When Second-To-Die Coverage is More Beneficial than Individual Life Insurance

For those planning to take out a survivorship or second-to-die life insurance policy, there are several benefits involved. The main benefit is that the policy insures both parties without the need of purchasing separate insurance. People who have businesses, real estate or other hard assets especially benefit from this type of coverage, because such assets can be very difficult to try to sell following the death of one of the parties. There are six important benefits to understand about these types of policies. Qualification is easier. In comparison with other individual types of life insurance qualification rules, it is easier to obtain second-to-die coverage. This is because insurers are less likely to make a decision based on one person’s health, and the risk is also spread. People who are older will find that it is easier to take out this type of policy. Also, business owners who have been denied individual coverage are more likely to be approved for this type of policy due to insurable interest and a second covered party. There is tax relief. Most people who purchase these policies are married couples, and they purchase this type of coverage to make sure the other receives enough payment to offset the estate tax liability. This coverage is best suited for people who have estates exceeding $2 million, and it is also useful to anyone with an estate consisting mostly of illiquid assets, real estate or business interests. Premiums are less expensive. If two people are insured under one policy, the insurer is able to spread the risk two two people. As a rule, premiums are about 50 percent less than an individual policy. In addition to this, the premiums are paid annually instead of monthly or quarterly. For those who are looking for policies to simply cover the cost of an estate, the policies are not expensive. An agent can provide a tax estimate based on individual details. There is a charitable trust option. These policies provide an effective way to set up trusts for heirs and charities in a cost-effective manner. It is best to choose a policy that suits a loved one’s needs as well as individual needs. For example, a person with a disabled child would be able to set up the policy so that the child would still receive the needed funds after the death of the policyholder. Policyholders have more control over their assets. With the right policy, a person could have the ability to control asset distribution and timing. For those who have concerns about family members’ spending habits, this is especially helpful. It provides liquidity to heirs. Without this type of policy in place, heirs could lose assets instead of keeping them. If a person has a second-to-die policy, it will ensure the assets are distributed to the intended heirs instead of being used to pay off the estate’s debts or final expenses. In a way, this type of policy can be considered a creditor-sheltered asset. There are other benefits associated with these policies. To learn more about second-to-die life insurance, call the experienced team of professionals at ACBI at 203-259-7580 or visit our website.

Why Life Insurance Should be Reviewed Often

When most people purchase a life insurance policy, they do not usually review it as often as they should to make necessary updates. Dealing with life insurance is something that most people consider unpleasant, but it is a very necessary part of making sure survivors are properly provided for. It is also important for covering final expenses, which can otherwise leave loved ones financially strapped or may make them go bankrupt in some cases.

Life is not static. It is common for a person’s circumstances to change. People may buy a house, start a new job that pays more, get married, have more children or start taking care of an aging parent in their own home. All of these life changes are also good times to review and modify a life insurance policy. For example, a man who purchased a policy when he had a spouse and two children might not leave enough behind if he did not update it after having one or two more children or receiving a job promotion. As a rule, life insurance benefits should always be commensurate with current living situations and life details.

Even if the year passes and there are no major life changes, it is still wise to review personal coverage. Keep in mind that a policy should not just cover expenses for a funeral and a few months’ living expenses after death. Survivors will probably require at least a few months to recover. Every person should decide how much is necessary based on an agent’s suggestions. People who are the main earners for the family and have children who they want to attend college may also want to make sure there are enough funds that children can pay for tuition and some other expenses.

Life insurance is not only necessary for people who work. A spouse who stays home to care for children should also have enough life insurance to cover child care expenses and any costs associated with keeping up the home. People who are single and have no heirs may think they do not need coverage, but they should always have enough to cover their own funeral expenses and any debts. They may also choose to purchase extra coverage so they can leave a sum to a charity, family member or friend of their choice.

While reviewing coverage every year, it is helpful to confirm beneficiaries and their information. Keep addresses and phone numbers current. When there are any doubts that coverage will not be adequate for supporting survivors, it is important to discuss any concerns with an agent as quickly as possible. Life insurance is not a pleasant topic to think about or discuss, but being prepared and covered is important.  ACBI can help you review your options and be sure you have the best solution for your individual needs.  Call our office at 203-259-7580 or visit our website.

Some Illnesses may no Longer be Barriers for Life Insurance Rates

In the past, people who had a history of serious health problems would not be able to buy affordable life insurance. However, the industry has experienced a dramatic shift, which resulted in the rules being changed. Experts note that the rules still vary from one company to another for preexisting conditions, but people who have these conditions will find it easier to obtain coverage.

Experts say that consumers should not just assume they will not be approved for coverage if they have health issues. With the possibilities of an earlier diagnosis, better detection and more treatment options, many people can live longer with serious health issues than they could in the past. Insurers are offering coverage to people who have chronic conditions due to the availability of information. As outcomes and care improve, people who could not afford coverage in the past might even qualify for standard rates with some companies. Experts say that they are hopeful these trends will continue.

With survival rates improving every year, life insurers have to shift their policies. In the past, people were evaluated based on several risk factors, family history, lifestyle and medical conditions. While job related and other risk categories may remain the same, acceptance for medical conditions is changing. The risk of insurers having to pay out a death benefit in a shorter amount of time is not as likely, which is part of what makes the policies more affordable.

Since the 1970s, the rates of survival for many serious illnesses have improved. For example, cancers such as those of the prostate, esophagus and pancreas often came with less of a chance of survival. With newer treatments and medications, people can survive these types of cancer for several years. For early detection of breast cancer, the five-year survival rate is more than 95 percent if treatment is used. However, the survival rate in the 1970s was only about 75 percent. The five-year survival rate for prostate cancer that is treated is also more than 95 percent, which is a climb from less than 70 percent in the 1970s.

Due to improved treatment options, many people can stabilize their health for longer. Once their illness is under control or in remission, they may qualify for lower life insurance rates. Experts gave the example of PSA testing used for prostate cancer. If the levels are acceptable, insurers can offer better rates. However, the rates are higher when the PSA test is not at a favorable level. These methods are not limited to just cancer. There are other ways of evaluating additional illnesses. For example, insurance companies are now more likely to offer decent rates to people with obstructive sleep apnea or well-controlled diabetes. People who have had organ transplants or have illnesses that cannot be controlled as well may not qualify for standard rates. However, they are still likely to receive better rates than those offered in the past. To learn more about these options, call ACBI at 203-259-7580 or visit our website

How People Can Insure Themselves Against Outliving Assets in Retirement


In the United States, the average expected lifespan of humans keeps increasing as time passes. The average male born today can expect to live about 75 years, and a female born now can expect to live about 80 years. Research shows that people who reach the 65-year age mark are likely to surpass those life expectancy numbers. Men who are 65 can expect to live about 16 more years, and females who are the same age may expect to live about 20 more years. Research also shows that people who reach the age of 75 are likely to live past the age of 85.

Many people welcome the thought of extra years on their lives, but these added years can also bring several challenges. One important issue is for people to decide how they will support themselves financially. To ensure there will be enough money to pay the bills after leaving the full-time workforce, insurers suggest purchasing longevity coverage.

What Is Longevity Insurance?
This type of coverage is essentially an annuity that starts paying guaranteed monthly amounts at a later age. People typically pay one lump sum as the premium when they retire. However, they do not start receiving annuity payments until they turn 85. Between the time of retirement and that age threshold, they must rely on income from other sources. Some examples would be retirement savings, pensions and social security benefits.

When a person knows that he or she will have a guaranteed income source after annuity payments start, that helps relieve some of the worry of outliving retirement savings. If insurers offer this option, it is marketed as one that protects people against longevity risks or insuring their assets against the possibility of outliving retirement income. It is also possible to consider longevity coverage as a simplified form of planning for retirement income. People with this coverage know that at least part of their income will be available to them later on. The following are some important points to consider about longevity insurance:

– These types of policies’ premiums are usually paid in lump sums. If a person buys longevity insurance at the time of retirement, it is likely he or she will have to use some funds from retirement savings to buy it. People must consider whether their savings will be large enough to do this, and they must also know exactly how much they plan to put toward the purchase.

– Before receiving money back from the investment, a person must reach the annuity start date. As insurers perfect their products, many are adding death benefit features as options. This means heirs will receive something in return if the policyholder dies prior to the start date for the annuity. However, this reduces the monthly income that an initial premium payment would buy.

– Since a person is paying for something that will not be possible to use for 20 years, it is important to choose products carefully. Always work directly with an agent, and be sure to discuss all concerns prior to buying coverage.

Not all people who buy these policies will live until the age of 85, so there is no guarantee that benefits will be paid in such a situation. This should not deter possible buyers from purchasing longevity insurance, because companies offer this form of coverage for surprisingly affordable prices. For many people, this is the perfect addition to retirement income. Please call ACBI at 203-259-7580 or visit our website to learn more and to discuss whether this product is a beneficial option for personal needs.

Most Households Lack Adequate Life Insurance


Researchers recently found that more than 20 percent of 24 million households in the United States did not have life insurance. Of the households that did have coverage, only about 50 percent had life insurance for all of the people living there. Experts said that more than 30 percent of adults do not have life insurance, and this is a statistic that has remained the same for the past two decades. Researchers also said that more than 50 percent of Generation X and Generation Y households said they needed more coverage. They said that 70 percent of women stated life insurance was a necessity, but only about 60 percent of men agreed with that. Of the married women observed, only about 30 percent owned life insurance even though 70 percent of households had two incomes. Researchers also said that about 30 percent of women earned more than their husbands.

These statistics may seem surprising, but what researchers found even more surprising were the comparative statistics they gathered regarding peoples’ feelings about life insurance. About 75 percent responded that they felt life insurance was important and was the best way to protect against the loss of income of a primary wage earner. In addition to this, life insurance ranked higher than any other income or asset Americans expected they would use to pay bills and manage other living expenses if a main wage earner died. Many Americans still believe that a surviving spouse will cover the expenses if the other dies, but they often do not realize just how financially devastating the loss of one income can be. The comparative statistics prompted researchers to find out why people were not buying life insurance if they knew it was important.

The most common reasons cited for not purchasing this coverage were that it was not affordable or there were competing financial priorities. However, researchers also found that people had misconceptions about the cost of life insurance and often overestimate the cost of it threefold. About 60 percent of the people surveyed said they had not been approached about buying life insurance within the past couple years. More than 30 percent of shoppers who met with sales representatives but decided not to buy coverage said their sales rep did not follow up. Another 10 percent said they were unsure what type to buy, and yet another 10 percent said they were afraid they would pick the wrong type. Les than 10 percent said they did not know enough about coverage to purchase it.

Researchers also looked at what prompts people to buy life insurance. About 40 percent of respondents said major life changes such as getting married, buying a home or having children prompted them to start shopping. Another 25 percent said they thought about coverage because of financial advisers. Twenty-five percent also said they purchased coverage because they wanted to review theirs and decided they needed more. Slightly more than 10 percent said friends or family members recommended them to an adviser or life insurance sales representative.

Many Americans today believe that life insurance benefits may not be as useful as stocks and other investments. However, in an ever-changing market, life insurance is still a good way to have the assurance of guaranteed benefits despite what is happening in the world. In addition to this, investments are normally taxed after a person dies, but life insurance avoids that tax. With solid financial planning, this money can also be kept out of estate proceedings.

One final point researchers made was that sales representatives needed to work harder to ensure more people are offered coverage and that follow-ups are made after initial contact. Researchers said that nearly 80 percent of people with existing relationships with sales reps bought life coverage, which was higher than the percentage of buyers with no existing relationships. They also said giving customers a needs-based analysis will help them make the best decision and understand how coverage works. Nearly 75 percent who received this type of analysis from an agent or rep bought coverage. To learn more about this topic, please call ACBI at 203-259-7580 or visit our website.