Suze Orman, of The Suze Orman Show offers one-size-fits-all Life Insurance Advice
Aman Goyal
October 12, 2009
Americans´ personal finance expert and host of The Suze Orman Show on CNBC may cost next-generation Americans billions of dollars by unintentionally offering wrong advice. Says Neil Jesani, CEO of BeamaLife.com and a Certified Financial Planner professional: "Ms. Orman is brilliant and a knowledgeable advisor as far as credit matters, budgeting, savings, investments, and asset allocations are concerned, but her "one-size-fits-all" advice of buying term insurance is amazingly naïve and could prove to be very expensive to the next generation of Americans".
Ms. Orman´s website, as well as her insurance kit, books and on-air show advise average Americans to buy term life insurance and condemn the other life insurance plans. Jesani continued, "The various types of life insurance (term life, whole life, universal life, and variable universal life) are like medicines in a pharmacy. Each medicine has its pros and cons, and no one medicine is good for everyone. It depends on the patients and doctors; advising everyone to buy term insurance is an ill-conceived strategy, as it creates a circle of poorly planned financial strategy on the part of most Americans."
A combination of Permanent and Term insurance products are better for the average American than term products alone. In the short span, the right amount of life insurance is more important than what kind of insurance, but over the longer time frame, the kind of life insurance (term or permanent) will matter the most. According to life insurance industry estimates, only 1% of term policies convert into death claims; for permanent policies, more than 35% end in death claims. Life insurance is the most under-recognized and least understood financial tool that offers fine tax advantages and great opportunities to create wealth for the next generation. According to the 2007 Annual Individual Life Insurance Sales Survey by LIMRA, 54% of individual life insurance policies purchased were permanent (37% whole life, 13% universal, and 4% variable universal life) while 46% were term policies.
Having served thousands of clients through Beamalife.com, Jesani asserts that advising Americans to buy term insurance is the biggest disservice to the next generation of Americans, as it is very unlikely that the insured will die during their term coverage and pass on the death claims to the next generation. Based on the viewer profile of the show, audience demographics and the target audience, affluent Americans are getting their financial advice from their planners, not from Suze Orman. End results: They end up taking advantage of the tremendous tax benefits of permanent policies while they are alive and passing on sizeable death claims to their beneficiaries without paying any taxes by structuring the policy in the correct manner. There are numerous real case scenarios to substantiate these accounts. Famous retailer J.C. Penney borrowed from his life insurance policies to help meet the company payroll following the 1929 stock market crash. In 1953, Walt Disney borrowed from his life insurance, sold his vacation home, and borrowed money from employees to fund Disneyland, his first theme park. And according to a New York Times article on July 28, 2002, Henry R. Silverman, CEO of Cendent, paid $3,653,365 for the annual premium on his policy in 2001, and Martha Stewart paid $1,174,069 for her 2001 annual premium. It´s a safe bet these are not term policies.
About Beamalife.com
BeamaLife is a privately held, rapidly growing online nationwide life insurance brokerage firm licensed in all 50 states. BeamaLife is doing for the life insurance Industry what Expedia has done for the travel industry. While leading the evolution of the life insurance industry into the E-commerce environment, BeamaLife's mission is to educate the general consumer, dispel the myths surrounding the insurance industry and help all educated consumers secure their family's future through proper financial planning and life insurance protection. Please visit www.BeamaLife.com for further information.
About Neil Jesani
Neil Jesani is the President & CEO of BeamaLife.com. He is also a Certified Financial Planner and recognized by the Consumers' Research Council of America as one of "America's Top Financial Planners". Mr. Jesani contributes articles and financial advice to the top publications within the financial and Indian communities. He has been a guest on several television programs providing sound business and financial advice and is passionate about helping individual consumers and business owners understand the complex and challenging world of Life Insurance and Financial Planning.
Media Contact:
Neil Jesani, CFP®
BeamaLife.com
Neil.Jesani@BeamaLife.com
(732) 465-0065 Ext. 20
Ms. Orman´s website, as well as her insurance kit, books and on-air show advise average Americans to buy term life insurance and condemn the other life insurance plans. Jesani continued, "The various types of life insurance (term life, whole life, universal life, and variable universal life) are like medicines in a pharmacy. Each medicine has its pros and cons, and no one medicine is good for everyone. It depends on the patients and doctors; advising everyone to buy term insurance is an ill-conceived strategy, as it creates a circle of poorly planned financial strategy on the part of most Americans."
A combination of Permanent and Term insurance products are better for the average American than term products alone. In the short span, the right amount of life insurance is more important than what kind of insurance, but over the longer time frame, the kind of life insurance (term or permanent) will matter the most. According to life insurance industry estimates, only 1% of term policies convert into death claims; for permanent policies, more than 35% end in death claims. Life insurance is the most under-recognized and least understood financial tool that offers fine tax advantages and great opportunities to create wealth for the next generation. According to the 2007 Annual Individual Life Insurance Sales Survey by LIMRA, 54% of individual life insurance policies purchased were permanent (37% whole life, 13% universal, and 4% variable universal life) while 46% were term policies.
Having served thousands of clients through Beamalife.com, Jesani asserts that advising Americans to buy term insurance is the biggest disservice to the next generation of Americans, as it is very unlikely that the insured will die during their term coverage and pass on the death claims to the next generation. Based on the viewer profile of the show, audience demographics and the target audience, affluent Americans are getting their financial advice from their planners, not from Suze Orman. End results: They end up taking advantage of the tremendous tax benefits of permanent policies while they are alive and passing on sizeable death claims to their beneficiaries without paying any taxes by structuring the policy in the correct manner. There are numerous real case scenarios to substantiate these accounts. Famous retailer J.C. Penney borrowed from his life insurance policies to help meet the company payroll following the 1929 stock market crash. In 1953, Walt Disney borrowed from his life insurance, sold his vacation home, and borrowed money from employees to fund Disneyland, his first theme park. And according to a New York Times article on July 28, 2002, Henry R. Silverman, CEO of Cendent, paid $3,653,365 for the annual premium on his policy in 2001, and Martha Stewart paid $1,174,069 for her 2001 annual premium. It´s a safe bet these are not term policies.
About Beamalife.com
BeamaLife is a privately held, rapidly growing online nationwide life insurance brokerage firm licensed in all 50 states. BeamaLife is doing for the life insurance Industry what Expedia has done for the travel industry. While leading the evolution of the life insurance industry into the E-commerce environment, BeamaLife's mission is to educate the general consumer, dispel the myths surrounding the insurance industry and help all educated consumers secure their family's future through proper financial planning and life insurance protection. Please visit www.BeamaLife.com for further information.
About Neil Jesani
Neil Jesani is the President & CEO of BeamaLife.com. He is also a Certified Financial Planner and recognized by the Consumers' Research Council of America as one of "America's Top Financial Planners". Mr. Jesani contributes articles and financial advice to the top publications within the financial and Indian communities. He has been a guest on several television programs providing sound business and financial advice and is passionate about helping individual consumers and business owners understand the complex and challenging world of Life Insurance and Financial Planning.
Media Contact:
Neil Jesani, CFP®
BeamaLife.com
Neil.Jesani@BeamaLife.com
(732) 465-0065 Ext. 20
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