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Old 09-27-2011, 12:24 PM
 
Location: Alaska
5,356 posts, read 16,427,613 times
Reputation: 4027

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We just had 10-year term policies expire this year. Last year, we got replacement 10-year term policies to hold us over until we retire. The cost on my policy went from about $15/month to $87/month, but I also increased the amount in the policy. My wife's went from about $12/month to $36/month for the same benefit. We let the old policy expire this year before the premium jumped up about 4-5 times the original premium. My wife also has a group policy through work.

Our idea was for the insurance to cover enough expenses so the other could live reasonably well on their own income (pay off house, kids' student loans, etc.). I figured retirement would be taken care of with pensions and retirement savings. We have the option to cancel the policies once we're both retired, but may keep them for the full period.
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Old 09-27-2011, 01:46 PM
 
Location: Near a river
16,042 posts, read 19,115,555 times
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Quote:
Originally Posted by Curmudgeon View Post
In many cases the survivors can "assign" the policy to the funeral home which will take out their fees and costs and give the rest to the assigned beneficiaries.

Assign a policy to a funeral home so they can take out their own fees? NEVER! I have a friend who works for a funeral home as an admin asst, and the stories she tells regarding billing and other matters you would not believe.


We'll be cremated and interred in a veterans cemetary so the costs will be minimal, especially here.

I am also to be cremated. I'm wondering if whoever finds me can send my body to the crematory directly (from wherever I am), after calling the coroner, or if I have to get ambulanced to some mortuary....?? Sorry to sound grim, but I would like to know so I can spell this out in my instructions...
A caution and a question ^ (a brief answer please, so we don't go off on a tangent)
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Old 09-27-2011, 06:58 PM
 
Location: Lexington, SC
4,281 posts, read 10,812,811 times
Reputation: 3718
I would say the main reason for life insurance is to be able to pay off whatever could not be easily paid off had one not died (like a mortgage and only one wage earner) then maybe (only maybe) it was a worthwhile bet (and make no mistake it is a bet).

There is a secondary reason and it is when one cannot comfortably live without the the others income.

I believe those that look at insurance as a windfall for others (like pay off their childrens debts) could well be, and in many cases are depriving themselves.
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Old 09-27-2011, 08:04 PM
 
5,090 posts, read 13,612,918 times
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Life insurance is a big waste of money if you have no one who relies on you for support. Getting life insurance to give your heirs money can be better spent to protect your estate. For example, I know elderly people who buy all this life insurance, yet they will only buy the minimum car insurance.

Here in Colorado the minimum requirement for liability is $25,000 per individual and $50,000 per accident; some states requirements are even less. That will not cover enough if you get into a accident. The insurance companies are required to defend you but they are not going to do much to prevent a $25,000 loss--their legal cost would be more than that. You will then be liable for the rest of the damages. Your house and estate assets can disappear. The heirs will then get nothing.

It would be better to spend the money on more auto insurance, especially as you age you entail more risk. Better yet, stop driving. You should have enough auto insurance so the Insurance companies will defend you aggressively and to cover a claim that can easily exceed the minimum coverage. All this depends if you have assets at risk. If you have nothing, there is nothing to be claimed. But I will suffer, if you injure me, which will not make me happy and I will want you to die, so I can claim your life insurance policy. So, again your survivors get nothing.

However, keep in mind, that the insurance coverage you have is tied to the same amount of uninsured motorist coverage. There is high percentage of drivers who do not carry insurance and most insured drivers who have minimum coverage. So, if you get into an accident, $50,000 (or less from other state drivers) is not going to cover much of your pain and/or disability. Ah, but you have big life insurance policies, if you die. So die, and make an end of your suffering and make your heirs richer--that is being foolish.

I would not get life insurance to cover cremation or burial. Why would you care? Your body will be disposed and buried by the state, even if their is no estate; it is not going to be dumped in the street. Cremation is very cheap today, cost less than all the useless crap, movies, DVDs, cable TV, eating out etc that your heirs buy everyday. Also, you will have some money from Social Security or some VA benefits if that is the case.

Some of you have high assets, would it not be better to have an umbrella policy to cover any successful claims against you--but at least get adequate auto insurance, with the money you save from paying useless life insurance.

It also makes me laugh about people who are so obsessively worried about these little loses on small purchases. They get extended insurance on everything, so they are covered if their coffee makers breaks after the warranty. Yet, they fail to cover the biggest risk of all--high personal liabilities that can occur in auto driving.

Livecontent

Last edited by livecontent; 09-27-2011 at 08:23 PM..
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Old 09-27-2011, 08:25 PM
 
Location: Near a river
16,042 posts, read 19,115,555 times
Reputation: 15656
Quote:
Originally Posted by livecontent View Post
Life insurance is a big waste of money if you have no one who relies on you for support. Getting life insurance to give your heirs money can be better spent to protect your estate. For example, I know elderly people who buy all this life insurance, yet they will only buy the minimum car insurance.

Here in Colorado the minimum requirement for liability is $25,000 per individual and $50,000 per accident; some states requirements are even less. That will not cover enough if you get into a accident. The insurance companies are required to defend you but they are not going to do much to prevent a $25,000 loss--their legal cost would be more than that. You will then be liable for the rest of the damages. Your house and estate assets can disappear. The heirs will then get nothing.

It would be better to spend the money on more auto insurance, especially as you age you entail more risk. Better yet, stop driving. You should have enough auto insurance so the Insurance companies will defend you aggressively and to cover a claim that can easily exceed the minimum coverage. All this depends if you have assets at risk. If you have nothing, there is nothing to be claimed. But I will suffer, if you injure me, which will not make me happy and I will want you to die, so I can claim your life insurance policy. So, again your survivors get nothing.

However, keep in mind, that the insurance coverage you have is tied to the same amount of uninsured motorist coverage. There is high percentage of drivers who do not carry insurance and most insured drivers who have minimum coverage. So, if you get into an accident, $50,000 (or less from other state drivers) is not going to cover much of your pain and/or disability. Ah, but you have big life insurance policies, if you die. So die, and make an end of your suffering and make your heirs richer--that is being foolish.

I would not get life insurance to cover cremation or burial. Why would you care? Your body will be disposed and buried by the state, even if their is no estate; it is not going to be dumped in the street. Cremation is very cheap today, cost less than all the useless crap, movies, DVDs, cable TV, eating out etc that your heirs buy everyday. Also, you will have some money from Social Security or some VA benefits if that is the case.

Some of you have high assets, would it not be better to have an umbrella policy to cover any successful claims against you--but at least get adequate auto insurance, with the money you save from paying useless life insurance.

Livecontent
Lots to think about here. The Homestead provision protects the home up to $250K for a single, $500K for married...or is it more? Excellent advice about upping the auto insurance.

I was not aware that an injured party can claim the defendant's life insurance policy, legally. Can you elaborate?

Last edited by RiverBird; 09-27-2011 at 08:35 PM..
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Old 09-27-2011, 09:08 PM
 
Location: Maryland
1,534 posts, read 3,799,778 times
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Our life insurance is zip. We established a reasonable kitty pre-retirement to handle end of life expenses. Otherwise, survivor support is already covered with pension assignments and other funds.

Mathjak may have some useful comments on this issue as there are reasonable estate planning issues which favor LI in retirement under some scenarios but for us its not pertinent in our situation.
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Old 09-27-2011, 09:15 PM
 
Location: Near a river
16,042 posts, read 19,115,555 times
Reputation: 15656
Quote:
Originally Posted by Pilgrim21784 View Post
Our life insurance is zip. We established a reasonable kitty pre-retirement to handle end of life expenses. Otherwise, survivor support is already covered with pension assignments and other funds.

Mathjak may have some useful comments on this issue as there are reasonable estate planning issues which favor LI in retirement under some scenarios but for us its not pertinent in our situation.
Mathjak where are you?
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Old 09-27-2011, 09:55 PM
 
5,090 posts, read 13,612,918 times
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Quote:
Originally Posted by newenglandgirl View Post
Lots to think about here. The Homestead provision protects the home up to $250K for a single, $500K for married...or is it more? Excellent advice about upping the auto insurance.

I was not aware that an injured party can claim the defendant's life insurance policy, legally. Can you elaborate?
It depends on the State if it is a protected asset, just like some states have the homestead exemptions but you better not have money in the bank, stock, bonds, or a salary that can garnished because it will all be gone. In addition, the type of policy can determine some issues. For example some life policies has a cash surrender value, then, in some States, that value is an asset. It can also depend on the State of the accident and subsequent claim. The value of the life insurance is not the big issue here, it is your other assets and your possible disability and suffering.

Understand that the protection of some assets in many states, may protect you, if you are at fault. But, they will also will work against you if you are the injured party and are trying to collect your just amount. So, do not be so joyful over homestead exemptions.

I know people who are so obsessive about insuring against every little loss. So, they buy extended insurance on all small purchases. So, if the coffee maker fails after the initial warranty, they are covered for this inconsequential amount. However, they continue to have minimum auto insurance. I think it is ridiculous when the loss from accident can easily exceed the minimum coverage. Then, you are liable for the remainder.

It affects me because what you do and others do, put me at risk for a loss. On the roads, there is trash of all colors and races, Legals and Illegals, that do not have insurance or have minimum insurance. Many do not have any money. Others are yuppie "posers" with big cars, big houses and big egos but have no money because all is bought on credit--they are in debt. We can see that with all the idiots who went into foreclosure by living beyond their means. Here is Colorado, I am told, by my agent, 1 in 8 drivers do not have insurance. There is a lot of trash on the roads in Colorado and many are your neighbor, driving the Lexus.

I got in a serious accident with an unlicensed driver who had no insurance, many years ago. My car was demolished. I was saved by the seat belt. My injurious were minimal but I could not collect on my auto damage, as I had dropped my collision. I tried to pursue this piece of trash but he moved out of State and he probably did not have any money.

The requirements for auto insurance should be raised, substantially, and strictly enforced. If you cannot afford insurance, then do not drive.

Livecontent

Last edited by livecontent; 09-27-2011 at 10:10 PM..
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Old 09-28-2011, 06:13 AM
 
Location: SW MO
23,605 posts, read 31,686,147 times
Reputation: 29089
Quote:
Originally Posted by newenglandgirl View Post
A caution and a question ^ (a brief answer please, so we don't go off on a tangent)
If you have already pre-paid or prearranged with a mortuary and die a long way from home your body will have to be shipped to them. If you die at or near home, they'll send a van or hearse to pick you up and bring you in.

If you have no prior arrangements with am mortuary, any "local" crematorium can turn you into a crispy critter and ship your cremains to the cemetary.
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Old 09-28-2011, 06:16 AM
 
Location: SW MO
23,605 posts, read 31,686,147 times
Reputation: 29089
Quote:
Originally Posted by newenglandgirl View Post
Lots to think about here. The Homestead provision protects the home up to $250K for a single, $500K for married...or is it more? Excellent advice about upping the auto insurance.

I was not aware that an injured party can claim the defendant's life insurance policy, legally. Can you elaborate?
Homestead laws vary by state and some states have none.

As far as I know, an injured party can collect only from an estate. If an insurance policy specifies a beneficiary or beneficiaries other than the estate, the injured party can't touch the proceeds. They belong to the named recipients.
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