If you live in or plan to relocate to Florida, you’ll want to understand how the state affects your life insurance picture.
Florida has the fourth largest population in the United States. Every day, a thousand more people pack up their things and move to Florida, a state known for its mild winters, beautiful beaches, and recreational activities. The life insurance industry in Florida is there to support the long-term financial goals of the 19 million people that call Florida home. There are more than 700 companies licensed to sell life insurance in Florida. With so many companies competing for your business, you should be able to find an affordable life insurance policy that provides the financial security your loved ones will need after your death.
Types of life insurance in Florida
Residents of Florida have access to pretty much any life insurance policy that is sold in the United States. There are a variety policies to choose from that can be tailored to suit each individual’s needs.
Types of life insurance policies sold in Florida are:
- Permanent life insurance
- Whole life
- Universal life
- Variable life
- Variable universal
- Term life insurance
- Annual renewable term
- Level premium term
The best life insurance policy for you and how much you will pay for it depends on several different factors, like how much coverage you want and how long you want your policy to last. To read more about the differences between each policy, visit Types of Life Insurance Policies. If you would like help determining how much life insurance coverage you need, visit The Right Amount of Life Insurance Coverage.
Marriage, families and life insurance in Florida
Right about the time you settle down and start a family, you may start worrying about what will happen to your family should you die unexpectedly. Life insurance is a great way to provide your spouse and children with financial security for years after you are gone.
Over 100,000 Florida residents get married each year. In Florida, the average age a woman walks down the aisle for the first time is 27. Men in Florida get married for the first time at an average age of 29 years-old, which ranks 11th highest in the United States.
In 2009, the US Census Bureau reported that 221,391 babies were born in Florida. Their parents had at least one more reason to consider purchasing or updating their life insurance policies. According to the US Department of Agriculture, it will cost Americans over $200,000 to raise a child born in 2012 to the age of 18. And that does not even include college. Life insurance would be an incredible help to any parents who may struggle with the financial burden of raising a child in Florida on their own.
Florida’s cost of living
The cost of living in Florida is the 28th highest in the United States. Some cities in Florida have a higher cost of living than others. A few of the more expensive areas are West Palm Beach-Boca Raton, Fort Lauderdale, and Miami.
Some of your regular expenses that determine the cost of living in Florida are:
- Housing (rent or mortgage)
- Health care
The median income for a family in Florida is around $47,000. A family is defined by the census as any individuals in a household over the age of 15 who earn income. There are many states that have a higher median family income than Florida. But Florida does not have a state income tax, which means the state does not take out a portion of the income you earn. That is part of the reason Florida is such a popular place for retired people because less money is taken out of their fixed income. Having a smaller tax burden gives residents in Florida more money each month to put towards other things, like a life insurance premium.
Because Florida can be an expensive place to live, life insurance policies can be an important part of your long term financial planning and investment strategy. The proceeds from your life insurance policy can help your dependents afford to continue living a similar lifestyle in Florida after your death.
The cost of funerals in Florida
According to the National Funeral Directors Association (NFDA), the average funeral costs around $7,000. And this does not include things like cemetery costs, headstones, or flowers, which you may want to have at your funeral.
Here is a breakdown of basic funeral costs according to NFDA:
- Service fee $1,975
- Transferring remains to funeral home $285
- Embalming $695
- Any other preparation of body $225
- Facilities and staff for viewing $400
- Facilities and staff for ceremony $495
- Hearse $295
- Service car for transportation $130
- Printed materials for memorial $150
- Casket $2,395
If you do not have money set aside to cover your funeral costs, then your surviving family members or friends will have to quickly come up with the money during a difficult time. Life insurance proceeds, which are usually paid right after the life insurance company receives the proper paperwork, can be a great way to ensure your funeral costs are covered. Make sure to add in how much you think your funeral will cost when calculating how much life insurance coverage you need.
Consumer debt and how it impacts life insurance in Florida
Florida residents carry a significant amount of debt, much like the rest of the country. The average credit card debt carried by a Florida resident is around $6,600, which is slightly above the national average. Other causes of debt for Florida residents are home mortgages, car loans, and student loans.
It is important to realize that after you die, your debts do not disappear. Someone, most likely your spouse or your family members, will be held responsible. Proceeds from your life insurance policy can be used to pay off your outstanding bills. Having enough life insurance coverage can prevent your family members from dealing with added financial stress as they try to settle the debts that you leave behind.
Common causes of death for Florida residents
The Florida Health Department reported that 175,849 residents died in 2012. The leading causes of death in Florida are heart disease and cancer, similar to the rest of the country.
Some of the other causes of death in Florida are:
- Alzheimer’s disease
- Influenza and pneumonia
- Kidney disease
- Accidents (falls, car, etc.)
- Alcohol-induced causes
- Drug-induced causes
The average life expectancy in Florida
How long you are expected to live, or your life expectancy, is one of the things that life insurance companies consider when determining how much to charge you for coverage. Certain factors impact your life expectancy, like your health, your career, and your habits. These are things that life insurance companies will ask you when you fill out your application.
The state where you live can also have a big impact on how long you live. In Florida, the average life expectancy is 79 years. Life insurance companies may consider the health and life expectancy of people in the state where you live when setting your life insurance rate.
Factors in your state that can increase your life expectancy are:
- Easy access to quality health care (doctors and hospitals).
- A health care system that focuses on preventative health care, like vaccines and screenings.
- A safe and healthy living environment.
- Positive behaviors, like exercise, a healthy diet, and not smoking, are encouraged by the community where you live.
Life insurance companies consider all sorts of things when setting your life insurance rate. If you want to ensure the best possible rate for your life insurance policy, it is important to do things that increase your life expectancy and stop doing things, like smoking, that might decrease your life expectancy.
How smoking can influence your life insurance rate in Florida
Smoking can have a huge impact on your life insurance rate. If you smoke, you may be charged up to four times more for the same amount of life insurance coverage as a similar person who does not smoke.
In Florida, the number of smokers is slightly below that national average. The Centers for Disease Control and Prevention (CDC) reported that in 2011 almost 20% of Florida residents over that age of 18 smoked cigarettes. 3% of adults in Florida used tobacco products, which was the 14th lowest percentage in the United States.
The CDC also reported that at least half of Florida’s population made an attempt to quit in the previous year. There are many reasons to quit smoking, like improving your overall health. Another benefit is qualifying for a lower life insurance rate. Visit Life Insurance for Smokers to read more about why smoking can increase your life insurance rate.
Chronic conditions in Florida
Many Florida residents suffer from one or more chronic conditions. Not only are chronic conditions difficult to deal with, but they can also have a negative impact on your life insurance rate.
Some of the chronic conditions that affect Florida residents are:
- Alzheimer’s disease
- Chronic lower respiratory disease
- Heart disease
- Chronic liver disease
- Kidney disease
- Peptic ulcers
If your chronic conditions can be easily managed with medicine and a healthy lifestyle, it will probably not increase your life insurance rate very much. But there are more serious conditions that impact your overall health and your life expectancy. Someone who suffers from a more serious chronic condition will most likely be charged more for life insurance than a similar person without any chronic conditions. To read more about other conditions that can impact your rate, visit Life Insurance for People with Special Conditions.
Life insurance for senior citizens in Florida
Florida has been a popular place for people to retire for many years. The weather, the variety of senior-focused housing options, and the fact that there is no state income tax attracts senior citizens who want to make the most of their retirement years and their retirement funds.
The percentage of Florida residents that are 65 are over is well above the national average. While most people purchase life insurance policies when they are younger, older residents of Florida may find themselves in the market for a new life insurance policy. The proceeds from their life insurance policies can be used to cover funeral expenses or to support an ailing spouse who may struggle to live alone on a fixed income. There are many reasons a senior citizen may purchase life insurance later in life. For more information, visit Life Insurance for Seniors Citizens.
The rights and responsibilities of Florida residents who buy life insurance
The Florida Department of Financial Services publishes a guide to help residents understand life insurance and what their rights and responsibilities are when purchasing life insurance in Florida. The rights outlined in the guide are enforced by law to protect both consumers and the life insurance companies in Florida.
Some of the rights of Florida residents who purchase life insurance are:
- To receive a summary of your policy from your life insurance company or agent that includes a “Cost Index” and a “Buyer’s Guide to Life Insurance.” This is for all types of life insurance policies, except for variable life policies.
- To receive a “free look” period that lasts at least 14 days, during which you can cancel your policy by certified mail and receive a full refund of the premiums you have paid to date.
- To have a 30 day grace period, during which you can pay any overdue premiums without having your life insurance policy canceled.
- To receive a prospectus if you are purchasing a variable life insurance policy that clearly explains how and where your money will be invested.
Some of the responsibilities of Florida residents who purchase life insurance are:
- Evaluate your needs and find a life insurance company and a policy that can meet those needs.
- Get quotes from more than one life insurance company in Florida so you can compare rates and get the best price for the coverage you need.
- Review the surrender charges, which are what you will have to pay if you terminate your policy early.
- Make sure that the life insurance company selling you a policy is licensed in Florida.
- Read your policy carefully and ask questions if there is anything that you do not understand.
- Keep a copy of your life insurance policy in a safe place, like a safety deposit box.
- Tell your beneficiary about the life insurance policy you purchase.
- Review your life insurance policy amount once a year to make sure it still meets your needs.
- Be completely honest on your application.
Life Insurance Resources for Florida Residents
Florida Office of Insurance Regulation:
A government organization that helps protect consumers and the life insurance industry in Florida. The division of consumer services takes complaints and provides information for people that have questions about life insurance in Florida.
Florida Life & Health Insurance Guaranty Association:
A organization in Florida that was established in 1979 to provide protection if your life insurance company goes out of business and is unable to pay the debts it owes. After a member of the association is ordered by the courts to liquidate, the other members, other life insurance companies, will help to transition your policy or find the appropriate solution for your situation.
Resourceshttp://www.cdc.gov/nchs/data/nvsr/nvsr58/nvsr58_25.htm http://www.prb.org/DataFinder/Topic/Rankings.aspx?ind=133 http://www.prb.org/DataFinder/Topic/Rankings.aspx?ind=136 https://www.census.gov/compendia/statab/2012/tables/12s0082.pdf http://cost-of-living.findthebest.com/d/d/Florida http://quickfacts.census.gov/qfd/states/12000.html http://nfda.org/about-funeral-service-/trends-and-statistics.html#fcosts http://www.debt.org/faqs/americans-in-debt/consumer-florida http://www.floridacharts.com/FLQUERY/Death/DeathCount.aspx http://www.medicalnewstoday.com/articles/263659.php http://www.cdc.gov/tobacco/data_statistics/state_data/state_highlights/2012/pdfs/states/florida.pdf