Women drivers get equality!

[MajGenl.Meade]

Glad you were not rear ended!

dgs49 - you are quite right that risk factors are legitimately taken into account in premium rating (or should be). But I think on the burial policies the analogy to term life, while bearing superficial resemblance, was actually different. Burial policies were mostly sold to disadvantaged people (not just blacks but mostly) as a kind of savings plan for that terrible day when death forces a funeral. Educated people would never buy one - at least, I'd hope not.

A real term policy has a real term date - not only death. Insurance doesn't simply stay in place until a person keels over at 105; that would bankrupt the companies since every insured eventually dies. Long before that it either terminates (number of years) or the premiums accelerate to become so outrageous that the insured gets the idea and cancels it before the bite terminates them. Burial policies on the other hand just keep on taking premum because (actuarially) they are bound to take in more premium than will ever be paid out.

That "price" you spoke of with grandma, nice though it is, is (I regret to say it) like being proud of giving free coffee to fake cops. It's the kind of thinking that the paper hangers relied upon in conning people into these burial policies. My mother had a penny-a-week term life policy on me which the agent collected once a week. But it did have a termination date when I was 10 years old or so after which premium payment ceased. She cashed it in some 15 years later and (aside from inflation) didn't lose out.

Cheers
Meade

[dgs49]

I think my grandmother's policy was paid off at some point. Then it was good forever.

"Term" policy is good during the TERM of the insurance, usually one year, after which it has no value. As contrasted with Whole Life, which accumulates a cash value over time. The pity of whole life, as I recall, is that if you stop paying you run the risk of losing the accumulated value (which doesn't accumulate much, at least in the early years).

Consider the historical significance of these burial policies: People were very concerned that the cost of burying them would be a significant problem for their surviving families. A couple hundred bucks, at the time. Say a few thousand now.

Makes you think.

[Long Run]

Consider the historical significance of these burial policies: People were very concerned that the cost of burying them would be a significant problem for their surviving families.

Definitely a creature of Depression era thinking, like keeping rubber bands on the door knob. Such policies, though, have long been considered a poor value in the insurance world (i.e., a standard policy would be a much better value, as would a decent savings account).

[Gob]

Ok, I'll bite, why do you keep rubber bands on the doorknob LR?