Be Assured — Questions for Karl Anderson, vice president, insurance product management

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Q: I find the array of life insurance products and options available confusing. How do I cut through the clutter?

A: You need to ask yourself several questions, which your Thrivent Financial for Lutherans representative can help you answer. How much insurance do you need? That will depend on your financial goals and your wishes for your survivors. How long is your insurance need going to last? You can buy insurance to last anywhere from one year to a lifetime. What degree of flexibility do you need? With certain types of insurance, the premium or amount of death benefit can be flexible. This can add complexity, but can be good if your needs are changing. What amount of risk and control do you want to accept? For example, the insurer can bear the investment risks, or you can buy a policy where you control the way the money is invested.

Q: OK, so first things first: How can I perform a rough calculation of my insurance needs?

A: Every situation is different and rules of thumb don’t apply perfectly. I’ve seen reports that say anything from 5 to 20 times your annual salary is the right amount of life insurance to carry. The only way to get it right is to do a free needs analysis with your Thrivent Financial representative. In the meantime, 10 times your salary is a decent starting point.

Q: To what degree is age a factor? Are some people ever too old or too young to insure?

A: Life insurance is available from birth to age 80 or older. Remember that life and disability income insurance don’t just protect an earned or unearned income stream. Insurance also often plays a role in estate planning and it can supplement the accumulation of dollars for retirement or college. For children, an insurance program started at a young age can last a lifetime. It can also be started much more cost-effectively than waiting until later in life.

Q: If I have life insurance through my employer, I’m totally covered, right?

A: Employer-based coverage is a good start, but the benefits are usually limited. Plus, if you leave your current job, your group insurance usually ends. Individual coverage is more portable and can provide you with more peace of mind.

Q. Should I buy insurance for my child? I don’t want to think about losing a child.

A. Life insurance isn’t just for the present; it’s a gift that can last a lifetime. It’s important to get a program started while the child is healthy so if something would happen to the child’s health, either as a child or adult, he or she would have a program in place and always have life insurance. And while we usually don’t want to consider this, the loss of a child can create a disaster for a family. The policy proceeds can help if the parents are unable to work or need counseling, or they can start a memorial fund in their child’s name or make a gift to special people who helped throughout the struggles.

Q. What things do I need to evaluate when shopping around for an insurer?

A. You first need a financial representative whom you know and trust. Find someone with an advisory process who will perform a needs analysis or financial plan—not just sell you a product. The strength and size of the insurer is critical. And you must understand what you’re buying, so that you can evaluate affordability for the long-term.

Q. What makes Thrivent Financial for Lutherans a good option?

A. We exist for the purpose of meeting the needs of our members. We have a strong group of financial representatives to help people understand insurance and their retirement needs—and a broad range of tools and solutions available in the planning process. We provide a good value for your premium dollars. We strive to keep your premiums fair, while maintaining our responsibility to support you and pay claims for decades. All of these factors help us retain our strong ratings from independent rating agencies such as A.M. Best and Moody’s.

Q. I’m avoiding dealing with life insurance because I’m worried about the cost. Should I be?

A. The cost you should be most concerned about is the one that would be borne by your loved ones if something unfortunate happened to you. There are many different types of life insurance available, and you might be able to get a policy for less than you think. The smartest thing you can do is to openly share your concerns about price—or anything else—with a financial representative.

Q. What about the medical exam? That sounds scary, too!

A. Believe me, I can relate to fears about medical exams. Indeed, with some purchases of life insurance, a medical exam will be required. A lot of companies, Thrivent Financial included, have taken steps to make this easier and faster. A paramedical will come to your home or workplace and get it taken care of quickly. He or she will ask a few questions, do a height and weight check, and sometimes collect a blood and urine sample. It’s fast and relatively painless.

Q. Can insurance be a gift? I’d like to buy a policy for someone who is important to me.

A. Yes, insurance can be gifted. It’s often done during estate planning as a means of passing assets to children or to a trust or charity. Often parents or grandparents will purchase a policy on a child’s life to get them started while premiums are lowest and their health is good. Also, you can use a new or existing policy to give to a charity to perpetuate gifting long beyond your life.

Q. Isn’t planning for retirement more important than insurance?

A. You do need to save for retirement, but I also strongly urge you to carry life, disability and long-term care insurance to help assure that your hard-earned savings aren’t decimated in an instant with an untimely accident, illness, death or long-term care need. Understand how these catastrophes could affect your retirement plan, and insure to the degree you can in order to see that your retirement plan will be carried out.