Life Insurance Is Probably Cheaper Than You Think

Good news for those apprehensive about the premiums - and the process.

Provided by KAC Financial Services

 

Lide Insurance is cheaper than you think

According to a new study, 41% of Americans lack life insurance coverage. The 2017 Insurance Barometer Study, conducted by the non-profit organizations LIMRA and Life Happens, also discovered that while 84% of Americans felt life insurance was appropriate for most people, just 70% thought it was a good idea for them. 1


What is preventing so many people from insuring themselves? Perhaps outdated perceptions about the cost of the coverage and the process of securing it. Most people think life insurance is more expensive than it really is and assume there will be a long, drawn-out path to obtaining a policy. The reality is different.

Life insurance is easier than ever to buy and not as costly as many believe. A life insurance shopper may be pleasantly surprised by the data contained in the next three paragraphs.

How much would a healthy, non-smoking 35-year-old man pay per year to maintain a whole life policy offering a $250,000 death benefit? According to LifeHappens.org, the average yearly premium is actually just under $3,000. 2

How about term life? LIMRA recently asked consumers how much a healthy 30-year-old would pay annually to keep up a 20-year, $250,000 term life policy. Their median estimate was $400 - which was way off. The annual premiums would be less than half that. 3

Even premiums for long-term care insurance policies have declined slightly. A new study from actuarial firm Milliman Inc., which surveyed 17 insurance companies selling standalone LTC policies, finds that the average annual premium fell by $17 in 2016 to $2,480. 4

New industry regulations have encouraged insurers to lower premiums. These rules took effect in most states at the start of 2017, and they permit lower capital requirements for insurance carriers. In some cases, the regulations they replaced were literally antiquated, dating back to the Civil War. This has encouraged major carriers to reprice term coverage. 3

A life insurance medical exam might soon be the exception rather than the norm. Consumers dislike these exams and the way they slow down the process of getting coverage; scheduling the doctor's appointment, waiting on test results, and waiting on the insurance carrier's approval can take a month or longer.

Things are changing. Insurers have begun to use algorithms to qualify applicants instead. Consumers fill out questionnaires about their health history and family health history; with their permission, the insurer culls information from past life insurance and health insurance applications, motor vehicle records, and prescription drug histories. A software program determines whether the person qualifies for coverage and the price of coverage. At the rate things are going, life insurance medical exams might disappear in the 2020s. 5

Living without life insurance means taking a financial risk. Too many households are taking it, mistakenly believing that life insurance is a cost they cannot afford. The expense will likely be less than they think and may be trivial compared to the financial pressures an uninsured couple or family may face after a tragedy.


Securities are offered through Kovack Securities, Inc. Member  FINRA, SIPC. Kovack Securities Headquarters: 800-711-4078 / www.kovacksecurities.com . Advisory services offered through Kovack Advisors, Inc. KAC Financial Services is not affiliated with Kovack Securities, Inc. or Kovack Advisors, Inc. Kim A. Checketts & Darren Downs are registered in AK, AL, AR, AZ, CA, CO, KS, LA, MI, MT, NC, NE, NM, OK, PA, SD, TX, UT, VA, WA and WY. Zachary Pinnau is registered in NM, and UT.

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. The information herein has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is a market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (S&P 500) is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the "NYSE") and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions - the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. MarketingPro, Inc. is not affiliated with any person or firm that may be providing this information to you. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

Citations.

1 - newsday.com/long-island/understanding-the-value-and-importance-of-life-insurance-1.14233401 [9/20/17]

2 - lifehappens.org/product-selector/comparing-the-cost-permanent-and-term-life-insurance/ [3/6/17]

3 - nerdwallet.com/blog/insurance/new-rules-mean-lower-life-insurance-rates/ [3/6/17]

4 - forbes.com/sites/howardgleckman/2017/09/08/the-traditional-long-term-care-insurance-market-crumbles/ [9/8/17]

5 - tinyurl.com/ybolyb38 [8/6/17]