ABA Journal

Going from ripping people off as lawyers to ripping them as insurance agents!!

By Rip It on 2010 03 19, 10:55 am CDT

re#1, appreciate you sentiments, but the insurance industry is better regulated than the legal profession, so the consumer is better protected from bad lawyers.

The insurance industry also appears better regulated than either the banking or securities industries, which accounts for this:

“Whole life insurance declined in popularity in the 1980s, when many consumers decided to buy cheaper term life and invested the difference in mutual funds and stocks. But when stocks declined, investors lost out while those who bought whole life found their money was still there, the story says.”

Whole life insurance may be a staid, boring investment, but it can be relied upon in a way that stocks and mutual funds cannot.

By fed up on 2010 03 19, 11:51 am CDT

Depends on the insurer and its reinsurers.  I would not want to be holding a whole life policy issued by, say, AIG or one of its hundreds of affiliated entities if Uncle Sam hadn’t come to its rescue after the Crash of 2008.

When an ancestor of mine got off the boat at Ellis Island, his first job was as a spear carrier at the Metropolitan Opera.  His next and last job for the rest of his working life was a life insurance agent for a large insurer.  He would have preferred law school but couldn’t afford it.  This article would have had him rolling on the floor with laughter.

By AndytheLawyer on 2010 03 19, 6:27 pm CDT

re#3, right, that was AIG’s London Financial Products Division that sold credit protection in the form of credit default swaps (CDSs) on collateralized debt obligations (CDOs) that had declined in value. Those exotic products brought the rest of the company down and show the need for a firewall between unrelated businesses like AIG’s life insurance business.

By fed up on 2010 03 20, 5:46 am CDT