LIFE INSURANCE

[knowitall]

Wouldn't that be succumbing to the sunken cost fallacy?

Presuming a person bought a $1MM 30 year term at age 25 for $50/mo. At age 35 same person can purchase a new $1MM 30 year term for $64/mo extending coverage for extremely critical 10 additional years. It is very likely that at this point said person realizes that he needs at least $2MM. He could opt to keep the old policy, that  would last for only 20 more years, or he could buy a new 20 year term for around $33/mo.

I think this could illustrate why I am NOT a fan of 30 year term (especially if purchased under age 35). Purchasing a 10 or 15 year term policy at age 25 (presumably before being settled with family and career) would likely cost less than $20/mo.

If he can do so with no new underwriting, sure. However, most frum 35 year olds have much bigger boichs than 25 year olds.

[avromie7]

Got myself a 30 year term when I was about 25 y/o. Now, about 10 years later, Just did some quotes from the wiki, and seems like it's just a few dollars more per month to start another 30 term . Is it a no-brainer? Or is there something better to do?

What does a 20 year term cost you now? If it's less than your current policy, you definitely need to drop the current policy.

[Euclid]

unless one thinks that by the time they are 35+, his health may decline

If he can do so with no new underwriting, sure. However, most frum 35 year olds have much bigger boichs than 25 year olds.

This is the biggest (no pun intended) issue in the frum community. A large percentage of 35 year olds arent in the best of health and wont get preferred rating

[farmbochur]

Thanks, very informative. I didn’t realize that, it would mean that nows a great time to review my policies with rates as high as they are.

The problem is that high interest rates make for a good environment to purchase all sorts of financial assets. Trouble is we only have finite resources.

[Euclid]

The problem is that high interest rates make for a good environment to purchase all sorts of financial assets. Trouble is we only have finite resources.

If an insurance broker gets his way, 100% of income would go towards insurance and other similar instruments

[ExGingi]

If an insurance broker gets his way, 100% of income would go towards insurance and other similar instruments

-1

The insurance salesperson wants the client to survive as long as possible. 100% income towards insurance and similar products is unsustainable.

[yos9694]

Highly doubt keeping the current policy will ever make sense in any capacity (other than lower health rating).

Wouldn't that be succumbing to the sunken cost fallacy?

TBH I didn't think of that and you're probably right. Unless it gets complicated by treating it as a replacement policy

[ExGingi]

TBH I didn't think of that and you're probably right. Unless it gets complicated by treating it as a replacement policy

Term to Term replacement isn't that big of an issue even in NY. Outside of NY replacements aren't as burdensome to begin with.

As for the underwriting class not being as good at age 35 (and definitely later), I  will make two comments:

1. Often when people compare the cost of term to whole life, they are looking at preferred (or more likely super-preferred) rates. At underwriting classes that aren't that good the math begins to skew better towards whole life.

2. Getting a policy at a younger age with a rider that will allow for guaranteed future purchases at the same underwriting class (though mostly whole life) could be seen as a prudent strategy.

[Yosel]

If an insurance broker gets his way, 100% of income would go towards insurance and other similar instruments

-1

[whacked1]

Got myself a 30 year term when I was about 25 y/o. Now, about 10 years later, Just did some quotes from the wiki, and seems like it's just a few dollars more per month to start another 30 term . Is it a no-brainer? Or is there something better to do?

which wiki?

[dovy2]

which wiki?

In the other life insurance thread

[popcorn1508]

Wouldn't that be succumbing to the sunken cost fallacy?

Presuming a person bought a $1MM 30 year term at age 25 for $50/mo. At age 35 same person can purchase a new $1MM 30 year term for $64/mo extending coverage for extremely critical 10 additional years. It is very likely that at this point said person realizes that he needs at least $2MM. He could opt to keep the old policy, that  would last for only 20 more years, or he could buy a new 20 year term for around $33/mo.

I think this could illustrate why I am NOT a fan of 30 year term (especially if purchased under age 35). Purchasing a 10 or 15 year term policy at age 25 (presumably before being settled with family and career) would likely cost less than $20/mo.

How do you generally propose getting proper coverage with 20 year policies.

[skyguy918]

TBH I didn't think of that and you're probably right. Unless it gets complicated by treating it as a replacement policy

I went through this whole shpiel myself this year - ie had one policy, looked at the rates and realized it made no sense to keep it in any capacity because current rates are so much better. When I replaced I did some 20 and some 30, upping the total significantly as well. The fact that it was a replacement may have made it take a few extra days, it added no significant complication from my perspective.

As for the underwriting class not being as good at age 35 (and definitely later), I  will make two comments:

1. Often when people compare the cost of term to whole life, they are looking at preferred (or more likely super-preferred) rates. At underwriting classes that aren't that good the math begins to skew better towards whole life.

2. Getting a policy at a younger age with a rider that will allow for guaranteed future purchases at the same underwriting class (though mostly whole life) could be seen as a prudent strategy.

You'd have nothing to lose by applying and seeing if they keep you in the top underwriting class. If not then you can go back and re-evaluate.

[mushkovits]

Any reason not to insure with Ladderlife? Anyone know of anyone ever having any issues with them?
They’re coming in the cheapest for me. Way cheaper than NY life and cheaper than guardian.

[yos9694]

Ladder life is a fine company to buy from, they're backed by real insurance companies.

The term that they sell has no add-ons. NYL and Guardian both include a conversion rider with their term, which is one of the reasons it's more expensive. Is that a reason to spend more? Some would say yes (cough, cough, @ExGingi ) and some would say no.

[mushkovits]

Ladder life is a fine company to buy from, they're backed by real insurance companies.

The term that they sell has no add-ons. NYL and Guardian both include a conversion rider with their term, which is one of the reasons it's more expensive. Is that a reason to spend more? Some would say yes (cough, cough, @ExGingi ) and some would say no.

Thanks!
I went ahead and bounded. Not too familiar with conversions but I’m paying less for this 30 yr term then I’m paying for my NYL 20 yr. And without a exam
In addition it’s charged monthly to cc vs annual check.

P.S. anyone interested PM me and I’ll send referral!

[ExGingi]

Thanks!
I went ahead and bounded. Not too familiar with conversions but I’m paying less for this 30 yr term then I’m paying for my NYL 20 yr. And without a exam
In addition it’s charged monthly to cc vs annual check.

P.S. anyone interested PM me and I’ll send referral!

May I inquire as to the face amount of each?

Also, does your NYL policy have any riders?

[mushkovits]

May I inquire as to the face amount of each?

Also, does your NYL policy have any riders?

1M

Waiver of premium rider

[ExGingi]

1M

Waiver of premium rider

What is the price comparison for the base policy? What ratings did you get? How long ago was NYL policy issued?

(NYL will not be a term low-price leader, it's in their DNA).

[mushkovits]

What is the price comparison for the base policy? What ratings did you get? How long ago was NYL policy issued?

(NYL will not be a term low-price leader, it's in their DNA).

Not sure how to check price comparison nor the ratings. Definitely wasn’t A+.
NYL is from 2 years ago