Bad Final Expense Product

It's been a while since I took a business math course, but isn't this about .46% annual interest? If I am correct, perhaps one could argue also, that she could do better putting that same amount in a savings account, and she would keep it after 24 years instead of giving it away. ( Some math major help me out here.)

Perhaps she does not understand the purpose of term insurance and its drawback. It's good to get $20K instant estate, but keep it too long, and it will cost you big time. I thought that's why they invented Universal Life. Something to phase in a cash accrual after the initial period....

edit:
OK, here's what I found. The AARP site shows NYLife as the provider, and discusses "final" expenses under the heading "permanent" life, and discusses the pros and cons of both term and permanent policies. If she understood the differences between permanent and term as they are presented on the website, she should have asked for permanent.

She has only had two years with this policy.... so she's not out all that much, and in the meantime has had $20K protection. If she doesn't think she will live much longer, she may be better off keeping what she has.... sometimes people will not disclose everything, especially probable serious health issues that they can conceal.

No she's perfectly healthy. She...like most people I've met with the AARP term-life plan...didn't understand that it was term. She also didn't understand that the payment goes up every 5-years even though it is well disclosed on their advertising.

Some seniors (and future seniors) actually believe the AARP is an organization that looks out for them. They see the AARP logo and don't read the rest of the brochure.

End of the story is: she canceled this plan and I sold her a level premium $20,000 policy.
 
Newby, don't they have the option of buying the whole life plan before age 80. What does that look like for rates and undewriting? Or is there only some kind of weird arrangment with AARP where you can only buy term up till age 80 and then whole life from there? Weird.

Winter

They can switch over to the whole-life anytime they want but at the age they are when they switch and a two-year waiting period on coverage.

Many seniors are misled by this plan in my opinion. They put a misplaced trust in AARP. I always recommed they read Andy Rooney's latest book Amazon.com: Sincerely, Andy Rooney: Andrew A. Rooney: Books
Where he talks about how 60-minutes exposed AARP to be selling sub-standard insurance policies to seniors at very high prices. The 60-minutes exposure is what actually allerted the feds who broke up the ownership of AARP which was a marketing wing of Colonial Penn Life Insurance back in the 1980s
 
It's been a while since I took a business math course, but isn't this about .46% annual interest? If I am correct, perhaps one could argue also, that she could do better putting that same amount in a savings account, and she would keep it after 24 years instead of giving it away. ( Some math major help me out here.) quote]

I actually flunked business math. But I can assure you that policy isn't .46% annual interest if she lived one day past her 80th birthday. it's a $18,069.20 loss.

She gets nothing. It's a really really bad deal if seniors buy it thinking of it as permanent coverage.
 
AARP is nothing more than a for PROFIT insurance company and the hell with the client

Very well said! AARP is bad for seniors and bad for our society. Our society has been duped by AARP.
 
I had this same problem with a lady I was working with. I quoted her a final expense plan at $50 a month and she was going to take it, but then her friend talked her out of it. She just had cancer so I knew it was the only policy she could get. Well, when I followed up with her a couple weeks later she said she got the best deal from AARP and that she didn't need my services. I asked her what she was paying and how much coverage. When I went on the AARP website I couldn't get her numbers to match up with the whole life policy she told me she had. So I called AARP (New Youk Life) She bought term insurance! Premium goes up every five years and they can drop you at age 80. I called the lady back and had to explain what she had purchased. She had no idea. I wonder how she even got the coverage because I know she has had cancer in the last year. People are amazing.
 
I had this same problem with a lady I was working with. I quoted her a final expense plan at $50 a month and she was going to take it, but then her friend talked her out of it. She just had cancer so I knew it was the only policy she could get. Well, when I followed up with her a couple weeks later she said she got the best deal from AARP and that she didn't need my services. I asked her what she was paying and how much coverage. When I went on the AARP website I couldn't get her numbers to match up with the whole life policy she told me she had. So I called AARP (New Youk Life) She bought term insurance! Premium goes up every five years and they can drop you at age 80. I called the lady back and had to explain what she had purchased. She had no idea. I wonder how she even got the coverage because I know she has had cancer in the last year. People are amazing.



AARP does not offer a whole life policy at any price. They have the term and they have UL. Their UL clearly states in the brochure and on the website that "premiums are subject to change at any time". The term increases in 5 year bands and ends at age 80.

Most people that have the AARP term don't have a clue that it ends at age 80 and none of them that have the UL are aware that the premiums can be raised. Well, the ones that I have encountered know it now.
 
I love to come across AARP's "whole life policies". They usually don't stay on the books once I have left that house. The only times are when they are way too old or unhealthy and they will probably die before 80. I typically replace four or five a month of those garbage policies. They do nothing but steal from these seniors giving them a false sense of security, and what happens when they are 80 and have COPD --- Colonial Penn at 8$ a unit and a 2 year waiting period or Americo UP3 and a 2 year waiting period and premiums through the roof! Thanks AARP for being a non-profit senior advocacy group. Sometimes I can't stand that I have their supp and MA's in my bag.
 
>>.... --- Colonial Penn at 8$ a unit and a 2 year waiting period ..........

What is a Unit? That is a question people do not ask also.

I love to come across AARP's "whole life policies". They usually don't stay on the books once I have left that house. The only times are when they are way too old or unhealthy and they will probably die before 80. I typically replace four or five a month of those garbage policies. They do nothing but steal from these seniors giving them a false sense of security, and what happens when they are 80 and have COPD --- Colonial Penn at 8$ a unit and a 2 year waiting period or Americo UP3 and a 2 year waiting period and premiums through the roof! Thanks AARP for being a non-profit senior advocacy group. Sometimes I can't stand that I have their supp and MA's in my bag.
 
I have been looking for the rates in IL for ARRP Life. I have not seen it. Does anyone have an idea where to find this and the terms of the policy. I know the rates can even go up after 1 year.
 
I have been looking for the rates in IL for ARRP Life. I have not seen it. Does anyone have an idea where to find this and the terms of the policy. I know the rates can even go up after 1 year.

You can run quotes online on their consumer site.
 
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