What Is The Guaranteed Insurability Option?

One of the things that can confuse people when purchasing life insurance (and other types of coverage as well) is the various types of riders that are available. These riders are simply add-ons that can increase the coverage of your policy. One of these riders is the Guaranteed Insurability Option (GIO), also known as the Guaranteed Purchase Option (GPO). 

The GIO rider can work for you by giving you opportunities during the life of the policy to purchase extra coverage without having to go through medical underwriting. The insurance company will send you a notice from time to time (sometime stated in the policy itself) stating that you have a window of time called an "option date" to purchase more coverage. These dates usually fall on the anniversary of your policy and can be spread out every 3 to 5 years.

Of course if you purchase more coverage it will cost you more in premiums, and the additional coverage will be based on your current age. For instance, let's say that you bought a policy at age 35 and the premium is $40/month for $250,000 coverage. At age 45 you want to purchase more coverage (you may have had a life change or bought a bigger home or whatever), yet you have also had health issues recently. In the case your rate will increase because you are buying more coverage, but that new coverage will based on you being 45 years old now. 

As an agent I recommend this rider to people who are insuring small children because you just don't know what can happen down the road for a your person when it comes to their health. 

The rider itself can add a small amount to your premium but should be considered if you have a family history of medical issues or if you have a medical issue that will may get worse. 

Here's a brochure from Illinois Mutual, a great company that has some awesome policies. 

As always, let us help you if you have questions or comments. You can visit our site and book a short phone appointment. In the meantime stay healthy and thank you for your referrals.

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!

Why Life Insurance Is Necessary For Blended Families

As the holidays approach, the idea of taking care of our family means more to us. Having our loved ones get together for a nice meal and gift giving leaves us with great memories. 

However, when we think of the "traditional family" we think of a husband and wife and their two or three children, who all live together in one home until the kids become adults and move out. Even though there are still families in this situation, there are many people who have changed that concept. With social norms changing and people living longer, the family structure has been altered dramatically. 

Now we have parents raising children who are not theirs, biologically speaking. Think of the old Brady Bunch TV show where two parents who had their own kids remarried. Of course, on the show everything was great. The fact that Marcia was not Mike Brady's biological daughter was never brought up as a topic. 

There are those people who do love their step-kids or other children who have been brought into the home, like nieces and nephews . I know of one person in particular who is raising his wife's nephew because his sister-in-law had a drug problem. 

There are those who begrudgingly raise a spouse's children from a previous relationship to "keep the peace". And when problems arise, the kids want to move back to their other biological parent or some other option. In other words, tensions can, and in some cases, do get escalated to the point where children are going back and forth between parents or other adult family members. 

With all of this in mind, it's important to keep an even keel when it comes to estate planning with a blended family as it creates a whole set of issues. A will may seem like a good way of planning, but in fact, life insurance could be a better option to make sure those who are intended to benefit will be taken care of in the eventual death of a parent. And in the flexibility of naming and changing beneficiaries, as well as listing primary and contingent beneficiaries, makes it incredibly easy to take care of the family's estate planning needs. 

As an attorney friend of mine says, "A life insurance policy trumps a will because it's a legally binding contract." The "yours, mine and ours" scenario can be very confusing for most families when it comes to estate planning, and life insurance can be the answer that is needed. It can help avoid a long and drawn out estate process and keep the peace within a 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!

Do People Have Enough Life Insurance?

Many Americans do not have nearly enough life insurance to support their families’ needs. In fact, about 44% of families say they would face financial hardship in six months if the primary wage earner were to die, noted David Levenson, president and CEO of LL Global, in a recent video presentation. Now, a group of life insurance organizations is aiming to change that.

LL Global, the parent organization of life insurance researcher LIMRA and LOMA, is helping lead an effort with industry trade associations and more than 60 of their largest member companies and distribution partners to close the life insurance coverage gap. One initiative is encouraging financial professionals to engage with their existing clients to look at the adequacy of their protection. 

"Most people think it’s just to pay for funeral expenses; but the word ‘life insurance’ is really a misnomer," Elsie Theodore, a Virginia-based regional vice president of Primerica, told Investopedia. "Can anyone really insure someone’s life? No, ‘life insurance’ is really income replacement. Its purpose is to replace the income of the breadwinners in the household."

As a general rule, she added, “When you are trying to determine how much coverage you should have, you must first look at your annual income then multiply by 10. You make $100,000 a year, your life insurance should be at least $1 million.”

That number may seem high but the priority is making sure that loved ones can stay in their home, take care of the everyday bills and even provide for education costs if children are still in the picture.

A major problem today, Theodore noted, is that many people rely solely on the group life insurance provided by their employer, which is often inadequate. Typically those policies only provide coverage for one or two years salary replacement. Also, they may or may not be portable, which means if the the employee changes jobs the policy might not be there when their family needs it most. 

According LIMRA’s research, about 60 million American households don’t have the proper protection for their families, with an average deficiency of $200,000.2

What's more, the problem is worse than it was in the past. While 63% of Americans had life insurance coverage a decade ago, that number had dropped to 54% by 2020, LIMRA says.

There are a lot of contributing factors to the incomplete coverage, including changes in individual life
distribution, employment-based benefits, worker participation rates, family and household make-up, and population demographics. People also have competing financial priorities.

In addition, there are misconceptions about price point, need, and ease of purchasing, particularly among Millennials. This is ironic when you realize that most of them grew up with phones and most agencies are trying their best to make insurance coverage accessible on mobile devices.

As LIMRA points out, the COVID-19 pandemic has highlighted the fragility of life and focused more Americans on the role of life insurance.

Theodore recounted one particularly sad situation: "After a few attempts to get this one client to sit with me and get her plan started, she called me because she had 13 members of her family die from COVID-19 and not a single one had insurance. That was an unfortunate wake-up call.”

The life insurance industry has also responded to the pandemic by adapting its sales practices. Companies have made significant advancements in the ability to deliver a fully digital purchase experience so consumers can choose to buy a policy when, how, and where they want. Understandably, insurance carriers are increasing the availability of web based applications and decreasing the requirements for in person medical exams. 

If you aren't sure if you have enough coverage, let us help. 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!

Are You Going To Insure Your Love?

Valentine's Day is this month. You may be in the group of people who think that it is a holiday created by greeting card companies or you may be in the group that loves the holiday. Either way, it is not a bad time to remind the people you love how much you care. And you can do that by insuring your love. 

And yes, using the month of Valentine's Day for promotion may sound cheesy but doesn't this get to the matter of what life insurance is all about?

In the insurance world February has been deemed "Insure Your Love" month. It is a good time to explain to people that life insurance is not just another financial product, but instead it is love insurance. Life insurance is purchased to protect your loved ones from financial struggles if you died. 

For those people who have lost a loved one too soon, you know that along with the emotional and physical pain, there is financial loss as well. There is a funeral to pay for, time taken off from work and bills that need to be paid, including medical bills that somehow need to be taken care of. If there are children in the mix, this financial loss can quickly become a financial disaster. Making sure that your family can stay in the home that they know, that their standard of living will not change and that their college funds are still safe is essential. 

When you really get down to it, life insurance isn't for the person who is covered, but to pay a benefit to those loved ones. And if you love your family, you will make sure that after you are gone they can keep moving forward with their lives.

We know that people want to do the right thing by their family, but sometimes we put off things that are important. No one wants to add add another monthly bill, but when life insurance should be a priority. 

And it isn't just about buying a policy, but making sure you have enough coverage. When an insured person dies, his or her spouse, who is typically the beneficiary, will ask a very important question: Will we be okay? What do you want your agent to say? 

Remember that life insurance is customizable, meaning that it can be tailored to your needs and budget. Whether you are purchasing whole life, term life or universal life insurance, you are making sure that your family is taken care of. And it can be much cheaper than you think.

With all of that in mind we have made it as easy as possible. We have added a quoting tool to our website (which is conveniently located in the upper right corner of this blog). There you can find coverage that fits your budget and your family's needs. If you like what you see or have a question, drop us a note and we will assist you.

With the Covid pandemic going on, people are concerned more than ever about their future. And along with that means getting coverage in a safe and efficient manner. You can set a phone appointment with us and we offer non-medical policies. Let us help you "insure your love" safely and be sure to look us up on Facebook.

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!