Insurance - Term Life vs ULIP vs Social Security Benefits, Provider Recommendations

DosaiLvr · Post by **DosaiLvr** » Sun Jan 21, 2007 11:05 am

It's that time of the year (for me) when the SS admin. dep. sends out a b'day greeting! Well, not really... but they do send out a notice saying, if I die at this time, how much my family would get etc...

This year, I paid attention to the notice, given that I'm planning to R2I and realized that, if I die now, my child will get $1043/month and my spouse who care for the child will get $1043/month. There is a cap of $2511/month for the family, so, though I have 2 kids, my fmly will receive not more than $2511/month.

Now, $2511/month or ~1 lac INR (today) is nothing to scoff about. With other inheritance etc. my fmly should be well taken of if my soul decides to recycle.

Given this, I decided to terminate my Term Life Ins. by simply ignoring to mail this quarters premium payment. I do understand that my fmly will not receive a lumpsum one time payment, but all things being the same, my chances of dropping dead suddenly is rather slim. Even if I did, SS payments and other inherit. will take care of them...

Am I doing the right thing in terminating the TLI? (I've always believed that the only one who makes money by insurance is the Insurance co. Warren Buffet is one smart 'oracle'). I tend to avoid Ins. unless it is mandated by law and basic health ins. coverage.

Bobus · Post by **Bobus** » Mon Jan 22, 2007 12:55 am

Every family has living expenses and financial goals, which are normally met via expenses from salary and savings (and growth) from salary of the breadwinner. The purpose of insurance is to ensure that shd the bread winner kick the bucket, the family does not miss his/her salary, and is able to meet its consumption needs and financial goals even otherwise.

Can your family meet all its consumption needs and financial goals from SS payments, in the same way that it would with you alive and working till you retire? You seem to think it can, perhaps because it will relocate to India - is that so? Have you taken all financial goals into account - kids education, a house in India, ...?

If $2,500 per month until kids leave home and later about $1,000 per month for spouse for life + existing assets are enough, perhaps you are not far away from retirement - is that so?

DosaiLvr · Post by **DosaiLvr** » Tue Jan 23, 2007 1:33 am

Bobus;2412If $2,500 per month until kids leave home and later about $1,000 per month for spouse for life + existing assets are enough, perhaps you are not far away from retirement - is that so?[/quote]

Bobus,

My net worth + SS checks may not be enough to sustain the current std. of living after 10, 15 or 20 yrs from now (unless it is augmented to beat inflation), I may have to reconsider my decision... at least for time being.

I am not a fan of Term Life Ins., though I held one for several years due to my financial commitments LIA

However, post R2I, it'd probably make sense to buy a life insurance/term-life combo, if something like that is available... I'd at least get my money back if I lived into my retirement.

In the meatime, it probably makes sense to reinstate my TLI, if I can... gotta check w/ NorthWestern Mutual.

Thanks for raising some vaild questions.

sertra · Post by **sertra** » Tue Jan 23, 2007 2:49 am

OP,

You stated you are not a big fan of term life. The reason seems to be that you would like to get 'your money back'. I am sure you know this, but the reason you buy insurance is because you need to protect your loved ones from finanicial burden. The same way when we buy car insurance we do not worry about getting the money back. Don't you feel our life is worth more than the car, so why should we be worried about losing the money ? In fact, its good that we lose the money, because that means we did not die during that time !!

Just my 2 cents.

Desi · Post by **Desi** » Tue Jan 23, 2007 2:54 am

DL,

The SS checks do go up with inflation on an annual basis. However, we don't know what laws the Congress will pass and we all know that social security solvency long term has been questioned by many.

So I generally ignore SS or figure it for five years of payments max and then assume the payments dry up after that. At worst, it leads to perhaps a little bit of overinsurance but somewhat of a peace of mind.

Bobus · Post by **Bobus** » Tue Jan 23, 2007 6:59 am

Forum software seems to treat the string "a s s" even in a word like ***ets as abuse.

Desi · Post by **Desi** » Tue Jan 23, 2007 7:10 am

Those are teething problems with the new forum. We corrected that. I don't think we need to censor any words - our COC, delete and ban functions are strong enough to handle any burros.:)

nand · Post by **nand** » Wed Apr 04, 2007 11:02 pm

Let us use this thread for recommendations of Insurance providers for both in USA and in INDIA.

ADMIN
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Seeking recommendations while shopping for term life coverage. I have been approached by Matrix Direct. Any other recommendations considering

1. reliability (will they be around, do they pay out in case etc.)
2. price (reasonable premiums within the ball park)

thanks

FreeSpirit · Post by **FreeSpirit** » Wed Apr 04, 2007 11:09 pm

Try this site:

http://www.term4sale.com/

This is the best site recommended by many financial planners. It's independent and provides quotes from maximum providers.

LoveIndia · Post by **LoveIndia** » Wed Apr 04, 2007 11:10 pm

I use Amica Life Insurance and pay a premium of $330 per annum 10 year term for half a million dollar. They seem to be good. Please use your discretion before selecting them.