Interest in life
insurance on the
rise locally

The September attacks have
inspired a re-evaluation
of family coverage

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By Lyn Danninger
ldanninger@starbulletin.com

As consumers re-evaluate their priorities in the wake of Sept. 11, more are making room in their budgets for increased life insurance, insurance companies say.

In Hawaii, local life insurers have seen an upswing in both policy purchases and inquiries.

"We've had more phone calls and more interest from people we meet with," said Mike Taylor, senior vice president and general manager of First Hawaiian Insurance, a subsidiary of First Hawaiian Bank.

It's been the same at Bank of Hawaii, said Carole Tang, spokeswoman for the bank.

"We've seen an increase in the number of inquiries and policies sold," she said.

Those with existing life insurance policies are now coming in to either update information or check to see whether they are carrying adequate coverage, First Hawaiian's Taylor said.

People who have had a policy for a long time often fail to update information when circumstances change.

"Frequently people don't even have their beneficiary designations correct," he said.

Moreover, many found they were not carrying adequate life insurance to cover things like a mortgage and provide an income for dependents should the unthinkable happen.

"Too many people still have the $10,000 policy their father bought for them," said said Bob Corboy, senior agent with New York Life Insurance Co.

Taylor said he has already met with a number of clients who have yet to do any kind of estate planning, such as drawing up a will or a trust. Many people mistakenly rely on the group life insurance that their employer provides.

But that's frequently inadequate, Taylor said. Often the value of the policy may only equal an annual salary.

"To me, it's imprudent to count on just the employer's policy," Taylor said.

While a year's salary is not bad, the employer controls the policy and when the person resigns from the company the policy does not follow, he said.

But since Sept. 11 people are now concerned about the details of existing policies or about not having coverage. Insurers are receiving calls to update policies and are fielding inquires about adding coverage or taking out a new policy.

If there can be said to be a positive effect from the events of Sept. 11, Taylor believes it is that many people now realize how important family is.

"It's caused people to realize that family is important and they need to make sure they are protected if something happens," he said.

The industry also received a boost as life insurers were seen to pay out promptly on catastrophic claims related to the events of Sept. 11, said New York Life's Corboy.

For example, Corboy said his company paid out hundreds of claims in New York, many within 5 days of the attacks.

Many of the claims were also paid without death certificates, something that would normally be an absolute requirement for an insurer. "I think, too, the fact that life insurers paid so quickly and honorably really helped," he said.