I thought this deserved a thread of its own even though I posted a different thread on Globe Life a few days ago.
There are a lot of things about their product offering that are not explained in the policy document which I thought were interesting.
I've had Globe Life Ins for both my kids for about 10 years.
I contacted customer service because I had questions to ask them.
I asked if the policies have dividends and she told me the policies do not pay any dividends. A small portion of the premium goes to the cash value.
In addition to the face value of the policy, the cash value is based on age as well as how long you've had the policy.
I asked the rep if there was a way of paying the policy in full to avoid paying premiums and she said there is a non-forfeiture option which has no cash value and much lower coverage. It would cost me $2,120 for a 12 year old and $1,500 for a 10 year old. The policy coverage would drop from $20,000 to less than $2,000. I asked why anyone would pay up a $20,000 policy with $2,000 just to have the coverage drop to $2,000? The rep could not adequately explain to me why this was the case.
I have ownership of both policies so I could keep paying into them for years and surrender them anytime for the cash value.
I have $10k coverage on my kids but it is term life insurance. I pay $3 a month for the policy via work. My thought process was if they died...I don't know that I have enough for a funeral just laying around. This would at least take care of that.
WhiteGuy said: I have $10k coverage on my kids but it is term life insurance. I pay $3 a month for the policy via work. My thought process was if they died...I don't know that I have enough for a funeral just laying around. This would at least take care of that.
True, but you're really overpaying for that insurance, at least if your kids are over one year old. You're paying $36/year for $10k in coverage, which is roughly 280:1 odds of a death in that year. The odds a kid in the US aged 1-14 will die in a given year is about 4700:1. That insurance should cost more like $3/year. The absolute amount you're overpaying isn't that high (an extra $33-34/year), but it's still expensive insurance vs. the risk.
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