History of Longevity Insurance
The history of longevity insurance [http://www.nevada-annuities.com/longevity-insurance/] can be argued two ways. Some say it is the actual day modern age insurance companies introduced the concept. Others say it was in May 1752 when Ben Franklin started The Philadelphia Contributionship for the Insurance of Houses from Loss by Fire.
People who say it can be traced to Franklin say so because he is generally regarded as the father of insurance in America. Regardless on which side of the argument you stand, longevity insurance offers protection against the possibility of outliving your money when you retire.
In other words, longevity insurance protects you from suffering a very bad retirement disease called insufficient retirement savings. You don't want to be 80 years old and have only a small check from Social Security as your only source of funds.
Longevity insurance actually came into being as a term used by insurance companies between ten and five years ago. That may sound relatively new but again, look at what Franklin created and its many products and you'll realize the concept was rooted long before modern insurance companies started promoting the term.
It is no secret Americans are living longer. It seems you can't pick up a magazine or newspaper without reading how our average lifespan has increased by some 20 years. And the base timeline for this increase is 1950.
I believe longevity insurance was originally called old-age insurance. However, old age insurance doesn't have the same warm fuzzy feeling as longevity insurance. Longevity insurance makes it sound like you will live forever.
The concept underlying longevity insurance is an annuity that doesn't start paying until a person reaches 75, 80 or even 85. The person purchases this annuity between the ages of 55 and 65.
The reason a person buys them at an early age for use at a later age is the premium is lower while the monthly payout is higher. For example, if a person wants $2500 a month at age 85 and buys the annuity at age 85, the premium is approximately $190,000.00. On the other hand, if a person desires the same $2500 per month and purchases the policy at age 55, the premium drops to around $35,000.00.
The math shows the savings to be considerable. By the way, the above numbers are rounded and only examples. If you decide to get a quotefor longevity insurance, you probably will see different premiums.
People who say it can be traced to Franklin say so because he is generally regarded as the father of insurance in America. Regardless on which side of the argument you stand, longevity insurance offers protection against the possibility of outliving your money when you retire.
In other words, longevity insurance protects you from suffering a very bad retirement disease called insufficient retirement savings. You don't want to be 80 years old and have only a small check from Social Security as your only source of funds.
Longevity insurance actually came into being as a term used by insurance companies between ten and five years ago. That may sound relatively new but again, look at what Franklin created and its many products and you'll realize the concept was rooted long before modern insurance companies started promoting the term.
It is no secret Americans are living longer. It seems you can't pick up a magazine or newspaper without reading how our average lifespan has increased by some 20 years. And the base timeline for this increase is 1950.
I believe longevity insurance was originally called old-age insurance. However, old age insurance doesn't have the same warm fuzzy feeling as longevity insurance. Longevity insurance makes it sound like you will live forever.
The concept underlying longevity insurance is an annuity that doesn't start paying until a person reaches 75, 80 or even 85. The person purchases this annuity between the ages of 55 and 65.
The reason a person buys them at an early age for use at a later age is the premium is lower while the monthly payout is higher. For example, if a person wants $2500 a month at age 85 and buys the annuity at age 85, the premium is approximately $190,000.00. On the other hand, if a person desires the same $2500 per month and purchases the policy at age 55, the premium drops to around $35,000.00.
The math shows the savings to be considerable. By the way, the above numbers are rounded and only examples. If you decide to get a quotefor longevity insurance, you probably will see different premiums.
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