Dropping Life Insurance...

**peanut** · 01-12-2008, 01:22 PM

Anyone know anything about term life insurance? DH has life insurance through work for 1 1/2 times his salary. Plus we have a separate policy on him for $50K through his alumni association. The price has been going up on the alumni insurance. We've been thinking we'll build our EF up to $10K and then drop the insurance. DH does not believe in insurance - thinks it's a rip off to pay for something you'll never use. I'm just not sure what kind of state this will leave me in in retirement. I'm Canadian - we have universal health care - so that shouldn't be a problem. But what about old folks homes/hospitals etc.? Are those paid for by government? Seems my MIL has to pay for her retirement home, and it takes up most of her income, which is more than my income would be in retirement! I'd be earning just around $2000/mth. in retirement.

Jean

**yonksgirl** · 01-12-2008, 01:36 PM

I have my Life license in PA so I can not really advise you since you live else where but if you lived in PA ( my little disclaimer LOL! ) I would tell you not drop your Term life insurance just yet. You can have the best laid plans in the world but if something god forbid should happen to one of you the plans are down the drain.
If it is the cost that you are worried about you could try dropping the trem of the insurance say you have a 20 year term now you could drop it to a 10 year term and save money that way, and hopefully in 10 years you would be in a place that you do not need it. If you would still need it you would have to redo your Meds, and go threw a new incontestablity period.

Also how much is your coverage for? If you can you could drop the face value. just have enough to bury the other person and pay off any debt.

hoope this helps if you have any questions just ask.

**Sari** · 01-12-2008, 03:26 PM

I don't know anything about the different types of life insurance, but you should definitely have some, and more than you think. It goes very quickly and there are a TON of expenses you'd never think of.

**peanut** · 01-12-2008, 06:59 PM

We have $50K on DH through his alumni association, and roughly $100K through work. Plus we plan to have $10K in an EF by the summer. The idea was the $10K EF would bury someone. I have no life insurance on me. I'm not gonna die! LOL

Right now the term runs out when DH hits 71 yo. I have no idea when the work life insurance runs out. Probably when he quits work. No way will he get that extended or transferred to a private plan, if I know him.

Jean

**monkeywrangler71** · 01-12-2008, 07:25 PM

I don't know the current rules, but it used to be that the nursing home took all your money/income, then when you ran out the government picked up the tab. When my grandfather went in, they took half of their financial assets and his pension - my grandmother's pension and the family home were exempt (luckily my grandmother was the one with the big pension).

I kind of share your husband's view on life insurance. It's important to have if you have debts and are supporting a family, but once the kids are gone and house/etc. paid off, I don't think people need more than enough for a funeral. Is $2000/mo. not enough for you to live on in retirement? If he dies first, does he have a pension that will transfer to you (or are you including that in the $2000)

If you aren't comfortable dropping the extra amount, check with his employer to see if you can buy optional additional insurance at a lower rate than the alumni one.

**peanut** · 01-13-2008, 03:26 PM

The $2000 includes DH's pension. If we live in our own home, yes, we can make it on $2000/mth. If we have to do the nursing home thing for one of us, no way could the other make it on $1000/mth. in our house. It would be poverty level for sure. One bedroom apartments are $500-600/mth. here.

Jean