The Insurance Rebuttal Part 2 – Episode 011

Today’s episode of The Prosperity Podcast continues the debate over whole life insurance vs. term life insurance. Best selling financial author, Kim D. H. Butler and “No B.S. Money Guy,” Todd Strobel pick up where they left off previously, discussing comments sent in by a reader in support of term insurance vs. whole life insurance.

The arguments and responses covered include: price comparison, investing comparison, and large commission comparison.

Kim and Todd address the reasoning behind each question the viewer had and then proceed to teach why both whole life and term insurance are important and practical. Most clearly, they express why term on its own is not a long term option, as its name suggests.

Once again, the final consensus is that a combination of both insurance options is the best way to stay protected as well as save for the future.

0:00 – Introduction
0:18 – Welcome
1:06 – Recap on previous podcast concerning term insurance vs. whole life insurance debate
2:51 – Argument #5 Why is term insurance cheaper than whole life?
3:02 – Response to argument #5 Immediate price comparison is not helpful because they have different functions over time. It’s like renting vs. buying.
6:16 – Argument #6 “Unbundling” gives the client more cash back and more options on investing.
7:10 – Response to argument #6 part one: Actually, it’s the “investing” part of “buy term and invest the difference” that often doesn’t work well.
9:33 – Typical advisor recommended investment information.
10:15 – Response to argument #6 part two: Whole life out-performs many other savings vehicles and even many investment vehicles, depending on the environment.
12:00 – Sales of term insurance helps the insurance company meet the 4 to 5 percent net figures to the whole life policy owners.
13:24 – Argument #7 insurance agents sell whole life to make huge commission.
13: 34 – Response to argument #7: Term, whole life and mutual funds can all deliver good commissions. Commissions are necessary to business success. It is ludicrous to think that a 200-year old product has survived only because of commissions!
14:44 – Wrap up