Life Insurance Awareness Month.
Interview with Frank F. Malpartida, New York Life agent.
Life Insurance Awareness Month (LIAM) is an educational campaign designed to get consumers to take stock of their life insurance needs and protect their loved ones through proper insurance planning.
LIAM is an industry-wide effort coordinated by the LIFE Foundation, a nonprofit organization dedicated to helping consumers make smart insurance decisions.
New York Life has been a proud supporter of the LIFE Foundation and Life Insurance Awareness Month since its inception in 2004.
The sluggish economy continues to put financial strain on many of us. So it just makes sense to examine our budgets and look for ways to trim the fat from our monthly expenses and put more into savings, if possible.
Life insurance is one of the few guarantees your family could rely on to maintain their quality of life if you were no longer there to provide for them.”
There are 95 million adult Americans without life insurance, according to LIMRA, an insurance industry research group. The fact is, the vast majority of Americans need life insurance and, sadly, many people either have none or not enough. If someone depends on you financially, you need life insurance. It’s that simple.
Also, even if you have insurance, Life Insurance Awareness Month is the ideal time for a life insurance review. Anyone that has loved ones that depend on you, this is a great time to take a few minutes out of their busy schedules this month to make sure they have adequate life insurance protection.
What makes New York Life different than other insurance companies in terms of coverage, service and financial strength?
A mutual life insurance company, like New York Life, is owned by its policy owners and does not have shareholders who own the company. Rather, owners of our whole life insurance policies share in the company’s distributions of surplus and receive dividends when they are declared by the company’s board of Directors, and a public company means it is traded on U.S. stock exchange and has shareholders. Dividends are not guaranteed.
What types of Life Insurance are offered? Benefits of each one?
That’s a great question. Insurance options are different for everyone. It’s very personal and depends on many factors but I can give you a simple overview.
Term insurance is like renting a home:
· Provides basic protection
· Similar to renting, the policy does not build equity in the form of cash value. Initially term insurance can be economical
· It is more economical today and the cost increases over time
· At later ages, term coverage is more costly and will expire, ending your death benefit coverage
· Term insurance is an affordable way to obtain the death benefit coverage you require and contains a valuable upgrade option that allows you to convert to a permanent policy, with a permanent policy you can build cash value and obtain a valuable asset – much like owning a home
· Term life insurance has a guaranteed death benefit but no cash value and the premiums will increase at pre-determined intervals such as 1 year, 5 years, 10 years and 20 years.
And, Permanent, cash value insurance is like owning a home
· Like a home, cash value life insurance builds equity over time in the form of cash value and is a valuable asset
· When you own a home, you are building equity over time and you have a valuable asset that you can borrow against to pay for other important needs.
Whole Life: There is no denying that whole life insurance is usually more expensive than its term counterparts. This is because a whole life policy lasts your entire life, whereas term expires after a certain period of time. But while you may pay more for whole life insurance, it is important to note that you are getting a lot more in return.
Whether or not whole life insurance can be affordable depends on your personal and financial situations. You may find that you can easily afford one of these policies. If you want to know for sure, receive quotes for whole life insurance. This will show you once and for all how much it costs and whether or not you can work it into your budget.
Combo: Term expires and could leave you and your family unprotected. You can find an optimal blend of term and whole life coverage that meets your needs and fits within your budget. Term life insurance may be right for younger people with limited means and few financial responsibilities. It can also serve as a short-term, stopgap means of pure protection. Later, as life changes occur, the term policy may be converted to permanent insurance. When all is taken into consideration, you may find that a combination of permanent and term insurance is best for you.
Which type of life insurance is best?
Actually there is no one “best” type of life insurance. What’s best is what is best for you. Life insurance is not a “one size fits all” product.
Life Insurance is optional in many jobs. What are the kinds of job when Life Insurance should be encouraged to protect the wellbeing and future of the families?
It doesn’t matter what type of job you have, if you have a family and loved ones to protect, you should have insurance. If your family relies on you to provide nearly everything that they need – a home, food, clothing and an education. If you were to die, could your family maintain its standard of living without your income? You likely have dreams for your children’s future. Would they be able to fulfill those dreams if you died prematurely?
Life insurance is for the ones that we care about. It allows them the opportunity to thrive and not merely survive in the event of your untimely death.
As a breadwinner your family relies on you to provide nearly everything that they need – a home, food, clothing and an education. If you were to die, could your family maintain its standard of living without your income?
You likely have dreams for your children’s future. Would they be able to fulfill those dreams if you died prematurely?
Life insurance is for the ones that we care about. It allows them the opportunity to thrive and not merely survive in the event of your untimely death.
Even if you’re young and single you should think about getting insurance. It’s one of the best times to buy insurance. The time to buy insurance is while you are young and healthy. The premiums for permanent and term are more affordable at a young age, and if for example you buy a cash value whole life insurance policy, you have a longer time horizon for your death benefit and cash value to accumulate. In addition, the healthy rate class that you receive when you are young can assist you in the future should you decide to convert term insurance to permanent insurance – Explain why). Insurance premiums become more expensive as you get older, and over time you may become less insurable or lose your insurability altogether.
What is the best age, the best moment in life for a person to buy life insurance?
I just stated this above.
I also recommend that people speak with their insurance agent when they reach different life stages. For example, if you have your first child, if you’re planning on retiring or getting married or divorced these are life stages. You should think about changing your policy or getting life insurance if you don’t already have it.
Stay-at-home mothers/fathers or self-employed people should also get life insurance? What would be the best type for them?
Yes, good question. The services of the full-time homemaker while often under-valued, are worth tens of thousands of dollars a year —and that’s what it would cost to replace those services should anything happen to her or him. Again, each person’s situation is different. There are different options for every situation.
Readers should speak with an insurance professional to get quotes.
General message to the public to increase awareness of the need for Life Insurance.
Protection isn’t the only reason to consider life insurance. A second reason may be to supplement your retirement income. A cash value life insurance policy that accumulates cash value on a tax-deferred basis can be borrowed against to provide additional funds for retirement, as your insurance needs decrease. Cash Value is accessed via policy loans that accrued interest and will reduce value and death benefits if not paid back.
Readers should speak with an insurance professional who can help work with them and analyze their needs and evaluate their situation. Life insurance is something you do in person, it is very personalized and you should set an appointment with a professional that can advise you on the options that you may have but everyone should do this before something should happen. Remember, this is your plan for your family.
My suggestion is that your readers talk to their friends and people they trust in their community and get recommendations. You can contact your state’s insurance commissioner for information on a company’s financial “health,” or check your local library for company ratings reports published annually by independent agencies such as A.M. Best. Study product illustrations carefully, and ask questions when necessary. You’ll want to fully understand the products that are proposed to you. If you’re uncomfortable with a scenario presented to you, get a second opinion. (A New York Life agent like myself who is professionally trained and experienced can help you analyze your needs and recommend appropriate solution through insurance and financial products and concepts —at no charge to you.) When you have all the facts, then you can make an intelligent decision on what’s best for you and your family.
If you have any questions, please contact Frank F. Malpartida, New York Life agent at (305) 798-7500 or ffmalpartida@ft.newyorklife.com.