Deciding which life insurance types to look at depends on each individual's specific need.
All life insurance does not fit everyone's situation.
Let us examine why a single person would buy life insurance.
What about a single parent, what kind of policy would fit this person?
Sometimes we tend to think only married people buy life coverage.
Why would we think this way? How about business people?
Why should these people consider life insurance policies?

You Choose Life Insurance Types

• Married People
  
  Let us look at the needs of married people as this seems to be the main reason people buy life policies. Let us also examine the life insurance types they tend to be interested in.
  
  You meet your soul mate and you decide to get married. You also have plans to have one or two children. Your partner and yourself work at jobs that yield a good income.
  
  You both decide it would be wise to buy a home before you have children. As you proceed with that you become very aware that you need some life insurance in case one of you should die.
  
  You want the home to be left free and clear.
  
  The life insurance types that you look at are level term policies and decreasing term insurance. With the level term policy, the death benefit remains the same throughout the life of the policy.
  
  With decreasing term, the face amount of the policy decreases as the balance of the mortgage decreases. You settle on the decreasing term policy as the premiums are cheaper.
  
  You also become aware that as you plan on having children you will have a need for more coverage. You can buy it now as it costs less or you can buy more and more as the years go by, if you can qualify for it.
  
  

  You decide to buy a term insurance policy sufficient to maintain the family at least until the youngest child graduates college. You feel a 20-year term policy would solve that problem.

  You are also aware that your spouse may need to guarantee your income up until age 65, retirement age. One of the life insurance types you look at is probably a 30-year term policy or possibly term to age 65. In some cases, a universal life policy or a whole life policy would fit the bill.

• Single Parent
  
  The needs of a single parent are similar in many ways to those of married people. These people have an even more urgent need as if this parent should die there will be no other parent to care for the children.
  
  After taking the time to make the necessary arrangements for their care a single parent now has to look at life insurance types that would best fit their particular situation.
  
  As this person has a need to be careful with money level term policies would more likely fit like a glove.
  
  If the children are young the 20 years, 25 years or 30-year policies, in the right amount, should be sufficient to carry them through from infancy to the end of their college years. If they are older you may want to use a 10 year or 15-year term policy.
• Single Person
  
  

  Does a single person need life insurance? Why? The only real life coverage needs a single person has is one that will provide sufficient cash to pay off outstanding debt, if any, and to pay funeral costs. It would probably be a good idea to use a 10-year term to do these things.

  These people should keep in mind though that coverage is much cheaper to purchase at a young age.

  It would be wise to buy a fairly larger amount of the type of policy that would be useful when they get older, that is if this person plans on marrying and having children sometime in the not too distant future. The types of life coverage types to consider here would be 20 year term or 30 year term policies.

• Business People
  
  

  Life insurance is an important consideration for any type of business. A corporation or partnership would need life insurance on the lives of each shareholder or partner which the survivors would use to buy out the shares of a deceased shareholder.

  Which life insurance types do these executives consider? Level term policies are usually used to fund this initially but they are usually converted to permanent policies later on that is if they intend to keep the business going for a long time.

  
  
  

  Key man or key employee life insurance is very popular with most any business. You buy a policy on that employee whose absence may hurt the company.

  You make certain that if this employee dies suddenly you have sufficient funds to tide you over until a suitable replacement is found. Long term level term insurance policies can be used for this.

  Permanent insurance is sometimes used. This could provide a lump sum or additional income for this employee at the time of his or her retirement

It’s a dangerous world out there, especially for members of the military. Protecting your country can often come with some unique occupational hazards, and carries a non-trivial chance of serious injury or death depending on where you’re posted and what branch of the service you’re in.

Since life insurance carriers often evaluate a person’s eligibility for life insurance based on their risk of death, active duty service members are often (but not always) stuck with higher prices if they opt for commercially available life insurance products. Luckily, they have other options tailor-made for their situation – the Service members Group Life Insurance, or SGLI.

What is SGLI?

SGLI is a military-provided life insurance option which covers active duty service members in the US. It combines elements of Traditional Life Insurance, Accidental Death and Dismemberment coverage, and Long-Term Care protection under one policy that offers guaranteed coverage over the duration of your tenure in the military.

When you join the military, the US government automatically enrolls you in the SGLI program and begins deducting premium payments from your paychecks. However, all service members have the right to opt out of the SGLI coverage to try for a lower price with an alternative life insurance policy if they wish.

SGLI is a standardized plan that is the same for every service member, but there are a few changes that you can make to your coverage to make sure your family is covered correctly. When you initially are enrolled in SGLI, you are covered for the plan’s maximum death benefit amount of $400,000, which costs around $26 every month taken directly from your paycheck. Service members can opt to reduce their coverage from the maximum in increments of $50,000, which reduces the deduction by $3.25 monthly per increment.

If you die on active duty, SGLI will allow your family to receive an extra $150,000 payment up to the maximum allowed coverage of $400,000, so you have the option to pay for a lower coverage amount and still receive the full $400,000 death benefit depending on the circumstances.

Non-military spouses and children can also be covered using the SGLI’s family coverage program, FSGLI. FSGLI can provide up to $100,000 in coverage for spouses of active-duty military members, and $10,000 each for dependent children.

What SGLI Covers

SGLI covers the life of the insured with the face amount of the policy, just like life insurance. However, it also contains separate provisions for injuries that can offer a separate payout of up to $100,000 for loss of sight, hearing, nervous system function, and dismemberment as the result of traumatic injuries.

The conditions that SGLI covers with traumatic injury benefits include:

• Total, permanent loss of sight, speech or hearing
• Paralysis of any limb or limbs
• Loss of a hand or foot
• Loss of fingers, toes, or limbs
• Burns across 20% of either body or face
• Loss of ability to perform Activities of Daily Living (eating, bathing, dressing, toileting, transferring to beds or chairs, and continence.)
• Inpatient hospitalization
• Reconstructive surgery costs for repairing wounds to limbs or face

Alternatives to SGLI

While SGLI’s coverage plan is fairly comprehensive, many young and healthy military service members are often eligible for better coverage amounts at lower prices through commercially available life insurance policies. If you’re stationed in a fairly safe position and are able to complete your life insurance application while you’re in the US, almost every commercial life insurance carrier will be able to cover you.

However, not all life insurance carriers offer meaningful coverage to service members on active duty in dangerous parts of the world – the heightened risk associated with combat deployment can often mean that coverage will be denied outright. Even for carriers that are willing to cover front-line service members, coverage in the case of death via an ”act of war,” such as dying in combat, is often excluded from policies.

This means that comparison shopping for term life insurance policies is crucial if you’d like to find the right coverage for your situation. The simplest way to shop around for coverage that will fit your life is to use an independent agency like Quotacy. If you apply online through our application process, we’ll shop around behind the scenes for you to make sure that you’re getting the best deal possible on a plan that will cover your lifestyle.

What Carriers Will Want To Know

If you decide to apply for coverage through a civilian life insurance carrier as an alternative to SGLI, they will likely have quite a few questions to ask you in order to give you a price that most accurately reflects your risks. Those questions will include:

• Are you now a member of any military service, active or inactive?
• What branch do you serve in?
• What is your present duty status?
• What is your rank?
• What is your unit, assignment, and location?
• What is your occupational specialty?
• Does your position involve any hazardous activities (like aviation, diving, parachuting, bomb disposal, special service groups, etc.)?
• Do you receive supplemental hazard pay based on your duties? If so, how much?
• To the best of your knowledge, are you aware that A: you or your unit will be transferred overseas? If so, where? B: you will be transferred to a new unit? C: you or your unit will be alerted for duty (if presently in the Reserve or National Guard)?

Carriers will ask for this information at various points during your application process. Depending on the company and the amount of information you give them to work with, you may get these types of questions upfront or a few weeks in.

If you opt for an independent agent life insurance agent, they should be able to steer you towards carriers that have better track records working with military families, thanks to their ability to shop around for your case. However, not all independent agents will work at length for military families, so be sure to speak with your agent up front to make sure they can help your family.

Life insurance is important for all families, especially if a parent has a dangerous job. Losing a mother or father can change a child’s life and leave a spouse with unexpected debts, not to mention the grief and sadness that come from losing someone you love. Working with a life insurance agent will help you learn the facts and find the best options available, whether that’s through a commercial life insurance carrier or through SGLI’s automatic coverage.

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Life insurance for children… sounds a little creepy, but it can actually be an extremely beneficial way to plan ahead for your children’s future.  Adding a child rider onto your term life insurance policy is the easiest way for you to purchase life insurance for your child.  How it generally works is that you pay a few extra dollars on top of your life insurance policy’s monthly premium and then each of your current children under the age of 18 and any future children you may have are covered with a small amount (typically anywhere between $1,000 – $100,000) of life insurance coverage.

Losing a child would be unimaginable and the funds a child rider provides could be used to pay for a funeral and allow the parents to take time off work to grieve.  While this death benefit is one aspect of what a child rider can offer, another benefit is that purchasing a child rider guarantees your children’s future insurability.  What this means is that once your child is of age (typically 18-25) you can convert the child rider into a permanent life insurance plan and your child would not be required to prove, via medical exams and records, their insurability.  If your child happened to develop a medical condition that could otherwise prove difficult to insure this guaranteed insurability would be a lifesaver.

Most life insurers require parents to complete a questionnaire form providing information on their children before they would approve the child rider coverage.  Depending on the insurer, some forms are simple with a few questions and some are much more inquisitive.  Below are a few screenshots of one company’s child questionnaire form.

That form would be an example of an insurer who requires more in-depth information on children before approving child rider coverage.  If any children have been, for example, diagnosed with any chronic illnesses they may be denied coverage.  So, what can a parent do?

Are there child riders that do not require medical underwriting?

Principal Financial is one life insurance company in particular that does not require any medical or lifestyle information on a child for rider approval.  They offer a maximum coverage of $25,000 and allow you to convert the rider to a permanent life insurance plan up to three times the amount of the rider in accordance with the conversion deadline in their contact.  For parents with children who have special needs or have been diagnosed with a serious medical condition, this child rider can be extremely beneficial.

In a previous blog post titled Everything You Want to Know About Life Insurance Child Riders we wrote an overview on child riders.  In this post we touched on an example in which Principal’s child rider would be especially advantageous.  Let’s dig a little deeper into that situation.

Example:

Jane Doe is 40-years-old and she is planning on purchasing a $500,000 20-year term life insurance policy from Principal.  She wants to add a child rider onto her policy as well.  Jane does not smoke and is quite healthy.  She qualifies for the Preferred risk class.

Jane’s payment options:

• Annually: $521
• Semi-Annually: $267
• Quarterly: $137
• Monthly: $46

Jane has four children – a 22-year-old daughter, twin 15-year-old sons, and a seven-year-old daughter.  Jane’s eldest is older than 18 so she would not be covered by the child rider; however, her twins and her seven-year-old daughter who has been diagnosed with acute lymphoblastic leukemia fortunately will be covered by Principal since they do not require medical underwriting for child riders.

Today, most childhood leukemias thankfully have very high remission rates.  If the worst should happen though and her daughter passed away, Jane would receive $25,000 which would allow her to pay for a funeral and take the needed time off work to grieve and spend with her other children.

The child rider benefit of guaranteed future insurability is also particularly advantageous for Jane’s seven-year-old daughter.  Applicants with a history of acute lymphoblastic leukemia would typically only be able to qualify for Table B ratings, and this would only be available nine years post-treatment (on average).  Table B means the applicants would have to pay 50% more than Standard premiums (see table below for reference).   However, Jane’s daughter would be able to convert to a $75,000 permanent policy at Standard regardless of the status of her leukemia.

As beneficial as a child rider would be for Jane and her children, the Principal child rider would be even more beneficial to a parent who has a child with special needs, such as Down’s syndrome.  Unlike leukemia which can go into remission, Down’s syndrome is a lifelong condition with considerably reduced life expectancy.  You would be hard-pressed to find a carrier to approve an applicant with Down’s syndrome.  Some insurers will approve coverage if the condition is mild, but the applicant would be highly rated (Tables H-J likely used) ergo the premiums would be very expensive.  With Principal, however, a special needs child would be covered by the child rider and could later be converted into a permanent policy.

When you apply for term life insurance online at Quotacy, during the process you will receive a form in which it asks if you have children and if you would be interested in adding on a child rider.  If you have a child with special needs or a serious medical condition, consider choosing Principal when applying.  Not every applicant or policy will qualify for a child rider, for example, most insurers do not give the option of adding a child rider if an applicant is over the age of 55.  But for the majority of applicants who need a child rider, the option is there.  Adding a child rider onto a policy is quite inexpensive and can be very beneficial to your family.  Contact us or comment below if you have any questions or want more information about child riders

When purchasing life insurance, the question really isn’t how much you need, but how much capital your family will need at the time of your death, which depends on two variables:

1)    How much will be needed at death to meet immediate obligations?

This amount takes into account all final expenses: uncovered medical bills, funeral and estate-settling costs, outstanding debts, mortgage balance and college costs to name a few.

2)    How much future income is needed to sustain the household?

This is the number you’ll arrive at after calculating the “present value” of cash-flow streams your family will need after your death.

With summer break upon us, most of us are reminded that home has its perks. Think back to your spring break vacation … Maybe you were stuck at the airport with your kids when their devices ran out of power. Or, maybe you spent hours in the car taking direction from a computer-generated voice telling you to turn in 0.5 miles. Every year, we crave an escape from our daily routines. Then, halfway through our vacations, we yearn for the comforts of home.

Now, take a moment to equate your last family travel experience with the current state of healthcare regulation. The Affordable Care Act (ACA) may have brought the change that some were craving, but the environment has now become a bit chaotic. Instead of craving change, we want reliable routines.

Fortunately, we still have COBRA. COBRA feels comfortable, sort of like home. With COBRA, you know what to expect. You mostly know the rules and how they will be applied. At one time, you might have been overwhelmed by COBRA concepts like qualifying events, applicable premiums, or election notices. However, now that you’ve made it through ACA compliance, COBRA administration is as easy as pie.

Now, you are COBRA-confident. You’ve got this. And, even if you don’t, the basic refresher below will bring it all into focus …

What is COBRA?

COBRA is the continuation of group health insurance by a qualified beneficiary who loses coverage due to a qualifying event. The qualified beneficiary must pay 102% of the cost of coverage.   

What Plans are Subject to COBRA?

COBRA applies to group health plans that provide medical care and are maintained by an employer. Examples of plans subject to COBRA include health plans; dental and vision plans; cancer (disease-specific) policies unless they are completely voluntary, employee-pay-all; prescription drug plans; health FSAs; HRAs; drug or alcohol treatment programs; wellness programs that offer physical exams, cholesterol screening, flu shots and nutrition counseling. 

Who is Eligible to Elect COBRA?

Qualified beneficiaries who are covered by a group health plan immediately before a qualifying event are eligible to elect COBRA. Qualified beneficiaries include a covered employee (including retirees, independent contractors, partners of a partnership – basically anyone provided coverage because they are performing or have performed services for the employer).  Qualified beneficiaries also include the spouse and dependent child of a covered employee.

What Triggers COBRA?

COBRA kicks in upon the occurrence of a qualifying event if that qualifying event causes a loss of coverage under the group health plan. There are seven qualifying events: (1) termination of the covered employee’s employment (other than for gross misconduct); (2) reduction in the covered employee’s hours of employment; (3) death of the covered employee; (4) divorce or legal separation from the covered employee; (5) ceasing to be a dependent child under the terms of the plan; (6) the covered employee becoming entitled to Medicare; and (7) the employer’s bankruptcy (only for retiree plans). 

Remember, the qualifying event must cause a loss of coverage. A loss of group health plan coverage means “to cease to be covered under the same terms and conditions as in effect immediately before the qualifying event.” This encompasses much more than simply losing group coverage entirely. For example, suppose a company has two plans for employees at different locations and the premiums are higher at one location. If an employee is transferred to the location with the more expensive plan and no longer qualifies for his or her current plan, the qualified beneficiaries have a COBRA right under the old plan.

What is the Maximum Duration of COBRA Coverage?

Generally, COBRA lasts for up to 18 months if the qualifying event is a termination of employment or a reduction of hours. COBRA can last for up to 36 months upon the death of an employee, divorce or legal separation, child’s loss of dependent status, or an employee’s entitlement to Medicare. COBRA for a disabled qualified beneficiary can extend up to 29 months. Finally, retiree coverage that terminates due to the employer’s bankruptcy can lead to COBRA for the life of the retiree plus 36 months for the spouse after the retiree’s death. If the retiree is not living when the bankruptcy occurs, but the surviving spouse is covered by the plan, the spouse gets COBRA for life. Keep in mind, there are many ways that COBRA can end early such as due to nonpayment of premiums. 

What COBRA Notices and other Plan Disclosures are Mandatory?

Notification drives COBRA. Some of the notices and communications that are mandatory include: the initial (General) notice; the election notice; the notice of unavailability of COBRA coverage; the notice of early termination; the notice of COBRA premiums short by an insignificant amount; open enrollment materials; individual conversion policy notices; summary plan descriptions; summary of benefits and coverage; summary of material modifications, and; a notice of change in COBRA premiums.

Just the Beginning

This basic refresher gets you through the front door, and comfortable with daily NEW LIFE INSURED routines. But like any home, NEW LIFE INSURED has its own nooks and crannies. If you venture into the basement or attic, you may encounter some scary topics including premium calculations, coverage terminations in anticipation of qualifying events, deadline calculations, notice contents, and let’s not forget Medicare! When these things come up, don’t go it alone. 

 

When you’re just starting out, it often seems that a dollar never stretches far enough. And with new commitments, such as buying your first home or having children, comes the responsibility to make sure your loved ones will be provided for financially, no matter what life may bring.

If you were to die unexpectedly, life insurance is there to make sure your loved ones can maintain their standard of living, stay in your home, send your kids to the same schools and keep their plans for the future on track. It also gives the grieving spouse or partner time to make decisions, or in some cases find work outside the home, without worrying about finances.

But common misconceptions often prevent young families from purchasing the life insurance they need.

Myth 1: I only need life insurance if I’m the primary breadwinner in my family.Whether you bring home the largest paycheck in your household or a smaller one, your family relies on your income to maintain its quality of life, and it would be missed if something were to happen to you. Even if you don’t work outside of the home, having life insurance is a smart choice. Stay-at-home parents perform valuable services such as childcare, cooking, housecleaning and household management, which can be costly to replace for a surviving spouse or partner.

Stay-at-home parents perform valuable services such as childcare, cooking, housecleaning and household management, which can be costly to replace for a surviving spouse or partner.

Myth 2: If I buy a term life insurance policy and find that I still need protection when the term ends, I can always renew the policy. Term policies are quite popular with many young families, and for good reason: They typically offer the greatest coverage for the lowest cost. Term insurance provides protection for a specific period of time (the “term”), and can be ideal for people who feel they have financial needs to cover that will disappear over time, such as a mortgage or a child’s education.

However, many families realize that even after the kids are grown and the mortgage is paid off, their need for insurance continues—to provide income for a surviving spouse, eliminate debts, pay taxes, etc. Because life insurance premiums increase with age, renewing your policy when the term expires can be very expensive. Moreover, poor health may make renewal impossible.

Myth 3: I only need term life insurance. Term life insurance makes sense for many young families because their need for coverage is great and their budgets are often limited. But that doesn’t mean it’s the only type of insurance you should consider.

Permanent life insurance policies provide a death benefit as well as other unique features such as lifelong protection and the ability to accumulate cash values on a tax-deferred basis, similar to assets in most retirement-savings plans. You can access the cash values for important uses like a child’s education or a business opportunity. (Keep in mind, however, that withdrawing or borrowing funds from your policy will reduce its cash value and death benefit if not repaid.)

If these features appeal to you, it might make sense to buy a large face amount term policy, giving you the death benefit protection you need, and combine it with a smaller permanent policy. When your budget permits, you can gradually increase your permanent insurance coverage. 

And remember, insurance agents and advisors are there to help you. They can step you through your life insurance needs and solutions at no cost or obligation. 

                 


Quotacy is always here to answer your life insurance questions.  One of the most commonly asked questions we receive is: How can I find out if someone purchased life insurance on me without my knowledge?  You should feel relieved knowing that it is nearly impossible to purchase life insurance on someone without their consent.

Life insurance companies implement a number of obstacles in order to prevent insurance fraud.  These obstacles include:

• Application questions – When applying for life insurance, there are certain questions that the insurance company uses to verify identity. These questions include:
  • Full name
  • Street address
  • Social Security number
  • Driver’s license number
  • Employer information
• Signatures – All life insurance applications require the signature of the proposed insured.
• A release form – Most policies require the proposed insured to sign a consent form to release his/her medical information.
• Phone interview – After submitting an application, the insurance company will contact the proposed insured for a confidential phone interview to review the application’s accuracy.
• A medical exam – After applying, most life insurance policies require the proposed insured to take a medical exam. The medical examiner will check the insured’s ID to ensure it’s the correct person and will ask the insured many of the same questions from the application to verify answers.
• Insurable interest – In order for someone to purchase life insurance on someone else, life insurance companies require insurable interest. Insurable interest means there has to be financial dependence.  For example, spouses rely on one another’s income for their standard of living.  Your neighbor does not have a financial interest in your life and could not buy life insurance on you.

After taking those obstacles into consideration, if you still think someone may have bought coverage on you without your permission, there are steps you can take, but it may take some effort.  It is not possible to just Google your name alongside the words “life insurance” to find out.  Life insurance is personal, so protecting privacy is important.

Step 1 – If you think you know which insurance company the policy in question was purchased from, you can call their customer service and explain the situation.  They will be able to confirm if there is a policy on you and then help you make the appropriate steps to terminate it.  There are many, many life insurance companies, however, so this option only realistically works if you know the name of the life insurance company.

Step 2– You can request your MIB Consumer File.  Life insurance underwriters use MIB’s services when assessing individual applications.  The consumer file may include the name of any MIB member company that:

• Received a copy of the medical and personal information that MIB has in its database about you during the three-year period preceding your request;
• Made an “inquiry” to MIB about you within the past two years.

It is free to request your MIB (Medical Information Bureau) file.  You will not have an MIB Consumer File unless you have applied for individually underwritten life, health, disability income, long-term care or critical illness insurance within the past seven years (or earlier depending on applicable law) and the insurance company to which you applied (or its reinsurer) was an MIB member company that submitted an MIB inquiry.  So, if you get a letter stating you don’t have an MIB file, you can rest assured there is likely no policy out there on you.  If you do receive a file, you can look for any companies that you did not personally apply to and contact them.

Step 3 – You can hire policy locator services.  There are online services that for a fee will send out emails and letters to life insurance companies on your behalf to discover if there is a policy in your name.  The MIB website mentioned earlier is one company that offers this service.  It costs $75 and it is important to note that the locator service generally will not report on policies with a $100,000 face amount or less, guaranteed issue policies, employer-based life insurance, or military issued life insurance.

As you have read, it is unlikely that there is a life insurance policy out there with your name on it that you did not sign off on.  Life insurance companies take privacy and security very seriously.  We hope this information was helpful and answered your question.

Today, more than half of the world’s population are active social media users, and on average people spend five years of their entire lifetime on social media. That includes approximately 35 minutes per day on Facebook. But what does all this mean for the future of health insurance? I will try to answer that in less time than it takes you to check your Facebook feed…

At last week's 9th Global Health Insurance Conference in Amsterdam, it was no surprise that the focus of events was on the impact of technology on the future of health insurance, with a mixture of both optimism and caution amongst participants. Whilst technology has the potential to open many doors for our industry, the sheer scale and pace of technological evolution means it can be difficult to make sense of the changing headwinds.

The health insurance industry has made significant strides in recent decades, with smartphone Apps and online member tools now considered the norm, while technological advancements continue to improve back office processes such as underwriting and claims management. However, we are still only at the start of this journey, and the next five years are likely to be game-changing for our industry. 

It was clear from discussion at the Conference last week that there are three key trends driving the digital global healthcare and insurance markets; namely wearables, big data and telemedicine. The industry is already facing increased competition in these areas, including from outside the traditional insurance sector, as new digital tools change the way consumers think about how they protect and manage their health.

Approximately one in six consumers currently own a wearable, and these devices continue to be integrated into health insurance plans to reward consumers for healthy behaviours. But in the near future the wearables of today will become obsolete, and health insurers will have to contend with new devices, such as digital contact lenses that monitor blood sugar levels, or clothes that record your heart rate when you run. Ultimately the rise of wearables presents significant opportunities for health insurers to better manage risks and keep premiums down for consumers.

More broadly, the true potential for wearables lies in the data they represent, which leads onto the next key trend – big data. With more than eight billion interconnected devices worldwide, business now have access to data on a scale that was previously unimaginable. Over the coming years, insurers and the healthcare sector more widely will need to significantly improve their ability to harness this data for commercial benefit; from customised product and marketing strategies for each individual, through to improved risk modeling tools to reduce loss ratios. 

Finally, the rise of telemedicine and mobile health is fundamentally changing the health insurance industry. While still relatively nascent, this technology has the potential to open up new markets by facilitating remote medical consultation for those living in poor or rural areas; increasing access to healthcare for groups who previously might not have been able to visit a doctor, let alone have health insurance.

More fundamentally, new technologies could help tackle the ever rising cost of healthcare and keep the costs of insurance claims down. Enhanced virtual care and monitoring services which spot early warning signs in high risk patients will help prevent the need for costly acute medical interventions. Meanwhile Apps that provide nutritional advice or support people to quit smoking could help address the growing danger from non-communicable diseases. Goldman Sachs has suggested the US alone could save US$300bn from digital health solutions, and the savings worldwide will be even more significant.

In summary, the future looks bright, with technology presenting significant opportunities for the industry as a whole. However, when dealing with people’s health and well-being, there is good reason to be cautious in the way we implement technological progress. Every week there is a new reminder of the vulnerabilities that technology can create. Given the sensitive nature of the data held by health insurers, ensuring effective protection of consumer information is paramount. This is not an issue that can be resolved overnight, and the industry must continue to collaborate and work with regulators to ensure the rules governing data protection are fit for purpose. 

So what does the future hold? One thing is clear – this is an ongoing journey. The health insurance industry will need to continue to innovate and adapt with the evolving technological landscape, and find new ways to meet the needs of our digitally savvy customers. Ultimately we must harness technology to go beyond the traditional parameters of health insurance, and deliver the truly integrated health solutions of the future. 

One of the lesser-known provisions of the Affordable Care Act (ACA) is an Annual Special Open Enrollment Window that gives you and your business the opportunity to get health coverage for your employees, even if you were turned down in the past.

An Amazing Opportunity

You can enroll in CaliforniaChoice with fewer requirements from 11/15/17 to 12/15/17. You do not have to meet the standard 70% employee participation requirement, nor do you have to contribute the usual 50% of premium for your employees’ health coverage.

This special enrollment period is an excellent way for your employees to get the coverage they want – and need – without increasing the costs to your business.

No Minimum Enrollment, No Minimum Premium Contribution

If you apply during the 11/15/2017 to 12/15/2017 enrollment Window, your employees’ coverage will begin on January 1, 2018.

There’s no minimum enrollment for your group and there’s no minimum contribution required from you for your employees’ premium. If you don’t want to contribute, then you will collect the full premium from each of your participating employees each month and pass it along to CaliforniaChoice.

If you want to contribute, you are able to pay any amount toward their coverage premium; the usual 50% employer contribution does not apply. It’s your choice; you can contribute 5%, 10%, 25%, or more – or you can make zero contribution to your employees’ premium.

There’s no minimum group participation either. (The usual requirement that 70% of your employees enroll does not apply.) So, if you have 10 employees and just two want to enroll, that’s fine. All we ask for is a minimum of one enrolled employee and that CaliforniaChoice be the only health plan offered.

Great Options for Employees

CaliforniaChoice offers your employees a variety of plans from seven different health insurance carriers, so each one is sure to find coverage to match his or her individual or family health care needs. They can select from HMOs, PPOs, HSAs, and other plans from Anthem Blue Cross, Health Net, Kaiser Permanente, Sharp Health Plan, Sutter Health Plus, UnitedHealthcare, and Western Health Advantage.

Qualification

It doesn’t matter how many employees you have, or how many choose to sign up for coverage through CaliforniaChoice during this special enrollment window. This is your once-a-year opportunity to offer health coverage to your employees without worrying about participation guidelines or premium contribution requirements.

Keep in mind, though, if you employ 50 or more full-time and/or full-time equivalent employees, your business is considered an Applicable Large Employer and you required to offer “affordable” health coverage to full-time employees. Continuation of Coverage

If you sign up during this ACA Special Open Enrollment Window, your employees’ coverage will begin January 1 and continue for up to 12 months as long as the premiums are paid. At the end of that time, if you want to keep your CaliforniaChoice coverage, you will need to meet the usual participation and premium contribution requirements at renewal.

What is a term life policy?

Quite simply, a term life policy is insurance protection that provides your beneficiaries with a cash death benefit if you pass away during the term of the policy.  For help understanding  the difference between a term policy and a permanent policy you can visit Us .

Life insurance companies will offer a term life policy for those individuals who qualify under a company’s underwriting guidelines. 

Underwriting guidelines are the criteria that insurance companies use to determine if you are an acceptable risk.

It’s important to remember that each life insurance carrier has different underwriting guidelines. They will all look at your health and lifestyle differently.

How do I know which life policy is the best?

To determine which life policy works best for your situation it is important to do a little bit of homework. By reviewing this article and with the help of google you should be able to gather enough information to make a wise decision regarding your life insurance needs.

Let’s breakdown some of the common questions surrounding a term life policy and how to go about finding the best plan.

How much coverage do I need?

This is probably the best starting point when purchasing life insurance protection. Here are some of the common reasons individuals purchase life insurance:

• Replace income– this is probably what most people thing of when trying to determine how much life insurance protection to buy. If you are not around to earn an income, then your family will suffer a significant lifestyle challenge. Six to Ten times income is a good starting point.
• Mortgage Protection– another common reason a family might purchase life insurance is to make sure the mortgage balance is paid off in case of an untimely demise.
• Children Education– Planning for a college education can be very expensive. Who knows where your child may want to go to college. And with college costs rising every year, protecting this need with life insurance makes a lot of sense.
• Final Expenses- the cost of final expenses such as funeral and burial continues to rise. Also paying off any outstanding credit card or auto loans may be something that needs to be planned for.
• Estate Planning Needs– Life insurance can often times be a good tool for those who expect to have a large estate tax due upon death. Other estate planning needs that life insurance can assist with include college endowment or charitable giving.

Now, it is important to remember that each person’s needs are different and we recommend a complete needs analysis from an insurance professional, CPA or estate planner to determine exact needs.

But, if you wish to do a quick needs analysis in order to get coverage in force as quickly as possible.

To this point we have primarily talked about term life coverage for personal family needs. But, term life insurance can also be used the same way for business needs. Here are some of the common ways that term life insurance can satisfy business protection needs:

• Key Person Insurance– Life insurance protection on a key member of a business or organization. Someone who is vital to the continuation of the business.
• Buy-Sell Insurance– A buy-sell agreement between two business partners can be funded with life insurance. This insures an easy transition of the business if one of the partners dies.
• Collateral Assignment– Many times banks want a life insurance policy assigned to them as the lender on a business loan.
• Executive Bonus– Often times a life insurance policy can be used as a special bonus to an important member of the business. This type policy can offer extra protection for the employees family.

Who is the life policy for?

Another important question that must be answered when you are thinking about purchasing a life insurance policy is who actually is the policy for?

Most often this is fairly straight forward when a personal policy is purchase. Many times the spouse is named as primary beneficiary. But, the need for coverage may be more complicated than this.

What if you want to leave money to your kids from a previous marriage? What if you have a former spouse that must have her as the beneficiary due to a divorce decree? Are there step-children involved? If leaving to minor children is there a guardian or trustee set up?

These questions on the surface may sometimes seem simple, but often times can get confusing. Again, it is important to know who the benefit of the life policy is for and make sure to update any necessary beneficiary changes.

How long do I need the protection?

Okay, this question is sometimes the most difficult to answer. After all, most people want the coverage to be in force for as long as possible. But, it is very important to remember that term life insurance is temporaryprotection, not permanent protection. This simply means that at some point when the original term period has expired the rates will increase dramatically if you want to continue the coverage.

Term life insurance by its very nature is the least expensive type of coverage you can purchase. It is meant to provide you with the most death benefit protection for the least amount of premium. So, it is important to know why you are buying the coverage and how long you want the coverage to offer protection.

Let’s look at a few examples of term life policies that are offered in the marketplace:

• 10 Year Guaranteed Level Term–  This policy offers a guaranteed level premium for 10 years. At the end of 10 years the rate will adjust higher. This policy should only be for a short term need. An example would be perhaps someone who has just 10 years remaining on a home mortgage. A 10 year term policy would not make sense for someone who needs protection to last 20, 30 years or longer.
• 15 Year Guaranteed Level Term- Offers guaranteed level premiums for 15 years. Rates for this policy will be more expensive than a 10 year policy, but will also offer an additional 5 years of coverage. This policy could make sense if your needs are limited to around 15 years. An example might be a married couple with a young child that will be through with their education/college within 15 years.
• 20 Year Guaranteed Level Term-  A 20 year guaranteed level premium plan offers many people a good compromise. The rate will be more expensive than a 10 or 15 year policy, but offers an additional number of years of protection. An example for this policy would be an individual who is age 45 and wants protection to last until they retire at 65.
• 25 Year Guaranteed Level Term- The 25 year term policy is not offered by as many insurance carries as the 10,15 and 20 year plans, but can be a great fit for someone that has new baby or new mortgage and wants to have coverage with guaranteed level rates for 25 years.
• 30 Year Guaranteed Level Term- The 30 year guaranteed level term is very popular especially for young families and those with new mortgages. The rates are higher than those of the other terms, but provides excellent  long term protection during most of the working years.
• Return of Premium Term– The return of premium term policies offered in the marketplace allow you to still lock in most of the guaranteed level rates mentioned above, but with one caveat. This policies allow you at the end of the return to recoup most if not all of the premiums you have paid in. Of course these rates are higher priced, but for those individuals who may need a simple way to insure and save, this product can be a solution.

What if I have health problems? Can I still get a term life policy?

Okay, so you have determined you have a need for life insurance. You know the amount of coverage you desire. You know the plan of coverage you want, but what happens if you have a history of pre-existing medical conditions? Or perhaps you scuba dive, race cars or have a high risk occupation.

Finding affordable protection for those who may be in less than perfect health is possible. But, there are a couple of things you need to do to help your cause. First you must work with an agent or agency who specializes in this niche area of underwriting.

Any agent in the marketplace can write a term life policy on someone who is in perfect health. But, only agents who have years of experience and knowledge working with all kinds of health impairments can find you the company that specializes in your particular risk.

As we mentioned earlier, all life insurance companies have certain criteria they look at when evaluating someone for coverage.

But, there are also a handful of companies who underwrite certain risks better than others. The secret is finding the company that will offer you the lowest rates for your condition.

Fortunately, you have landed on the right page. We are experts at finding the companies who do this type of underwriting the best. In fact, with our over 30 years of experience we often times can instantly tell you if an offer is possible and what even give you a quote.

Optional riders that can be added to a term life policy

Many of the hundred, if not thousands of life insurance carriers offering term life policies also offer riders that can be added to the base policy.

A rider is simply an additional benefit added to the base policy at an additional charge. Here  are some of the most common riders that can be added to term life policies.

• Waiver of Premium– this benefit which is typically available up to about age 55 allows the insurance company to waive your premium should you be disabled.
• Child Rider– A child rider offers a low cost way to add child(ren) coverage to your policy. Most child riders are limiting to $10,000 of benefit per child.
• Spouse Rider– Much like the child rider , the spouse rider allows you to include your spouse on the base policy. The benefit amount for the spouse is usually limited to $50,000. Important to note that all riders are subject to same underwriting review as the base policy.
• Long Term Care or Critical Illness Rider– these riders are fairly new and only a few carriers offer them. But, they do offer you the ability to accelerate your death benefit and use for a long term care or critical illness. The definition of the long term care or critical illness rider is different for each carrier, so it is important to review carefully.
• Accelerated death benefit rider–  This rider has become very common on most term life contracts and often times has no additional premium charge. Most define this rider as the ability to accelerate up to 50% of the death benefit early subject to a maximum amount if you are diagnosed by a doctor with a terminal illness and have less than 12 months to live.

Real Life Example of the use of Term Life Insurance

David is a 35 year old married man with 3 children ages 8,5, and 3. David has a small amount of life insurance at his work, but feels the need to have more coverage. David has approximately $225,000 left on his mortgage. His income is 85,000 per year. David wants to be sure that his wife and kids have enough money to pay off the mortgage, put the kids thru school and still have income to live off of. David calculates his needs at $1,000,000 of coverage.

David would also like a policy that will stay in force until he retires in approximately 30 years. In order to keep his premium cost down, Dave wants to ladder his policies. This laddering will help his coverage stay in affect for the needs as he goes thru his life. Dave decides to purchase a $225,000 15 year level term to match the approximate time left on his mortgage.

Dave’s youngest child is 3 so he determines that a 20 year guaranteed level term policy for $250,000 should be set aside for education purpose. The remaining $525,000 of coverage will be carried under a 30 year guaranteed level policy.

Dave would also like to add some coverage for his wife and kids. So, he decides to add a child rider for $10,000 of protection for each child and he places a spouse rider of $50,000 for his wife.

Dave now has a complete line of protection for most of his foreseeable needs.

Conversion option with term insurance

One of the most important features that is offered for free with most term life policies is something called the conversion option.

The conversion feature is included in most term policies, but it is important to check your particular proposed plan to see the details of this option.

Some companies only offer the conversion option for a limited time. Perhaps only during the initial guaranteed level period or to a certain age. Knowing how long your conversion option is offered can be particularly important if or when you need it.

Here is exactly what the conversion option is. The conversion option allows you to convert any or all of your term death benefit to a permanent lifetime death benefit with no medical underwriting or health questions.

Now, you may ask why is this so important. Here is why. Suppose your needs change and so does your health. Let me give you an example.

Joe purchased a 10 year level term to cover him until is youngest kid gets out of college. Joe was originally issued a $250,000 policy at super preferred non-tobacco rates. Approximately 5 years into the term policy Joe is diagnosed with diabetes and high blood pressure. Joe also finds out a new surprise. His wife is pregnant.

Joe knows his current 10 year term policy only has 5 years remaining. He is worried if he will not be able to qualify for new insurance protection due to his medical history.

Fortunately,  Joe has the conversion option on his current policy. He can now convert any or all of his current term policy to a new guaranteed lifetime level premium policy with no medical exam or health questions. The conversion option is guaranteed.

When or if he converts his current coverage to a new plan he will receive the super preferred non-tobacco risk class that he was originally approved at 5 years earlier. This is a huge advantage for those whose health has changed but still need insurance coverage.

Bottom line is, you never know if you will need to extend your coverage. You also never know what your health will be. It is vital that your current term life policy have the conversion option included just in case.

Who are the best term life policy companies?

In the life insurance arena it is common to see some of the same company names show up year after year as having the best term plans. Of course, occasionally you will have a company that wants to make a splash in the term market and they will lower their rates to be competitive.

Or, you may find a company that wants to be more competitive in the “impaired” risk marketplace, so they begin to price their rates better for those with diabetes, heart disease, etc.

But, as of the time of this blog, below are the companies that typically show up as being competitive both in price and underwriting. In addition, all of these carriers are rating excellent by most of the rating services such as A.M. BEST, Standard & Poors and Moody’s. In no particular order:

• Protective Life
• Banner Life
• Prudential 
• Lincoln National Life
• Principal National Life
• Cincinnati Life
• Ohio National Life 
• American General Life
  
• John Hancock
• Mutual of Omaha
• Pacific Life
• Assurity Life 
• North American Life
• Mass Mutual Life
• Savings Bank Life 
• Independent Order of Forresters

How to apply for a term life policy?

Nowadays there are many ways to buy life insurance. Below are some of the ways you can purchase a term life policy.

1. Online from a big box quoting service perhaps hundreds of miles away.
2. From your hometown property and casualty company
3. Direct toll free number to an insurer
4. The use of an independent insurance adviser
5. A bank
6. Financial Adviser or CPA

It’s important to keep in mind, how much assistance you will need when purchasing coverage. Will you need help finding the lowest rates? Do you want to be sure to have somebody to call on policy issues that come up after the policy is placed? Do you have a pre-existing medical condition that needs an experts assistance? Do you need to know every detail about the policies? (conversion, riders, etc.)

Most people buying life insurance know that somebody will get paid a commission to help with your policy. All life insurance policies pay a commission to someone- no matter how much assistance you get. The commissions are already built into the price of the policies, so there are no negotiations on commissions like with a car sale or some other large ticket item.

In other words, let’s say you buy a Prudential policy from an agent in California even though you are located in Georgia. The rate would be the same in Georgia as it would be in California. So, what you are paying for is the service you get in helping you obtain the protection and the service you get once the policy goes in force.

So, although a quick toll free number to someone sitting in a stall may be a quick way to get a quote- what actual personal service will you get thru the underwriting process and after the policy is completed? I mean will you ever be able to get a hold of the person again from the 1-800 number.

Of course, we are probably biased, but we feel you will get the best rates, knowledge and service from an independent agent who has been in the business for 20+ years.

An independent agent will represent hundreds of companies and will be able to give you expert advice on the questions you need answered. Also, an independent agent who has been in business for many years is here to stay. No worries about not being able to reach your agent when the time arises.

Remember, someone on the end of that phone is getting paid to sell insurance. We think it should be someone who will be there to answer any questions that arises and represents your best interest, not theirs.

Information needed to quote on a term life policy

• Name
• Date of birth
• Amount of coverage needed
• Type of plan (if known)
• Tobacco use within 5 years
• Family history of cancer or heart disease before age 60
• Current medications
• Brief medical history
• Any foreign travel
• Any motor vehicle violations
• Any hazardous activities or hobbies

Exam or non exam term life policy

Many insurance companies offer individuals the opportunity to purchase life insurance with or without an exam depending on the circumstances. If you are a relatively healthy individual less than 50 years of age, you can typically buy coverage up to $1MM without a medical exam or bloodwork.

Now you will typically pay a bit higher rate to buy insurance without an exam or labs, but if you are in a hurry for protection and a few extra dollars does bother you, then a no exam policy could be a good idea.

If you are not in a hurry, and want the absolute lowest rates then a fully underwritten policy with exam and lab work will give you the best chance for the lowest rates.

Again, an experience agent who offers all the different options will give you the information you need to make the best decision.