The American Government regularly issues a US State Department’s travel warning list, a list which life insurance companies and brokers use in order to work out the level of life insurance premiums they should offer to people working in these areas – or, indeed – whether or not they are willing to offer them life coverage at all.

Examples of countries on the list are: Somalia, Iraq and Haiti. In these countries, workers, including those volunteering in the aftermath of disasters and those working for construction companies, are likely to struggle to get life insurance. In Somalia crew members or divers who are there in order to profiteer are very unlikely to obtain life insurance.

Whether working for aid organizations, construction companies or adventuring in Somalia, the one thing all these employees have in common is that life insurance is a headache to find either for themselves or by employers on their behalf.

Aid workers Struggle to get Life Insurance

According to Ryan Pinney of Pinney Insurance Center, California “The more unstable and dangerous a country is and the more likely something bad will happen, the less likely you are to get insurance, not even from Lloyds of London which provides specialty insurance if you can pay the price”.

Members of the Red Cross and Peace Corps have to find life insurance for themselves because, as Pinney states “neither agency provides it for their volunteers” and, it could cost “24 to 50 per cent more for a policy because of the danger.”

31 Countries are Considered ‘Unstable’

According to the State Department’s web site a travel warning is issued when “long term protracted conditions make a country dangerous or unstable” and thereby “lead the State Department to recommend that Americans avoid or consider the risk of travel to that country.”

There are currently 31 countries on the list and reasons for being on the list vary from war to physical instability to terrorism or to the type of rebel violence recently witnessed in Mexico. People travelling to, or working in these countries face a daily high risk of being kidnapped, injured or killed and life insurance companies can feel that the costs of insuring anyone working in these conditions is prohibitive .

Government provides Life Insurance for the Military

The military obtain life insurance through the US government and many private insurance companies are willing to insure servicemen too, but the majority of life insurance companies will not provide insurance for contractors or volunteers working in war zones.

Source: SSCI-Iraq.com

 photo credit: timsnell

Business owners have different needs when it comes to taking out life insurance which differs from individuals who are employed. Life insurance is there to help look after loved ones, should the unthinkable happen. But if you own a business and die unexpectedly then you need a life insurance plan which will not only keep your family provided with an income, but also to ensure that the business can continue as usual.

Which Type of Life Insurance Would Best Suit you as a Business Owner?

When taking out life insurance as a business owner there are some things which should be considered such as whether to take out term or permanent insurance. Term life insurance is a relatively simple idea – you decide on the level of cash payment which would be paid out upon the event of your death, and also on the term of the coverage e.g. $400,000 over 25 years. This can be a good way of making sure a mortgage balance would be repaid for instance.

This might also be a good type of life insurance for a business owner with a partner who is planning on retiring at a fixed date. For a couple running a business together they could agree that if either one dies before their planned retirement date, the partner left behind would be able to purchase their deceased partner’s share in the company. Term policies could be taken out making either partner the beneficiary.

This could be a good option to cover the business – but the problem with term insurance is that once the qualifying period runs out – say, after 20 years, then the company would no longer be covered. And, as the business gets older, so do the owners, which means taking out term insurance later on will be more costly. When term insurance ends without the policy owner having died, there will be no cash payment.

Would Permanent Life Insurance be a Better Option for Business Owners?

Permanent life insurance policies include both insurance as well as some investment, or ‘cash value’. The premiums pay, not only for your life insurance coverage, but some is used for investment purposes. The upside of this is that – when the term of the insurance ends, you will still have the investment element to call upon. Plus, permanent life insurance continues for the whole of a person’s life – and so may be more attractive to those wanting coverage for longer.

Plus an additional benefit to a business owner is that the investment component of the policy can be borrowed against and used to further the company – or the policy owner can use the funds to repay premiums.

Life Insurance for Key Employees

Life insurance can also be taken out by business owners on key employees to cover them in the event of their death – should that employee die the insurance would cover them for the loss of income entailed and help fund them in finding a replacement.

Life insurance for a business is often in place for buying out the remaining partners in the event of the premature death of one of the owners. The insurance can cover all the key members of the business. Before deciding which type of insurance to buy – business owners should get in touch with a financial advisor who can help identify the pros and cons of the various life insurance policies on offer.

Source: Karin Price Muewller at Entrepreneur.com

photo credit: Greg317

According to a recent Times report, the amount of money life insurance companies withheld from beneficiaries more than doubled over the last ten years. The Times analysed data compiled by the National Association of Insurance Commissioners, for this conclusion. Last year alone more than 5,000 life policy holders were denied their claims – and the main reason cited was ‘flawed applications’.

Life insurance companies do pay the majority of claims, and paid out $38 billion pounds on individual life policy death benefits last year, but a recent case involving American General has shown that Life Insurers are not always playing fair when it comes to refusing to pay out.

American Life Cancelled Life Policy and Withheld Monies from ‘Exemplary’ Life Policy Holders

Sheila Weissberger became a widow in 2005, after her husband Ian died of Lou Gehrig’s disease. American Life was the Weissbergers’ life insurer and – according to their advertizing -the protector of ‘the hopes and dreams of American families’. Upon the death of Mr Weissberger, they cancelled Mr Weissburger’s life policy and much to her astonishment refused to pay Mrs Weissberger the expected $250,000 payout.

American life confirmed the premiums were fully paid up, no fraud was suspected and nobody could doubt that Sheila Weissberger was the rightful sole beneficiary – plus, Mr Weissberger’s illness was not diagnosed for several months after taking out the life policy. In fact it might seem as if the Weissbergers were exemplary life policy holders.

Refused Payout to Widow on basis Life Application was ‘Incomplete’

The reason for this decision was, according to American Life, that the life policy application was in their opinion incomplete. They stated that Mr Weissberger had failed to declare on the form that he had a bipolar disorder and pulmonary disease – conditions he did not actually have, according to his doctors.

Due to their decision Mrs Weissberger, 62, said “I lost my house. I lost everything” “It was very, very devastating”. American General has now reached a confidential financial settlement with Mrs Weissberger, but she will not likely to ever forget this period in her life.

Most Common Reason for Withholding Payouts is ‘Flawed Applications’

Life insurers can refuse to payout on policies for legitimate reasons such as foul play, unpaid premiums and suicide, but the most common reason for disputing claims is ‘material misrepresentation’. This means failure to disclose information deemed important when assessing risk – this clause can allow life insurance companies to totally rescind live cover.

The majority of American states have banned limitless rescissions in order to stop life insurers abusing the system, but Californian and other areas, life insurance companies can rescind life policies in the two years following the signing of a policy.

Source: Latimes.com November 2010

photo credit: StuartWebster, tibchris

Certain female celebrities such as Courtney Cox Arquette, Madonna and perhaps most famously of all Demi Moore have been the envy of many women due to the fact they bagged themselves much younger husbands. However, new research puts a damper on their apparent good luck.

A study published in May 2010 in the journal “Demography” looked at data collected from over 2 million Danish couples. Statistics showed that women who married partners seven to nine years younger than themselves had an increased mortality rate of 20%.

The study, carried out by the Max Planck Institute for Demographic Research in Rostock, Germany, found that women who marry considerably older men also tend to have shorter lives. A big age gap either way from a woman’s point of view has a detrimental effect on her life expectancy.

A woman’s best choice of partner for a long life is someone of the same age or slightly older.

Men who marry younger women are a much better risk to a life insurance company

This is not the case for men since the research showed that the mortality risk of a man who marries a woman seven to nine years younger than himself is reduced on average by 11%, compared to marrying someone the same age.

“Health Selection” doesn’t work for women

Previously it was thought that it was beneficial for either partner to marry a younger spouse.  This idea known as “health selection” says that those selecting younger partners are generally healthier and have the potential to live longer than others, and that by matching up with someone younger this would increase the positive psychological and social effects which help in older age.

Why don’t women  benefit from their younger husbands

According to researcher Sven Drefahl, “One of the few possible explanations is that couples with younger husbands violate social norms and thus suffer from social sanctions.” It is also believed that the psychological and social benefits an older husband gets from a younger wife do not hold true the other way round – the husband is unlikely to have as many social contacts as a woman would and is less likely to match a woman in terms of the level of care he will offer his ageing wife.

The good news is that life insurance for married couples is cheaper overall

The bright side is that marriage raises life expectancy for both sexes compared with the unmarried, with women overall still outliving men by a few years. This makes them more of a positive investment for a life insurance company when it comes to taking out a life insurance policy.

photo credit: jenny downing

The need for parents to consider taking out life insurance has been highlighted recently. LIFE (Life and Health Insurance Foundation for Education) recently awarded $105,000 worth of Scholarships to students who could not afford to pay for college because a parent had died.

Parents who die without Life Insurance Scupper College Plans for Children

LIFE reported on the case of Esther Kim who was only 16 when her dad died of cancer – he didn’t have any life insurance, which left her and her family financially insecure. Esther had always been a straight ‘A’ student and had always planned to go to College, but the bereavement looked set to put her plans on hold, since she, along with her mom had to work flat out in order to keep the family going.

Luckily for Esther she now has the chance to start a course at Oglethorpe University. She has achieved this by using money she saved herself, as well as a student loan and a scholarship worth $10,000 from the not for profit organization LIFE.

Parents have to Consider Children’s Future should they Die Prematurely

Mr Marvin H Feldman, President and CEO of LIFE Foundation stated “ When parents die prematurely without adequate life insurance, the people who depend on them most – their children – often face difficult financial realities that can force their dreams of a higher education and a better life to be put on hold.” “We are proud to be able to help deserving young people like Esther and our other scholarship recipients to reach their college goals, and we hope their stories will remind all parents to protect the financial well-being of their loved ones through proper financial planning.”

The LIFE Lessons Scholarship Program offers scholarships to students who are unable to afford a college education due to a parent dying with negligible or no life insurance. During the last year 59 American students received awards from the Foundation – in order to qualify students had to make a video, or write about the financial consequences of losing their mom or dad.

The judges included members of the LIFE Board, as well as Life Insurance company executives, from some of the top US Life Insurance companies. One of the scholarships was awarded as a result of an online vote – Mashell Ewing was the winner, for describing how difficult her financial circumstances had become since the death of her single mom.

Single Parents need to Consider Life Insurance as a Priority

Mashell’s mom died suddenly of a heart attack having made no provision for life insurance. Since then Mashel l and her brother both had to work long hours just to pay the rent and care for their younger sister. Despite this Mashell managed to secure a place at the University of California, Berkeley and so determined was she, she took out loans to help pay for college fees. The extra $5000 dollars awarded to her last year by LIFE will help her achieve her plan to graduate this May.

The LIFE foundation was set up in 1994 with the aim of educating the public about life, health, disability, and long-term care insurance.

Source: lifehappens.org/content

photo credit: ralph and jenny