Let's Keep Your Private Information Private

Last week, while on a work trip in Virginia, I saw a commercial on TV for life insurance. You more than likely have seen these ads as well. 

"Bob, 45, just got $2 million life insurance policy for $10 a month! Let us help you!" the voice over guy screams. A blur of fine print flashes across the screen. I'm not sure if I read it all correctly, but it implied that Bob got super ultra preferred rates because he runs marathons daily and is 4% body fat. In essence, Bob will never die.

I'm exaggerating a bit, but you get the point. The ad shows the best case scenario, but we all know that if we could have read the rest of that blur of words, it would also mention that all rates are subject to underwriting and your premium could differ. 

These ads are for insurance agencies which represent multiple companies. When someone goes online and looks for a quote, the agency gathers your information. But what does it do with that information, like your date of birth and email address? That information is sold to an insurance agent who has purchased that lead. 

Here is where things get weird. Many insurance agents will purchase leads. They think it will be worth the cost to avoid having to prospect for clients or advertise. Personally, I have never had much luck with leads of any kind. 

I used to work with a life agent, who we will call Pete. Pete paid a service approximately $300 for a year's worth of leads. Part of this deal was that Pete could choose up to three zip codes, and if the leads were in those zip codes, the agency would email him the prospects information. The problem was that there could several agents signed up for the same zip code, and they would each get an email.

According to Pete, he needed to wake up early enough to get the email and be the first agent to call the prospect. If he was too late, even by a few minutes, the poor prospect, who didn't understand what was going on, would yell at him. "I was looking at life insurance in the middle of night because I couldn't sleep. I didn't realize I was going to get five agents calling me!"

Pete also told me that most of these leads were from people who were "kicking the tires" to see how much insurance would cost and had no intention of actually buying a policy. And if they did, the premiums would be so low that his commissions would never make up for the $300 he paid for this "service". 

We do things a bit differently. If you go to our website, we also have all of the big name insurance companies, and our site compares rates as well. And, yes, we do gather your information as well. But that is where any similarities end. 

If someone likes a quote on our site, they can start an application. We don't sell data to agents. We will contact prospects to let them know we are available if they have questions or if the insurance carrier has any underwriting questions. And if someone would like to speak with an agent, they can always contact us.

Everyone is trying to stay within a budget, even when it comes to making sure that their family can stay in their own home if tragedy should strike. But one should make sure they are purchasing the amount they need as well. Our quoting engine has a calculator to help find out how much coverage is needed, which is important. Too often people don't apply for enough coverage. 

Do you know someone who needs a little more life insurance? Pass along our website and help them protect their family's financial future.

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

Making Insurance Accessible To All

As we all know, the internet has changed the way people do business. More importantly, it's also changed the way businesses do business. 

Not that long ago if you needed someone for a specific service, you "let your fingers doing the walking in the Yellow Pages". Now I make that reference to my college age daughter and she doesn't know what I'm talking about. Everything from entertainment to financial services has gone digital, and for those who aren't offering some sort of web-based platform, they may as well be throwing a chunk of their marketing dollars into the garbage. 

This struggle is real in the insurance industry as well. The old school method of getting a referral, meeting with them in their home or office over several appointments, and hoping to get an application completed (along with more referrals) has lost some of it's appeal. For younger, more internet savvy consumers, doing their own research and making online purchases is the norm. 

At the same time, these younger people are less interested in selling insurance, mostly because of the old school methods that still are being taught in training offices throughout the country. According to a 2017 article by the World Economic Forum, the average age of a life insurance agent was 59. Considering that agents tend to sell to those around their own age, millennials are, for argument's sake, not being properly attended to when it comes to their own life insurance needs.

In 2007 I went to work for a large life insurance company. We were the "best of the best" according to the management, so you would think that we could attract agents who would succeed and thrive. Our managers boasted that we were ahead of our competitors in agent persistency, because we had a rate after three years of 17%, opposed to 10-15% by our peers. This meant that if they hired 100 agents today, a whopping 17, on average, would be around after three years. And they were actually proud of this.

For the consumers, though, this is bad news as well. How many times have you purchased life, disability or other kind of insurance, only to find out that your agent is no longer with the company?  

As a society, we have become numb and/or jaded when it comes to having bad service. This is why a growing number of people are cutting their ties to agents and buying financial services from the internet. The television is full of ads letting us know to get car insurance, life insurance and investments straight from our computers. Convenient and quick. 

But what about the personal service? What if we have questions or concerns or need to file a claim? Are we destined to having to call an 800 number each time we need something. Even worse, what if we have to speak to someone who is out of the country? Is that good customer service?

At Surf Financial Brokers, we have tried to combine the best of both worlds. Our quoting tools for life insurance, dental, vision and hearing plan, cancer insurance, hospital indemnity insurance and accident plans make it easy and quick for people to find a policy within their budget. And if they like what they see they can start an application.

At the same time, if they want a more personal touch they can book a short phone appointment with one of our agents who can help with our products, including others like Long Term Care and disability insurance. We want to help anyone who recognizes they need insurance to be able to get it in the way they want. 

Let us help you find the right product for your needs.

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

The Good, The Bad And The Ugly Of Insurance Sales

A few months back I ran into a great lady who had purchased a life insurance policy from me many years ago. We had stayed in touch for a few years but I lost touch with her. Needless to say I was a bit surprised when she responded to one of my posts on Facebook regarding some new policies Surf Financial Brokers was offering. 

After speaking to her for a while I realized that a lot of things in her life had changed since we had last spoken. She had made several career changes and was currently working for a non-profit organization. Her personal situation had changed as well, as she had a new beau who seemed to be a good guy. During our conversation she mentioned that the life insurance policy she had purchased from me years ago had lapsed and now she was in the market for a new policy.

Her concerns had also changed a bit over the years. Her parents were now deceased, but before they died she had been one of the principle caregivers in their later years. With that experience she had come to realize how expensive care in a facility was. Now she was in the market for some sort of life insurance, but she also wanted something to help offset the costs of long term care. The problem was that she had a limited budget to do all of the things she wanted to accomplish. 

One of her main concerns at the time was that Covid was sweeping through nursing homes and assisted living facilities. With this in mind, she really wanted to know that if she needed care, she could stay in her own home. Luckily we had a great way of handling this part of the issue in a way that would be affordable for her. 

Our Short Term Home Healthcare plan (STHHC) offers clients a way to offset the extremely high costs of having caregivers in the home. The policy helps with costs for up to 365 days, which do not all have to be consecutively, since many people have caregivers come to their homes only 3 or 4 times a week, usually when family is unavailable. This means that the policy can conceivably be stretched out over several years. 

Even better, the application only has 3 questions, which means getting approved is very easy.

But the best part for her was that the policy is very affordable compared to a full-blown Long Term Care (LTC) policy. Saving her money was a priority for her, but this was only one part of the issue. 

We still needed to resolve the life insurance part of the puzzle. This is where things got messy. She had gotten older (by about 15 years) since she had purchased the previous policy from me, so that made the rates go up of course. Even though the face amount of the policy she wanted was fairly low, we both agreed that a permanent policy would be a better fit than a term policy. 

I took her application and submitted it to the insurance carrier, and soon after a paramed nurse met the client at her home. Everything was going smoothly until I got a call from the insurance company. Apparently when the underwriter pulled her medical records there were some underlying health issues that had not been disclosed previously. 

The insurance carrier rated up the policy, meaning that her premium cost would go up. They gave me a new price, as well as different face amount for the premium she wanted. I knew in my gut that the client was not going to be pleased either way, but I picked up the phone and gave her a call. 

When I gave her the new numbers she said she needed a few days to think it over. The following week I called her and left a voice message, followed up with a few more over the next week or so, along with emails. I got no response. This wasn't good. 

After several weeks I got a letter in the mail from the insurance carrier. She had called in and requested that the company withdraw her application. Since she decided that she did not want to communicate this information through me I left her alone. I don't want to badger the lady and honestly I think she prefers I drop the matter. 

The moral of this story is that if she had been upfront with me on her health issues, we could have gotten her a more accurate quote from the beginning of the process. Remember that life insurance quotes are merely estimates based on the information given. A final rate is not determined until the full underwriting process is completed. It may be uncomfortable, even embarrassing, to discuss these kinds of personal matters with your agent, but full disclosure is always the best option.

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

5 Reasons For Business Owners To Consider Life Insurance 2023

Often on this blog I discuss ways to make sure your family's financial future is secure by having the proper life and disability products in place. But what about your business? 

For many business owners and entrepreneurs, life and disability insurance are just as important. Their business is the source of their income, and possibly the incomes of other partners and employees. Making sure that the business can stay afloat is of utmost importance not just to the owner, but to customers and vendors as well.

There are several insurance products you may want to consider if you are a business owner.

1. Keyperson life insurance. Do you have an employee who has a special skill that brings in a good percentage of your business receipts? A specialized talent may be hard to replace. With that in mind, you may want to consider insuring that key employee.

2. Life insurance to fund a buy-sell agreement. A buy-sell agreement is a legal document that basically states that if one of the partners should die, the remaining partner(s) can buy out their stake in the business. Sometimes the buy-sell agreement is part of the original paperwork starting the business.

For instance, let's say Bob dies and his wife, Mary, inherits his interest in the business. Mary may not really want to be an owner in the business, and she may be willing to sell her shares to the remaining owners. 

At the same time, the remaining owners may not be interested in having Mary as their new partner. And if Bob's role in the business was highly specialized, Mary may not be able to fill his shoes. The life insurance proceeds would go to the partners who could pay Mary for her shares.

As you can see, for all parties involved, a buy-sell agreement is a good idea, but it will need to be funded when one of the partners dies. A life insurance policy can fill that need.

3. Life insurance to secure loans. Many entrepreneurs starting out may need to get a loan for equipment, office space and other expenses. Lenders may require a life insurance policy to secure those loans. 

A few years ago I met a woman whose husband worked in the corporate world and decided to go out on his own. He borrowed heavily to start his own business and the wife implored him to get life insurance when she realized how much debt he was incurring. He said he would but never bought a policy. 

Sadly, he died while cutting down trees on their property when a log fell on him. She was stuck with the debt she couldn't pay because he didn't purchase the policy she kept asking him to get.

4. Disability insurance for a disability buy-sell agreement. Very similar to the example above, but instead of a partner passing away, the partner becomes permanently disabled. 

5. Disability overhead expense policy. I always urge my business owner clients to buy two disability policies. One is to replace their personal income if they get sick or hurt and are unable to work. That policy will help pay their personal bills. The other policy is to pay for the business's bills should the owner become disabled. 

These policies are pretty affordable because they usually pay out for a maximum of only two years, but what is most important is that the policy gives the business owner time to make a decide what to do. That two year window gives ample time to find out if the business owner will recover or not, whether or not to sell the business or shut it down altogether. In the meantime, payroll and other bill like utilities can still be paid. 

These are just a few reasons why you may want to consider a life insurance policy for your business. If you have questions, please drop us a note. And in the meantime, please stay healthy!

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

What Is The Mix And Match Life Insurance Strategy? 2023

Can you imagine having one wrench in your toolbox that is supposed to take care of all sizes of nuts and bolts, but you know deep down that that wrench can't do all that the jobs it is advertised to do. It works fine on some things, but not all things. Your life insurance is like that as well.

When someone tells me that they only buy term life insurance or they only buy whole life I always asks why. The most common answer is something like, "That's what my mother always had." I want to respond that my mother drove an AMC Gremlin, but you don't see me with one. 

The other answer I get is that they heard a financial "guru" on television who is an "expert" in all things pertaining to personal finance. This guru suggested they "buy term and invest the difference". I won't go into that argument but I did cover it in the previous post.

This is why it is important to know about the different types of insurance and the needs they fill. Having only one type of insurance at a time, or for your entire lifetime, can be inefficient and expensive.

First and foremost, life insurance is at it's cheapest when you are young and healthy. Leveraging your age and good health can work to your advantage, especially when it comes to permanent life insurance coverage. In a perfect world, one could afford to buy all the life insurance they need when they are in their 20's. But our lives are not always ideal.

Some people will buy term coverage during their working years with the intent of buying permanent insurance, like whole life or universal life, when they "have the money" or retire. Others will try to buy an expensive plan when they are young, only to stop paying for it when they need the money for something else. 

If you know what features each kind of life insurance work best, you can develop a better strategy for securing your family's financial future while keeping it in your budget. A great way to do this is to "mix and match" a couple of types of insurance. 

For instance, let's say that you have met with your agent have agreed that you need $500,000 of life insurance coverage. That would be an expensive policy if it was all in one whole life program. However, you also know that you may need some permanent coverage down the road when you are older.

At this point you could, assuming you are fairly young and in good health, purchase a $450,000 term policy, either 20 or 30 years, for a affordable rate. Then you could cover the difference of $50,000 with a permanent policy, like an Indexed Universal Life plan. That would make sense to most people and fit in their budget.

An important part of all of this is having an independent agent who can offer a wide variety of plans. Some agents only want to sell term life while others really push whole life to their clients. It's like going to a car lot that only offers sedans, but you need a truck. Why bother? 

Make sure that your agent has all the insurance products you need. If you feel as if he or she is pressuring you into one plan instead of giving you several options, look for someone else to help you. 

If you have any questions about this, let us know. In the meantime, please stay healthy. 

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

Should I Buy Term and Invest the Difference? 2023

There is a school of thought that when it comes to life insurance, people should "buy term and invest the difference". What does this mean and why should it matter when you are trying to secure your family's finances?

First off, the people who like to preach this method of buying life insurance have some sort of issue with purchase permanent life insurance. Whether it is whole life or universal life, they think that the cost too high. These people also think that the growth inside the policy, building cash value, is not as good as putting your money in the market. 

One of my pet peeves in the financial services industry is the large number of financial gurus who give generic blanket advice. These gurus, who are prevalent on TV, radio and other media, including books, seem to feel that everyone is in the same boat. As someone who has been working in the insurance industry for over 20 years, I can attest that financial situations are like fingerprints - no two are alike.

Another issue that many of the agents out there who like the "buy term and invest the difference" mantra are captive agents who work for companies that do not offer good permanent products. Even worse, these agents have been given bad information as to how some permanent life insurance products work by their managers. I have worked for a few of these companies and have heard it myself. 

As I have said in the past, all insurance products have a need somewhere, but not all insurance products are for everyone. This applies to term life as well. Term life insurance is great if you can quantify your specific need. An easy example of this is a loan that needs to be secured. If you have a 30 year mortgage on your home, a 30 year term policy fits the bill, because if you were to die your family could pay off the note. The lender will be happy to know this too.

For many families, there are more things going on than just a mortgage though. There may be other debt, like credit cards and car payments. A young family may want to consider education costs of their kids as well. After doing the math, a 20 year term policy may do the job while the debt is there and the kids are still living at home.

Let's assume that our young family did the math (with their trusted life insurance agent, of course) and realized they needed $300,000 worth of life insurance. A term life policy may cost them around $50 each month (these are estimates). But a permanent policy would cost around $150 each month. According to the gurus, they should purchase the term policy and put $100 into an investment each month. What kind of investment? Mutual funds, hopefully tax deferred, like an IRA. 

Here's the main problem with this strategy. They almost always will buy the term life policy (if the agent has effectively communicated the need) but they rarely do the investing part. "Check back with me in a few months," is the refrain when it comes to putting that extra $100 somewhere. It may be a budget issue or the client just isn't sure about the markets. Either way the plan is not complete.

People have varying degrees of risk tolerance, which is fine. As mentioned, no two situations are the same. Not everyone wants to be in the market and the ones that do can do so through online trading platforms nowadays. 

So what is a suitable alternative that will help a client efficiently and in their budget? Drop us a note or book a short phone appointment to discuss. In the meantime, please stay healthy.

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

Has Covid Made You Rethink Your Insurance Coverage?

When the pandemic struck last year some people were too distracted by the news to take a look at their existing insurance coverages. Having major medical coverage is good, but if one were to be seriously ill and hospitalized, out-of-pocket expenses like deductibles and coinsurance could quickly take their toll on a family's finances. 

And the loss of income from being out of work could also lead to unpaid bills piling up. Extra stress doesn't necessarily help a situation like this. 

That is why many people took a second look at their insurance policies in the last year or so. It seems that almost everyone knows someone who has had the virus. Even though most managed to have mild symptoms and rode it out at home, we also know those who have been seriously ill from it and even died. 

Over the last year people have begun purchasing more disability insurance, along with hospital indemnity plans, and even increasing their life insurance coverage. I recently met with a group of teachers who all had some level of interest in at least one of the above mentioned plans because they had co-workers who had fallen ill due to Covid. I suppose it hit home for them.

Putting these policies together, some agencies have constructed a loosely knitted "Covid package" plan to get the message out. Sales for these plans have increased, especially the hospital indemnity plan. The weird part was that many people I spoke to seemed to have never heard of this policy before, so I would assume that the agents were not discussing them with their clients. 

Hospital Indemnity plans are exactly what they sound like. They help defer the out-of-pocket costs of being admitted and confined to a hospital. We offer a fine plan that has good benefits. If you would like a quote or more information, click here. 

Aside from the plans mentioned above, our agency has had an increase in sales of our Short Term Home Health Care (STHHC) Plan. Due to the very high rates of infections in assisted living and skilled nursing facilities, more people are wanting to make arrangements to stay in their own homes when they get older. The STHHC policy does just that, by helping to pay for cost of caregivers in the home. To watch a short video on the policy, click here.

The cost of having in-home caregivers is about double of that in a facility. Taking the burden off of family members makes these kinds of plans especially attractive, plus the family members don't have to worry about putting their own careers (and families) on hold.

Of course, everyone could use additional life insurance. Studies have shown that of those who own life insurance, up to 40% don't have the amount of coverage they actually need. And it isn't nearly as expensive as people think it is.

If you aren't sure if you have enough coverage for Covid or the next pandemic, drop us a note or book a short phone appointment. We'll be happy to look over your existing coverage and see if you need to fill any gaps. In the meantime, please stay healthy.

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

Who Are The 3 People On A Life Insurance Policy?

For most of us, buying a life insurance policy is a simple concept. We decide how much coverage we need, apply for the policy and name a beneficiary, who will receive the face amount when we die. But what if you have strange or unusual circumstances as to who the insured person is but someone else is paying for the policy?

There are three "people" involved in the purchase, not counting the agent of course. They are as follows:

1. The insured. This is the person whose life is being insured. When they die the policy pays out. The insured is the one who may have to go through a paramed exam, along with their medical records being looked at by the insurance company's underwriter. 

2. The beneficiary. This is the person who, as mentioned previously, receives the money at the time of the insured's death. You can name more than one beneficiary and the money will be divided by percentages. For example, Bill may get 40%, Joe may get 20% and Mary, who is obviously the favorite, will get 60%. 

It's important to keep your beneficiaries up to date. If you need to change a beneficiary, it is usually a simple process of calling the insurance company and having them send you a form. It can be done at any time. 

3. The payor/owner. These payor and owner are usually the same person, and in the vast majority of cases, the payor is the insured as well. However, on certain occasions, the owner may be a third party, like an employer. In these cases, the employer may offer to buy a policy on an employee as a perk with the employee's family as the beneficiary. 

Another example is when a parent takes out a policy on a small child. The parent is the owner, but when the child grows up and is a responsible adult, the parent can transfer ownership of the policy to the adult child, who now can pay the bill each month and change the beneficiary to their spouse or children. 

As you can see, the owner of the policy is in control of the policy. This allows them to make decisions with the cash value if the life insurance is a permanent policy, like whole life or universal life.

A few years ago I was working with a client who wanted to take out a policy on himself and leave the money to his church. Knowing that this was a version of a charitable donation, he thought he could just write off the premiums, but after doing a bit of research, we found out that the IRS frowned on this practice. 

We found a workaround, though, by changing the ownership of the policy to the church, with the client as the insured. The bill for the annual premium would go to the church, who would contact the client. The client would cut a check for the amount of the premium as a "donation" to the church, which the church would use to remit the premium payment. The insured could then deduct the donation as a gift. Everyone was happy.

Knowing who is the insured, owner and beneficiary of your life insurance policy is important and, as you can see, they can move around from time to time. If you have questions, drop us a note in the comments section. In the meantime, stay healthy!

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

3 Ways To Set A Good Financial Example For Your Family

One of the most intriguing things I have learned in my many years of being a life insurance agent is how values are handed down from one generation of a family to the next. This is almost always true for everything, from work ethics to religious beliefs. Most notably I see it with financial practices. For example, parents who have bad credit will also have adult children who tend to be late paying bills, creating bad credit for themselves as well. 

One of the other areas where this is true is when it comes to life insurance. There are parents who don't buy life insurance because of various reasons, like thinking it's some sort of scam (yes, I've heard this!) or "Why do I need something I can't use?" (it's not for you, but for your family!). On the flipside of this, I have clients who know the value of life insurance because their parents had policies which paid out nicely. 

Sometimes they insists on buying whole life insurance because "that's what my mother said to buy", which is fine, but maybe a term policy is a better fit for their needs and budget. At least they're considering the purchase for their families. That's the first step in making sure that if something should happen their surviving loved ones will be financially secure.

I often hear stories from clients about how life insurance helped them. My wife is a great example. Her father passed away very unexpectedly when she was still in high school. He had a large policy that helped her and her siblings pay for college and pay many of the outstanding bills. We even used some to the proceeds years later to put a down payment on our home. Now my wife tells people how that policy was helpful, even though she doesn't sell insurance.

Too often, however, I hear stories of families struggling to make ends meet when one of the breadwinners in the family dies too soon. You can easily avoid leaving your loved ones all kinds of bills, like outstanding debts like mortgages, credit cards, car payments and funeral expenses. Shifting the burden of covering all those bills to a life insurance policy will give you and your family the peace of mind that lets you sleep well at night.

I often hear stories from clients about how life insurance helped them. My wife is a great example. Her father passed away very unexpectedly when she was still in high school. He had a large policy that helped her and her siblings pay for college and pay many of the outstanding bills. We even used some to the proceeds years later to put a down payment on our home. Now my wife tells people how that policy was helpful, even though she doesn't sell insurance.

On the other hand I also hear nightmarish stories about families struggling to pay bills and wondering if they can afford to stay in their homes because one of the breadwinners failed to take care of something as simple as buying a life insurance policy. 

About a year ago I met a young widow whose husband died suddenly in a traffic accident. He left a ton of debt, including payments on a muscle car that she eventually sold at a loss because he was upside down on the payments. Her son, a bright kid who was about to graduate from high school, told me "I probably won't go to college because we just can't afford it." He is having to go with his "plan B" which is to enter the military and use the GI Bill down the road.

Making the purchase of a policy can be the deciding factor in whether or not your family can afford to stay in their home, go to college, or just pay off any debt you may have incurred. And life insurance is much less expensive than you may think. Here are a few steps you can take to make you a hero long after you are gone.

1. Go to our website and get a quote. Find a policy that fits in your budget.
2. Not sure how much life insurance to get? Use the "calculate" button to see how much coverage will be needed.
3. If you see a policy you like you can start the application immediately. 

By letting your family know they are taken care of if something should happen to you will send a great message to prepare for the unexpected. It's that easy. And if you have a question, you can just drop us a note. In the meantime, stay healthy!

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

7 Times When You May Need Life Insurance

There are times in our lives when we need to start looking at purchasing a life insurance policy. These are events that can make a difference in our lifestyles, spending habits and social habits as well. And many times these changes do not only affect us, but our loved ones and business associates as well. 

With that in mind, here is a list of times when you should start to seriously look at life insurance.

1. Married or getting married. This is a no-brainer for most people. Becoming a spouse means that, for most people, purchases and financial decisions will be made jointly. Homes, cars, and other large purchases will typically be in both names, as well as credit cards, bank accounts and various other items. Should one spouse die too soon or unexpectedly, the surviving spouse will be obligated to pay off any debts.

A friend of mine was widowed several years ago only to find out that his deceased wife still had a balance on a credit card he was unaware of. In his state, he was legally obligated to pay off her debt. Luckily for him, it was not a lot of money, but if it had been it could have affected his credit poorly.

2. Parent or about to become one. A comedian once said that kids are like really expensive pets. Nothing could be truer. The estimated amount of money to raise a child in this county varies from around $175,000 to $250,000, depending on which study you read.  No matter which source you choose to use, the numbers are high. And if you are planning to pay for education costs, the numbers can be increased from 50-100%, depending on the school your child attends.

When I sit with a parent and discuss their life insurance needs we take into consideration the costs of raising a child as part of the overall plan. A single parent could be burdened with a huge financial issue which can be easily avoided with a life insurance policy. 

3. Purchasing a home. While most people think of buying a home as a good thing, it can be a huge expense. Maintenance, repairs, taxes, insurance and other expenditures will sneak up on many new homeowners. Again, why leave your significant other with shouldering all of those expenses when it can clearly be avoided. 

4. Changing jobs. Depending if you are getting a raise or taking a pay cut, you may have to adjust your financial plan, including your life and disability insurance. If you are getting a pay increase, you may start spending more money, which incurs more debt. Taking a pay cut may mean you still have debt to pay but on less money coming in. Either way, making sure your loved ones don't get stuck with those bills is what life insurance is for.

5. Retired or planning for retirement. Many times I see people who have outlived their term life insurance policy, which is a good thing, but they still need some insurance for their final expenses and maybe some money for estate taxes. In these cases, people usually look into Final Expense insurance, but that can be pricey. If you are still healthy, a Guaranteed Universal Life policy can save a lot of money and accomplish the same goal. 

6. Newly single. If you are getting divorced and are obligated to pay child support, the court may want you to buy a life insurance policy with your ex as the beneficiary. 

7. Starting a business. Opening a business can be an expensive endeavor, and whether or not you have partners, you still may want to look into a life policy. 

I met a nice lady a few years ago who was up to her ears in debt because her husband decided to open his own medical practice. She begged him to buy a policy to cover the debt he incurred with rent, equipment and payroll. He kept putting it off and a few months later, while cutting down some trees in their yard, a log fell on him. She was stuck owing money that could have been paid out.

The same can be true of business partners. If one dies, the other partner(s) may want to buy out the deceased partner's interest. Otherwise, they may end up with the widow as a partner, which may or may not be desired by either party. A buy/sell agreement funded with a life insurance policy can fix that problem.

As you can see, a life insurance policy can help you and your loved ones avoid many problems down the road. And it can be less expensive than you think. If you want to see how much a policy can cost head over to our site and run a quote. In the meantime, please stay healthy!

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

What Keeps You Up At Night?

One of the hard parts of being an insurance agent is getting people to have an honest conversation when it comes to their finances and how their situation affects future decisions. Some clients either don't want to discuss their goals or simply have not taken the time to figure out what their goals are. 

There have been many times when I have sat down with someone and asked, "Where do you want to be three years from now?" The look on the client's face is priceless. They really don't know. I'm not trying to embarrass them or make them feel bad, but the point of the conversation is that many people are just meandering through their financial issues, paying bills as they come in and buying stuff when they have money put aside.

Just as you would think, most people don't have a clue what their goals are. They say that they haven't really considered it before. Here's an exercise you can do (it's the same one I use with my clients) and it will help you make a game plan.

Take a sheet of paper and put today's date at the top. Next to that, put the same date but three years from now. Underneath the dates make three columns, with headings "Personal, Professional, Financial". Under each heading just write what you want to happen within the next three years. 

There are no wrong answers. I've had people give me all kinds of answers from saving $100,000 (financial) to owning a new boat (personal). One lady who was a cosmetologist put "open a cosmetology school" under the professional heading. Knowing what the goal is helps tremendously but that is just the first part of the conversation. 

Then I ask what would happen to that goal if the client were to die unexpectedly or to become chronically ill. Will they still be able to reach those goals if a potential landmine were to get in the way?

Every once in a while one question will get the client to open up and that question is "What keeps you up at night?" As a husband and father, there have been many times when I have lain in bed thinking about retirement, sick family members, paying for my child's education and a long list of other issues that can, and probably will, show up down the road. It can be overwhelming.

Another part of this is that people will hear advice, through friends or the media, which may sound good, but may not be applicable to their situation. One of my pet peeves is "financial gurus" giving generic advice. A single dad who makes under $50,000 a year and has a sick parent will have an entirely different situation than a married couple who have a six-figure income and no debt. Much like fingerprints, no two financial positions will be the same.

When I sit down with someone and they say they want a 20-year term life insurance policy for $100,000, I ask questions like:

• How did you decide that was the amount of insurance you needed?
• Will that cover any debt you have, including your mortgage?
• Will that amount replace your income?
• What do you want to accomplish with that amount of coverage?

Sure, this line of questioning can make someone feel uncomfortable, but my job is to make sure that the client gets what they need. Taking the time to get an accurate number for the face value of a life insurance policy will make sure that the client is getting what they actually need.

Don't let this stuff stress you out. Sit down with your agent or make a phone appointment to discuss how you can do what is best for you and your family. And in the meantime, please stay healthy!

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

How Does The Disability Waiver Of Premium Work?

For many people, buying life insurance is a chore. Having to research the different types of policies, from term to whole life, as well as dealing with an agent and maybe even scheduling a paramed exam, can make the whole experience is less than enjoyable. And don't even start with the litany of "optional riders" that can be tacked on to a policy, increasing the cost and leading to more confusion.

But before you decide you don't want any riders, let's take a look at a few of them over the next few posts. You might decide which ones will work well for you in the long run. 

In this post I want to discuss the Disability Waiver of Premium (WP), which is available on nearly all types of life insurance, as well as other insurance plans too. Generally speaking, this rider makes sure that if you (or the payor of the policy) become disabled and are unable to work, the premiums will continue to be paid so that your policy does not lapse. Think of it as insurance on the life of your policy.

One of my favorite clients and I were discussing this rider one afternoon and he said, "I never thought of this before, but the last thing you need if you can't work is for your life insurance to get pulled out from under you. That's when you need it most." He was correct.

This rider is usually so inexpensive that I will urge clients to take it, as the cost is inconsequential. For example, a policy that may cost around $30 each month will see a premium increase of less than a dollar. Seriously, this is never a deal breaker. I have even worked with agents who don't even discuss it with the client and tack it on anyway. 

I have a client who purchased a policy from me about 10 years ago. A few years ago she was in a very bad accident that has left her permanently (as far as I know) disabled. Since we had added her WP rider on at the time of the application, she does not have to make any premium payments until doctor says she can go back to work. Every six months or so she receives a form from the insurance company (I get copied on all of this) that she passes on to her physician. The doctor completes the form saying that she is still disabled and she continues to get her life insurance paid for. 

Here's where things get really interesting. After discussing this situation with the insurance company, I found out that if the term of the policy ends (in her case it was a 20 year term) and she is still disabled, they will convert the policy to a permanent whole life policy for her at no charge. Needless to say, she was very relieved to hear this when I passed the information along. 

I have worked with other carriers that will convert in the middle of the term if someone is permanently disabled. The most interesting case was a fellow agent who took out a policy on his son when the boy was very young. Around age 4 the boy was diagnosed with autism and the father was able to get the WP to kick in and convert at the same time. 

The point of all this is that I don't want you to dismiss the rider when it can offer great value in a time of need. Discuss all of this with your agent or drop us a note on our website. In the meantime, please stay healthy!

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

The Cost of Waiting

People generally don't want to have to take on a new monthly bill, especially if it is for something they do not plan on using, like life insurance. But putting off the purchase of a policy can cost you more money in the long run.

Life insurance, as well as disability and other types of insurance, are based on your age. As we get older the rate goes up until you "lock in" on a rate. Life insurance rates are based on risk, and the risk of you dying each year goes up as you age, thus making the premium increase. Buying life and disability insurance when you are younger can save you money in the long run while giving you the coverage you need in case something should happen to you.

This is the first reason why you should not put off buying insurance. As we age our health declines. Unless you are one of the few people who decide, in the midst of a mid-life crisis, to get back into shape, your health will more than likely get worse as you age. 

I currently have a client who is in desperate need of more life insurance, but her health issues have made it nearly impossible to find a policy for her that fits in her budget. Over the last 20 years that I have worked with her and her family, she has had tremendous weight gain which has brought on an onslaught of other issues, like diabetes, high blood pressure, cholesterol and joint pain. 

If she had taken a serious look at a policy when I first met her she would have had the coverage she needs now. Unfortunately, her best bet down the road will probably be for a "guaranteed issue" policy which will cost her a lot of money for just enough to bury her.

Leveraging your good health can be a great way to keep your insurance costs down. It also helps when overfunding a life insurance policy for accelerated growth inside a cash value policy. Permanent policies, like Indexed Universal Life (IUL) can be used for things other than the death benefit, like long term care expenses, chronic illness and a retirement supplement.

Another reason to buy early is to protect your loved ones. Just because you are young doesn't mean you don't have responsibilities. The sudden and unexpected death of a young parent can be even more catastrophic to a family's financial future because young children are involved, as well as the fact that the mortgage payment is mostly interest, leaving little to know equity in the home. That means the burden of making a mortgage as well as funding the educations of the kids could end up on the shoulders of a single parent.

Consider this for a moment. A permanent life insurance policy can be paid up early, so if a young person buys a policy that is paid up in 10 years (or at age 65), that piece of the financial puzzle is taken care of before old age and bad health sets in. And you won't have to deal with it later.

The same is true with most other kinds of insurance. Many cancer plans, for example are based on the age of the insured when the application is taken, thus locking in that rate for as long as one keeps the policy. Take advantage of your good health and young age. You'll be glad you did in the long run and so will your family. 

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

Can I Take Out A Life Insurance Policy On Someone Else?

Every once in a while I will be having a conversation with someone who wants to know if it is possible to insure someone else, like an acquaintance. When this happens I don't really know if they are kidding or not, but I ask if there is some sort of relationship there between the two of them. Usually the answer is "no, you can't" which seems simple enough but people ask why.

Can you imagine the madness that would ensue if people just went around insuring the lives of people they didn't know but "looked sick"? And if insurance companies had to pay those claims they would be out of business quickly. 

There are some guidelines (and reasons for them) when it comes to insuring other people. One of the basic rules for this is that there must be an insurance interest. In other words, before you take out a policy on someone else, you must have a relationship, either familial, personal or financial, with that person. Of course we can take out a policy on a spouse or child, as people do that all the time.

And if you borrow money from a financial institution or an individual, they may require a policy to secure the loan. That is considered acceptable as well. 

Another piece of this is that most states forbid insuring someone over the age of 16 without their knowledge.  But if the insured is over 16 they must sign a form acknowledging they are being covered. This rule applies even if the insured is your 18 year old child.

Back in the old days big companies would buy life insurance policies on all of the employees, with the company being the beneficiary. The thought process was that if the employee died there would be "transition costs" associated with finding a replacement. These Corporate Owned Life Insurance (COLI) policies became controversial when family's in need began learning that the death of their loved one was profitable to their deceased loved one's employer.

The issues arose (as well as lawsuits) when the insureds were no longer in the employ of the company. At that point, any insurable interest went out the window. In the early 2000's several of these types of legal issues got some news publicity which shined a light on how many large corporate companies were secretly adding to their bottom lines.

Nowadays, COLI's are still used, but not covering every employee, including the janitor. (They were actually called "janitor policies" because of this). More often than not, COLI's are used to cover the lives of the top brass, like the board of directors or top executives, who are supposedly fully aware of the policy. I have even heard that the beneficiaries of the policies are split among the company and family members. That sounds much fairer.

With all of that said, here is a short list of people you can insure:

• Family. When the life insurance agent asks what your relationship is to the insured, immediate family is a no-brainer. Be aware that there are limits on insuring children but otherwise you should be okay.
• Former family. As in ex-spouses. If there are children involved the court may order that you maintain a life insurance on your former spouse to help with expenses if the former spouse should die.
• Parents. Yes, they are family but they may have let their life insurance policy lapse or expire and a final expense plan may be the best answer.
• Business partner. Buy/sell agreements are usually written up between business partners to help ease with the transition of responsibilities when one of the partners dies. These agreements are usually funded by a life insurance policy so one partner can buy out the deceased partners ownership. 
• Key employees. Key employees are the ones who contribute significantly to the business or may have some highly specialized skill. These people are difficult to replace and if they die unexpectedly the company could take a financial hit.

If you have any questions about any of these scenarios, ask your agent or drop us a note in the comments. In the meantime, stay healthy!

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life, disability, long term care, cancer, accident and other insurance coverages in North Carolina, South Carolina, Virginia, Tennessee and Georgia. 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!

Who Brings Your Family Money When You Die?

Last year when my father passed away, I found myself as the executor of his estate with many responsibilities. In addition to finding a realtor to handle the sale of my father's home and hiring contractors of various sorts for quotes and repairs, I was also on the hook for making sure bills got paid. Where was that money supposed to come from?

Unfortunately for me, my father had not updated the beneficiaries on any of his life insurance policies in over 40 years, which is insane and downright criminal. All of his named beneficiaries has died way before him, including my mother who had died nine years earlier. That left us creating his estate's bank account with the little cash that was in his checking account and waiting a few months for the policies to pay to the estate instead of his heirs. 

In that time, I realized that when someone dies there are a lot of people with their hands out wanting money. Here are a few: 

1. Contractors. As previously mentioned, we had to figure in the cost of repairs and upgrades to the house. Some we dealt with and others we passed along to the prospective buyers because they were just too much for us to afford.
2. Attorneys. Our attorney let us know from the beginning of the process what the estimated bill will be at closing, so I have to make sure that money is on hand when we need it.
3. Accountants. Be prepared to pay someone to handle your deceased loved one's tax preparation for up to 2 years (if they died before filing the previous years taxes plus the preparation of tax forms for the years in which they died), plus possible estate taxes. 
4. Funeral costs. I've mentioned before how my father pre-planned his funeral but didn't pre-pay. In other words he made a wish list. Inflation took it's toll from the time he chose his casket to when he would actually use it. 
5. Lien holders. This was one I didn't expect but a deceased person still may have debts to be paid off. My father was taking money from a Home Equity Line of Credit (HELOC) which we were unaware of until his death. We settled up with the bank after the sale of the house but I can imagine other people have all kinds of debts that need to be taken care of with cash.
   

Of course with everyone coming forward and asking for money was stressful, however the one bringing us money to take care of these things was the insurance company. When all the others have their hands out, one is bring the much needed check. 

Think about your family for a minute and consider them being in a situation like that. Having to handle funeral directors, lawyers and other bill directors while grieving is a tough situation to put them in. You can avoid it by making sure you have enough life insurance available for them to handle easily and without going into debt or needing a GoFundMe page. 

To help you determine how much life insurance coverage you need, we have included on our quoting software a calculator. It asks for numbers regarding your debts, including mortgage, as well as how much savings you have put aside. You may find out that you don't need as much as you previously thought.  

If you have questions about making sure your life insurance will ease the burdens on your loved ones drop us a note. In the meantime, please stay healthy! 

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!