X-Message-Number: 6312
Date:  Tue, 04 Jun 96 11:11:27 
From: Steve Bridge <>
Subject: Life Insurance considerations

To CryoNet
>From Steve Bridge, Alcor
June 4, 1996

In reply to:   Message #6306
               Subject: I'm buying life insurance.  Advice?
               Date: Mon, 03 Jun 1996 13:31:29 -0500
               From: Will Dye <>

>In the meantime, I'm about to upgrade my life insurance 
>to $400,000 for myself and $300,000 for my wife.  It will 
>be "plain vanilla" term life insurance, 20-year fixed rate.  

     If you have children and need short-term coverage in case you die 
with dependents, term insurance is cheap per dollar of payoff.  For long-
term cryonics needs, term insurance by itself is almost certainly the 
wrong choice.

     A few tips from my 4th Quarter, 1995 *Cryonics* magazine article on 
funding:  (additional language for this post marked in [brackets])

-- Life insurance has one very big advantage [for cryonic suspension 
funding]: no matter what the monthly premium is nor how long the 
individual has had the policy, the full death benefit is paid to the 
beneficiary when the policyholder dies.  For people who do not have the 
full $50,000 or $120,000 available in one sum, life insurance may provide 
the only way to fund a suspension.  A good insurance plan will allow the 
total amount paid in to be much less than the minimum suspension funding.  
Insurance may not be the best investment for retirement income; but it is 
a very good investment for suspension funding.  For more discussion on 
Life insurance, see "Life Insurance Simplified" by Bob Gilmore and Mary 
Naples in the December, 1991 *Cryonics.* (free reprints available [from 

-- What type of policy should you choose? [for suspension funding]

     *Term* insurance is relatively inexpensive when the member is young.  
However, it gets more expensive or decreases in value every year [Will 
states that he has a "level payment" policy, which probably means that the 
death benefit starts dropping at some point.], which makes it impractical 
or prohibitive to retain by the time the member reaches age 50.  Also, 
term insurance is typically for a particular "term" of years and so may be 
completely unobtainable at the time the member actually needs it for 

      If you begin your suspension funding with term insurance, make sure 
the insurer guarantees it to be convertible to whole life insurance 
whenever you can afford to pay the higher rate.  Some cryonicists have 
combined a term insurance policy which decreases in value with another 
investment vehicle which increases in value.  This is fine, but it takes a 
lot of discipline to maintain.  Most people who start this way discover 
that the automatic insurance payments are simpler to keep up with.

     *Whole life* insurance is a policy based on the individual paying the 
same premiums as long as he lives [although practically, most policies 
stop the premiums at around age 80].  These premiums are much higher than 
for a term policy.  However, this gives you several interesting 

     [Typically, you can choose to have earnings above the company's 
profit go into the cash value of your policy or into additional death 
benefit.  If you choose the cash value option, after 12-15 years the cash 
value may be large enough to pay your premiums.  This means after you have 
paid perhaps less than 10% of the policy's value, you could stop making 
payments altogether.  

     In my own case, I have a $100,000 Universal Life policy (see next 
section) from New York Life.  After 11 years (approximately $8,000 in 
premiums), I no longer had to make premium payments, yet the death benefit 
will always be $100,000.  (This was a great advantage for me when I took a 
large pay cut to become Alcor's President.)  While these policies may be 
more expensive up front, they will be less expensive in the long run, 
especially if you are lucky enough to live to your 60's or longer.

     Or you could *continue* to pay the premiums and convert the extra 
money to additional paid-up insurance, increasing your policy's death 
benefit to stay ahead of future cryo-flation.  

    Note: you have to actively *choose* which options you want.  Do not 
assume the insurance agent reads your mind or understands your cryonics 
needs.  And you can change the option later if you need to.]

     *Universal life* policies may appear similar to whole life policies 
in an insurance agent's sales pitch; but they are designed differently.  
In some ways this is like a combination of term insurance and an outside 
investment account.  If the insurance company's investment strategies are 
sound, the investment part of the policy will eventually outstrip the 
insurance portion and provide the same advantages of a whole life policy.  
If the insurance company *doesn't* do so well, the policyholder may be 
required to make payments many years longer than predicted originally.  My 
own universal life policy appears to be doing very well; but some 
insurance agents have warned me recently that they believe universal life 
policies tend to be bad risks for cryonicists.  These agents believe that 
some of these policies will "collapse" from poor investments before the 
cryonicist has need of the benefits.  We'd be happy to hear other opinions 
or real evidence from other people on this subject.

     Recently, some insurance companies have been offering new 
combinations of insurance policies and investment accounts for sale.  The 
unique aspect of these policies is that the policyholder controls most of 
the investment decisions (mutual funds, stocks, bonds, etc.).  This may be 
an advantage for some cryonicists in that it allows a lot of control; with 
the disadvantage that the policyholder takes the risks of bad decisions.

>We're both non-smokers in good health.  I'm 36 and my wife 
>is 34.  Besides price, I'd also like to consider how stable 
>& friendly the company is, but other than AM Best ratings 
>I'm not sure how to measure that.  

     Ask for the experience of the cryonics companies, Will.  Alcor has a 
list of cooperative insurance agents experienced with cryonics funding 
requirements.  Several major insurance companies have been easy for Alcor 
to work with in obtaining policies and in making payoffs.  We have many of 
years of experience with New York Life and Jackson National Life, but many 
other companies are now cooperative, too.  We have had good experience 
with First Colony recently (which you mention) and Jefferson National.  
(This is not to limit the field; these are companies with which I dealt 
personally in the last couple of years.)  

     The only major company that seems to be an active problem for initial 
cryonics coverage is Prudential, but I feel sure that even they would pay 
Alcor as beneficiary on a policy which was first dedicated to a family 
member and then transferred to Alcor.

>Since cryonet folk are well-versed in the wiles of life 
>insurance, I would appreciate your advice on this matter. 
>I am particularly interested in any hitch that may arise 
>from the idea I have to later commit some of my policy 
>towards cryosuspension.  If that's untenable, then I'll 
>need to make other arrangements.  

     All insurance companies allow you to split your policies between 
several beneficiaries.  This is acceptable to Alcor; but it does increase 
our paperwork load in some cases, and the occasional conflict with other 
beneficiaries can delay Alcor's payment.  If you have a choice, it is 
simpler for Alcor if you maintain a separate policy for your cryonics 

Stephen Bridge, President ()

Alcor Life Extension Foundation
Non-profit cryonic suspension services since 1972.
7895 E. Acoma Dr., Suite 110, Scottsdale AZ 85260-6916
Phone (602) 922-9013  (800) 367-2228   FAX (602) 922-9027
 for general requests

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