Life Insurance

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tiagoabner
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Re: Life Insurance

Post by tiagoabner » Sun Oct 29, 2017 11:17 pm

This is not a paid advertisement by any company. The insurance agency I work with doesn't sell anything on Chile, we work with US based clients only. This comment is anecdotal and shouldn't be used as a basis for investment or legally binding decision. I'm not endorsed by any Chilean based company, nor I legally endorse any of their services.



Well, now that my legalese rant is over, I will quickly drop my 2 cents here. I'm partially familiar with the local branches of US-based companies (I work for an US insurance brokerage agency) and their Chilean branches are allegedly bound by the same quality standards.

Go through Ohio National. Get yourself underwritten (IE. get your medical records examined) to get their "Preferred Plus" rates, assuming you have good health and are a non-smoker. Almost all US-based companies will offer this for Term Life policies, which is what you need for the end you described (make ends meet until the kids get out of the college in case something happens to you). The offers you are getting are based on the "Standard" rates, which are offered to non-underwritten cases. They offer insurance for up to 120000 UF (roughly 5 million US dollars), so they should cover your needs easily.

With Ohio National:
- For life insurance, go with Term Life (Vida Temporal, in Chile). A 20-year term should go somewhere north of USD $300~400 per year, roughly CLP $190000 to $250000). Ask for it to be fully underwritten ("con suscripción").
- If a Chilean CS Agent/Insurance Broker doesn't help, go with: "Yes, I understand I will need to provide medical records. No, I don't mind waiting about 2 months for the whole process. Please get me your manager/supervisor, I'm used to the US standards offered by Ohio National and I want to get the Preferred Plus rates only available through medical underwriting. This is a right assured to me in your legal base, as per recorded at Superintendencia de Valores y Seguros under codes POL 220131233 and CAD 320131239". They will 99% of the cases try to sell you a shitty policy that gives the broker higher commissions, and this specific legalese point will help you get the broker to know you know what they sell.
- Still on the life insurance topic, avoid anything other than Term Life/Vida Temporal unless you have been instructed by your lawyer and your accountant. All other policies will have stricter "bail out of this" terms. Whole Life/Vida Entera, specifically, is a nightmare in itself and should be avoided like the plague unless you have a very good reason to want your money stuck on Chile.
- If you work on a skilled profession, look to get some individual disability insurance as well. It is sold on Chile as an add-on to life policies and it is named "Incapacidad. Total y Permanente". Specifically, look to get an "Own occupation" policy, which will cover you in case you can no longer work at your skilled profession, but can still do something rather unskilled or with a large income drop (IE. surgeon who gets permanent damage at the left/non-dominant hand, but who can still teach).

The other US based insurance company that operates on Chile that I know is Metlife/Brighthouse. They are also solid, but I don't have too much experience handling with them (my insurance policies are both through Ohio National's US branch).

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admin
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Re: Life Insurance

Post by admin » Mon Oct 30, 2017 7:59 am

Every time we handle an inheritance or an estate, it never fails to impress me how expensive it is to die.

You would think that would be the most affordable activity in your whole life.
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Britkid
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Re: Life Insurance

Post by Britkid » Mon Oct 30, 2017 1:26 pm

Thank you for this helpful information.

You mention brokers. I googled Ohio National and they have an office at: El Bosque Norte, 0125 Las Condes. https://www.ohionational.cl/ Do you work for this company? Should I go there directly? I just called them and they said I could turn up directly without appointment to talk about this. Your post (where you reference "a Chilean CS Agent/Insurance Broker") seems to implies that I could go to a third party company rather than direct to the source? The less middle men (or women) the better I think?

Yes, I do want to want to be able to bail out at any point.

I am guessing I should go in and ask for a quote first, rather than turn up with medical records. I did actually do a thorough medical check when I started a vegan diet, and another one a year later, even though I was fine, just to see if there was any difference. That last check was around February this year, heart, blood tests etc.
In 2014/2015 I blogged about my life in Chile. http://web.archive.org/web/201601121940 ... age_id=268

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tiagoabner
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Re: Life Insurance

Post by tiagoabner » Mon Oct 30, 2017 2:55 pm

I don't actually work with them in Chile. The office I manage is US-based and only works with US-based clients. If Ohio National has a local office, going through them is certainly an option. You are going through a broker even if you do it at their office, there is no way out of this. That's simply how life insurance works and the person that serves you at their office will be your designated broker.

Having the option to bail out is important, specially if your family decides to move to another country later on. There's usually no need to present your medical records at the get-go, they will ask for them as needed. Take what you have just in case, but don't stress over it. Just make sure they are 100% clear that you want to go through underwriting to get their Preferred Plus rates and you're good to go.

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Re: Life Insurance

Post by Britkid » Mon Oct 30, 2017 5:27 pm

I'll give it a try the next time I go to Santiago - do you think I'll likely have to end up making a very large number of trips in person to the doctors and to the life insurance company's office, or maybe just 2 or 3. Or maybe it's hard for you to tell.
In 2014/2015 I blogged about my life in Chile. http://web.archive.org/web/201601121940 ... age_id=268

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tiagoabner
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Re: Life Insurance

Post by tiagoabner » Mon Oct 30, 2017 6:12 pm

It's hard for me to tell. In the US case, all it takes is 2 sets of signatures: one when placing the insurance application, which authorizes them to analyze your medical records, and another one when placing the policy after the underwriting process.

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Re: Life Insurance

Post by Britkid » Thu Aug 02, 2018 9:11 pm

tiagoabner wrote:
Sun Oct 29, 2017 11:17 pm

Go through Ohio National. Get yourself underwritten (IE. get your medical records examined) to get their "Preferred Plus" rates, assuming you have good health and are a non-smoker. .......

With Ohio National:
- For life insurance, go with Term Life (Vida Temporal, in Chile). A 20-year term should go somewhere north of USD $300~400 per year, roughly CLP $190000 to $250000). Ask for it to be fully underwritten ("con suscripción").
-.......codes POL 220131233 and CAD 320131239".
Quoting parts of your post above, and I finally got around to going to Ohio National today. Thanks again for your advice.

The prices they offered me were 45,000 a month for a payment on death of 5000 UF (136 million pesos on today's rate). 10 year policy.

And 62,000 a month for a payment on death of 8000UF (218 million pesos). 10 year policy.

I had originally asked for higher payouts, and 20 year policies, but reduced both payout and term to get better quotes.

It is still several times more expensive than equivalent UK pricing, and the pricing you suggested above I might get, and similar to what I got at other insurance companies, even after I asked for everything you said above including the specific codes which are printed on the policies, and the fact that it will be medically underwritten.
In 2014/2015 I blogged about my life in Chile. http://web.archive.org/web/201601121940 ... age_id=268

Britkid
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Re: Life Insurance

Post by Britkid » Thu Aug 02, 2018 9:28 pm

Here is another way to look at this. They are charging me 62,000 a month for ten years. 62000 x 12 x 10 = 7.44 million pesos. Paid from now (age 38) to when I'm 48 (then policy ends).

If I die, my wife gets 218 million pesos.

We can ignore inflation I think since both amounts, the monthly fee and the payout, increase equally with inflation.

7.44 out of 218 is 3.4%. They are charging me 3.4% of the payout.

In a raw, statistical, gambler's take, that, for us, is a deal worth taking if the chance of me dying in the next 1 years is greater than 3.4%. Obviously that is not the only way to look at it!

Obviously, Ohio National thinks that the chance of me dying in the next 10 years is less than 3.4%. To allow for their profit margin and cost base, it must be quite a bit less. Say 2.5% - IF the quote is reasonably fair which it might not be. Counterpoint: they probably invest the monthly payments in the stock market and may be able to get an above inflation return with compound interest and the stock market - so actually they may even be able to cover their costs and profit if the chance of me dying is 3.4%. So let's call it 3%.

So say if there's a 3% chance of me dying in 10 years that is a fair quote.

I looked at one website and I answered some questions and it calculated the odds of me dying in the next 5 years at 0.3%. My health is very good with no negative indicators.
In 2014/2015 I blogged about my life in Chile. http://web.archive.org/web/201601121940 ... age_id=268

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Re: Life Insurance

Post by admin » Thu Aug 02, 2018 9:57 pm

Was that quote in UF or in Pesos?
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at46
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Re: Life Insurance

Post by at46 » Thu Aug 02, 2018 10:49 pm

I don't know about Chile, but in Canada life insurance is mostly used for tax minimization and is also attached as a mandatory requirement to some mortgages. Even though, statistically, most people die after paying out their mortgages of any kind.

For a healthy 38 year old with family living in Chile, I would think getting a good medical coverage would give a bigger bang on the buck.

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Re: Life Insurance

Post by Britkid » Fri Aug 03, 2018 12:44 pm

admin wrote:
Thu Aug 02, 2018 9:57 pm
Was that quote in UF or in Pesos?
The quote is in UF.

The one quote is 1.66 UF/month (currently around 45,000 pesos) and the payout is 5000 UF (currently around 136 million pesos).

The other quoteis 2.27 UF/month (currently around 62,000 pesos) and the payout is currently 8000 UF (currently around 218 million pesos).
In 2014/2015 I blogged about my life in Chile. http://web.archive.org/web/201601121940 ... age_id=268

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tiagoabner
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Re: Life Insurance

Post by tiagoabner » Sat Aug 04, 2018 8:09 pm

I'm not in Chile any longer, but I'll get the contact for the guys I know in there to check this out. Unless you smoke, the price seems way higher than I expected. What's your current age? I can use that to run a more accurate guesstimative through the backend of a couple of insurance companies.

My 2 cents are on the broker you went through having no idea about what he was doing and running a quote for a policy full of riders. Things that are overpriced, such as "double benefit amount in case of accidental death". Also, did they include disability benefits on the policy, or was it term life only?

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