An older barn on a couple's property was struck by lightning, caught fire and burned to the ground. Julie, the wife, called their insurance agent to report their claim and said "we had that barn insured for twenty thousand and we'd like a check". Their insurance agent explained, "It doesn't quite work like that Julie. The company will have an adjuster verify the value on the barn and then provide you with a new barn of comparable worth". There was a long pause, and then Julie said "Well, in that case, I'd like to cancel the policy on my husband."
All kidding aside, we all know life insurance can't replace a loved one. You can't replace a family or the things that a family means to one another. Yet even after losing someone, you can still reach the goals you set as a family by planning for a few common needs.
Here's an example with some numbers filled in for a family (parents plus 2 children) taken from Auto-Owners Insurance.
| Immediate Needs: | |
| Funeral Costs | $10,000 |
| Unpaid Medical Costs | |
| Readjustment Needs: | |
| Mortgage Payoff | $85,000 |
| Credit Cards | $2,000 |
| Emergency Fund | $3,000 |
| Survivor Income | $300,000 |
| (survivor income = 5-7 times your gross annual income) | |
| Legacy Needs: | |
| College Fund (2) | $80,000 |
| Retirement Fund | $200,000 |
| Total Needs: | $680,000 |
| Available Cash | $10,000 |
| Investments | $50,000 |
| Life Insurance | $250,000 |
| Total Available Cash | $310,000 |
| Life Insurance Need | $370,000 |
To complete your own calculations, go to Auto Owners online Life Insurance Estimator at http://www.auto-owners.com/our-products/life-insurance/life-insurance-needs-estimator. Then call us to get some rate options. For instance, how many years do you want to be covered? 10? 20? 30? Selecting a plan that will work for both your needs and budget is important.
One way to make the life insurance premiums easier to afford is to take advantage of an electronic monthly pay plan with no additional installment charges. Breaking the cost into 12 payments can help with budgeting and the electronic billing is an extra precaution against having the policy lapse for non-payment by mistake.
Life insurance isn't like other insurance policies where if you drop the coverage you can always buy it again. If your health changes, you may not be eligible. Even if you are healthy still - the cost for a new policy later would be at an older age bracket where the rate won't be as low.
So what's your next step? Hopefully it will be to call us … 231-347-8113 … about your life insurance needs. We'll be happy to provide you with options - including multi-policy discounts for combining policies like auto, home, boat, motorcycle, rv, business and workers compensation. All of these can be discounted when you have a life insurance policy too. The savings can really add up and make the life policy even MORE affordable.
September has 31 days … make one of them your Life Insurance Awareness Day!
Jenny Brower - Harbor/Brenn Insurance Agencies
( Licensed Life Agent since 1987 )
