Monday, February 17, 2020

My Own Life Insurance Story Part 2

As I mentioned in my previous post, my father's passing was left us in a lurch. It wasn't sudden or unexpected, as he had been suffering from the effect of Parkinson's Disease for years. And even though I have been a life and health agent for years, he ignored any of my pleas to let me take a look at what he had in place. And with him living in Fayetteville, NC while I lived two hours away and my sister living seven hours away, it was more than difficult to keep an eye on his affairs.

His beneficiaries were horribly out of date. Yet he managed to keep these policies up to date, either paid up or still making premium payments. Always trying to impress us with his financial intelligence, he screwed up when it came to something simple like life insurance. 

And worse, he put his family, my sister and I, in a situation that needed to be cleaned up. I can foresee myself spending hours on the phone with these carriers trying to sort out death claims that will eventually be paid to his estate. At this point we would be satisfied to cover his funeral costs, which were in excess of $13,000. (Did I mention he had an equity line on the house that he was using to pay his monthly bills? Another surprise!)

A horrible thought crossed my mind. What if he had died 40 years earlier? His insufficiently low face amounts would have probably forced us to move from our home. College would have been a "maybe" for me. My mother, who was a great home maker but had few marketable skills, probably would have been forced to enter the job market. 

These are the reasons why agents like myself ask a lot of questions when we sit down with a family to discuss life insurance coverage. And a good agent will get an answer and continue to drill down for more answers. It may seem annoying and a bit invasive at the time, but the process of discovery is necessary to make sure that families can stay financially solvent if the breadwinner dies unexpectedly.

Life insurance agents sometimes get a bad reputation. I get it. However, the vast majority of us are genuinely concerned for our clients. We know that people have budgets, yet they also have families who will be in trouble in someone dies too soon. The question to ask yourself if this: If I were to die tomorrow, will my family be okay?

Even though my sister and I are adults and have our own families, we never expected to be on the hook for my father's final expenses. Nor did we think we would be having to sort out a tangled web of life policies. The main problem was lack of communication. My father dismissed our entreaties to go over his finances. We weren't vultures waiting for him to pass to inherit his vast empire. But we did want to be aware of potential landmines that could have been eliminated. Now we are dealing with those landmines.

The moral of the story is as follows. Let your life insurance agent help you. Take into account final expenses and the "cost of dying", as well as any outstanding debts. And even though we hear horrible stories in the news concerning elder abuse and financial fraud, most adult children are caring and should be trusted. 

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life and disability insurance coverage. He's also is a professional speaker helping sales people be more productive and efficient and has spoken to professional and civic organizations throughout the Southeast. And please subscribe to this blog!

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