Another life insurance question

julieanne912

So I've been researching life insurance so I can present H with some options.  I have a small policy (around $70,000) through my work, and I also have a small policy on him ($20,000) through work as well.  He says he doesn't have any through is work.  But obviously I'd like to get something not tied to work started, especially when we start TTCing.  I'd like him to have enough to cover all his debts and pay off our mortgage since he's the main breadwinner, so around $500,000.

Our issue is, as I've mentioned before, he has Crohn's disease.  He's convinced he can't get life insurance, or if he does the cost will be astronomical.  I keep telling him that's probably not the case, and now is the time to get it because he has age on his side (he's 32).  Is this really the case?  Or is he pretty much screwed because of his disease?  I've had private policies on myself in the past and didn't even have to have a health exam due to my age, but it's been a few years since I did that. 

I did tell him that his dad, who is 60 and morbidly obese, was able to get a policy (not sure of the cost), so he will be able to also, but he's not convinced.  

brij2006

Call an independent insurance agent in your area and have them run some numbers for you.  It really all depends on the company, and they can usually quote you with multiple different ones.  

As far as how much, you will want to have a minimum of 10x his salary.  The point to that is so you can put that amount into a mutual fund and pull from it each year, acting as his salary if he were to pass.  Another thing to look at, there is quite a bit of debt between the 2 of you.  I would add all of that up and have a policy large enough to also pay off all of the debts, including the mortgage.

It may seem like a lot of coverage, but it's best to leave your spouse in a "best case" situation if either of you were to pass.  The last thing you want is for him or you to worry about how the mortgage is going to be paid next month, while grieving. 

I personally would not factor in what you currently have through your work.  Just so if you were to leave your job in a few years, you aren't then scrambling to find more coverage.  Right now, I'm seeing a price break at the $1mil price point with most companies.  

Worst case scenario for your H, if he can not find a company who will insure him, then he may want to look into an AD&D (accidental death and dismemberment) policy.  The premium is usually very cheap, but they only pay out if death was accidental.  It would not cover if he passed from his disease, but it would be better than having nothing on him at all. 

hoffse

Well I would at least get some quotes.  Worst case scenario is they come back too $$$$, but you won't know until you call in and ask.

H and I haven't insured to 10x our salary yet, because that would probably be overkill for us.  But we have enough to pay off all of our debt and provide a generous cushion to take an extended leave of absence.  TBH, if H passed, I probably would NOT pay off the house (and I would invest that money instead), but it's comforting to know that I would at least have the option.  

I'm going to increase coverage soon, but I'm honestly on the fence about how high we will need to go when TTC (for both of us).  I would be really surprised if I end up wanting to stay home because I really love my job, but stranger things have happened. I'd like to bump up coverage on both of us before we turn 30.  Right now I'm thinking I'll double it for me and triple it for H.  

If both of you plan to continue working, but you are also going to TTC soon, I would just go ahead and insure for that amount because the price isn't going to go down.  $500K probably isn't enough with kids, given your other debts. Personally, I would want enough to cover the cost of college and also defray childcare costs to some degree.

maple2

My DH was diagnosed with Crohn's and was able to get life insurance. He wasn't able to qualify for the best tier (i.e. the cheapest), which made him really mad since he is otherwise very healthy. I don't remember the exact cost per month. It's higher than what a lot of people on here are paying, maybe around $50/month, but that's obviously influenced by things other than his disease (the amount of life insurance we have on him, the length of the term, other health measures, etc.). I definitely think it's worth it for your h to at least get some numbers rather than writing it off as impossible.

julieanne912

maple2 said:

My DH was diagnosed with Crohn's and was able to get life insurance. He wasn't able to qualify for the best tier (i.e. the cheapest), which made him really mad since he is otherwise very healthy. I don't remember the exact cost per month. It's higher than what a lot of people on here are paying, maybe around $50/month, but that's obviously influenced by things other than his disease (the amount of life insurance we have on him, the length of the term, other health measures, etc.). I definitely think it's worth it for your h to at least get some numbers rather than writing it off as impossible.

Thank you, this is very good to know.  He's actually technically in remission, and has been for about 10 years, as long as he keeps up with his Remicade treatments, but it's not a guarantee that it won't get worse.  He recently had to start going for treatment every 7 weeks instead of 8.  But anyway maybe him being medically "in remission" will be a benefit for him.  

brij2006

One thing to keep in mind as well, you both have student loans.  As long as those haven't been refinanced into a private loan or non-government loan, then they are forgivable upon death.  I'm not 100% sure, but I don't believe any private student loans are, but someone could correct me if I'm wrong.  

simplyelise

Yeah, in my research (lot's of GI issues and just cleared of having Crohn's a couple weeks ago), the disease doesn't actually cause a shorter lifespan. You've got a higher risk for some cancers, but it's not a fatal disease and if you know you have it, you'll be getting regular screenings for those cancers. So maybe 20 years ago you wouldn't be able to get life insurance with Crohn's, but it would shock me if you couldn't find someone to insure him, assuming he doesn't have other medical issues.

You definitely need to get some life insurance on him asap. What would happen to his house and mortgage if he died? There is so much debt in his name and probably not enough assets to cover the debt. You wouldn't qualify on your own to refinance the mortgage in your name, so if he died unexpectedly, you might be left with nowhere to live, the joint debt in your name (mattress and driveway CCs IIRC), and whatever is left of the 20k rider you have on him after burial costs.

This is a situation where even if he couldn't find a term policy, I'd still want him to take out a whole life policy on himself with you as the beneficiary. If he can afford $900/month on a truck he doesn't even drive daily, then he can afford to make sure you aren't broke with nowhere to live if he died.

Xstatic3333

OP, when we signed up for life insurance we were able to get quotes based on medical issues we knew about during a quick phone survey with our agent.  If the Crohn's is going to be a problem with one particular company, it will likely turn up right away so he can know to move on to another option quickly.  Term life is so affordable that even at a slightly lower tier, I'm sure it will be affordable.  I agree with PPs that this is extremely important for you both to take care of getting him insured soon.

@maple2 I am also super, super annoyed about not getting getting placed in the highest health tier.  I am blessed to have pretty much perfect health.  I was knocked down based on one unexplained fainting episode in 2003, which I could easily have forgotten to bring up in the first place, combined with scuba diving.  My agent actually appealed my case to the national company and everything, and said it was the most surprising ranking he had ever seen.  Glad your H was still able to be insured with his Crohn's!

hoffse

simplyelise said:

This is a situation where even if he couldn't find a term policy, I'd still want him to take out a whole life policy on himself with you as the beneficiary. If he can afford $900/month on a truck he doesn't even drive daily, then he can afford to make sure you aren't broke with nowhere to live if he died.

Yeah, this.  I hate to say this, but a couple weeks ago there was a fundraiser on my FB page for a mother and her three kids.  Her husband had died in a car accident.  She was a SAHM, and now they are penniless.  I felt really bad for them, but in my head all I could think was, "Life insurance? Anybody?"

Dying at such a young age is absolutely tragic, but insuring against the financial catastrophe of it is so cheap that I've never been able to bring myself to donate to one of those things.  Even being in a more expensive tier, most people will spend way more on cell phones each month than life insurance - and ironically, their cell phone might be the thing that kills them if they use it while driving.

I don't want this to turn into a rant, but it absolutely baffles me to hear of families with young kids who never think about life insurance or disability insurance. Call me boring, but obtaining the proper level of insurance and getting wills in place should come before picking out the perfect stroller. 

brij2006

hoffse said:

simplyelise said:

This is a situation where even if he couldn't find a term policy, I'd still want him to take out a whole life policy on himself with you as the beneficiary. If he can afford $900/month on a truck he doesn't even drive daily, then he can afford to make sure you aren't broke with nowhere to live if he died.

Yeah, this.  I hate to say this, but a couple weeks ago there was a fundraiser on my FB page for a mother and her three kids.  Her husband had died in a car accident.  She was a SAHM, and now they are penniless.  I felt really bad for them, but in my head all I could think was, "Life insurance? Anybody?"

Dying at such a young age is absolutely tragic, but insuring against the financial catastrophe of it is so cheap that I've never been able to bring myself to donate to one of those things.  Even being in a more expensive tier, most people will spend way more on cell phones each month than life insurance - and ironically, their cell phone might be the thing that kills them if they use it while driving.

I don't want this to turn into a rant, but it absolutely baffles me to hear of families with young kids who never think about life insurance or disability insurance. Call me boring, but obtaining the proper level of insurance and getting wills in place should come before picking out the perfect stroller. 

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AMEN!

vlagrl29

brij2006 said:

hoffse said:

simplyelise said:

This is a situation where even if he couldn't find a term policy, I'd still want him to take out a whole life policy on himself with you as the beneficiary. If he can afford $900/month on a truck he doesn't even drive daily, then he can afford to make sure you aren't broke with nowhere to live if he died.

Yeah, this.  I hate to say this, but a couple weeks ago there was a fundraiser on my FB page for a mother and her three kids.  Her husband had died in a car accident.  She was a SAHM, and now they are penniless.  I felt really bad for them, but in my head all I could think was, "Life insurance? Anybody?"

Dying at such a young age is absolutely tragic, but insuring against the financial catastrophe of it is so cheap that I've never been able to bring myself to donate to one of those things.  Even being in a more expensive tier, most people will spend way more on cell phones each month than life insurance - and ironically, their cell phone might be the thing that kills them if they use it while driving.

I don't want this to turn into a rant, but it absolutely baffles me to hear of families with young kids who never think about life insurance or disability insurance. Call me boring, but obtaining the proper level of insurance and getting wills in place should come before picking out the perfect stroller. 

************************************************

AMEN!

Truth! I  kind of think its irresponsible to your family if you don't get disability and life insurance

Xstatic3333

hoffse said:

simplyelise said:

This is a situation where even if he couldn't find a term policy, I'd still want him to take out a whole life policy on himself with you as the beneficiary. If he can afford $900/month on a truck he doesn't even drive daily, then he can afford to make sure you aren't broke with nowhere to live if he died.

Yeah, this.  I hate to say this, but a couple weeks ago there was a fundraiser on my FB page for a mother and her three kids.  Her husband had died in a car accident.  She was a SAHM, and now they are penniless.  I felt really bad for them, but in my head all I could think was, "Life insurance? Anybody?"

Dying at such a young age is absolutely tragic, but insuring against the financial catastrophe of it is so cheap that I've never been able to bring myself to donate to one of those things.  Even being in a more expensive tier, most people will spend way more on cell phones each month than life insurance - and ironically, their cell phone might be the thing that kills them if they use it while driving.

I don't want this to turn into a rant, but it absolutely baffles me to hear of families with young kids who never think about life insurance or disability insurance. Call me boring, but obtaining the proper level of insurance and getting wills in place should come before picking out the perfect stroller. 

Yup! Life insurance came up in conversation with my girlfriends a few weeks ago. I'm the only one who has it, despite being the only non-mom in the group. I just don't get it. I think term life needs a better PR campaign or something.

brij2006

Xstatic3333 said:

simplyelise said:

This is a situation where even if he couldn't find a term policy, I'd still want him to take out a whole life policy on himself with you as the beneficiary. If he can afford $900/month on a truck he doesn't even drive daily, then he can afford to make sure you aren't broke with nowhere to live if he died.

Yeah, this.  I hate to say this, but a couple weeks ago there was a fundraiser on my FB page for a mother and her three kids.  Her husband had died in a car accident.  She was a SAHM, and now they are penniless.  I felt really bad for them, but in my head all I could think was, "Life insurance? Anybody?"

Dying at such a young age is absolutely tragic, but insuring against the financial catastrophe of it is so cheap that I've never been able to bring myself to donate to one of those things.  Even being in a more expensive tier, most people will spend way more on cell phones each month than life insurance - and ironically, their cell phone might be the thing that kills them if they use it while driving.

I don't want this to turn into a rant, but it absolutely baffles me to hear of families with young kids who never think about life insurance or disability insurance. Call me boring, but obtaining the proper level of insurance and getting wills in place should come before picking out the perfect stroller. 

Yup! Life insurance came up in conversation with my girlfriends a few weeks ago. I'm the only one who has it, despite being the only non-mom in the group. I just don't get it. I think term life needs a better PR campaign or something. This is very accurate.  I touch on life insurance a lot with my job, and explain to people how important it is to have.  Even a simple term policy.  It's sad to say that 90% of people say they don't want to get it.  Or "not right now, money is tight."  Yet these same people have a $500/month car payment and their spouse stays home with the kids.  

Many people also say that they have it through work.  Yet they don't know how much of it they have, nor whether or not it's an AD&D policy only.  

I wish more people would understand the importance of protecting their family. 

julieanne912

Thanks for all the comments.  Just so you know, you're preaching to the choir.  I've always had some kind of life insurance since I got my first "real" job at 22.  Some private, some through jobs, but always SOMETHING.

The only joint debt we have at this point is our bed, which I pay for anyway.  The mortgage, his truck, the rzr and the camper are all solely in his name.  Mostly because it was acquired before marriage and I wasn't comfortable having my name on anything before we got married.  As for not having somewhere to live if he died and I couldn't keep the house, I managed to find myself a place to live for 12 years before I met him, so I could probably find another place again  I was pretty much single from 18-30 years old, so somehow, I did manage to adult on my own without a husband to help.  Of course, once we have a kid this all changes but I'm a pretty independent person.

But, I completely agree that it is a bit irresponsible of him to NOT have at least some, especially once we start a family.  My dad died when I was 18, and while my mom made quite a bit more money than him, the life insurance he had (which she insisted on) made it so she didn't have to struggle financially at all, allowed her to retire early at 64 when she started having some back problems, and that's also what helped pay for our wedding (mom saved a bit of it for that purpose).  

And yeah, he recently had a friend from back home die of a brain aneurysm, he and his wife had a small baby.  No life insurance whatsoever, and so they were doing gofundme's and local fundraising events for the wife and baby.  I plan on using that example as to why he needs to get it together.

brij2006

@julieanne912  Not sure what state you're in, but I know at least in Illinois there is a spousal responsibility when it comes to death.  So even though none of that stuff is in your name, it is automatically your responsibility upon death.  

Not every state is that way though, but just keep that in mind. 

julieanne912

brij2006 said:

@julieanne912  Not sure what state you're in, but I know at least in Illinois there is a spousal responsibility when it comes to death.  So even though none of that stuff is in your name, it is automatically your responsibility upon death.  

Not every state is that way though, but just keep that in mind. 

Yes, I'm thinking I need to research that more!  I'm in Colorado and I'm not familiar with the laws here.  When my dad passed in CA, his only real debt was his work truck, and it was forgiven and my mom was able to sell it and keep the money.

Disneygeek77

My husband has Crohn's disease and he didn't have a problem getting life insurance.  He has some through work but also some through Northwestern Mutual.  In 2014, we were looking into switching to AAA and after the health screening, his quote wasn't much more than mine.  

julieanne912

Disneygeek77 said:

My husband has Crohn's disease and he didn't have a problem getting life insurance.  He has some through work but also some through Northwestern Mutual.  In 2014, we were looking into switching to AAA and after the health screening, his quote wasn't much more than mine.  

Thank you!  Interesting how 3 of us have H's with Crohn's.  

Disneygeek77

I guess it is becoming more common or better diagnosed.

I know he thought for a long time he wouldn't be able to get some because of the disease, but after talking to a few agents, he realized he had assumed wrong.

MommyLiberty5013

If you or DH are active, retired, or honorably discharged OR if anybody in your family is (any branch) you can get into USAA. They offer great insurance policies.

julieanne912

MommyLiberty5013 said:

If you or DH are active, retired, or honorably discharged OR if anybody in your family is (any branch) you can get into USAA. They offer great insurance policies.

His sister is honorably discharged... he has his banking accounts at USAA through her.  I'll see if he can look into policies there.  I know the quotes for our car insurance were quite a bit higher than we are paying elsewhere.  

short+sassy

MommyLiberty5013 said:

If you or DH are active, retired, or honorably discharged OR if anybody in your family is (any branch) you can get into USAA. They offer great insurance policies.

Thanks for that!  I looked into getting life insurance for my H but, because he is a smoker, the cost was outrageous.  However, he was previously in the military and I never even thought to check with USAA.

I'd also love to get more life insurance for myself and will check with them for me.  Having Type I diabetes, most companies won't even sell me a policy at all and...the ones that do...charge insane prices.