$30/month GI term policy for $100k to age 85?

[Agent16]

I met with a client and he had just recently taken out a policy through a company called SureMed. The actual insurance company is Amalgamated Life Insurance Company. He had to pay a one time $50 fee and now he pays $30 per month for a group term policy that expires at age 85. It is guaranteed issue. In the first year it only pays out for accidental death and then after that it pays out for any cause.

I didn't believe it so I called in and got a quote from them and they confirmed that a 75 year old can get a 10 year $100k term policy for $30 per month and the rate and benefit never change. Only catch is the 1 year waiting period.

Either I stumbled across the best term policy I have ever seen or there is something they aren't telling me, anybody know?

SureMed Benefits > Life Insurance

 

[BibH]

With a group term policy i believe the rate can change for the whole group at any time .It’s like joining an association .In other words if they underprice the product or take on big risk like this seems to be doing watch out. You’d have to see the actual policy . If its too good to be true it usually is.

 

[titeye]

I just called them. It is an association membership, and they confirmed every word. The rep said the rate will not change for policies in force.

 

[BarryNY]

I think you guys got something wrong...the death benefit is 4x the accident benefit and does kick in after the first year.
However - the $100K death benefit is based on the accident benefit which is offered under the "Plus" plan only. Here are the quotes:

$2,500 accident = $10,000 death costs $30/month
$10,000 accident = $40,000 death costs $45/month
$25,000 accident = $100,000 death benefit = $55/month

No longer that great a bargain...

 

[Allen Trent]

I think you guys got something wrong...the death benefit is 4x the accident benefit and does kick in after the first year.
However - the $100K death benefit is based on the accident benefit which is offered under the "Plus" plan only. Here are the quotes:

$2,500 accident = $10,000 death costs $30/month
$10,000 accident = $40,000 death costs $45/month
$25,000 accident = $100,000 death benefit = $55/month

No longer that great a bargain...

Actuarially speaking, $660 per year for 10 years is only payments of $6600 total in exchange for $100k coverage. Based on insuring 75 year olds, that is a math problem for sure. 3-5% of people age 75-80 die every year & 5-7% age 80-85. that is a lot of $100k death claim checks being paid with only $660 per year being paid. 100 people aged 75-80 would mean $500,000 claim checks paid. Premiums collected from those 100 people would only be $66,000(costs & expenses would have to be deducted from this).

There has to be more to this or I am missing something or doing my own bad math. Most fully underwritten 10 year term for those ages is 5-15 times those premium amounts

 

[Agent16]

I think you guys got something wrong...the death benefit is 4x the accident benefit and does kick in after the first year.
However - the $100K death benefit is based on the accident benefit which is offered under the "Plus" plan only. Here are the quotes:

$2,500 accident = $10,000 death costs $30/month
$10,000 accident = $40,000 death costs $45/month
$25,000 accident = $100,000 death benefit = $55/month

No longer that great a bargain...

They have a membership level that I don't see on their website called Base+LF which is $30/month and includes the $100,000 group term death benefit. I attached the quote I got below.

 

[BarryNY]

They have a membership level that I don't see on their website called Base+LF which is $30/month and includes the $100,000 group term death benefit. I attached the quote I got below.

Can you give me the actual link? Good sleuthing...

 

[titeye]

I think you guys got something wrong...the death benefit is 4x the accident benefit and does kick in after the first year.
However - the $100K death benefit is based on the accident benefit which is offered under the "Plus" plan only. Here are the quotes:

$2,500 accident = $10,000 death costs $30/month
$10,000 accident = $40,000 death costs $45/month
$25,000 accident = $100,000 death benefit = $55/month

No longer that great a bargain...

When I called, the rep said the exact same thing as Agent 16's post. Only thing he added was $2,500 level pays 4x = $10,000, and $25,000 pays 4x = $100,000. Naturally, I asked why doesn't it just state $10,000 and $100,000? He offered no explanation. I'm still suspicious, because there has to be a reason.
The other thing is, everyone pays the same premium, at least male gender does, regardless of age.

 

[shonceman]

When I called, the rep said the exact same thing as Agent 16's post. Only thing he added was $2,500 level pays 4x = $10,000, and $25,000 pays 4x = $100,000. Naturally, I asked why doesn't it just state $10,000 and $100,000? He offered no explanation. I'm still suspicious, because there has to be a reason.
The other thing is, everyone pays the same premium, at least male gender does, regardless of age.

Everybody is paying the same dues for their particular membership level. The group is paying the premium for the entire group, just like if a company carried a group term policy for employees. The risk is spread throughout the group. Hopefully the younger members dues are high enough to compensate for the older members benefits.

Regardless of what the membership rep says, the premiums are not guaranteed. The insurance company can reassess their risk along the way and change premiums. Then it’s up to the association whether they will absorb any increases from the existing membership dues.

The association can also make changes to any of the membership fees, and/or change the available benefits. They can decide to drop the life insurance altogether. I’m not saying they will do any of that. Just saying they can.

I checked out the website (SureMed - Home) but couldn’t find any mention of life insurance anywhere on any page. Apparently, somebody has to tell you about the special link. That gives me pause.

 

[BibH]

Bingo the premium is not guaranteed . It’s a group policy . If the group exp’s adverse claims they’ll raise everyone’s premium like a Medicare or health policy. I would never sell this . I only sell guarantees . Like i won’t touch those aca alternative bs health policy’s for 40% less . The client never remembers what you told him and when he gets a bill or a rate increase with this term he’ll be very angry