You have seen and read about many heartbreaking stories on social media. A father of very young kids dying prematurely due to an accident or Covid-19. An aspiring young athlete needing surgery. A single mother getting disabled. A family's house burned down during the holidays. The list goes on. They could even be your friends, family, co-workers, neighbors or someone in your community.
When the unexpected happens, the plea for help is put in the form of an online fundraising. Many online platforms have been a blessing when families need it the most. Please continue to help and donate when you can!
As someone in the life, long term care and disability insurance industry, I can't help but wonder if our industry is doing enough to educate consumers on the benefits of insurance and the cost of having it versus not having it.
When I started in the insurance industry, I was 18 years old and did not see the need for any of these insurance products. During my training as a field underwriter, I learned pretty quickly how wrong I was! Illnesses, accidents and death do not discriminate. It strikes when, where and who it wants! I also learned that there are two things in life that are certain: death and taxes. Both of those things you want to avoid. So I spent the past 23 years, learning and honing the craft of insurance to help people intelligently plan for these two inevitable things.
Most people do not buy insurance because of cost or fear of getting rejected. But most people don't know is that they actually have much control of how much they pay for insurance. As far as getting rejected, the only way to know is to talk to an experienced insurance advisor about your particular situation before assuming you cannot get approved.
Life, LTC and disability insurance premiums are determined by underwriting. As a consumer, you do your part by living a positive lifestyle...exercise, eat healthy, don't smoke or do drugs, don't get DUIs or have risky hobbies, etc. Making good choices lead to lower premiums. This is something the consumer controls 100%!
But nobody is perfect. So more times than not, people have an issue or two that we need to work with. This is where an insurance advisor well versed in "technical underwriting" part comes into play. You want someone experienced and not beholden to one carrier so that you can be sure to get the best available rate as well as that your best interest always comes first. You also want someone who specializes in life/DI or LTC not someone who specializes in other types of insurance who does life/DI or LTC insurance as an after-thought. You won't go to your podiatrist for brain surgery would you?
Different carriers have different underwriting manuals. They also have leaders with various expertise as well as programs that cater to specific medical conditions or rating improvement platforms that could help reduce premiums. This is not a post about underwriting so I wont dig deep into that. Bottom line is that you should know that when it comes to insurance pricing/underwriting, it is not a one size fit all.
From an underwriting/pricing perspective, one company may be great with diabetics, pilots or overweight people and another company may not. But the latter company may give someone who is HIV+ insurance coverage.
As you can see, your lifestyle choices affect your premiums and you control that. Not all insurance companies are the same and more importantly, not all insurance advisors are the same. You get to choose who you want to work with.
Online fundraising is amazing and but it should not be the only plan for when something unexpected occurs. Especially now that you know that you have more control of how much your insurance premium should be.
If you are a fee-only planner, advisor or a client and would like to know more about this topic, please email me at email@example.com
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