Rmi 3500 Case Application Chapter 2

RMI 3500

Life Insurance Part 1

1 Occurrence and its absolute

        No deductibles

        Only make 1 claim

WHY?

Look after family

        College

        Stay-at-home partner

        Outstanding debt

                Mortgage

Funeral

On a child?

        Devastating effects

                Inability to work

                Counseling

                Funerals

Property and casualty = insurable interest at the time

Can we take out a life insurance policy on teacher?

        No, not an insurable interest in him

        He is easily replaceable

Which is better for you?

Term or Whole Life

Universal Life insurance

        “To complex to understand”

EX: 20 year old Marine suicide?

        FOUND: Had to payout

                        -Burden of proof. Would have to prove it was a suicide.

Stranger-Owned Life Insurance (STOLI)

        What could possibly go wrong?

                No meant to be a security traded asset

                Prices go up = premiums go up

                Screw over consumers

                Going to get maximum coverage = drives up premiums

                Decide to get life insurance later = Cant because its sold off