Support NeoGAF

[Stouffers]

In the words of the great Eric Andre “Life is stupid, do whatever. You could die or live forever.” You probably won’t live forever especially with Covid and the coalescing democrat-helmed kill squads. If you have a spouse and/or a family, it’s probably smart to have life insurance so your loved ones aren’t left destitute when you inevitably die.

So do you have life insurance, and if yes, how much?

 

[Cravis]

I got around $750K on myself. Sucks to think I’m worth more dead than alive.

 

[Irobot82]

If everyone dies eventually how do these companies make money?

 

[Stouffers]

If everyone dies eventually how do these companies make money?

Maybe not everyone is dying. Don’t believe everything you see on TV or the papers.

 

[NeoGiffer]

 

[Super Mario]

If everyone dies eventually how do these companies make money?

You just answered your own question. It's a huge waste of money for the average person, as most insurances are.

There's a small percentage of people that benefit from term insurance, where they die unexpectedly, and it is paid out like expected. The amount of people that ever get to use this is somewhere between 1-3%. Whole life insurance is an even bigger scam. Death in itself doesn't mean you get a fat payday. Every policy has terms and conditions. Also, every professional who recommends it to you is getting paid in some form to do so. They aren't recommending it to you because they care about you.

You pay all of this money towards something you will never use. When in return, you were statistically better off putting that money into an investment. However, try telling all of the victims of the world to invest, and see the angry NPC faces you get back. How dare you!?

 

[AJUMP23]

I have a small policy. I think there are some benefits to having some life insurance. as a way to protect your family in the event of a tragedy.

I think the best thing to do is to invest and create the idea of being self insured. When my mother died all of her policies paid out to me and my siblings, and the money helped our family do some different things. What I want to do is create a Revocable trust, so that way when I die I can just give everything to my children without getting killed by the taxes. I want to find ways to use my money and give my money while paying as few taxes as legally possible.

 

[poppabk]

If everyone dies eventually how do these companies make money?

They generally last until you are 60 or so. After that the price goes up steeply or you can't even get a policy.

 

[xrnzaaas]

Nope, neither me nor my partner have life insurance. I think it's just something that's not very popular in my country, much like having a will prepared in case of your death.

 

[eddie4]

Insurance is a scam, it's bs and I hate that it's legally required. They never pay out what they promise, there's always a "but, this happed so no". You're basically paying just in case something happens, and if it doesn't, well, you just gave your money away. You stop paying, oh you just lost all that money you invested. Life insurance? LOL , I'll be dead I don't care.

although i have to have coverage because of my daughter(state law), so i have a 1M life insurance policy.

 

[epicnemesis]

Well this topic is relevant to me. I do financial planning, which most of the time involves auditing existing coverage clients have or getting the ball rolling on new policies. The vast majority of the time we see people uninsured or underinsured. (A lot of the time their insurance guy sold them the wrong coverage amount in the wrong type of policy.)

The common mistake I see is people only covering their liabilities (mortgage, other debt, and education costs.) They ought to be digging a little deeper and finding the present value of their current lifestyle and insuring for THAT.

With that said, since I'm the breadwinner in the family and my wife would struggle finding a job that comes close to what she and my daughter need to survive, I have 3.5 million on me. Laddered into various duration term coverages. 500k of which is earmarked to convert to permanent coverage when I have the means to start contributing to that.

If you have dependents you NEED to look into coverage.

Not to self promote, but if you want advice, just reach out via PM, you don't have to go through me but I'm happy to help.

If everyone dies eventually how do these companies make money?

As stated, most people have cheap term coverage that pays out 1-3% of the time.

Permanent coverage is a much more limited use case that makes A LOT of sense for some people and 0 sense for others. The premiums on this coverage are designed to be profitable for the company after the policy is held for a certain amount of time (usually around 15 years.) People get these policies because they get favorable tax treatment on the living benefit side of things and because they help sort out estate issues.

 

[Stouffers]

Well this topic is relevant to me. I do financial planning, which most of the time involves auditing existing coverage clients have or getting the ball rolling on new policies. The vast majority of the time we see people uninsured or underinsured. (A lot of the time their insurance guy sold them the wrong coverage amount in the wrong type of policy.)

The common mistake I see is people only covering their liabilities (mortgage, other debt, and education costs.) They ought to be digging a little deeper and finding the present value of their current lifestyle and insuring for THAT.

With that said, since I'm the breadwinner in the family and my wife would struggle finding a job that comes close to what she and my daughter need to survive, I have 3.5 million on me. Laddered into various duration term coverages. 500k of which is earmarked to convert to permanent coverage when I have the means to start contributing to that.

If you have dependents you NEED to look into coverage.

Not to self promote, but if you want advice, just reach out via PM, you don't have to go through me but I'm happy to help.



As stated, most people have cheap term coverage that pays out 1-3% of the time.

Permanent coverage is a much more limited use case that makes A LOT of sense for some people and 0 sense for others. The premiums on this coverage are designed to be profitable for the company after the policy is held for a certain amount of time (usually around 15 years.) People get these policies because they get favorable tax treatment on the living benefit side of things and because they help sort out estate issues.

I’m at 2M, but a quarter of that will lapse in 3 years.

 

[Amory]

You just answered your own question. It's a huge waste of money for the average person, as most insurances are.

There's a small percentage of people that benefit from term insurance, where they die unexpectedly, and it is paid out like expected. The amount of people that ever get to use this is somewhere between 1-3%. Whole life insurance is an even bigger scam. Death in itself doesn't mean you get a fat payday. Every policy has terms and conditions. Also, every professional who recommends it to you is getting paid in some form to do so. They aren't recommending it to you because they care about you.

You pay all of this money towards something you will never use. When in return, you were statistically better off putting that money into an investment. However, try telling all of the victims of the world to invest, and see the angry NPC faces you get back. How dare you!?

...I don't think it's as simple as you're making it out to be. Investment and insurance are two completely different worlds with different purposes.

Sure, most people don't die unexpectedly at a young age. But if you do, and you have no life insurance, your family is fucked. If I die at 35 the premiums I saved in an investment account would be worth like a month or two of mortgage payments.

 

[Super Mario]

...I don't think it's as simple as you're making it out to be. Investment and insurance are two completely different worlds with different purposes.

Sure, most people don't die unexpectedly at a young age. But if you do, and you have no life insurance, your family is fucked. If I die at 35 the premiums I saved in an investment account would be worth like a month or two of mortgage payments.

Most people are also not getting their families life paid for for a $2500 premium.

99% of families would be better off with the money invested elsewhere

 

[Papa]

u dyin stouff?

 

[Amory]

Most people are also not getting their families life paid for for a $2500 premium.

99% of families would be better off with the money invested elsewhere

Idk where you're seeing $2500 premiums. I've never seen anything close to that high.

Most people can get a decent amount of coverage for like $30 a month.

Edit: now I realize you're talking total premiums over the full term. That makes sense, I misunderstood.

In any case, I dont agree that investing the premiums is a better plan than paying for insurance. I want my family to have a safety net in the event of my demise, and I feel better having it be a defined benefit, regardless of whether I croak at 30 or 45. But to each their own.

 

[PleaseDontBanMe]

death lowkeys renders learning new things and just living in general as kind of a big waste of time

 

[Stouffers]

u dyin stouff?

Overweight, high Covid risk, high BP, unruptured brain aneurism, calcified thyroid nodule, vein disease and skin cancer.

Probsbly

 

[SLoWMoTIoN]

Did you get all that by eating fucking STouffers?

 

[Papa]

Overweight, high Covid risk, high BP, unruptured brain aneurism, calcified thyroid nodule, vein disease and skin cancer.

Probsbly

pls dont go

we love u

 

[Elektro Demon]

I don't have a policy nor I plan on getting one. I just don't see the point. And after I'm dead I don't really give a shit what happens to anyone.

 

[Mihos]

I did when I was younger and we had a mortgage, kids at home, and required 2 incomes to make it, but now we have enough saved and invested to where it isn't necessary.

 

[Kagey K]

You have to watch these term policies. They try to get you in your 20’s for a 40 year policy, and then when the policy expires you have no coverage and you have to sign a new one with new terms and the previous 40 years you paid don’t matter anymore.

Like OH SRory too bad you didnt die at 58.

Insurance (like every other company) are there to make money, and they don’t do that issuing payouts. They will do everything they can to prevent the payout.

It’s probably the greasiest most disgusting industry in the world.

Lawyers would be worse, but the insurance industry sells promises and then takes them away.