Hello,
I have very little knowledge about life insurance policy’s and need your help to understand my father’s policy.
My father been paying for his life insurance since 2006/07 and he just told me about it. Did he get a fair deal for the money he is paying monthly or the agent basically screwed him over?
Your father has a $25,000 life insurance policy that costs $1,214.75 each year. The premium is likely higher because he was charged a smoker rate when the policy was issued. This premium is probably fixed for the rest of his life.
The policy might have a cash value that you could surrender. It might also pay an annual dividend, and the current death benefit could be higher. Your father should call Nationwide to ask about these details, or you can look for an annual statement from last December for more information.
You need an in force illustration. This doesn’t say what the cash value is.
Current annual statement would be sufficient.
Is he still a tobacco user?
This example shows why policy reviews are important. Is the policy still meeting its original goals? Was it meant only for final expenses? During the review with the client, you might find opportunities to switch to a policy with a higher death benefit, depending on your dad’s health. I always advise clients to get as much coverage as the insurance company will provide. This helps cover inflation or other future needs.
Hi, since your dad is a smoker, he was charged higher rates. The Canadian side seems reasonable, but a $100 policy fee is a bit high. Check the reduced paid-up value if you want to stop paying. This value is what you get when you exchange your cash value to lock in a certain amount of insurance.
what was your father’s financial objectives when he established the policy? There must have been a need/reason he acquired this coverage. Had he passed away and you received $25,000 would it had been a good deal?