Dead Peasant Insurance–The Employer Owned Life Insurance Problem Solved with a Napkin

Dead Peasant Insurance–The Employer Owned Life Insurance Problem Solved with a Napkin

To follow up Brandon's post from yesterday regarding employer owned life insurance (EOLI) and so called Dead Peasant Insurance as it's been described in the media, I thought I'd share a piece recently written over at Forbes.

We think this sort of reporting is pretty typical of the insider media mantra, “if it bleeds it leads”.

You should really take a few minutes to read the piece and form your own opinions, however, it quickly became apparent to me that the journalist is really huffing and puffing about nothing in this case.

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Employer Owned Life Insurance, It Might Not Be Quite What You Think

Employer Owned Life Insurance, It Might Not Be Quite What You Think

Employer Owned Life Insurance is a funny topic.  Funny in the way religion divides the masses and causes all kinds of fun (and not very amicable) discussion.  And, a lot like religion, there's a fair deal of mis-interpretation that leads to further distrust and hatred (ok no more religion on the Insurance Pro Blog, ever).

Today, I'm not really interested in discussing the moral ramifications of EOLI (as it's known).  Just the applicability and why this term “Employer Owned Life Insurance” exists.

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The Financial Planners are Turning to Alternative Investments and Life Insurance is on their List

The Financial Planners are Turning to Alternative Investments and Life Insurance is on their List

We've been hammering the alternative investments point pretty hard lately, and this is because the financial services industry is abuzz about what to do with its tarnished image for cuddling up with the main stream stock market for so long and and now being accountable for it's general lack of reliability to the average investor.

So, what are money managers and general financial planners (the certified kind) doing to restore faith and peace of mind among their clientèle?  The answer is quite interesting.

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4-6% Historical Return with very Limited Risk: The Idea Par Excellence in Alternative Investments

The Idea Par Excellence in Alternative Investments

Alternative Investments? You say…hear us out.

I'll admit it, I have a certain penchant for the unusual and I have a huge tendency to buck the trend. According to certain personality tests circulating the internet, I share personality traits with only roughly 5% of the U.S. population. Bad for social gatherings, great for dissecting conventional wisdom and avoiding common pitfalls.

I've been a finance geek for a long time (I like numbers). I was an online investor back when stock quotes were delayed more by my dial-up internet connection then by the speed of the ticker tape. And I've always been amazed at the crazy ideals we dogmatically hold onto in the personal finance world.

So imagine how I attacked the notion of using cash value life insurance as an asset class when the idea was first presented to me.

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Modern Portfolio Theory turned upside down

Modern Portfolio Theory turned upside down

Let's start with a brief discussion of modern portfolio theory (MPT)  just to make sure we're all on the same page.   To avoid a less than exciting academic foray into MPT, I'll provide a basic definition.

Basically, the theory is that individual investment (a particular asset i.e. stock or bond) selection should not be chosen on their own merits. What's more important is how each asset's price moves relative to all the other investments in a portfolio.  Harry Markowitz was the first to articulate this concept back in 1952.

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Dear Insurance Pro Blog: 7702 Plan

Dear Insurance Pro Blog

We recently received the following email from a fellow reader about the 7702 Plan post:

Dear Brandon,

Why so much hate for 7702 Plans? I've been following your blog for a few months now, and for the most part I love what you do. However I think your recent post about 7702 Plans was unfair. For starters, the plan is nothing like a 401k or IRA. Those plans can and HAVE declined in value. The 7702 Plan was created by Federal Tax Code and has served a lot of people very well. I was surprised to see someone like you attack a solid plan like 7702's.

Rich

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An Introduction to Estate Planning

An Introduction to Estate Planning

Estate planning is a subject that traditionally incites images of stuffy topics that require obtuse attorneys who spend all of their time fascinating over abysmal tax implications.  While this assumption about the topic isn't unwarranted, it's a tad incomplete.  Estate planning is a subject that will infiltrate everyone's life and how you choose to address it will make a dramatic difference in the lives of those who have to deal with your matters once you have passed away.

Today I'm not all that interested in detailing depth, as much as I'm interested in presenting a few key concepts that will hopefully adjust some thinking and make everyone realize that like it or not, all roads lead to estate planning.

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Ohio National Life Term: You Had No Idea a Mutual Could Write Term this Cheap…Did You?

Ohio National Life Term

Ohio National Life, the 100 some odd year old life insurance company from Cincinnati known for having a good…well…almost everything.

Most of the time, we can segment companies by being rockstars with certain products.  For example, we know Berkshire Life and the Standard for their industry leading and extremely benefit rich disability insurance contracts.

We regard Banner Life and Genworth for their fiercely cheap term insurance rates, we know of Jackson National Life for their amazing annuity products.  Ohio National tends to be a different story.

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