Weird insurance

Kiplinger's Personal Finance Magazine, Oct, 1998 by Kimberly Lankford

Chubb's TravelSafe policy (888-885-7233) will reimburse you for nonrefundable deposits if you cancel your trip or leave early because you've been subpoenaed, your plane is hijacked or you're quarantined (also if you or an immediate family member gets sick or has an accident). The policy also pays for emergency medical transportation and provides $25,000 in accidental-death insurance. The price is based on the cost of the trip: $59 for a $501 to $1,000 trip; $241 for a $4,000 to $4,500 trip.

Weird Life Insurance

Indianapolis life's runner's edge policy gives fast runners discounts off their term life insurance policies. Just send the company your certified race time for an event that's 5K or longer and you'll get up to a 15% discount, depending on the distance, your time, your age and your gender.

But the term policies are expensive and the discounts small, even if you're one of the world's top runners. For example, Moses Tanui's winning 1998 Boston Marathon time of 2 hours 7 minutes and 34 seconds would garner him only a $26 discount off Indianapolis Life's $250,000 15-year level-term policy, bringing his annual premium down to $206. That discount would last for four years; if Tanui had stopped running marathons by then, the price would rise back up to $232 per year. (He could buy a $250,000 15-year level-term policy from CNA and pay only $175 per year no matter what happened to his running career.)

Then there's expensive insurance with weird commercials. Gerber, the baby-food company, sells life insurance for senior citizens? If you watch a lot of late-night TV, you'll see Gerber's ads targeted at term-life-averse seniors concerned about having enough insurance to cover burial costs. For $27.40 per month, a 60-year-old can buy $5,000 worth of cash-value insurance, regardless of health.

But that's a crummy deal. If you live for more than 15 years, the $5,000 death benefit will be less than the amount paid in. If you live to age 90, for example, you will have paid $9,864 in premiums but have only a $5,000 death benefit. Even if you're in bad health, you'd do better putting the money under your mattress.