Life Insurance
Okay, cosmos, I can only change so much of my financial paradigm at once, got it? You're really asking a lot of me!
Life Insurance Quote
Opinions, advice or suggestions on this topic are most welcome!
The Finance Talking Heads have been telling me for years to investigate renewable, convertible, term life insurance. Now that Ian and I are married and I'm trying be All Responsible And Stuff, I decided to go ahead and do it. I got a quote from our auto/renter's insurance company, Liberty Mutual, while I was on the phone with them updating our policies anyway. Now, the Talking Heads keep telling me that I'll be shocked at just how affordable term life insurance really is. I'm shocked, alright, but not pleasantly! It is, in fact, more expensive that I guessed it would be!
The Talking Heads tell me that it would be really awesome if I had $1 million in life insurance. Heads, you're going overboard here. I decided to start much smaller. First piece of education: With term life insurance, yes, you can start with a policy as small as a $50,000 benefit (at least with Liberty Mutual), and then increase your coverage over time as you have greater means to afford the monthly premiums. Therefore I asked for quotes on $100K, $200K, and $300K. Here's what we got for Ian and me at our respective ages and as nonsmokers for a 50 year term (give or take):
$100K - $38.59/month each
$200K - $65.92/month each
$300K - $84.50/month each
Whoa, Nellie! That's MUCH more money than I expected! This is just my first pass, so I have questions and need to educate myself. Do these numbers reflect a discount for carrying my other insurance with the same company? What are the AD&D benefits, since of course I'm more concerned about those at our present ages? How exactly does this work with the 30-year policy, then the rider for the extra 20 years? These are things I will ask the insurance agent, but haven't yet.
This is a paradigm shift. It's money for something intangible that I hope I will never use. In the best case scenario, we will dutifully pay this money out every year and never collect on it -- so naturally it's not something I want to buy. That makes it seem like an undesirable expense. It's easy for me to flip out about OMG, how could and why should we pay $80 a month for the barest coverage? That's a lot of money! But I'll pay about the same for my cable and Internet service, or four outings to a Mexican restaurant during the month. $100,000 coverage doesn't seem like very much money in the event one of us died, but you know how much money it really is? $100,000 more than we'd have without it!
I get 4 x salary life insurance, and an additional 4 x salary AD&D through my employer for just a few bucks a paycheck, and that's what I'm used to. Ian will pick up life insurance through his new job, although I have yet to comb through his benefits with him. I know it's smart to get your own term policy in the side anyway -- I gotta wrap my brain around this. I want to ask those questions, educate myself, and get some quotes from competitors. One thing I'll also research is their customer service process in the event of a claim. Last year I went through the process of preparing instructions on filing a life insurance claim for myself and my mother since of course that's the time in your life when you least have the energy and ability to deal with bureaucratic red tape! My life insurance provider through work is UNUM, and their process appears easy and relatively hassle-free; you don't even need to wait to get the death certificate to file a claim. My mother's life insurance through State Farm, on the other hand, appears positively byzantine. I think I might actually have to raise my dead mother from the grave as one of the unliving to personally appear in a State Farm office to file her own claim to prove that she has, in fact, expired. So the company's process for filing a claim is a factor I will consider against price as I make my decision.
This is certainly not a "one afternoon" decision, however. I gotta nerd this one out.
Like I said at the top, I welcome your input on this one!
Trace
Life Insurance Quote
Opinions, advice or suggestions on this topic are most welcome!
The Finance Talking Heads have been telling me for years to investigate renewable, convertible, term life insurance. Now that Ian and I are married and I'm trying be All Responsible And Stuff, I decided to go ahead and do it. I got a quote from our auto/renter's insurance company, Liberty Mutual, while I was on the phone with them updating our policies anyway. Now, the Talking Heads keep telling me that I'll be shocked at just how affordable term life insurance really is. I'm shocked, alright, but not pleasantly! It is, in fact, more expensive that I guessed it would be!
The Talking Heads tell me that it would be really awesome if I had $1 million in life insurance. Heads, you're going overboard here. I decided to start much smaller. First piece of education: With term life insurance, yes, you can start with a policy as small as a $50,000 benefit (at least with Liberty Mutual), and then increase your coverage over time as you have greater means to afford the monthly premiums. Therefore I asked for quotes on $100K, $200K, and $300K. Here's what we got for Ian and me at our respective ages and as nonsmokers for a 50 year term (give or take):
$100K - $38.59/month each
$200K - $65.92/month each
$300K - $84.50/month each
Whoa, Nellie! That's MUCH more money than I expected! This is just my first pass, so I have questions and need to educate myself. Do these numbers reflect a discount for carrying my other insurance with the same company? What are the AD&D benefits, since of course I'm more concerned about those at our present ages? How exactly does this work with the 30-year policy, then the rider for the extra 20 years? These are things I will ask the insurance agent, but haven't yet.
This is a paradigm shift. It's money for something intangible that I hope I will never use. In the best case scenario, we will dutifully pay this money out every year and never collect on it -- so naturally it's not something I want to buy. That makes it seem like an undesirable expense. It's easy for me to flip out about OMG, how could and why should we pay $80 a month for the barest coverage? That's a lot of money! But I'll pay about the same for my cable and Internet service, or four outings to a Mexican restaurant during the month. $100,000 coverage doesn't seem like very much money in the event one of us died, but you know how much money it really is? $100,000 more than we'd have without it!
I get 4 x salary life insurance, and an additional 4 x salary AD&D through my employer for just a few bucks a paycheck, and that's what I'm used to. Ian will pick up life insurance through his new job, although I have yet to comb through his benefits with him. I know it's smart to get your own term policy in the side anyway -- I gotta wrap my brain around this. I want to ask those questions, educate myself, and get some quotes from competitors. One thing I'll also research is their customer service process in the event of a claim. Last year I went through the process of preparing instructions on filing a life insurance claim for myself and my mother since of course that's the time in your life when you least have the energy and ability to deal with bureaucratic red tape! My life insurance provider through work is UNUM, and their process appears easy and relatively hassle-free; you don't even need to wait to get the death certificate to file a claim. My mother's life insurance through State Farm, on the other hand, appears positively byzantine. I think I might actually have to raise my dead mother from the grave as one of the unliving to personally appear in a State Farm office to file her own claim to prove that she has, in fact, expired. So the company's process for filing a claim is a factor I will consider against price as I make my decision.
This is certainly not a "one afternoon" decision, however. I gotta nerd this one out.
Like I said at the top, I welcome your input on this one!
Trace