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Do You Need Life Insurance?

Joseph Coupal - Tuesday, September 26, 2017

Lallis & Higgins Insurance, Weymouth, MAAs "Life Insurance Month" draws to a close, we thought we would answer a question that we get all the time: “Do I need Life Insurance?

Life insurance can fill a wide variety of needs including covering the finite years of a mortgage and protecting the interests of a special-needs child who will need financial support after you’re gone.

In fact, although, 70% of Americans consider life insurance a necessity for themselves, 41% have no life insurance at all.

Here’s a guide to who needs life insurance and what kind of policy likely works best in each situation.


Life insurance can provide “income replacement” so that your family can continue to pay everyday expenses.

Term life insurance can cover your working years.

Stay-at-home parent

Life insurance would cover the cost of paying for services the parent does for “free,” such as child care.

Term life can cover the years your kids are young.

Divorced parent

A policy could cover the support payments that a divorced parent makes.

Term life can cover the years of support payments.

Parent of a special-needs child

Life insurance can make sure the child will have financial support no matter when a parent dies.

Permanent life insurance provides a payout no matter when you die.

Homeowners with a mortgage

A policy can cover mortgage payments, so your family doesn’t have to move if you die.

Term life insurance can match the years of a mortgage.

Someone with co-signed debt (such as student loans or credit cards)

Life insurance could cover the cost of the debt.

Term life can be timed to end with the debt payments.

High net worth individual

Life insurance can provide funds for heirs to pay estate or inheritance taxes.

Permanent life insurance is best for those with estate tax concerns.

Someone who wants to provide an inheritance

If you don't have a lot of wealth, life insurance can provide a small inheritance to heirs.

Permanent life insurance will pay money for the inheritance, no matter when you die.

Business owner

Life insurance can pay off business debts if you die, help heirs to the business pay off estate taxes, or fund a buy-sell agreement that allows a business partner to buy out your share.

Term life or permanent life, depending on the issue to be solved.

Investor who has maxed out other retirement plans

Life insurance with a cash value component can provide a supplemental source of retirement savings.

Permanent life insurance, which builds cash value that you can access.

People concerned about paying for their own funerals.

Small life insurance policies can pay for your funeral and final expenses.

Permanent life, such as final expense insurance.

For more information on Life Insurance, contact Lallis & Higgins Insurance.

How to Prepare Your Home for a Storm

Joseph Coupal - Monday, September 18, 2017

Lallis & Higgins Insurance, Weymouth, Quincy, MAWhile it looks like Hurricane Jose will miss most of New England, there may still be tropical storm-type wind gusts and several inches of rain in some areas. Southern New England could see conditions similar to nor'easters that we regularly experience along the coast. Lallis & Higgins Insurance recommend continuing to monitor your local forecast as the storm moves north.

The Atlantic Hurricane Season will continue for another six weeks so New Englanders should continue to be prepared in case another storm heads our way. Even moderate wind and rainfall can cause significant damage so prepare your home before severe weather hits:

  • Remove any items in your yard that could potentially be picked up by strong winds, including lawn furniture, grills and trash cans
  • Trim or remove any damaged or hanging tree branches from your property that could fall onto your home
  • Secure any loose gutters and seal your roof
  • Park your car in a garage or on higher ground and avoid parking under trees

If you do experience damage from Jose we encourage you to report your claim as soon as possible. Contact Lallis & Higgins Insurance.

Bunker Hill

Reasons to Buy Life Insurance

Joseph Coupal - Tuesday, September 12, 2017

Lallis & Higgins Insurance, Weymouth, MABeing a responsible adult means making sure loved ones who depend on you are financially safeguarded if you unexpectedly leave them behind. The way you provide that protection is with life insurance.

But three out of 10 Americans don’t feel they have enough life insurance coverage.

Twenty-somethings won’t buy life insurance because they feel invincible. At the other end of the spectrum, folks 50 or older have a hard time buying coverage, either because it’s become more expensive or they have a hard time qualifying, medically.

The real “sweet spot” for buying coverage is in your 30s or 40s, when you qualify for good rates.

However, a New York Life survey found that the gap between the life insurance Americans have and the coverage they need increased 11 percent in six years.

Is your life insurance lacking? Probably, and here are seven reasons why.

While health insurance is a common employee benefit, it’s not unusual to get life insurance at work, too.

The U.S. Bureau of Labor Statistics reports that three-quarters of full-time civilian workers are offered life insurance by their employers. The overwhelming majority of them take advantage of the benefit.

However, that work coverage usually isn’t adequate.

Most employers give employees coverage equal to one to two times their annual salaries. While this might be enough for someone who is single with no dependents, if you have a mortgage, young children or a nonworking spouse, you’ll need more than that.

A common rule of thumb is that life insurance should provide seven to 10 times the insured person’s annual salary.

But that’s just a starting point. From there, you need to get a full financial picture so you can dial in the right amount of coverage.

There are a variety of factors, including a client’s income, assets, liabilities and — perhaps most difficult to predict — plans for the future, such as for having additional children, or for retirement.

If you think you can’t afford life insurance, you might be wrong. A study found that 80 percent of consumers have the wrong idea about what life insurance costs. Millennials, for example, believe life insurance policies are more than three times more expensive than they actually are.

In fact, premiums for life insurance are typically lower than for other forms of insurance and are often less expensive than monthly bills for cable or cellphones.

A large majority of term policies written have premiums of under $100 per month, and for some people it’s even possible to buy adequate coverage for under $50 a month.

Of course, the prices do vary based on age, gender and health factors.

Like just about any financial product, life insurance comes with some jargon. But it’s all fairly straightforward.

Broadly speaking, there are two types of life insurance:

  1. Permanent, which is meant to cover your entire life.
  2. Term, which lasts for a limited number of years.

Most people will end up buying term life insurance because the monthly premiums are substantially less.

Think of it like renting a house versus buying a house. With term insurance, you are covered for a set amount of time, much like if you were renting. After your term ends, you are no longer covered.

Permanent life insurance, on the other hand, is for those with a lifelong need for insurance. Like buying a house, as long as you continue to pay the mortgage (or the policy premiums, in the case of life insurance), the home, or policy, is yours.

Deciding which product is right for you can present some challenges, but a reputable professional should be able to walk you through the details. While it’s easy to put off buying life insurance, the longer you wait, the more you’ll spend.

Up until age 40, coverage only goes up by a little bit every year. Once you hit 40, the increases become more noticeable, and by 50 they become even more pronounced.

A 20-year term policy with a $250,000 death benefit might cost $13 a month for a healthy man who’s 25. But that same policy purchased by a healthy man who’s 50 would cost $43 dollars a month.

The older you are, the more expensive the premiums. Think about it this way: It is highly unlikely that a person would be healthier at age 40, 50 or 60 than they were at age 30.

But that doesn’t mean you should buy coverage just because you’re young. The key is for young people to lock in coverage when they need it. Protecting the home and family are often the key drivers behind a life insurance purchase.

Homeowners often need coverage to spare family members from the financial burden.

This could mean making sure there’s enough coverage to pay off the mortgage, even if the survivors ultimately decide not to use the money for that purpose.

But while life insurance protection for the home may be seen as optional, providing for children is a different story.

For parents, the need is much greater and less debatable. If a parent passes away, their children still need food, clothing and shelter. If the deceased parent’s income was also the funding source for college saving, replacing this should be considered, as well.

Even a parent who’s not the family breadwinner should consider life insurance.

Replacing the care a stay-at-home parent provides can be expensive, and life insurance can be a great source of these funds if the unexpected happens. Life insurance is designed, in part, to cover debts you leave behind. Should that include student loans, so they won’t fall to your survivors? That depends on your lender.

If you have a federal student loan, that debt is dischargeable when you die. So a surviving family member can request to have that loan discharged. The key is that the debt is dischargeable, not automatically discharged. That is an important distinction.

Private lenders are another matter.

While one company’s policy may be to automatically discharge the debt, another company might assign it to a surviving spouse, parent or co-signer. Worse, the loan contract might include an acceleration clause that brings the entire balance due at death.

Insuring against those outcomes is relatively easy and inexpensive. You need to factor your student loan into your liabilities when determining how much life insurance you need.

Nobody likes to think about aging and mortality, but as we advance into adulthood it’s time to face reality.

Sometimes, getting someone in their 20s or 30s to talk about life insurance is like trying to hold onto a fish — they squirm the whole time. No one wants to talk about life insurance or dying.

Younger clients tend to put off purchasing life insurance because they see it as optional — something they might not need just yet, or something that might not be worth the cost. Steele has a word for that logic: immature.

Life insurance isn’t supposed to be about you. It’s about taking care of your responsibilities and your loved ones. You’re not a kid anymore. Your parents aren’t going to take care of this for you. You need to accept the responsibility as an adult and take care of your loved ones because no one else in the world will.”

September is Life Insurance month, make sure you're covered. Contact Lallis & Higgins Insurance.

Flood Insurance Myths

Joseph Coupal - Thursday, September 07, 2017

Lallis and Higgins Insurance, Weymouth, MAIf a flood swamps your home, will insurance cover the damage?

That depends on the value of your home, the amount of water damage and whether you have a flood insurance policy.

Regular home insurance doesn’t cover flooding. You’ll need a policy offered through the government’s National Flood Insurance Program — but note that those top out at $350,000 in coverage for your home and its contents. For higher amounts, you may need supplemental coverage to protect your savings from taking a hit.

People tend to associate floods with a total loss, but the average flood claim for U.S. homeowners is about $39,000, according to the flood insurance program.

Here are six other persistent myths about flood insurance — and the truths you need to know.

1. To get a policy, you must live in a flood plain

Not true. If you live in a flood plain, your mortgage company will likely require you to buy flood insurance. But you can purchase it even if you don’t live within a flood zone.

Almost anybody can get flood insurance who wants flood insurance. In fact, 1 in 4 flood claims is for a home not in a flood plain.

The price through the federal flood insurance program is based on standardized rates and depends on the home’s value and whether or not it’s in a flood plain.

The average price for flood insurance is about $660 annually. Your insurance broker can help you buy a policy and may accept payment by credit card.

2. Flood insurance is just for high-risk areas

All homeowners — even those who do not live in designated flood plains — weigh the dangers and their options and seriously consider buying flood insurance.

3. Flood insurance covers everything

Not necessarily. When it comes to the physical structure of your house, federal flood insurance policies top out at $250,000. If you have a $300,000 house that’s a total loss because of a flood, the most you can recoup through the program is $250,000 to cover the structure itself.

For your personal possessions, the cap is $100,000 under the federal program.

If you already have insurance through the federal program, then you can buy “excess flood insurance” through a private carrier that would cover claims above the national limits. In essence, it’s a flood policy with a $250,000 deductible.

Note that flood insurance doesn’t cover living expenses if you have to relocate while your home is being repaired.

4. My homeowners policy covers floods

Unfortunately, a lot of folks may be under the impression that their standard homeowners policy might cover flood damage. But the standard policy doesn’t. The typical home insurance policy doesn’t cover earthquakes or floods. So a homeowner wanting coverage for either of those disasters will need to pick up separate, specific coverage against those types of disasters.

If you want flood insurance, it pays to think ahead. There is a 30-day waiting period between when you buy the coverage and when it kicks in. When a hurricane is bearing down on your area, it’s too late to get a flood policy.

5. Water damage is water damage

When it comes to your insurance, not all water damage is the same.

If there’s a storm and your roof comes off and water comes through, that would be covered under your homeowners policy. Versus a flood situation where the riverbank overflows and you look out of the front of your house and you need a boat to get from point A to point B.

Most consumers have a pretty good understanding of how to draw the line between storm damage and flood damage.

Some homeowners policies offer an optional water-backup endorsement that covers damage from water backing up into your home from causes such as a broken sump pump.

6. Flood maps don’t change

Flood plains (and flood plain maps) change and evolve. Just because you weren’t in a flood plain when you bought your home a few years ago doesn’t mean you’re not in one now.

There are a couple of ways you can find out about your flood risks. This site will allow you to put in your address and see if it’s in a flood plain, and give you information on risks, premiums and agents. But use it as one tool, not the final word on whether your home is in a flood plain.

Your insurance agent. When it comes to researching whether your home is in a flood plain, you definitely want someone knowledgeable to research the question for you. And, you might want to get a second opinion from a different agent.

Insurance agents have different levels of sophistication with regard to this product. You get a different answer sometimes. So call an insurance broker who can make a couple of checks to make sure you’re protecting yourself.

For more information on flood insurance, contact Lallis & Higgins Insurance.

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