIL was treated for stage zero breast cancer, and my employer was treated for a stage zero type cancer. These are the type cases where there were very few or no symptoms and we may have all lived long lives never knowing. In this day and age with MRIs, mammograms and ultrasounds, these conditions are being caught so early. I think it does have a lot of ramifications when it comes to insurance.

My spouse could have been easily undiagnosed for years or decades - he didn't have any real symptoms of any brain problems. His primary physician sent him for an MRI on a "gut feel" after a neurologist told him he didn't nee an MRI- and only because the technology is so readily available and cheap these days. 10 years ago they never would have sent him for an MRI on such a whim.

[Like2Plan]

BUT, that said, I think my dh's experience is going to be far more common. In the last year we both had benign tumors removed, my MIL was treated for stage zero breast cancer, and my employer was treated for a stage zero type cancer. These are the type cases where there were very few or no symptoms and we may have all lived long lives never knowing. In this day and age with MRIs, mammograms and ultrasounds, these conditions are being caught so early. I think it does have a lot of ramifications when it comes to insurance.

It is a good wake up call for folks who are putting off getting life ins. Maybe insurance companies will re-evaluate risk groups as more time passes--because folks in these situations will lead long lives (and the insurance companies won't make any money if no one can qualify for life ins).

[LivingAlmostLarge]

Glad your DH is okay. How much did you get for $250 a year for 30 years?

I bought 20 years/$500k recently for myself for $200/year (32F), lucky they didn't ding me with being pregnant (fat), I was on the high end of "healthy" BMI with great BP and normal cholesterol.

I bought 25 years/$2M (extra on top of what we bought previously) recently for DH for $900/year (34M) excellent health.

We bought $300/year $1.2M annually through employer not really term but just tied to employment. We got it when DD was born and until then nothing. He also gets free through work 7x income free. So we probably have around $4M total right now.

I had also bought disability maximum on DH 70% post-tax income, for $30/month? Through work unfortunately since they provided 60% if we bought it privately they could only insure the extra 10% they told me based on where we live.

With new baby we may increase our term coverage on DH, although shorter term to keep it low. It depends on too many factors. I figure worse case is keeping the $2M and buying from work if necessary.

[frugalgirl]

MonkeyMama

You are so right. I find it incredible that people with children don't have wills and people living on one income don't have life insurance on the working spouse. When I was a SAHM our moms' group had a meeting to discuss the "3 D's": death, divorce and disability. What an eye opener for a lot of the people there. It was an eye opener to me that they were so unprepared.

Where/how did you find the information about whether insurance companies would cover your DH after his tumor? My DH had cancer almost 5 years ago and I'd like to see if we can get life insurance for him now at a non-inflated price. I'd like to replace the policy that we currently have. We were quoted a price about a year after his treatment and the price was outrageous so we stuck with what we had pre-cancer. I'd like to see if I can find out some information about the likelihood of coverage and an approximate cost before I even consider getting quotes. I've tried to find info but haven't had much luck finding anything specific on his type of cancer. Thanks!

[FredGoldie]

Interesting story on universal life insurance vs. term insurance and generally, just having the will power to invest wisely and see a good deal through. And with so many ways to obtain a variety of insurance quotes to protect you and your loved ones, it's better to have more options to counteract bad advice from one advisor. Sometimes sifting through dozens of different quotes can be the difference of saving a few hundred dollars with a monthly/yearly insurance plan, rather than opt for the first offer you see.

[elessar78]

I just started a new job this week that I think I'm going to love. The cool thing is that they offer life insurance and they pay 100% of the premium for it too. So on top of the term policies I already have, my wife should be sufficiently covered if, God forbid, anything happens to me.

But a question moving forward, we set our policies at ten times our income about 2 years ago. Times have been good to us in many ways and that no longer reflects 10x, what's the best way to increase our policy? Take out another one for a smaller amount? Cancel the current one and just take out higher ones? <-prob not the best course of action because we'll get rates at our age today.

advice?

[Like2Plan]

elessar78,
Get quotes for either way and then make your decision. Make sure the term is going to be long enough for the coverage your going to need so that you don't end up having to purchase a new term policy when you are in your 50's (as you noted, it gets more expensive when you get older). Another thing to think about is phasing out coverage as you acquire more assets and have less need for insurance over time.

[disneysteve]

what's the best way to increase our policy? Take out another one for a smaller amount? Cancel the current one and just take out higher ones?

Get quotes for either way and then make your decision.

I agree. Term rates have been steadily declining though depending on how long you've had your current policies, it could actually be cheaper to replace them even though you are older. For example, a 40 year old today might be cheaper to insure than a 35 year old was 5 years ago.

[sherylgray]

First of all I like to wish best of luck to MonkeyMama's husband. Hope he gets well soon. It is very difficult to get insurance for people suffering from tumor and other harmful diseases. With the term as it getting lowered it is very difficult to insurance companies.

I think one should compare all the insurance and the terms offered by insurers before opting for any insurance.

[mynarky]

First of all I like to wish best of luck to MonkeyMama's husband. Hope he gets well soon. It is very difficult to get insurance for people suffering from tumor and other harmful diseases. With the term as it getting lowered it is very difficult to insurance companies.

I think one should compare all the insurance and the terms offered by insurers before opting for any insurance.

The rates going down has ZERO to do with it being harder to insure people who are terminally ill or nearly terminally ill. In reality, it's easier to get life insurance on unhealthy people that at nearly any other time in history. As far as "comparing all the insurance". Life insurance has been fairly comoditized by the Internet. If you know where to go it take mere seconds to compare a term.

By the way, "universal life insurance" isn't all bad. Guaranteed universal life insurance is nothing more than term that lasts till age 100 or 121. It's an excellent option for people who need or want coverage upon death regardless of how long they feasibly live.

[galanins]

What happens to the cash value when you die?

[Rainbow Traveller]

What happens if I miss an installment of premium??