X-Message-Number: 13809
From:
Date: Wed, 31 May 2000 19:22:47 EDT
Subject: Cryonics too costly? Not for most...
Hello, everyone.
Rudi Hoffman writing from Daytona.
I have been following with interest the Pizer comments and responses, and I
believe I have something to add regarding the cost factors of cryonics.
I have reproduced below the previous posts by Charles Platt and Dave Pizer.
(Both of these gentlemen are highly respected pioneers in the still
developing field of cryonics,
IMO. Which does not make them right all the time.)
In a message dated 05/29/2000 5:02:30 AM Eastern Daylight Time,
writes:
<<
>Price: I find it hard to believe that this is a major factor compared with
>all the others, since almost everyone pays via life insurance, and the
>premium for a $50,000 policy is not THAT different from the premium for a
>$150,000 policy. Also, the cost of whole-body preservation at CI is not
>that different from the cost of neuropreservation elsewhere; and many
>people do opt for neuro.
I have been in several business for over 40 years. I will state that price
is often the single most important reason for success or failure of a
business.
The fact that most suspensions are NOT paid for with cash as Charles points
out should be evidence that hardly anyone feels the risk is worth our
asking price. In other words we have priced our product out of the reach
of most people who might buy it when they need it most and can't get
insurance.
>>
(Rudi again)
I have said this before and I am sure I will say it again. Life insurance is
the LOGICAL, rational, and preferred way of paying for suspension for most
people.
This IS an affordable deal for the vast majority of people prior to age 70 or
so.
"Cryonics is Dead?" NONSENSE! Over the last 6 years I have devoted an
increasing part of my financial planning practice to writing cryonics
policies. Inquiries and policy applications are active, and consistently
trending up. While we are still very small and need to grow faster, the
extremely low figures quoted earlier for Alcor membership are belied by the
documentable life insurance policies currently issued or in progress. And I
may the leading writer of life insurance to fund biostasis, but I am not the
only provider.
Please allow me to reproduce the article I have written for "Cryonics", as
this is on point here. Yes, I know John DeRivas will have a fit, but the
numbers still speak for themselves.
Why Fund Your Suspension with Life Insurance?
by Rudi Hoffman CFP
I expect to have the money to fund my suspension in cash eventually. Mr.
Hoffman, why
should I take out a life insurance policy to fund my suspension?
This question in some form comes up often in discussions with people with an
interest in
cryopreservation. The good news is that there are answers that are
mathematically valid,
(i.e. not merely opinions) and that make sense to most people.
The purpose of this article is to answer this question in a clear, concise,
understandable
manner. Additionally, we will see that there is an empirical way of
determining the
optimum funding that will appeal to most rationally minded cryonicists.
Let s personalize this with a discussion of a hypothetical individual Jack
who is a 45
year old software developer.
Okay, Jack, so you want to be cryogenically frozen with the possibility of
future
reanimation. You have thought about it for some time, but you are of a
skeptical and
questioning nature, and you have a consituency in the form of a wife and
family who are
not at all sure if you have not gone off the deep end and do not share your
enthusiasm for
the possibilities of technology .
You want to create $120,000 for a full body suspension with ALCOR. You are
excited
because your mutual funds have been growing well, your career is taking off,
and you
expect to be seriously wealthy in the future. You want to do the best thing
to assure your
funding. You have negotiated with your wife, and you and she have decided
that you can
spend $1000 dollars per year towards cryonics funding.
Here is the key question. Is is better for Jack to spend his 80 dollars per
month in a
mutual fund, or a life insurance policy, to fund his suspension?
Here are the facts. Jack, a healthy nonsmoker, can create an INSTANT
$120,000 to fund
his suspension in a permanent Universal Life policy. Once he pays 80 bucks
and qualifies,
there is an IMMEDIATE and SURE payment to his cryonics organization to assure
his
suspension. The money does not go the cryonics organization at the expense
of the
survivors. This $120,000 does not have to come out of the estate Jack is
leaving for his
wife Mary and the children. Nor do they have the opportunity of second
guessing Jack s
choice and delaying or litigating Jack s wishes.
On the other hand, let s say Jack puts his $80 dollars per month into a
mutual fund. Even
if he averages a great return, it will take decades to generate the required
$120,000.*
What happens if Jack is struck by a truck on the way to work tomorrow? There
is no full
funding, and Jack will not be suspended.
What if Jack lives long enough to have adequate funding in his account? When
Jack
dies there is $120,000 which Jack has earmarked for his suspension. But
this $120,000
is a much clearer target for any of Jack s potential heirs to contest.
Jack s kids all turned out great. Except for the youngest, Leroy, who felt
the world owed
him a living. Jack had left each his children $200,000 in his will. But
Leroy wanted at
least part of the $120,000 Jack had earmarked for suspension! Do you think
Leroy could
find an attorney who would take this case? Could the money be tied up in a
legal battle?
Do will and estate contests occur over much less controversial issues than
funding
cryostasis? Absolutely! And these funding controversies HAVE and WILL
CONTINUE
to occur.
There are other issues. If Jack is not insurable due to health reasons, he
will not be able to
obtain life insurance to fund his suspension, and he would be forced to fund
his suspension
from his estate.
Most people become uninsurable at some point in their lives. It therefore
makes sense to
find out how affordable it can be to fund your suspension with the incredible
financial
leverage that only life insurance provides. It the case of cryonicists, the
policy can truly
become LIFE insurance-- not DEATH insurance.
Cryonicists tend to be life extenionists who take great care of themselves
and thereby can
usually qualify for the best possible insurance rates. (I spend a good deal
of time
explaining this information to insurance companies!)
In conclusion, for most people it makes sense to use life insurance to fund
the exciting
possibilities of cryonic suspension.
*80 dollars per month =960 per year. 960 annual payment
12 % after tax compound yield
25 years to grow to $128,001
(22 years at 15% after tax yield)
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