Saving You Money For Life

You may have heard by now, sophisticated investors have discovered that they can earn much better returns by owning portfolios of life insurance policies on the lives of strangers than they can in other types of investments. So they’ve been promising wealthy seniors millions of dollars of “free life insurance” for two years plus an opportunity to put significant sums of cash in their pockets.

So, if billions of dollars in the form of hedge fund and other investors are chomping at the bit to own life insurance policies on wealthy seniors so that policies can be held until these seniors die, solely as an investment, perhaps they’re on to something!

The death benefits of these same policies, if structured properly in a trust for the insured’s family, can be entirely income tax-free AND estate tax-free. This makes life insurance significantly more valuable and attractive as a financial instrument for the covered individuals and their families than it is for “investors”. What a GREAT investment for individual families! So why aren’t you and your family members taking advantage of this?

If you don’t fully understand why investors are so interested in owning policies on strangers such as yourself and you’re approached by one of these investors, you should take a closer look at using life insurance in your own financial and estate plans before you sell your future insurability rights. You may be surprised at the return on investment it would bring your family.

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With so many people worried about identity theft, ‘identity insurance’ is hot right now. But although the cost often seems reasonable, the benefits are usually very limited and “typically not worth the money,” according to editors of Consumer Reports magazine.

Nobody is really sure how many people are victimized by ID theft each year. The Federal Trade Commission puts the figure at about 9.3 million individuals. A recent report by the Justice Department estimates that 3.6 million households were victimized. The majority of these cases involve a stolen credit card number, not the more serious crime of trying to steal someone’s identity by opening accounts and getting fake ID in their name.

The National Association of Insurance Commissioners cautions consumers that insurance “cannot protect you from becoming a victim of identity theft and does not cover direct monetary losses incurred as a result of identity theft.” It simply covers some of the expenses you will incur to deal with the problem, such as the costs of making phone calls and copies, mailing documents and possibly legal bills.

So what are you buying? Coverage typically costs from $20 to $100 a year, as a rider to a basic homeowner’s policy or as a stand-alone purchase. Throw in the cost of the deductible and the fact that usually there’s no coverage for lost time from work or legal fees – and what it seems you’ve got is window dressing. Money for a pair of scissors to cut up the old credit card.

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The Insurance Information Institute reported today that life insurance rates will decrease again in 2007.

The prediction is that one will be able to obtain life insurance for 4% less in 2007.

The report goes on to say: “Life insurance rates are dropping because death rates for the 25-44 age group-the primary age range for purchasing life insurance-have decreased significantly over the past 10 years,” Dr. Weisbart pointed out. In 1996 the death rate per 100,000 for the 25-44 age group was 177.8; by 2004 it had dropped to 161.8 (preliminary data, National Vital Statistics Reports). That is nearly a 10 percent drop in the death rate in less than a decade for the prime insurance-buying ages.”

To see how this drop in rates would apply to you, you can visit an instant life insurance quoting firm like AccuQuote.

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Bloggers from peer-to-peer file sharing land report the existence of a Swedish company who is offering a policy covering free music downloaders should they be sued by the RIAA (the music industry copyright police) for stealing copyrighted music. It’s hard to assess the viability of this company if one is uniligual, as their front page declares:

Hur blir man medlem?

Genom att fylla i formuläret på den här websidan och att betala till vårt plusgiro 208777-3 och där uppge Personnummer som meddelande. Medlemskap gäller ett eller ett halvt år från det datum vi mottagit betalning.

However, according to those fluent in Swedish the firm is offering this policy for a mere $19 annually. They agree to cover all legal costs in the event of an RIAA lawsuit, and provide you with a tee-shirt into the bargain. Click for further information.

More after the jump…

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Asthma is a growing problem. The National Center for Health Statistics reports approximately 15 million Americans have asthma and 4,487 died from it in 2000. This doesn’t seem like a huge number, but half of those deaths were people younger than 65 years old.

If you have asthma will you pay more for life insurance. You may…it depends on the severity of your asthma. If you have asthma it pays to shop around and use a broker who knows the ins and outs of different companies and their underwriting criteria for this particular ailment.

Insurers will want to know your “peak flow meter” readings and the results of pulmonary function tests performed by your doctor. Both of these tests will let the insurer know how well you’re breathing and how your asthma is affecting you.

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Denver resident Carolyn Hobbs was dealing with the slow, steady advances of her diagnosed lung cancer when she took the opportunity to try a new biotechnology product designed to slow spread of the disease. Waiting for her second treatment in the doctor’s office, someone from the accounting department came out to tell her that her share of the treatment would be $18,000.

As a mother of three grown children, she had lived with frugality all her adult life. Maybe this new drug, Erbitux, could extend her life by a small fraction, but she wouldn’t be cured. She declined treatment.

“She was just very frugal, and she said it wasn’t worth it,” her husband Larry remembers.

More after the jump…

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You quit smoking last year so you are a non-smoker, right? WRONG! In order to qualify for the BEST rate class (preferred plus) you must abstain from smoking for at least 5+ years! There are companiesout there that will offer the best rate to people who quit less than 3 years ago. Finding them is only one battle. Even though these companies may be good if you’re a smoker…they may be bad with your other health ailments such as high cholestoral.

What should you do? Shop around. Use a broker or call multiple insurance companies to make sure you get the best deal. And, if you have life insurance and were a smoker when you bought it 3-5 years ago, you may want to consider re-financing your policy. You may be able to save money even though you’re a few years older.

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According to a study by The Commonwealth Fund about half of adults in middle-income families reported serious problems in paying for their health care while even those in more affluent circumstances said they had troubles with medical bills.

Forty-eight percent of individuals in families earnings between $35,000 and $50,000 said they had either a somewhat serious or very serious problem paying their medical bills in the last two years. Layered atop that issue is the fact that 50 percent of adults in that income bracket said they had difficulties affording their health insurance.

Moving up a bracket, 33 percent of individual in families earning between $50,000 and $75,000 a year said they had trouble paying for medical bills. Ranging a little higher, the poll showed that 21 percent of people in families earning $75,000 or more reported such difficulty in meeting medical costs. Half of the individuals interviewed in families earnings less than $35,000 annually reported such a problem.

More after the jump…

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Life insurance companies want to know a lot of things about you before they insure you. When you speak to a representative they will ask you pre-screening questions about your health and lifestyle. You may be surprised at some things they’ll want to know:

• height/weight
• cholestoral
• tobacco use
• participation in any hazardous sports (rock climbing, scuba diving, skydiving, etc.)
• driving violations
• felonies
• bankruptcy
• citizenship

All of these things in one way or another help insurers calculate the amount of risk they are taking by insuring you. It makes sense right? If you have lots of driving violations, you may be more likely to get into a car accident that could be deadly.

To get the most favorable rate, work with a brokerage that knows the ins and outs of carriers. The broker will be able to determine which carrier will give you the best deal.

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In the first ruling on a Katrina-related lawsuit pitting homeowner against insurance carrier, Senior District Judge L.T. Senter Jr. ruled today that the insurance policy of plaintiffs Paul and Julie Leonard of Pascagoula, Mississippi, specifically excluded flood damage and that therefore their policy did not cover their losses.

However, Senter ruled that the couple could collect compensation from Nationwide Mutual Insurance Co. for wind damage — a total of $1,228.16. The Leonards said their Gulf Coast home incurred more than $130,000 in wind and flood damage on August 29, when Hurricane Katrina raked the Gulf Coast.

This is the first of hundreds of cases pending against insurance companies who claim that Katrina’s destruction amounted to flood damage – and that any homeowner who lost his home to the storm who hadn’t made the extra investment in flood coverage was out of luck.

More after the jump…

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