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Life insurance advertising galore on TV

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jltrent

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Every few minutes it seems another life insurance advertising on tv. Can these companies be trusted or are they just getting a cash flow for them self to squander and then go bankrupt? They sound to good too be true. The one with Alex Trebek my wife hates every time it comes on. Some say will give it allllllll back.
 

Craig Miller

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I can't remember all the details from my life insurance days but the company is required to keep a percentage of the policies bought in reserve so they don't go under like that. They know that most people will quit paying on the policy before they die.
 
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jltrent

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Craig Miller":3nwlh4nc said:
I can't remember all the details from my life insurance days but the company is required to keep a percentage of the policies bought in reserve so they don't go under like that. They know that most people will quit paying on the policy before they die.

Some good info there as I bet you miss a payment there will be no money getting back. Thanks for the information.
 

Caustic Burno

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jltrent":2wnlvfss said:
Craig Miller":2wnlvfss said:
I can't remember all the details from my life insurance days but the company is required to keep a percentage of the policies bought in reserve so they don't go under like that. They know that most people will quit paying on the policy before they die.

Some good info there as I bet you miss a payment there will be no money getting back. Thanks for the information.

Each state has a guarantee association that governs insurance companies in the event they go under. The repayment amounts vary by state.
 

Jogeephus

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Craig Miller":2im2ogno said:
I can't remember all the details from my life insurance days but the company is required to keep a percentage of the policies bought in reserve so they don't go under like that. They know that most people will quit paying on the policy before they die.

I took out what I thought was a large policy when I was 16. It had an annual payment of $180/year. Its built up some sort of "cash value" that is worth several thousand dollars IF I cancel it. There were times when I was tempted but I didn't and have kept paying the annual fee. With the amount of "cash value" that is now in the policy the insurance company told me there is no way I'll live long enough to ever deplete this amount so they offered to take my annual payment out of this "cash value" each year rather than my having to write a check. I don't want to do this because their annual bill each year gives me assurance they are still in business and haven't been bought out by someone. I suspect that they were banking on if I had them take the money out automatically was to erase the paper trail that lets my family know there is an insurance policy they can get at my death.

If you have children, I believe this type policy would be a perfect thing to set up for them at a young age when it would be cheap. A policy of the same value for me now would be extremely expensive.
 

Craig Miller

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Those type plans are good to get into when you're young especially from large well established companies. You may want to write down all policies and who they are with to be included with your will. Also keep up with beneficiaries. There was a man who worked in our company died a couple years ago who had a policy through the company. He had his wife as beneficiary when he took out the policy. Divorced her and remarried. Now ex-wife received the payout and now current wife got nothing.
 

TexasBred

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Jogeephus":3coupoj9 said:
Craig Miller":3coupoj9 said:
I can't remember all the details from my life insurance days but the company is required to keep a percentage of the policies bought in reserve so they don't go under like that. They know that most people will quit paying on the policy before they die.

I took out what I thought was a large policy when I was 16. It had an annual payment of $180/year. Its built up some sort of "cash value" that is worth several thousand dollars IF I cancel it. There were times when I was tempted but I didn't and have kept paying the annual fee. With the amount of "cash value" that is now in the policy the insurance company told me there is no way I'll live long enough to ever deplete this amount so they offered to take my annual payment out of this "cash value" each year rather than my having to write a check. I don't want to do this because their annual bill each year gives me assurance they are still in business and haven't been bought out by someone. I suspect that they were banking on if I had them take the money out automatically was to erase the paper trail that lets my family know there is an insurance policy they can get at my death.

If you have children, I believe this type policy would be a perfect thing to set up for them at a young age when it would be cheap. A policy of the same value for me now would be extremely expensive.
You do know that when you die that cash value disappears.
 

TexasBred

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Craig Miller":2xmeobws said:
Unless it's a policy where he get it along with the policy pay out.

Never head of that but cash value in life insurance is not a death benefit. If you die before you withdraw the cash value in your policy, your insurance company keeps the money. It is not paid out to your beneficiary or beneficiaries and is essentially lost. This is what I have always been taught. Show me different and I'll change my mind though.
 

Craig Miller

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TexasBred":2ca1ie8e said:
Craig Miller":2ca1ie8e said:
Unless it's a policy where he get it along with the policy pay out.

Never head of that but cash value in life insurance is not a death benefit. If you die before you withdraw the cash value in your policy, your insurance company keeps the money. It is not paid out to your beneficiary or beneficiaries and is essentially lost. This is what I have always been taught. Show me different and I'll change my mind though.
It's been too long for me to remember all the particulars. There are all different kinds of policies. Surely there's an insurance agent here on the board that knows something. We aren't your stereotypical cattlemen after all.
 

ALACOWMAN

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Jogeephus":1enbujfk said:
Craig Miller":1enbujfk said:
I can't remember all the details from my life insurance days but the company is required to keep a percentage of the policies bought in reserve so they don't go under like that. They know that most people will quit paying on the policy before they die.

I took out what I thought was a large policy when I was 16. It had an annual payment of $180/year. Its built up some sort of "cash value" that is worth several thousand dollars IF I cancel it. There were times when I was tempted but I didn't and have kept paying the annual fee. With the amount of "cash value" that is now in the policy the insurance company told me there is no way I'll live long enough to ever deplete this amount so they offered to take my annual payment out of this "cash value" each year rather than my having to write a check. I don't want to do this because their annual bill each year gives me assurance they are still in business and haven't been bought out by someone. I suspect that they were banking on if I had them take the money out automatically was to erase the paper trail that lets my family know there is an insurance policy they can get at my death.

If you have children, I believe this type policy would be a perfect thing to set up for them at a young age when it would be cheap. A policy of the same value for me now would be extremely expensive.
I bet there ain't a handful of teens, that has ever even thought of of buying a policy..or even thought they will ever need one.. I didn't...course I never thought of anything other then girls,cars and living forever, at sixteen..
 

Jogeephus

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TexasBred":ljotv5x9 said:
Craig Miller":ljotv5x9 said:
Unless it's a policy where he get it along with the policy pay out.

Never head of that but cash value in life insurance is not a death benefit. If you die before you withdraw the cash value in your policy, your insurance company keeps the money. It is not paid out to your beneficiary or beneficiaries and is essentially lost. This is what I have always been taught. Show me different and I'll change my mind though.

You are probably right and what you say makes sense being this money could be used to pay the premiums without my writing a check each year but I'm scared to mess with it because the death benefit is worth far more than the cash value. Also, the agent that wrote the plan has longs since passed so my only contact with the company is when they send a bill each year. I probably need to do some homework on this. Maybe tomorrow. Or the day after. :oops:
 

1982vett

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Jogeephus":1mzobq7i said:
TexasBred":1mzobq7i said:
Craig Miller":1mzobq7i said:
Unless it's a policy where he get it along with the policy pay out.

Never head of that but cash value in life insurance is not a death benefit. If you die before you withdraw the cash value in your policy, your insurance company keeps the money. It is not paid out to your beneficiary or beneficiaries and is essentially lost. This is what I have always been taught. Show me different and I'll change my mind though.

You are probably right and what you say makes sense being this money could be used to pay the premiums without my writing a check each year but I'm scared to mess with it because the death benefit is worth far more than the cash value. Also, the agent that wrote the plan has longs since passed so my only contact with the company is when they send a bill each year. I probably need to do some homework on this. Maybe tomorrow. Or the day after. :oops:
I think I have one similar. I get a 1099 each year for interest earned on a policy mom and dad bought when I was in single didget age. Policy is supposed to earn enough to pay the premium best I can tell....don’t really know. One of those things I need to follow up on and find out what it’s really about. May be millions out their somewhere just waiting..... :lol2: :lol2:
 

Jogeephus

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1982vett":2v66eypn said:
Jogeephus":2v66eypn said:
TexasBred":2v66eypn said:
Never head of that but cash value in life insurance is not a death benefit. If you die before you withdraw the cash value in your policy, your insurance company keeps the money. It is not paid out to your beneficiary or beneficiaries and is essentially lost. This is what I have always been taught. Show me different and I'll change my mind though.

You are probably right and what you say makes sense being this money could be used to pay the premiums without my writing a check each year but I'm scared to mess with it because the death benefit is worth far more than the cash value. Also, the agent that wrote the plan has longs since passed so my only contact with the company is when they send a bill each year. I probably need to do some homework on this. Maybe tomorrow. Or the day after. :oops:
I think I have one similar. I get a 1099 each year for interest earned on a policy mom and dad bought when I was in single didget age. Policy is supposed to earn enough to pay the premium best I can tell....don’t really know. One of those things I need to follow up on and find out what it’s really about. May be millions out their somewhere just waiting..... :lol2: :lol2:

You can get right on it tomorrow. Or maybe the day after. ;-)
 

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