so the only thing I have not taken care of (on the to do list i created before getting a bike) is select a life insurance policy. Do any of you have suggestions? anything I should pay special attention to as a rider?
The number of ways to die is almost limitless. I can't see why riding a motorcycle should suddenly prompt you to buy life insurance. Fact is, where death is concerened, if one thing doesn't get you another will. I don't think whether or not you ride a motorcycle should factor into the life insurance decision at all.
Regardless of whether you ride or not make sure you have enough insurance to leave any dependents without heavy financial burden. Make sure it is affordable and renewable. You will have to decide if you want to do term insurance or a whole-life kind of policy. If you do pick term make sure to find out what the renewal amount will be at the end of the term. I'm not too familiar with whole life policies except that they initially seem more expensive but have a cash surrender value.
I think I'd be more concerned I had decent medical coverage, either through your health plan or your bike insurer, than I would be about life insurance.
PizzaMonster,
Thanks for the reply. I'll check into term vs whole-life. I guess I left out some details. Some recent life changes put life insurance on my radar. I'm still dragging my feet on it. When I went to get a bike, I wondered about any loop-holes or exceptions in insurance policies related to motorcycles.
Anyhow, thanks for you concern on medical...I'm good in that department.
I just had to have my term policy renewed renewed. There were questions on whether I did sky-diving, piloted a private plane or raced cars. Other than that there didn't seem to be any activities that would prompt a "rating" of the premium. Then there is the medical questionaire......... :-[.........Let me tell ya. It was so much easier to pass when I was 30. Life after 50 sucks!!
My life policy has exclusion for sky diving (need a rider if you want to get paid if you die doing it) but when I asked about the motorcycle it wasn't an issue.
You didn't say your age, but buying a term plan that ends in your 60s is one of the most cost effective since purchase rates go up as you age.
Whole life plans are good if you have a good bit of money to put into them initially so they can become self funding. Cash value whole life are good too if you care to cash it out later.
The biggest problem is forseeing how much to get. Whole life is problematic because you are fixed at an amount for the life of the plan. If you want to add more coverage, fine, but it's just like getting a second policy. For example, my pop bought me a whole life plan when I was 10 years old (I am not kidding, he was eminently practical). When I turned 20, he bought another one for the same amount, but the cost was about 30% more. Both are self funding, so I don't pay premiums. (this is also a great way to bypass inheritance taxes. Buy a whole life insurance policy (fully funded) for your kid and name yourself as beneficiary. When kid turns 30 or so, change the beneficiary to the kid. If he dies, his family gets the money. If he lives to the end of the plan (usually 60+) he gets the full amount of the policy which will be 3-5 times the purchase value)
ANYHOW
term plans are fine though, you just buy as much as you can afford. life insurance is a bet you will always win -- everyone dies!
Many employers will have life insurance options available as a benefit.
Quote from: msincredible on August 18, 2008, 12:59:13 PM
Many employers will have life insurance options available as a benefit.
it's true, but unless you plan to stay with an employer for life, i would recommend you consider that as supplemental insurance to your "core" insurance.
employer policies are usually price competitive until you no longer are an employee, then you get the full retail rate. i had a policy with a previous employer for $500k and was only paying $20/month. when i separated i was quoted a rate of $210/month.
however, i just noticed the OP asked about looking at policies "...as a rider"
I would make sure they don't exclude motorcycling. Many will exclude racing activities included under "ultra hazardous" activities. If you want racing coverage, you'll need a rider specifically for that. Expect to be reamed.
Track days are not racing FYI. Racing is not merely riding on a private track, it is the organized sport. Other than that, just make sure the list of exclusions doesn't include things you enjoy doing.
[Tom puts on his CFP and Life Insurance License hats on]
The big things that underwriters look for to cover you are your age, health, and certain occupations (flying airplanes, racer) that sort of things. The casual stuff like owning a motorcycle or hot rid aren't really an issue.
The AMOUNT you get is really the key. If you are trying to cover a mortgage and your kids education - for example - there are some simple calculations that can give you a pretty accurate target for what you should aquire.
What KIND of insurance runs a close second. Term vs. Whole Life. Variable / Universal, etc., etc., are all important for establishing the economics of your decision. To make those decisions, you really need to figure out the death benefit first, then work with a professional YOU TRUST to figure out what you can and should pay for.
[/Tom takes off the hats]
I dragged my feet on life insurance and then ran into some health problems in my early 30s, now insurance companies won't touch me. Next thing I know I have a wife, son and no insurance to cover them. But I was fortunate to pick up a couple of group life plans through employers. The first employer covered 2x salary and allowed an additional 2x salary no questions asked. It was portable so I carried it to a new company and picked up a similar deal. I'm not recommending group lvs whole vs term, just recommending you get the right coverage while you're still eligible.
is anyone depending on your income? that is the first question you should ask yourself before buying life insurance. if not don't bother. If you do then by all means protect your family by getting life insurance.
Quote from: Carman on August 19, 2008, 03:47:35 AM
is anyone depending on your income? that is the first question you should ask yourself before buying life insurance. if not don't bother. If you do then by all means protect your family by getting life insurance.
even if no one is depending on his income now, it is cheaper to buy the insurance when healthy and young. esp a whole life policy.
Quote from: ducatizzzz on August 18, 2008, 12:50:39 PM
You didn't say your age...
I'm nearly 30. I guess, I'm hoping to avoid what bigtime had to deal with.
Wow! Thanks for the replies everyone...life insurance is starting to make some sense now [thumbsup] I'm hunting around for a policy from a source outside of my company, but I think I will get supplemental through work.
I do hope to do track days, but no "racing" for me. I'll be sure to check the details on riding a motorcycle.
how are whole life policys self funding?
Quote from: He Man on August 20, 2008, 06:20:55 PM
how are whole life policys self funding?
you buy it with a large sum of money, i.e. lump sum payment:
http://www.life-cover-quotes.co.uk/Whole-of-life-Insurance.html
how much are we talking about here? Like 100grand?
Ive never had any type of insurance in my life except auto (not even health)
Quote from: He Man on August 20, 2008, 07:56:38 PM
how much are we talking about here? Like 100grand?
Ive never had any type of insurance in my life except auto (not even health)
depends on the full amount of insurance and number of years. 100k of coverage will probably cost around 20-25 lump sum if you buy it when you're in your 20s and it comes due when you're 65.
whole life policies develop cash value, so you can cash it out for the policy amount when you're 65 (or when the policy says).
Quote from: ducatizzzz on August 18, 2008, 12:50:39 PM
Whole life plans are good if you have a good bit of money to put into them initially so they can become self funding. Cash value whole life are good too if you care to cash it out later.
I have a personal problem with Whole Life insurance. Whole life is really two product tied into one: 1 part investment, 1 part life insurance. Personally I hate bundleded products as you are always better off (assuming you have financial discipline) buying term and investing the difference yourself. The rate of return on the investment portion of whole life is paltry....however, I will conceed that for folks who need additonal nudge to save money, it is an okay idea, just recognize that the insurance comapny is making a premium on your lack of discipline.
[/ax-grind]
Quote from: CDawg on August 21, 2008, 07:14:13 AM
I have a personal problem with Whole Life insurance. Whole life is really two product tied into one: 1 part investment, 1 part life insurance. Personally I hate bundleded products as you are always better off (assuming you have financial discipline) buying term and investing the difference yourself. The rate of return on the investment portion of whole life is paltry....however, I will conceed that for folks who need additonal nedge to save money, it is an okay idea, just recognize that the insurance comapny is making a premium on your lack of discipline.
[/ax-grind]
i agree if you are buying it for yourself as an adult.
my dad bought me 2 whole life policies when i was 8 and 10 years old. he put a very small amount in the lump sum, but the return over 55 years will be pretty good. not to mention, it is a way of giving your kids some retirement help for a small amount up front.
but don't forget the insurance co's premium is a lot less than what you'd pay in taxes on interest if you invested the money yourself. if you invested yourself, you'd only have the interest minus taxes as a benefit, whereas that $50-100/month interest will buy you a significant amount of additional coverage -- and you still only pay taxes on the interest, not the benefit.
Don't know about other insurance co's, but FWIW State Farm didn't have anything about motorcycles (despite the fact that I have two bikes insured with them) on their standard list of questions for life insurance applicants as of two or three weeks ago when I started a new term policy.
They did interrogate me EXTENSIVELY about possible plans to go attempt an unsupported winter ascent of K2 without supplemental oxygen and using just my body hair for warmth (gotta top Reinhold Messner somehow...) -- all based on my honest answer that, yeah, I do a little top-rope rockclimbing with the 13 year old daughter.