Life insurance...for war zones?
November 12, 2019 4:46 PM Subscribe
I don’t know anything about life insurance, and I know you’re not my insurance agent, but I have no idea where to start.
Let’s say hypothetically I die in a war zone with no affiliation to any official military such as the US armed forces. What life insurance would I want to have in that event, and am I able to put non-family members (e.g. friends, or even charitable organizations) as my beneficiaries? If so, what life insurance should I be looking at? I am a 30-year-old male in decently good health (I smoke a small amount, no drinking or doing drugs). Where do I begin?
Let’s say hypothetically I die in a war zone with no affiliation to any official military such as the US armed forces. What life insurance would I want to have in that event, and am I able to put non-family members (e.g. friends, or even charitable organizations) as my beneficiaries? If so, what life insurance should I be looking at? I am a 30-year-old male in decently good health (I smoke a small amount, no drinking or doing drugs). Where do I begin?
Best answer: When you get life insurance they will ask you if you plan to travel to [various places they don't insure] and decline your coverage or offer it to you with exclusions. If you lie about your intentions, they'll cancel your coverage. If you already had life insurance, you might under certain circumstances get a payout if something unpredictable took you into the war zone and/or it wasn't specifically excluded in the policy, but if you plan to travel to a dangerous place you will find it very difficult to get new coverage.
You can only have life insurance pay out to people who stand to lose in an obvious, direct way by your death - immediate family only, in most cases. You can't have it pay out to a friend or a charity. An employer might insure you if your death would cause them a serious loss.
Basically this isn't going to work. Smoking is also going to ding you a lot on rates.
Signed, I had the misfortune to have a long-term temp gig at a life insurance company at one point.
posted by Frowner at 5:14 PM on November 12, 2019 [2 favorites]
You can only have life insurance pay out to people who stand to lose in an obvious, direct way by your death - immediate family only, in most cases. You can't have it pay out to a friend or a charity. An employer might insure you if your death would cause them a serious loss.
Basically this isn't going to work. Smoking is also going to ding you a lot on rates.
Signed, I had the misfortune to have a long-term temp gig at a life insurance company at one point.
posted by Frowner at 5:14 PM on November 12, 2019 [2 favorites]
Best answer: War zone insurance is absolutely a real thing. It just isn't called life insurance, even though it will pay out if you die (among other payouts). I used to work for a nonprofit that operated in Afghanistan, and all employees who traveled there were covered by a policy that would pay out for war or terror related death, dismemberment (with specific payout amounts listed for various body parts), even kidnapping. Private individuals can buy these policies too. Just google "war zone insurance" and you'll see a million options (though I can't recommend anything specific).
posted by showbiz_liz at 5:25 PM on November 12, 2019 [1 favorite]
posted by showbiz_liz at 5:25 PM on November 12, 2019 [1 favorite]
Response by poster: Thanks! I can quit smoking easily (I know, I know), so I’m not super worried about that, I just put it in there for full disclosure.
@showbiz_liz: do these allow payment to non-family members?
posted by gucci mane at 5:31 PM on November 12, 2019
@showbiz_liz: do these allow payment to non-family members?
posted by gucci mane at 5:31 PM on November 12, 2019
Best answer: No idea! I imagine different insurers might have different policies about that. A quick google hasn't answered one way or another - if I were you, I'd just call a few places and see what they say.
posted by showbiz_liz at 5:35 PM on November 12, 2019 [1 favorite]
posted by showbiz_liz at 5:35 PM on November 12, 2019 [1 favorite]
Best answer: Try checking into Accidental Death and Dismemberment (AD&D) insurance. It is different from life insurance in the sense that it does not pay out if you die of natural causes. Some people get it if they can't get regular life insurance due to pre-existing medical conditions. The rules on beneficiaries vary from insurer to insurer.
This is what my organization gets for people working in war zones. One caveat: the premiums can be extremely high if you are traveling to a high-risk area.
posted by rpfields at 7:39 PM on November 12, 2019
This is what my organization gets for people working in war zones. One caveat: the premiums can be extremely high if you are traveling to a high-risk area.
posted by rpfields at 7:39 PM on November 12, 2019
Best answer: You can only have life insurance pay out to people who stand to lose in an obvious, direct way by your death
It’s a long time, 35+ years, since I took the Illinois life insurance agents exam so my memory has faded and the world has doubtless moved on a bit, but I think this is slightly confused. To buy life insurance you need an “insurable interest” — what is being described here. You can only obtain a policy for your own life, for a spouse, usually for a (minor?) child, for a business partner (under some circumstances), and in a few other similar situations. Where the money goes on the death of the insured is an entirely different matter and not nearly so restrictive — by default it just goes to the polcy holder (i.e. the person buying the insurance), but you can usually specify a beneficiary which in theory could be an unrelated third party. It is possible that insurance companies try to restrict beneficiaries, but I don’t know if it has become normal nowadays.
if you take out a policy on your own life, the usual state of affairs, and there is a specified beneficiary (usual but not required, as far as I know) it goes straight to them, bypassing your estate which can have probate and/or tax advantages. Without a third party beneficiary, the money becomes part of your estate. If you have a will it would then be paid like any legacy: according to the terms of your will by your executor and could go to anyone or any organization you could legaly leave money to, whatever the policy of the insurance company about beneficiaries.
The hard part is getting the coverage; getting any resulting money to random third parties of your choosing may involve a little complexity, but should be doable.
posted by Quinbus Flestrin at 8:26 PM on November 12, 2019 [1 favorite]
It’s a long time, 35+ years, since I took the Illinois life insurance agents exam so my memory has faded and the world has doubtless moved on a bit, but I think this is slightly confused. To buy life insurance you need an “insurable interest” — what is being described here. You can only obtain a policy for your own life, for a spouse, usually for a (minor?) child, for a business partner (under some circumstances), and in a few other similar situations. Where the money goes on the death of the insured is an entirely different matter and not nearly so restrictive — by default it just goes to the polcy holder (i.e. the person buying the insurance), but you can usually specify a beneficiary which in theory could be an unrelated third party. It is possible that insurance companies try to restrict beneficiaries, but I don’t know if it has become normal nowadays.
if you take out a policy on your own life, the usual state of affairs, and there is a specified beneficiary (usual but not required, as far as I know) it goes straight to them, bypassing your estate which can have probate and/or tax advantages. Without a third party beneficiary, the money becomes part of your estate. If you have a will it would then be paid like any legacy: according to the terms of your will by your executor and could go to anyone or any organization you could legaly leave money to, whatever the policy of the insurance company about beneficiaries.
The hard part is getting the coverage; getting any resulting money to random third parties of your choosing may involve a little complexity, but should be doable.
posted by Quinbus Flestrin at 8:26 PM on November 12, 2019 [1 favorite]
Just a follow-up: when I worked for Unnamed but Major Life Insurance Company in the early 2000s, they did not consider friends or charities to have an insurable interest, and distant family insurable interest came under scrutiny. The rationale that I got was both "a friend does not have an insurable interest because they do not stand to lose materially if you die" and "if you're too free and easy with the beneficiaries, you're introducing various kinds of moral hazard". The company would not issue policies under those circumstances - part of my job was collecting beneficiary information so I remember this particularly. At the time I was under the impression that this was widespread, but maybe it was just this company.
posted by Frowner at 3:28 AM on November 13, 2019
posted by Frowner at 3:28 AM on November 13, 2019
My understanding, but IANAL, life insurance when taken out must benefit someone or something with an "insurable interest," which is, they or it would have a financial loss at your death. A close relative, a business especially if you're a high ranking employee, someone holding personal debt from the insured. A policy w/o an insurable interest would be a kind of gambling.
After the policy is established, I understand the insured can change to beneficiary to whomever or whatever they like.
The question I have is: do you need life insurance? Is there someone or something you're financially supporting now that would be in a bad way financially should you die? If not, don't buy life insurance.
posted by tmdonahue at 6:25 AM on November 13, 2019
After the policy is established, I understand the insured can change to beneficiary to whomever or whatever they like.
The question I have is: do you need life insurance? Is there someone or something you're financially supporting now that would be in a bad way financially should you die? If not, don't buy life insurance.
posted by tmdonahue at 6:25 AM on November 13, 2019
Best answer: Frowner and tmdonahue, I think you’re really just agreeing with my point given that you have an insurable interest in your own life and can buy life insurance and then, either directly by naming a beneficiary or indirectly through your estate, use any payout to benefit whoever you direct. In most cases other people do not have an insurable interest in your life so they can’t even start the process, but that’s wasn't really the question here.
The OP is asking about buying life insurance themselves that would possibly later benefit third parties — I think that part is entirely doable. The part that is beyond my knowlege is obtaining a policy that would be valid in a war zone.
posted by Quinbus Flestrin at 9:04 AM on November 13, 2019
The OP is asking about buying life insurance themselves that would possibly later benefit third parties — I think that part is entirely doable. The part that is beyond my knowlege is obtaining a policy that would be valid in a war zone.
posted by Quinbus Flestrin at 9:04 AM on November 13, 2019
Response by poster: I appreciate all of the answers! Maybe I am not understanding the concept of “life insurance” properly.
Basically, I want to pay into something that, in case of my death in a war zone, will pay out money to a person who I am not related to. This person is a loved one but not a spouse.
posted by gucci mane at 10:39 PM on November 15, 2019 [1 favorite]
Basically, I want to pay into something that, in case of my death in a war zone, will pay out money to a person who I am not related to. This person is a loved one but not a spouse.
posted by gucci mane at 10:39 PM on November 15, 2019 [1 favorite]
This thread is closed to new comments.
posted by Fiasco da Gama at 4:55 PM on November 12, 2019 [3 favorites]