Big Cajun Man
The Clown Prince of Financial Blogging, canajunfinances.com
“All my best financial decisions have been completely accidental.”
1. What type of life insurance do you own?
I own life, disability, and medical insurance through work, as well as car and home insurance. I also use term life as “Mortgage Insurance.”
2. What factors did you consider when determining the coverage amount?
Mostly, what was recommended by the selling “agents” or the maximum that was available through work. Usually, for life insurance, it was five times your yearly gross income when I was younger.
3. Do you believe in life insurance for children?
No, never really saw the point, even though I had it when I worked at Nortel. The children’s life insurance I had at Nortel was very inexpensive, approximately 10 cents a pay per child. I don’t currently have that kind of insurance for my son (who is nine).
4. What is the biggest life insurance mistake people make?
Buying whole life, assuming it is a good investment, and not having enough term life when they are younger. I had a very bad experience with a whole life insurance salesman and it soured me on the concept. If I want to buy an investment, I will invest in it. If I want insurance, I’ll buy insurance — it has been my opinion all along. For many, I am sure whole life has worked, but my one brush with it was far too expensive for someone who could ill-afford the premiums.
5. Outside of life insurance, what other types of individual insurance are often overlooked?
Disability Insurance. I know too many former co-workers who are now disabled that are having a hard time getting by. Moreover, I know a lot of people who had “Disability Insurance” at Nortel, but then found out that Nortel was self-insuring, so they lost their benefits when Nortel declared bankruptcy.
The Big Cajun Man is the nom de plume of Alan Whitton, who has been commenting and writing about personal finances for over nine years on The Canadian Personal Finance Site. A graduate from the University of Waterloo, he has survived Nortel and is now working in the federal government as a project manager. While his writings do cover the gamut of personal finance, the topic of helping the parents of disabled children is near and dear to his heart.
Sandra, Thanks for sharing your story.
I agree with him. However, policies for children can actually pay off. I received, as a gift, a Universal Life policy from one of my best friends for each of my sons at birth. I kept them since the premium was very cheap. The life benefit was $50,000. By the time they reached 16, they had $2,000 cash value, which was more than I paid over their 16 years.
We cashed them out and purchased nice used cars for them! It wasn’t what I had planned, but they both needed a car for work and school and this was the “available” cash we had to do this, otherwise, we would not have been able to purchase these cars. My sons are less than a year apart, so both turned 16, one after the othe