Life’s Risks




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Course Overview

  The course titled “Life’s Risks” looks at the multiple types of insurance used to insure an individual from birth to death.




Course Schedule




Chapter 1

Insuring from the Beginning

The first chapter, Insuring from the Beginning, looks at how insurance treats pregnancy coverage, including Medicaid coverage. The ACA is mentioned, although not in the depth that it is covered in a later chapter.

Chapter 2

Recognizing Life’s Risks

The second chapter, Recognizing Life’s Risks, looks at insurance following birth.  Critical Illness Insurance is covered, looking at both positive and negative aspects of this type of coverage.  Life insurance on the very young is looked at, with the opposing views this brings. 


College plans, such as the 529 College Savings Plans, are discussed briefly since any aspect of financial planning also affects insurance.  Buying insurance is specifically linked to financial planning.  That is why people buy life insurance to protect their families, home and auto to protect their possessions, and so on.  It is not possible to separate insurance products from financial planning.  Some products, such as long-term care insurance, is specifically purchased for financial planning reasons.


Sport insurance and group events coverage is also looked at as one of life’s risks.  Parents buy sport insurance for their children as they participate in school sports, but group events may also mean that some type of insurance product was purchased for the spectators, as well as participants. Many people buy insurance to cover a wedding event in case it must be canceled or is affected by other issues.  In fact, wedding insurance is one of the fastest growing types of insurance being purchased today.  We also look at travel and trip cancellation insurance.


A newly recognized area of insurance involves credit card coverage and its relationship to travel accident insurance.  Many credit cards advertise this perk that comes with credit cards, but few people actually understand how it works.  Terrorism is also linked to travel insurance, often as an exclusion.  One aspect of terrorism insurance relates to how terrorism is defined.  Many acts of violence are not termed terrorism even though it might feel like it to the victims.  Agents that understand how insurance is affected by terrorism are better able to discuss the topic and recommend products effectively.

Chapter 3

Life Insurance

 Chapter three looks at life insurance.  Life insurance is considered the ‘old man’ of the insurance world but that does not always mean that consumers and agents completely understand it. Since it is the agent’s job to understand the product, not the consumer’s, agents must make sure they present the products in a way that is understandable.  No matter how knowledgeable an agent may be, if he or she cannot effectively communicate the benefits and exclusions of the product, then consumers are left short-changed.  All types of life insurance are covered in this chapter, with emphasis on effective communication with clients.


The chapter looks at how insurers measure risk when underwriting applications.  While consumers may not need this information, agents must have it.  Otherwise, they cannot effectively recommend products that will be issued.  We also look at specific aspects of life insurance contracts, such as incontestable clauses, dividends and other aspects of life insurance that are often not discussed. Key person insurance is discussed as well as small company exposures and how that might affect consumers.

Chapter 4

Health Insurance

The 4th chapter is on health insurance.  This has been a hot topic since the passage of the Patient Protection and Affordable Care Act.  It has been difficult to include it in continuing education courses since there is so much disagreement over whether or not it benefits Americans.  Many states have opposed being forced into it and Americans have been confused regarding benefits.  We lay out the Act from passage to current with a short easy version of how it works.


No chapter on health insurance would be complete without looking at long-term care products, commonly referred to as nursing home insurance.  While it does cover the nursing home, it is really much more than that since it also covers home care, assisted living care, and other features of growing old. We look at what can be expected from Medicare but more importantly, what Medicare does not cover.  Private policy benefits are discussed, including qualifications to receive home care. This section is specifically aimed at helping agents understand what recommendations will improve the lives of their clients and which features may not be as valuable.

Chapter 5

Disability Insurance

The 5th chapter covers disability insurance, which is perhaps the most undersold type of insurance in the marketplace.  The chapter points out that an adult is much more likely to become disabled than they are to die, yet life insurance by far outsells disability insurance.  Consumers simply are not aware of the risks because agents do not seem to be aware of them.  The chapter looks at the important terminology that can mean the difference between an average product and a superior product.  The course looks at why insurers seldom, if ever, offer 100% income replacement (the goal is to return the person to work rather than encourage malingering). We look at the different between total and partial disability and how these definitions affect benefit payouts.

Chapter 6

Auto Insurance

Chapter six covers automobile insurance. The chapter does cover the routine aspects of automobile insurance but it also covers much more than that. Some agents might believe they already know everything there is to know about this subject, but they are wrong. One of the newest developments has to do with legalized marijuana.  Even though it is still illegal federally, it is likely that more states will approve recreational use.  Additionally, nearly all states recognize medical marijuana use. Insurers have already recognized the effect it could have on their risk level and are developing special guidelines and encouraging states to do so as well.


The chapter looks at how premium rates are affected by many different factors, including our current focus on telephone use and texting while driving.  Distracted driving is a term commonly used today since it affects automobile policies. Texting while driving has been compared to reckless driving; we are likely to see some future changes to address this.

Chapter 7

Homeowner’s Insurance

Chapter seven is on homeowner’s insurance. While it covers the basics it also looks at a new problem: assignment of benefits.  It is likely that few agents are aware of this practice and how it is affecting insurers and claims that are filed.  It is a topic they need to be aware of.

Chapter 8


Chapter eight is on annuities: an oldie, but goodie.  Annuities have been around far longer than most people realize. Most agents know what annuities are and basically how they work.  In fact, many agents probably own one or more of them.  What they may not be aware of is how some payout options delete the use of beneficiaries, making the insurer essentially the beneficiary (lifetime payout options).  Without the knowledge of how payout options and other features work it is not possible for agents to make adequate recommendations.  Many states now require specific annuity education for this reason: they realize that well-meaning agents can make potentially devastating recommendation errors.


We are seeing advertisements now about using annuities to stagger payouts to create a longer, more effective income stream but few agents are familiar with this strategy.  Whether they agree with it or not, agents must understand the concept.  Many agents may not realize that annuities are either fixed or variable and all others are merely a sub-category.  This is discussed in detail.

Chapter 9

Anti-Money Laundering

Chapter 9 looks at anti-money laundering.  Anti-money laundering may seem like an old topic, but crime is never ‘old.’  It merely recreates itself into new strategies that the perpetrators hope will be effective.  Insurance agents must always be aware of these types of crime because insurance is so often used for illegal gains.  Unaware agents may easily fall victim to the schemes.  All aspects of anti-money laundering is discussed and, in fact, this chapter qualifies for the required education on the subject.

Chapter 10

Identity Theft Insurance

Chapter 10 looks at identify theft.  Identity theft is growing and insurers are presenting policies to protect against it.  Anytime a policy covers a risk, definitions come with it.  We look at how identity theft is defined and how policies are used in relation to it.


Many consumers do not realize that identity theft often attacks home ownership.  When sufficient information is obtained it can be possible to remove all equity from someone else’s home, leaving them now owing for the full price all over again.  The chapter looks briefly at the Identity Theft and Assumption Deterrence Act of 1998 and how that law affects this.  Finally, we show a sample policy for identity theft.  While policies can vary, this provides a basic example.

Chapter 11

Debt Affects Insurance

Chapter 11 looks at a topic few people recognize: debt affects insurance.  Even agents often do not recognize that high debt affects insurance as well as other aspects of life.  Some states have prohibited issuing some types of insurance based, in part, on a person’s debt level but high debt still affects their insurance options. High debt even affects the individual’s ability to afford coverage. Bare minimums in auto insurance, for example, may be purchased rather than the level of coverage desired.  Debt affects the availability and the cost of insurance.

Chapter 12

Employment Practices Liability Insurance

Chapter 12 is on Employment Practices Liability Insurance.  Only business owners may realize the risks involved in the hiring process, but it certainly exists.  Agents who market products to businesses are wise to bring this risk up and emphasize the growing need for it as lawsuits continue to climb.  Whether the lawsuit is on negligent hiring practices or mistakes during an interview, the risk will only get larger as time goes by.


Chapter 13

Ethical Insurance Practices

The final chapter is on Ethical Insurance Practices, or plainly stated: how to be moral in an immoral world.  Agents are held to a higher standard than many other people; agents can help or harm consumers.  A fully educated agent can help reduce risk and insure a fully funded retirement for their clients.  A poorly educated agent, no matter how well-meaning, can cause great financial harm.


While there are always a few agents who will never give importance to their profession or their level of competence, most agents want to perform well.  Most agents want to improve the lives of their clients.  Therefore, our ethics chapter focuses on the aspects of the profession that agents can improve on.  Ethics are important for all careers but especially those that involve financial planning as insurance most definitely does.  We look at why the states mandate education and why agents must not consider it a chore but rather as a way to improve their personal performance.


This chapter also considers the legal side of ethics.  We look at the types of law that determines when an agent has not performed to expectations and what doing so might mean personally to them.  We discuss insurer ratings and how agents can use them to provide the best products available.


This chapter discusses goal-setting from an ethical standpoint. We point out that professional responsibility is really just another word for accountability.  Each agent is accountable for their actions, good and bad.  We use multiple examples of ‘good’ versus ‘bad’ agent conduct in the sales field, with the goal of demonstrating the right and ethical way of performing his or her job.  We demonstrate that being ethical does not mean low earnings; in fact, very ethical people are often at the top of the pay scale.


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