Insurance Nerd

Keeping the Family Farm in the Family

2010-04-11T14:58:00.000-05:00

I hope to keep my family's farm in my family, so I recently have been much more attune to happenings in agriculture. I have especially been reading online since learning that a couple of my friends (Jeff Caldwell, the husband of one of my wife's co-workers, and Mike McGinnis, a guy who went to my high school and was a wrestling, football and tennis team mate) do a lot of writing on the subject. An article Jeff posted this week, Have The Talk, was especially relevant to me both personally and professionally. You can read it here. http://www.agriculture.com/ag/story.jhtml?sssdmh=dm17.441916&storyid=/templatedata/ag/story/data/1270571788119.xml

"Consecutive ownership within the same family for 100 years or more of at least 40 acres of the original holding of Iowa farmland" is the eligibility guideline to be considered a Century Farm according to the Iowa Department of Agriculture. Many family farms fail to reach this milestone because the family fails to "have the talk" about passing the ownership from one generation to the next. Jeff's article helps get that ball rolling. As with any business succession, people often worry about problems that might arise and use that as an excuse to not discuss it, but the potential problems are minute compared the the real problems caused by lack of a plan when a business owner dies or has an unexpected health crisis. When no plan exists, often the business or farm has to be sold to someone outside the family.

Life insurance shows its incredible power when used properly as a tool to facilitate transferring ownership of a farm. It can solve a lot of "what ifs".

What if Dad and/or Mom dies unexpectedly and the next generation is too young to take over? The death benefit can be used to keep the farm running with hired help or to replace lost income while a renter farms the land until the kids are ready to take it over.

What if only one of several children wants the farm? How can the estate be settled fairly? If "the talk" reveals this situation, life insurance can help form a fair solution. Without life insurance, at the time of death it's not unusual for the ones who don't want the farm to demand that it be sold so they can get their shares of the estate. Unless the one who wants it has the capital available to buy it, the farm often ends up being bought by someone outside the family. If the one who wants the farm buys a life insurance policy on the owner, he or she would have the money to buy out siblings at the time of death, and it's fair because he or she has invested his or her own money into the life insurance. Depending on the situation (which should be discussed with a qualified tax advisor), the premiums could potentially be considered a business expense. Another benefit of this route is that depending on the type of policy, etc., the cash value in the life insurance could be used to purchase of the farm before the owner's death if wanted.

What if multiple children want the farm? How can the estate be settled fairly then? This is a much tougher question, one that just having a life insurance policy won't cure. One person using the strategy above would have the upper hand since the money would give him or her a lot of bargaining power, but that scenario would lead to a lot of bickering. This is the scenario where "the talk" is going to be most difficult, but also will do the most to prevent future problems.

What if the owner(s) become sick or disabled and/or have to go into a nursing home? On the surface, it doesn't sound like this is a job for life insurance. The best option to cover this possibility would be a separate disability and/or long term care policies, but sometimes the best option isn't possible. The right life insurance policy can do double or triple duty if the added cost of a second or third insurance policy isn't affordable or if age or a health issue makes it impossible to qualify for coverage. Many life insurance policies have more lenient underwriting than long term care or disability coverage because the life insurance is more predictable. The amount of "death benefit" they pay out for terminally ill or disabled policyholders before their death is a defined amount, not an ambiguous number based on how long someone is unable to work. The money paid out could help pay for the cost and/or buy the farm before the owner "buys the farm".

Examples

Here are some "real number" examples of how life insurance could be used as part of the transfer of ownership plan.

Young farmer (25)with middle-aged parent (50--this is middle-age in my book since I'm not there yet): To purchase $250,000 coverage, assuming Dad is a standard rating, the cheap route to go would be term insurance, which would cost around $1,000 a year (conservative estimate--could be lower depending on health) for a 20 year policy. Then Dad would be 70 and son would be 45, where there's a good chance the son would be taking over anyway. For about three times that premium cost, he could buy a return of premium plan, where it would pay the same death benefit, but at the end if Dad was still alive, he could get back everything he'd paid in, about $60,000, which could be used as part of the money needed to buy him out. Or for about $3,000 per year he could buy permanent insurance guaranteed until Dad was 120 (and Son is 95). There are also numerous other possibilities depending on wants and needs, policies that would pay for long term care, would build large amounts of cash value, etc.

Middle-aged child (50) with older parent (70): Believe it or not, there are 20 year term policies available on healthy 70 year-olds. A standard rated male could get $250,000 coverage for about $8,000 a year, guaranteed for 20 years. The downside is that if he lives past 90 the rates jump quickly and before long the premium paid over the years will be more than the $250,000 death benefit. A permanent policy would be a much better option here, with only a slightly higher premium.

These are just a few of the ways life insurance can be used to keep the family farm in the family. It all starts with a family discussion, but once that is done, make sure you include your life insurance agent (along with a tax advisor and attorney as the bare minimum professional team).

Wellmark Evil Ripoff?

2010-03-14T23:25:00.000-05:00

Because of all the attention being paid to Congress's proposed health care reform, the 18% increase in Wellmark's individual health insurance premiums is getting more attention than it normally would. Is it a big increase? Absolutely. Is it going to hurt? Of course it is. And the final question: why is health insurance expensive? Because it's worth it.

Here's a little background. Effective October 1, 2008, Wellmark revamped its rates and underwriting guidelines. Before that, I wrote very little individual health insurance coverage with Wellmark because of their underwriting. If an applicant had ever been sick or hurt, it seemed like they always wanted to see doctor records, and usually added riders to exclude anything an applicant had ever been treated for in the past. I often had applicants turn down what was offered and take their chances without insurance. Sometimes applicants were turned down for ridiculous reasons. For example, one lady couldn't recall who the doctor was 20 years earlier who had treated her for a minor ankle fracture over 20 years earlier when she lived on the other side of the country. She said he was old enough then that after 20 years he was almost certainly either retired or dead. Because we were not able to get his records regarding her old ankle injury, she was declined for coverage, even though she hadn't required any further treatment since having the cast removed 6 weeks after the accident happened.

When Wellmark revamped its underwriting, I was suddenly able to write business with them because they were being reasonable. For many of the health questions they changed from asking, "Have you EVER" to "In the last five years have you..." or "In the last two years..." or "Are you currently...". Instead of excluding high blood pressure, they figured it into the rates, charging slightly more to the person who showed a history of it being well controlled and charging a lot more for the person who was not controlling it well. In my eyes, it was very fair, and most applicants saw it that way too.

Since October 2008 I have used Wellmark almost exclusively for individual health insurance because they have been easy to work with and have usually had a rate lower than the competition. Even with the increased rates, I will continue to offer Wellmark because I have not been able to find anything better.

The situation with American Community illustrates better than anything else why Wellmark must raise rates. For the past year and a half, when I compared them to Wellmark, they occasionally had lower rates for similar but not equal coverage. When Wellmark announced these rate changes tried to take another look at American Community rates, but I discovered that they are no longer offering individual health insurance in Iowa and A.M. Best dropped their rating to "D" ("poor").

I have been and will continue to check into other companies, but have yet to find anyone who is offering rates significantly lower than the new higher rates than Wellmark's increased rates.

Are the new higher rates an evil ripoff? I don't think so, since the increases are more bringing the rates in line with other companies than anything else. I think what happened is that Wellmark mis-calculated the effect of loosening up their underwriting guidelines and has had to adjust the rates accordingly. Wellmark has postponed the increase pending an investigation from the governor's office. I'll be updating here, but I'll be shocked if the state finds the increases are not justified.

The Real Health Care Crisis

2009-10-06T22:06:00.000-05:00

With all the hoopla about health insurance, lots of people ask me my opinion, which along with $1.85 with get you the best cup of coffee in Des Moines at Cup O' Kryptonite. My opinion: the current problems are only the tip of the iceberg.

The real crisis is about 10 to 20 years down the road. The Baby Boomers will be going to the nursing homes. Think about this. During the "Summer of Love" in 1968, the first Baby Boomers were 23 years old. If dementia and Alzheimer's are problems for our 70 and 80 year olds now, what do you think it will be like when the Boomers start seeing white rabbits again? Instead of streaking football games, they'll be streaking the hallways of long term care facilities. Instead of burning their draft cards and bras, they'll be burning down their kitchens because they forgot to turn off the frying pan. Instead of smoking pot they'll...never mind, they'll still be smoking pot. but they'll have long term memory loss in addition to the short term memory loss.

Where will their care come from? Who's going to pay for it? We don't have enough facilities or qualified workers to handle them all. And if science continues to reduce the mortality rate, more and more bodies with fried minds will live longer and longer. The "if it feels good, do it" generation hasn't saved their money like their parents did, and what they did save has been lost in the market downturns. They have fewer children, and most of their children have moved away.

The good news? Those of us with aging parents won't have to worry about being empty nesters. When the kids move out, the parents can move in. We won't be bored with no one to take care of.

Or maybe the Green Movement will become the Soylent Green Movement.

LIFE and health, No Longer HEALTH and life

2009-08-22T00:47:00.000-05:00

It's taken longer than I've wanted and the journey has not been without frustration, but I've taken my agency from being a health insurance agency that also offers life insurance to being a life insurance agency that also offers health insurance.

Several things prompted the change. Most important was the realization that although I saved my customers hundreds and often thousands of dollars on health insurance, I had the potential to create and save tens or hundreds of thousands of dollars for them and their families with life insurance, annuities, and IRA's. That's thrilling to me and my clients.

The increasing regulation of the health insurance industry, especially with Medicare, has been a factor also. Because of all the hoops I have to jump through, extra documentation, and time spent on claims issues, I'm fairly sure I'm making less than minimum wage on health insurance sales. I haven't calculated it out. Better things to do with my time.

I'm focussing on life insurance because I believe in it. Nothing else has the power to protect families that life insurance does. And nothing's more important than family.

Generic Cosopt!

2008-11-14T01:06:00.000-06:00

Cosopt (dorzolamide hydrochloride with timolol maleate) was approved on 11/6/08 by the FDA. Cosopt is used to reduce pressure in the eye (glaucoma).

Who to Vote For?

2008-11-01T22:19:00.002-05:00

The following is my response to a friend who says we should vote for Obama because then we'll have universal healthcare:

"You obviously don't work in the health care or insurance industry or haven't talked to anyone from Canada. Universal health care is extremely expensive and inferior to coverage available in the private sector. If you want to see the right way to do healthcare, take a look at Medicare part C & D. Letting the private companies compete has resulted in prescription coverage costing billions less than what was predicted. The best way to solve the health care problems is to reward healthy decisions and to make the consumer pay a large portion of the cost. The problem we have is that health care costs are rising because of overuse. Our generation runs to the doctor every time we have an ache or pain we brought on ourselves and expect it to be paid for. Quit smoking, exercise, maintain a healthy weight weight, eat your vegetables, drink water, sleep 8 hours a night, etc. If you still get sick with something major, then use your health insurance. If we all did that, half the hospitals and doctors wouldn't even be needed. The vast majority of health costs (95%???) comes from a small minority (5%???) of the population. Almost all of those costs can be traced to smoking and obesity. The biggest problem we have in this country is not letting people suffer the natural consequences of their actions. "

I'm still undecided and don't like any of my choices. All I know is that the choices I make in all the other areas of my life will have a much bigger impact on mine and my family's future than who is chosen as president.

Jumping Through Hoops!

2008-10-30T23:34:00.000-05:00

Wow! I haven't posted forever (and probably won't again for awhile)! October is usually insane for me, but this year it's like insanity decided to smoke some PCP. It's been great for business, but not so much for my sleep schedule. Usually my main concern is getting through all the training and certification for the next year's new plans, but this year on top of that I've been dealing with everyone's concerns with the financial markets and insurance company difficulties. Then just as things seem to be settling down somewhat, CMS came out with a bunch new regulations, saying that I have to have written permission to talk to a prospect, that it has to be signed at least an hour before I talk to him or her, and I have to keep it on file for 10 years. Even if it's my own grandma. The good thing is that it at least gives me an excuse to go pheasant hunt for an hour after she signs it!

AIG and the Amusement Park

2008-09-17T13:33:00.000-05:00

With AIG showing up on the news every night (or every minute on the internet), I've had a few questions come my way along the lines of, "What's going on with AIG? Do I need to switch companies?" The strongest statement I can make is, "I am making no changes to my AIG policy" (which happens to be the biggest policy I've sold for them, both in premium and coverage amount).

As both a policyholder and agent I've been following the situation closely. Every news story and press release has its own bias and angle, but they have a consistent theme. AIG is not broke. They have over a trillion dollars in assets. The problem is that it's not a trillion dollars in cash sitting in a vault. It's in long-term investments, real estate, etc., where they don't have instant access to it. The crisis is a short-term liquidity problem.

Billions and trillions of dollars are difficult for me to grasp, so here's how I'm thinking of it. Hopefully this will help you to. This situation is parallel to me going to an amusement park with my family and $100 cash in my pocket. I'm not planning to spend that much, but want to have it just in case. The first ride, my younger son tells me repeatedly he can't ride the merry-go-round because he'll throw up. I tell him, "That's ridiculous. Nobody get's sick on that little ride". I drag him onto it, and after about a minute he pukes up his breakfast. Then my wife smells his vomit and loses her breakfast too. Luckily my son's wearing an old t-shirt, so instead of trying to clean it up, we throw it away and spend $25 on a new Hawkeye t-shirt at the gift shop that's really only worth $10. Of course now the second son wants a Cyclone t-shirt to make it "fair". I don't want the day to be ruined already, so I avoid the fight and buy it. No problem, I've still got $50 and my ATM and credit cards.

However, an hour later my wife and son are both "starving" because they barfed breakfast. So we go to the hot dog stand. Hot dogs are $5 and pop is $4. Even though the price is ridiculous, I bite the bullet to keep the peace. I think that maybe I should use my credit card, but the cashier tells me it's a $50 minimum for credit card purchase. Do I spend $18 of my cash, or spend another $32 so I can use my card. Either way stinks. I figure I'm better off spending the cash and just not being extravagant the rest of the day. I've got $32 and 8 hours left in the park. I should be fine.

Six hours later, everything has been a blast. We've played a few games, had a few snacks, and my cash is gone. But I can get by another 2 hours. If they get hungry, I can stall a couple of hours by promising that I'll take them to McDonald's across the street on the way out. No big deal.

But an hour later we go by the ice cream stand and both kids start screaming for ice cream. They're hot and tired, and it sounds pretty good to me too. I tell them I'll go to the ATM and get some cash, even though I know the ATM has a $10 charge since it's not my bank. They get in line while I go to the ATM. But when I get there, the ATM is down. Out of cash. There's a couple grand in my checking account, but no way to get it. What do I do? Other than asking strangers for a handout (the ice cream stand doesn't take credit cards), my only other option is to pull them out of the ice cream line and head to the parking lot. I just keep my head down and avoid the stares of the people watching me drag the crying kids out trailed by my angry wife. I'm a really great guy, but I sure don't look like it to the other people in the park. It stinks, but we'll survive.

And then the straw that breaks the camel's back. We get the truck and head to the gate. Parking is $8 ($1 per hour--didn't think it was that expensive at 9:00 this morning). Cash only, no checks or plastic. The attendant thinks he's a U.S. Marshall and won't let me out without paying. I scrounge the floor, ashtray, bottom of my wife's purse and come up with $4.72 in change. Not good enough for Johnny Law. The 20 cars behind me are honking, kids are screaming, mosquitos are biting, and now I have to pee. I'm on the verge of a meltdown because I can't come up with $3.28 at that moment. The only thing that's going to save me is if someone behind me comes up and gives or loans me a few dollars to get me the heck out of the parking lot.

That's where AIG is at, on a global scale. The $85 billion loan should get them through the short term problem and back on the right track. In retrospect, there are plenty of ways they could have avoided this problem, just as I could have started out with more cash, not forced my son onto the merry-go-round, rinsed his old shirt out instead of buying new ones, drank from the water fountain instead of buying pop, and so on. I learned a lot of lessons and won't make those mistakes again. I just need a little help to get out of the parking lot and back on the road home. I'm having an acute financial crisis right now, but I'm confident I can pay my mortgage and light bill, just as I'm confident AIG can pay anything it needs to on my policy.

Who Helps You Spend?

2008-08-12T23:52:00.000-05:00

Who helps you spend? Everyone? Nobody?

There's never a shortage of people wanting to sell us something to get our money (or kids, spouses and grandkids wanting us to buy them something). No shortage of people wanting you to save or invest with them either. But there is little or no guidance on how to access and use the money you've saved and invested, especially retirement money.

Why? Because the companies and their representatives we invest and save with have much to lose and little to gain by you withdrawing money. Also, if money is in a 401k, you are rarely still working for the company when it's time to start using the money, so you don't have access to human resources professionals.

What's the result of the lack of help? In my practice, I usually see one of two extremes. Either a person pulls out more than he or she should, often paying much more in taxes and penalties than necessary, until the nest egg is either gone or drastically reduced to the point that the standard of living falls. I see the other extreme much more often. In those cases, fear of the money running out prevents it being used at all. Those people don't live any better than those who have spent their nest egg. The money sits earning a small amount of interest with nothing taken out until age 70 1/2. Then only the RMD's (Required Minimum Distributions) are taken. Then 20 years or so later at death, the descendents (usually adult children) receive the money and have to pay taxes on it. This often puts them into a higher tax bracket where they end up with a fraction of what their parent intended for them to get. Most of the children would much rather have had their parents spend more money on themselves instead of passing it on.

There's great news regarding a solution to this problem. There isn't one! There are many. You need a professional to sort it out. The best piece of advice I can give is is to actually formulate a plan instead of just "thinking about it" and maintaining the status quo. Equally important is to run, not walk away, from someone who talks to you about a product without delving into your wants and needs. The new generation of annuities, life insurance and other products have better performance and guarantees than products of just a few years ago. However, small, somewhat hidden differences between products can make one a perfect fit for your neighbor but cause huge problems for you. The wrong "help" can be worse than no help at all.

I Have "LiveStrong" Survivor Notebooks

2008-05-28T16:07:00.000-05:00

Just a quick note to let you know I now have "LiveStrong" Survivor Notebooks. They are available at no charge. It is a notebook to track cancer treatments, doctors, etc. It's a great resource for both inspirational and practical information. If you or someone you know could use one, just let me know and I'll get one to you or them.

"Live 'Til I Die"--Memorial Day

2008-05-26T20:38:00.000-05:00

I had a conversation with my 9 year-old to day about Memorial Day, about how traditionally people go and decorate the graves of their dead relatives. We talked about how we should honor their memory every day, not just once a year. One way I'm doing that is by naming my new project "Live 'Til I Die" in honor of Grandpa Green.

He put together working hard and working smart as well as anyone I've ever known. I had trouble keeping up while working with him on his farm even when I was a fit teenager and he was on Social Security with heart trouble and diabetes . The "Live 'Til I Die" comes from what he always said whenever Grandma would get on his case about his blood sugar when he put real sugar and cream in his coffee to go with his glazed donut. He'd always say, "I'm gonna live 'til I die!". We all worried that he would lose his eyesight, feet, etc. He had been so active throughout his life that we thought he'd be miserable in his final years. Instead, he was hit head-on and killed by a drunk driver, so I guess he showed us.

So am I saying to ignore your doctors and conventional wisdom regarding your health? Absolutely not. What I am saying, is to make the most of your time, because we don't know when it will end.

Many insurance companies, investment companies, etc., have some kind of planner kit that they say is to help you leave some kind of financial legacy. In the right hands, they can be very useful. However, like any other tool, they are only as good as the person using the tool. And sometimes the tool isn't very good. The biggest problem I've seen with them is that they are a one shot deal. The advisor or agent uses it to find out where the client has money and finds a product he can sell the client which produces a commission. Then he or she moves on to the next prospect.

"Live 'Til I Die" will be different. It will be a living document with no two of them looking the same. The base of it will come from a Reader's Digest article I read in college, something along the lines of "50 Things to do before I die" (If anyone knows how to track it down, please let me know). The story was about a guy who had made a list like that when he was in high school, then made his living by going on adventures, then lecturing, writing, etc. about them. I made my own list which has been lost in one of my moves, but I have rewritten. Some I have accomplished (having kids), some I've altered (watching the Olympics in person instead of competing in the Olympics), and some I've postponed (still plan to win a national cycling championship, but will be in the 70 and over bracket when I've outlived a bunch of my competitors). However, I can't think of any that no longer interest me. Instead, I just keep adding to the list. If I stopped working today and lived to be 100, I'd still run out of time to accomplish everything I want to do.

The goal of "Live 'Til I Die" will be to help people discover what they want to do, then help them do it. Fear of loss is a much bigger factor in decision making than potential reward, so my role as an insurance agent will be to remove or minimize the fear of loss, freeing people up to accomplish dreams.

I'll be writing more about this as I develop "Live 'Til I Die". Please let me know if you have any materials or suggestions to add to this, and also if you want to be a guinea pig for the development of it.

Ride of Silence Today

2008-05-21T15:11:00.000-05:00

Across the world today, bicyclists will be riding in silence at a slow pace to bring awareness to the issue of motorists hitting bicyclists. Here in Des Moines, the ride will start at 6:30 at the steps of the Historical Society building (600 E Locust). Unfortunately, I didn't find out about it until today. I definitely will ride it in the future. For details of the movement and ride locations, please check out their web site, http://www.rideofsilence.org/main.php

As an insurance agent, I look at this as a prime reason to make sure we're all covered with life and accident insurance. But it's a much more personal issue for me. About 20 years ago I was hit by a drunk driver while on my way home from a training ride. By sheer luck my bike went to the left and I rolled to the right. The driver drug my bike under his car for almost a block before turning the corner and running over it with the back wheels. Had he hit at a slightly different angle, it would have been me under the car. Although he fled the scene, was driving without a license and had no insurance, he spent a couple of days in jail but had no further consequences. Because he had no insurance or job, I even had to get my destroyed racing bike replaced on my own. I have mostly recovered, but still have problems with my hip that was injured and will probably have to have it replaced at a relatively young age.

I was the lucky one. Two of my friends and teammates were killed in separate incidents, Dan Bockenstedt, and Chris Lillig. When I do the ride next year, I'll be riding a bike formerly owned by Chris.

So when you're driving, remember that bicyclists have as much legal right to the road than you, but more importantly that they are friends, parents, sons and daughters.

Help Hypertension, Help Your Brain

2008-05-17T13:55:00.000-05:00

I guess I can take the rest of the day off. My dad always told me I should learn something new every day, and I just learned something.

Some new research is showing a link between high blood pressure and Alzheimer's Disease. Keeping your blood pressure down can reduce your risk of decreased brain function, attention def--are the Penguins and Flyers playing this afternoon? When do the Stars and--I wonder if it's too late and too dry to get morels--I could really go for Tasty Taco--wonder how the Hawkeye quarterback situation--anyway, what was I talking about? Oh yeah. Anyway, I also learned that only about 1/3 of people with high blood pressure have it because of too much salt. The best way to fight it is to keep your weight down. So I guess I'd better go play some hockey tonight.

You can find the whole article at http://health.yahoo.com/alzheimers-causes/blood-pressure-and-the-brain/pt--Psychology_Today_articles_pto-20030602-000004.html

Generic Requip Approved by FDA

2008-05-09T11:21:00.000-05:00

The FDA has given final approval for a generic version of Requip (ropinirole hydrochloride) used to treat Restless Leg Syndrome. The portion of the patent that covers the same drug for Parkinson's Disease doesn't expire for another month. It's expected that companies will apply for approval to label it for treatment of Parkinson's once that patent expires.

If interested, you can view the details at http://www.fda.gov/bbs/topics/NEWS/2008/NEW01832.html

Our Mission, Should You Choose to Accept It...

2008-04-21T22:09:00.000-05:00

Universal misssion statement...Treat every customer (client, patient, passenger, subscriber, guest, member) in such a memorable way that when the transaction is complete, the customer tells someone else how great it was!--Jeffrey Gitomer

I recently finished Jeffrey Gitomer's book, Customer Satisfaction is Worthless, Customer Loyalty is Priceless: How to Make Them Love You, Keep You Coming Back, and Tell Everyone They Know, which contained the quote above. I like it, and don't think I can write a better mission statement. I realized that although I have a motto ("We work for our customers, not for the insurance companies"), I don't really have a "mission statement". Time to fix that.

My mother compelled me to focus my energies on health insurance. I didn't realize it at the time so we never discussed it, but since she has passed away, I have often wondered if cost was part of why she chose not to do chemotherapy. The doctors recommended it, saying that chemothereapy would dramatically reduce the chance of her cancer returning after surgery. However, she chose not to go through chemotherapy, saying, "If there's a 40% chance it will return, that means there's a 60% chance it won't return." Unfortunately, it did return and she died from it just over a year later.

The original tumor they removed had been growing 10 to 15 years, according to her doctors, before she experienced symptoms that caused her to seek medical attention. Had she gotten a routine colonoscopy, they would have caught it early. There's a very good chance she would still be with us.

So here's my mission statement specific to my business, which is in addition to Gitomer's universal mission statement: "Promote prevention and remove financial considerations from the health and wellness decision-making process."

That's optimistic, but still seems kind of "doom and gloom" to me. As I often say, "If you're into life and health insurance, people are going to die and people are going to get sick". That's why I use a lot of humor in my work, and also why I promote making the most of the limited time we have. Look for more regarding that in future blogs and a program I'm working on, "Live Until I Die".

D Cup Championship

2008-04-13T16:06:00.000-05:00

This picture pretty much tells the story of how the D League championship went for the 11 to 7 Insurance team. That's me on the bottom and Cup of Kryptonite captain Matt Johnson with the 3-point nearfall. We gave up the 1st goal 18 seconds into the game and were down 5-0 before closing it to 5-2 with 2 3rd period goals.

The team will continue to play in the D-league this summer with the majority of the team intact. I will not be on my own team this summer, choosing instead to play for the Alien Hockey black team in the C league. My skills aren't really at C league level yet, but I'm giving it a shot anyway.

Diovan and Requip Generics

2008-04-13T15:31:00.000-05:00

I've been very busy with the fortunate problem of not enough time to handle the incoming business and working some new opportunities, so the blog has been on the backburner. I'm working on blogging more often.

Two particular name brand drugs hopefully will have generics available soon. Valsartan, generic for Diovan, was tentatively approved 10/25/2007 but does not yet have final approval which would make it available for purchase. The same applies for ropinirole hydrochloride, the generic for Requip with tentative approval date of 11/28/2007. Diovan is used to treat high blood pressure and heart failure, while Requip is used to treat Parkinson's Disease and Restless Leg Syndrome.

The Best Insurance: ROP?

2008-03-13T12:33:00.000-05:00

People ask me all the time, "What's best insurance?" I have a couple of answers to that. One is that it's like asking, "What's the best car?" It depends on how you plan to use it, what your budget is, how long you plan to keep it, etc. The best option varies from person to person, and can vary for each individual over the course of a life time. When I was 17, my 1975 Mercury Monarch (AKA "Blue Thunder") was the best option because could afford to pay cash for it, it had a rocking Pioneer AM/FM/cassette with Jensen coaxial speakers, and it ran. When I was in college and delivering pizzas, my 1981 Dodge O24 (AKA "Sherry")was my best option because it got great mileage and the black vinyl seats and carpet showed little of the spilled pop, pizza sauce, etc. My 2004 Dodge Dakota 4 door 4x4 I'm driving now (I'm so old and boring I don't even have a nickname for it) is my best option now because I can afford the payments more than I can afford to not be able to get to a client's home if I need to in the middle of a blizzard. It also works great for taking my family to my sons' out of town hockey and wrestling tournaments no matter what the weather. And no matter where I go I can always get "Outlaw Country" or "Hair Nation" or "Blue Collar Comedy" for myself, "'80's Pop" for my wife or "Radio Disney" for the kids on my Sirius satelite radio. But when the kids are gone, I'll probably be driving something much smaller that gets better mileage. So when asked about the best insurance, I first have to get to know the person, find out what they need, want, and can afford, then formulate the best plan to meet those wants and needs at the best possible price.

My other answer to, "What's the best insurance?" is the old cliche, "Whatever is in force when you need it." Even though that sounds like kind of a glib answer, it's true. Which is why I usually recommend a return of premium (ROP) if it's available. People keep it, so it's there when they need it.

ROP is most commonly used for life insurance. It's available on other products, but for this discussion I'm focussing on life. The principles apply to other types, however. This is a bit of an oversimplification, but basically how a ROP policy works is that you take out a policy for a set amount of time (term). If you keep making the payments until the end of the term, at the end the insurance company gives you the money back that you paid in. The premium cost is significantly higher than a straight term policy. They make their money on interest earned and by people cancelling before the end of the term.

On paper, there are several ways one can argue that other products are a better deal than ROP. However, I usually recommend ROP, because just like Communism and "friends with benefits" relationships, the concept and the way the real world works are completely different. I can show on paper that if you purchase a straight term life insurance policy, then take the difference in premium and invest it, the money you would have at the end of the term could be more if you hit the right investments, etc. However, in the real world, nobody does that. Instead of investing the difference, it gets spent here and there. Or in the rare cases it does get invested, it doesn't stay there. It gets pulled out to buy new tires for the car, Christmas presents, etc. Either way, at the end of the term, there's rarely a significant amount of money there. The same happens with loans and withdrawls when a person has a whole life or universal life policy. With ROP, you get a good chunk of money back at the end because you don't have access to the money until then.

Another advantage of the ROP is that you keep it even when times are tough. On a straight term policy, it's easy to let it lapse if you run across a tight spot. With a UL or whole life it's easy to let the cash value pay the premium, which causes the policy to "blow up" in later years. With ROP, you will keep it until the end of the term because you don't want to lose all the money you've put into it. Then it's there for the death protection, the real reason for buying a policy.

ROP is especially beneficial for those who aren't the best insurance risks. Yes, they are going to get charged a higher rate, but that also means they will get more back in the end. Instead of taking a trip to Chicago with the money they get back at the end of the term, they can go to Hawaii or Jamaica. It works especially well for those of us who say, "I know I need the insurance, but I'm going to wait until "someday" when I've lose 30 pounds and can get preferred rates. Unfortunately, as John Fogarty said, "Someday never comes".

If you haven't ever considered ROP, your action item is to call now to set an appointment to discuss "the best insurance".

D-Cup Finals

2008-03-11T14:08:00.000-05:00

Other than my agency sponsoring my team, this has nothing to do with insurance. Sunday March 16 at 7 p.m., my underdog 11 to 7 Insurance team will be taking on the regular season champion team sponsored by my friend Matt Johnson's coffee shop/comic book store, Cup O' Kryptonite. I'm seeking the dubious honor of being the 1st ever repeat winner of the Trainer's Trophy (AKA "D-Cup"). I say it's a dubious honor because everyone else in the picture above has improved their skills, taken off the training wheels, and moved up from the D-league to the C-league since a year ago when my Silver Bullets team won the inaugural D-Cup.

Please accept this invitation to come cheer us on at 7:00 Sunday, West Rink of MISF, 5100 NW 72nd St, Urbandale, IA 50322.

Generic of Fosamax Approved!

2008-03-10T12:26:00.000-05:00

Good news! The FDA has approved a generic version of Fosamax (alendronate sodium). Since it was just approved on February 6, 2008, not all the insurance companies have their formularies updated. Call me (515 457 3112 or 888 207 3525) to check on a particular company.

Fosamax is used to treat osteoporosis, most common in women after menopause. The normal Fosamax dose is one pill per week, with a retail price of about $80 for a one month supply of 4 pills. Most insurance companies currently have it on the 2nd tier of a 4 tier formulary which is made up mostly of name brand drugs on the less expensive end of name brands. As they add the generic version to be an approved level 1 drug, don't be surprised to see them also move the brand-name Fosamax to their 3rd tier with a higher copayment in order to encourage use of the generic instead.

As always, an ounce of prevention is worth a pound of cure. The two main things a person should do to build bone mass so as to not need this drug is to get plenty of calcium (dairy products, some vegetables such as broccoli, supplemental pills and drinks that contain added calcium such as some orange juice and Propel Fitness Water), and to do regular weight-bearing exercise.

Doing that sure beats compression fractures of the spine and broken hips that commonly result from osteoporosis.

If you are an insurance nerd like me and want to read the FDA's release regarding this approval, it is online at http://www.fda.gov/bbs/topics/NEWS/2008/NEW01793.html

Exsanguination Insurance

2008-03-07T12:14:00.000-06:00

When I heard the word "exsanguination" on one of the numerous versions of CSI awhile back, I knew what I meant. I guess my $400+ monthly student loan payment for that English degree is worth it!

If you didn't spend a semester in "Greek and Latin for vocabulary building", exsanguination basically means to bleed to death. After seeing what happened to Richard Zednick of the Florida Panthers http://www.youtube.com/watch?v=2L0_LGblKGk&feature=related and then going back and watching a similar thing happen to Clint Malarchuk http://www.youtube.com/watch?v=YWQH9x1lqDc&feature=related back in the 80's, I started thinking about the odds of something similar happening to me. (If you read this blog regularly, you'll find that I'll jump at every chance I get to try to write about both hockey and insurance together.) Realistically, the odds of it happening are pretty small. But at the same time, so was the price of a neck guard. I picked one up at Alien Hockey for about $16. The knock I hear on neck guards is that they're uncomfortable. This one was, straight out of the package, because it's designed for up to a 17" neck and I buy my dress shirts with a 17 1/2" neck. However, all it took was sewing an additional 2" piece of Velcro on it, and now I don't even know it's there when I play. I've even discovered that it has the unexpected benefit of helping me stay warmer when playing on the east rink of MISF where they only turn the heat on during the 3 months I had off back when I was a teacher.

As far as I know, no one offers an insurance policy to specifically cover exsanguination, just life insurance. There's one minor drawback, though: you have to die to collect! Make that two drawbacks. Somebody else gets the money, too. Just like my fire insurance on my house and my theft insurance on my truck, I'll probably never need it, but my $16 exsanguination policy is money well-spent.