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By Kevin Spann | September 12, 2018

Top 7 Insurance Questions People Ask Me When Wearing a Pink Shirt

This is Kevin Spann, your Insurance Guru. Coming to you live today, with the top seven questions that people ask me when I’m wearing a pink shirt. Number seven: why is life insurance important? Life insurance is important for three reasons. Number one; you want to take care of your final expenses, that’s the cost of your funeral. Number two; you want to pay off any outstanding debt that you have. Whether that’s a home mortgage, whether that’s credit card debt or a car note. Last and most important, life insurance if you have the right amount, it can also replace your income and take care of future goals.

Number six question people ask me when I’m wearing a pink shirt. How life insurance works when someone dies? Very good question. The way that life insurance work when someone dies is that, you can let the funeral home know that you have a life insurance policy. The life insurance company will then cut a check directly to the funeral home and the balance of the proceeds will go to the beneficiary. So that’s the way that life insurance works when someone dies.

Number five question is, will life insurance pay for death by suicide? The answer to that question is, no. If someone commits suicide within the first two years of having a life insurance policy, is known as the ‘contestable period’. So, you cannot buy a life insurance policy and take your own life within two years. The life insurance policy will be null and void.

Will life insurance cover the cost of a funeral? Yes, as long as you have enough life insurance. So that begs to ask the next question, how much does a funeral cost? Well it all depends. If you’re being buried locally here in the New York state area, the average cost is between $10 – $12,000.00. But a conversation that I like to have with people, since we have so many people from all over the world in New York is, “What are your final plans?” Some people plan to be cremated. Believe it or not, you cannot be cremated for free. You’ll pay less but that cost can still be between $3 – $5,000.00. Some people want to be buried abroad in the country that they were originally born in. In that case, they will need more life insurance to pay for their funeral expenses.

Can the beneficiary on a life insurance policy be changed? Yes it can be changed and yes, it absolutely should be changed in several circumstances. Sometimes people … Most times if people are married, they name their spouse as the beneficiary of their life insurance policy. Well, as we all know about 50% of marriages unfortunately, end in divorce. However, they don’t always let their life insurance agent or their life insurance company know. So in that case, if there’s a change in your relationship with the beneficiary be it a divorce, be it the death of the beneficiary, be it a change in the relationship where you’re no longer see that significant other, domestic partner, as someone who you would want to have the proceeds of your life insurance policy. You should definitely change the beneficiary.

What life insurance is right for me? Should I get a whole life policy, should I get a term policy? Well, those two policies are very different. I won’t answer any of those questions in this question. But, the one thing I will tell you, you should get the amount of life insurance that best suites your budget. As a general rule, a younger person can buy a significant amount of term life insurance for very little premium. And I’ll say young as being under 50, being a man of a certain age myself. At age 50 and above, people should really consider permanent life insurance so they can get locked into a policy that does not expire or change.

And the number one question that people ask me when I’m wearing a pink shirt. “Kevin, why are you wearing a pink shirt?” Don’t know. Haven’t thought about that one.