Clark recently received a report from a life insurance insider which contained info that just tore the industry apart.

The insurance industry is one in which bad apples exist right alongside the good apples. Ultimately, however, this is an industry that would not exist if not for a real need. For some families, a life insurance policy can mean the difference between poverty and financial survival. Still, Clark wants to alert you to some dangers.

Much like full-commission stockbrokers, insurance salespeople are exempt from what's called "fiduciary responsibility." Fiduciary responsibility simply means your interests must be put first in all business dealings...and sadly they're not required to do that.

Let's say you go to a full-commission stock brokerage. They're allowed to do what helps them first as long as the investment they put you in is generally "suitable." So if, for example, it would be great for you to own a stock fund, the full-commission broker can pick the most expensive, lowest-performing stock fund for you if it earns them a bigger commission. Even if that investment financially harms you!

When it comes to life insurance, 98% of us would be well-served with a plain simple level term insurance policy. But in huge numbers, we're pushed to buy whole life. Why? Because it has huge commissions vs. the tiny commissions on level term insurance.

Remember, the insurance salespeople are not held to fiduciary standards, no matter how nice and charming they may seem.

Are you considering selling your life insurance policy to score some quick cash? The world of death futures contracts (aka viaticals or life settlements) is fraught with dangers.

Let's say you have a $100,000 policy. Your insurer may quote the cash value of your policy as only $5,000 if you were to turn it in. But someone in the free market may offer you $15,000 or $20,000 if you sign over your rights to them.

The company or person you sell to pays your premiums and hopes you die in a hurry! But your heirs won't get any payment upon your death. It will all go to the new policyholder.

For investors, death futures are pitched as a way to earn a great return on your money. But one word of caution. There are untold numbers of scams in this field, and there's no way to be certain you're dealing with legit players.

In summary, here are some key pointers to remember:

• If you have a policy, start by finding out the cash value of your policy from your insurance company.

• If you want to sell it in the free market, be sure to get quotes from multiple companies who buy life insurance policies. The quotes will likely be all over the board.

• There may be tax consequences in taking a payout.

• Beware of the Larry King phenomenon, where the media personality sold his policy and is now worried he'll be knocked off for the proceeds. Don't sell your policy if you're subject to paranoia.

The relative health of insurance companies has created a unique market climate that can mean big savings on your life insurance policy.

Those insurers who are weak because they put policyholder dollars at risk in bad investments are raising their premiums. Yet others who are healthy are actually offering real deals.

The irony is this is completely reversed from the historical pattern. In the past, weak insurers typically offered the cheapest premiums and it got more expensive as you shopped stronger companies. Today, however, it's haphazard and that traditional wisdom may not hold.

The Wall Street Journal reports one person was looking for a life insurance policy at 56. The customer was able to get a premium quote for the same coverage that was half of the initial quote from another company. That's a big savings!

Higher quality companies may offer lower premiums because of today's unique market conditions! So it's more important than ever to shop your life insurance far and wide.

Remember, the best option for most people is term insurance -- a plain vanilla policy that you buy for a set number of years where the premium stays the same over those years. The goal of this insurance is to replace your income. So you might buy it until your children are grown or until you reach retirement age, for example.

More and more people who are elderly or ill are selling their life insurance policies to death future contracts companies (aka life settlements) to score some quick cash.

Let's say you have a $100,000 policy. Someone may offer you $30,000 or $40,000 if you sign over your rights to a policy that would otherwise eventually pay out to your heirs.

Is this a good deal? Usually not. Think about it, you're taking pennies on the dollar for a policy you may have had for years. It will also likely create an additional tax burden for you.

The only time you should consider doing a life settlement is if you are out of all sources of income and have no survivors who need the money. But even then, you'll want to shop the market to make sure you're getting the best deal.

What happens when a life insurer fails? Clark has addressed this issue before and created some panic among listeners…so he's going to tread gently on the topic again!

First off, there's no FDIC for failing insurance companies. Insurers have historically been regulated at the state level. So each state has its own state guaranty association that handles paying out money to people in the event of an insurer failure.

Most states have coverage levels of somewhere between $100,000 to $300,000 for individual policyholders. NOLHGA.com can help determine the level of protection your state affords.

However, there is one caution about state guaranty associations. The associations will not have enough money on hand to make everyone whole in the event of a failure. So there may be an indeterminate waiting period until you get your money.

But remember, once again, most insurers won't fail.

The greatest warning here is for those buying insurance. Clark recommends only buying from insurers that are rated A++ or A+ by A.M. Best. In addition, you may also want to buy multiple policies instead of just one. That way you can ensure that each policy does not exceed your state's limits.

Well, another day and another federal bailout.

For weeks now, Clark has been warning you about difficulties in the life insurance industry. Just yesterday, with great reluctance, he singled out one troubled life insurer named Lincoln National on the air.

The consumer champ never wants to be a part of the problem, but his duty is to you as a listener to make sure you know how to protect yourself.

The insurance industry has long been regulated by the states. But it became clear that state guarantee funds would not be adequate to handle the insolvency of large providers. So the feds coughed up additional taxpayer money.

Wow, who would have ever thought you'd need insurance for your insurance?!

Hartford Financial Services, Genworth (a GE spinoff), Lincoln National and Prudential are among those insurance giants lining up at the taxpayer trough. A rumored fifth one -- Met Life -- will not comment on whether they're seeking federal rescue funds or not.

So what exactly happened to bring us to this sorry state? Two things, actually.

First, insurance companies made promises to policy holders (in the form of variable annuities) that they couldn't keep. Their risk projection models did not account for the significant decline in the stock market.

Second, the investments that they put policyholders' money into tanked -- just like your own investments over the past few years.

One bright note here: Some of the largest insurers are rock solid and need no bailout money. Dow Jones has cited these ones as Northwestern Mutual, Mass Mutual, New York Life and TIAA CREF.

So if Clark made you nervous as a policyholder from any of a number of insurance giants over the past few weeks, you now have nothing to worry about. But as a taxpayer, you're going to be paying for it through the nose.

During the financial tumult of last year, Clark went on the air and named banks that were facing possible failure. He didn't want to be part of the problem at the time, but he did want to arm his listeners with info that could help them protect their assets.

Now he's feeling torn again about circumstances involving giving out info about an ailing insurance giant named Lincoln National.

It's hard to know exactly what will happen with Lincoln and Clark doesn't want to speculate excessively. But there will certainly be other failures of insurers.

So here are some general guidelines that you need to know: Unlike banks, insurance companies are regulated at the state level -- not the federal level. That means there's no equivalent of FDIC coverage; a state guarantee association is the last line of defense in the event an insurer goes bust.

While it varies by state, most states afford a minimum protection of $100,000 for policies. Some states even offer up to $300,000. Unfortunately, with state guarantee associations, there's no clear cut timeline for policyholders about when they'll get their money back.

Here's another tip: If you have whole life insurance, Clark suggests you consider borrowing out your cash value now so you're protected in the event of a failure.

The really tricky part is trying to figure out what to do if you have annuities and you're in a surrender period (usually 7-10 years since inception) where you could be hit with massive fees if you take money out.

In that case, Clark is recommending you sit tight. That way you don't face a certain loss through heavy fees just to avoid the possibility that your insurer may fail.

CLARKONOMICS: Worried about your life insurer? Unlike banks, life insurers are not regulated on the federal level. Rather, there are state guarantee associations that serve as the only line of defense if an insurer goes bust.

But waiting to get your money from a state guarantee association can be a very long process. Contrast that with the FDIC approach: If a bank goes bust today, you get your insured money tomorrow.

When you're vetting potential life insurers, be sure to check AMBest.com for an assessment of their financial ratings. (Free registration is required). Look for those insurers with A++ ratings; anything less than A+ is unacceptable.

If you're changing insurers, do not cancel your existing policy until you pass the medical underwriting for the new policy.

If you are in a whole life policy (sometimes referred to as "permanent insurance") with a substandard company, you can borrow out the cash value and use those proceeds to buy a term policy from a strong company.

One word about variable annuities: Even if the insurer goes bust, the individual contracts should be OK because each contract is a series of holdings of stocks or bonds. And in most states you are covered for about $100,000 in the event an insurer fails.

The biggest risk is fixed annuities where they promise to pay you a set amount of money for a set period of time. If your insurer goes insolvent, that promise won't be kept.

But don't just bail on your annuities unless your insurer is tragically on the ropes. Many annuities have massive fees for early surrender, which is usually considered before 7 or 10 years.

What happens when a life insurer fails? Unlike banks, insurance companies are regulated at the state level -- not the federal level. A state guarantee association is the last line of defense in the event of a failure.

Unfortunately, with state guarantee associations, policyholders are often left waiting and wondering if and when they'll get their money back. There often isn't even a clear-cut timeline about the process, according to Clark.

In the latest example, Shenandoah Life recently failed and is now in receivership after being seized by the state of Virginia.

Clark's longstanding advice is to only buy life insurance or long-term care from insurers that are rated A++ by A.M. Best. Well, Shenandoah Life had a B++ rating!

Don't be tempted by low premiums when you're shopping around. Stick with insurers of top strength -- even if you have to pay more for it.

Finally, there are caps on the protection you can receive under state guarantee associations that vary from $100,000 to $300,000 by state. So if you're going to buy substantial insurance or annuities, be sure to have it split up with different insurers to be proactive about protecting yourself.

When it comes to buying life insurance, would you rather buy from a company that shares its profits with policyholders or with stockholders?

Amica Mutual and USAA are two companies in the auto and home insurance arena that share their profits with policyholders. You can receive a rebate of sorts if they over-collected premiums during the year.

Forbes recently ran a glowing story about mutual life insurance companies. The mutual life insurers are cooperatives similar to Amica and USAA (and to a credit union) that you as a policyholder own.

Three mutual insurers won particular praise in the article -- Northwestern Mutual, Mass Mutual and New York Life. Each one is owned by the policyholders and has an A++ rating from AM Best.

Remember, everything the mutuals do is designed for you the customer; their profits flow back to you instead of stockholders.

The Forbes report was particularly noteworthy because they're known to have a strong anti-coop bias. So you can believe them on this issue! In fact, the stockholder-owned life insurance companies got low marks in the article.

Clark doesn't want to create anxiety, but he does want to let you know that a number of life insurers are on financially shaky ground.

The insurers are being hit with a double whammy. On one hand, they had some commercial real estate investments on their books that went sour. On the other hand, they're required to pay certain holders of variable annuities (who signed a special rider) to make up for any losses incurred in the stock market.

Before you go into panic mode, heed these words of advice. First, know that in most states you're covered up to $300,000 if you have a life insurance policy. If you want to cash out and your insurer has failed, you're covered by state guarantee associations for up to $100,000.

Of course, money in excess of the cap is potentially at risk. So how do you know if your insurer is healthy? Well, if you're buying life insurance, only buy from A++ rated insurers as determined by A.M. Best.

If you're already in a policy and you're insurer rates highly, then you can relax. If not, get in touch with your insurer and explore the ways to reduce your exposure.

Finally, it almost goes without saying that if you're below either of the caps, there's no need to even check because you'll automatically be covered.

Why do you buy home or auto insurance? You do it because if something goes wrong, the insurer is there to make it right -- be it repair your home, fix your car or replace it if stolen.

But some companies only do half the job. They take the premiums, but they aren't vey good about paying out claims. A trial lawyer's group called the American Association for Justice has come with a list of the worst insurers in America.

Topping the list as the single worst insurer is Allstate. This company once enjoyed a great reputation for customer service, but Consumer Reports also concurs in a separate tally that now they're way toward the bottom of the heap. In a J.D. Power survey, Allstate also gets the lowest score of any home insurer.

But this is not a bash on Allstate segment. Clark just wants you to keep in mind that cutesy TV ads do not a good insurer make.

The penny-pincher prefers to concentrate on those insurers that actually do a good job. Such elites typically include USAA and Amica Mutual.

USAA is open only to active military and those who have recently retired from the service. Clark has been a member for 30 years. During that time, his family had 3 claims (none of them major) and each time the service has been phenomenal. Christa, meanwhile, has been with Amica for 2 years now.

There is one other insurer that Clark knows has a great reputation. That's a small company called New Jersey Manufacturers Insurance, which has nosed out both USAA and Amica in some surveys.

Single-issue insurance policies are considered a rip-off by some consumer advocates. Clark also agrees that you should avoid them. Examples of single-issue policies include mortgage life insurance, cancer insurance and accident insurance.

In the case of cancer insurance, insurers use the power of the C-word to sell the policy. Years ago, people wouldn't even utter the word "cancer." They would just say that you had a malignant tumor, because a diagnosis was often considered fatal. But today, many people survive cancer. Insurers, however, have learned that they can still capitalize on people's fear of the disease.

Accident policies are a tremendous rip-off. The reality is that general insurance -- of the life, disability and/or health variety -- represents a better choice.

Mortgage life insurance, meanwhile, is also garbage. The premiums are about 10 times what life insurance should cost. The worst part of it all is that you're insuring the mortgage company, not yourself; mortgage life insurance pays off the lender in the event of your death! But your survivors likely will have more pressing financial needs at that time. That's why plain vanilla term life insurance would suffice in such an instance.

Finally, extended warranties on electronics are another example of single-issue insurance policies that you should avoid. Consumer Reports says that 1 in 5 laptops will fail in the first 5 years. Yet, on the bright side, 80% will go for 5 years without a problem.

Another reason why extended warranties don't make sense is that the laptop or HDTV you buy today will be obsolete in 24 months. You shouldn't insure rapidly depreciating commodities.

Clark has often talked about how free meal seminars offered by annuity salespeople are to be avoided at all costs -- unless you want to get indigestion in your wallet for the rest of your life. An annuity is basically an insurance contract. The money you put in is not taxed until you spend it. Salespeople love to sell them because they get giant commissions. In fact, the commission is so large that it's hard for even a decent person to avoid the temptation of selling this garbage. Now The Wall Street Journal reports that a class action lawsuit has been filed against Allianz. This German-based company has been selling equity index annuities to older people via seminars, infomercials and free-dinner events.

Equity index annuities promise a portion of the gain of the stock market, while assuring holders against losses. They offer the allure of getting money without risk. But Clark thinks they're a piece of trash because all insurance companies cheat you on the gain -- only giving you a tiny portion of the actual gain in return for their guarantee of safety against market loss. Worse still, you usually have to stay in for 15 or more years to get the benefit. So salespeople target senior citizens, who may not live long enough to qualify for the guarantee. And if you are lucky enough to get wise to how bad equity index annuities can be, you may lose between 10 and 15 percent in penalty fees for surrender if you try to get out. Regulators across the country are calling this an instance of fraud. As Clark says, the "just say no" rule applies here to these free meal seminars.

Life insurance has gotten much cheaper over the years, in part because people are living longer. Add into the mix the Internet, which has made it ultra easy to compare prices when shopping for life insurance. The result is that term life insurance costs have dropped by two-thirds in the last 15 years. In the past few years, life insurance has dropped by as much as 60 percent! That’s a great deal! So, if you bought a policy when you were 30 and now you’re 45, you can get a new life insurance policy at a much lower rate than 15 years ago. As long as your health hasn’t declined, you’ll still be able to get great deals. The only purpose for life insurance is replacement of income if you die. So, if you have a wife, a partner or kids, you need it. And, you want to buy 10 times your income. If no one is dependent on you, you don’t need to buy life insurance. Just remember to buy insurance from only top rated companies, which means they have gotten a A++ or an A+ on the ambest.com Web site.

Since Clark’s son Grant was born, he has gotten a lot of solicitations for life insurance on Grant. It pulls on your heartstrings, for sure. But when should you buy life insurance on a child? Never. Life insurance is not for children. It’s for the benefit of children should their parents die. Yet, people still get sucked into these deals. Stay away from these offers if you see any. And consider a 529 plan instead. Saving for a child’s college education is much more useful, both for the young person and for you in regards to taxes.

If you’re thinking about changing up your life insurance policy, Clark strongly suggests that you shop around for term life policies. There are 20-year, 30-year, and 40-year level term policies, plus a few more. Level term means you buy insurance for a set number of years depending on your age and who is in your family. For example, if you have young kids and you want to provide financial security for them until they are adults, you would want a 20-year term policy. If you’re 35 and it’s just you and your spouse, you probably want to provide for the remainder of your spouse's life, if you die. So, you’d probably want a 30-year term. The prices keep getting cheaper because life spans are getting longer. As a result, you’re in a position to buy insurance at a much lower rate. Just make sure that when you’re buying this insurance, you get enough to take care of all your loved ones. Usually, a good bet is 10 times your current income. If you make $100,000 a year, for example, you need a $1 million policy. You can shop online now and compare quotes from several companies. One site Clark likes a lot is insure.com. Just be sure you go with a company that gets either an A+ or an A++ rating from AM Best.

Are you aware of the responsibility you have to protect your family? It’s called life insurance. Now, if you have no family and no one who depends on you, you can stop reading now. But if you have dependents and you have no life insurance, you’re putting your loved ones in a tough spot. Almost half of Americans either have no insurance or are woefully underinsured. So, this being “Life Insurance Awareness Month,” Clark feels compelled to remind you to buy life insurance. What kind of insurance should you buy? Well, you don’t want “permanent insurance” and that is what the salespeople will try and sell you. The three kinds you want to avoid are whole life, variable life and universal life. You want to buy the kind of insurance that is not considered permanent. It’s called “term” insurance and it’s based on the length of time you want to provide for your survivors. Usually ten times your income is the right answer. The good news is that term life insurance is cheaper than it’s been in a long while, so it’s also a deal.

Term life insurance is not the most interesting topic. But Clark has to keep mentioning it because it just keeps getting cheaper! Level term is what it’s usually called, and it means you buy insurance for a set number of years depending on your age. For example, if you have young kids and you want to provide financial security for them until they are adults, you would want a 20-year term policy. If you’re 35 and you want to provide for your remainder of your spouse's life, you might get 30-year term. The prices keep getting cheaper because life spans are getting longer. As a result, you’re in a position to buy insurance at a much lower rate. The Wall Street Journal ran some numbers to show us how things have changed since the ‘90s. They looked at a 40-year-old man with a 20-year term. In the ‘90s, it cost $1400. Today, that same policy is $400. So, if you bought a term insurance policy in the past 10 years, you may be able to get a cheaper one today. Just make sure that when you’re buying this insurance, you get enough to take care of all your loved ones. Usually, a good bet is 10 times your current income. If you make $100,000 a year, for example, you need a $1 million policy. You can shop online now and get comparable quotes from several companies. Just be sure you go with a company that gets either an A+ or an A++ rating from AM Best.

Life insurance is not one of the most interesting topics to discuss, but it’s a necessary one. Lark prefers that you buy term life insurance – plain and simple. You never want to tie your life insurance in some kind of savings and investment vehicle unless you’re earning more than $375,000 a year. So, term insurance is the kind you buy for a set period of time. And, according to the Wall Street Journal, term life insurance rates have dropped by about 50 percent in the past 10 years. The Internet is the No.1 reason why. People can now comparison shop online and companies have had to lower prices to compete. The second factor is that we are living longer. People who do actuarial work figure out the risk to insurers and that determines what rates will be as well. As you get older, rates will cost more. But it’s possible that you could get a lower price today than you did 10 years ago when you signed up. Or, maybe you were underinsured at the time you bought your policy and now you’re making more money. So, look around and maybe get a new policy. One of the greatest sources out there is USAA. Other site to try are accuquote.com and insure.com. The simplest rule is to buy 10 times your income. So, if you make $50,000 a year, you’d want a $500,000 policy.

Many people out there don’t surf the Web, and sometimes Clark forgets that. He often gives out Web sites that offer comparison quotes and information. So, what about those people are aren’t Internet active? There are options out there for you, but you need to pick up the phone and call. The companies that offer very good rates on term life insurance are TIAA-CREF and USAA. The phone numbers are 1800-223-1200 (tiaa-cref) and 1-800-531-8000 (usaa). You buy term life based on the years between now (your current age) and the number of years left in your working life. You base the amount on your needs, which include a wife and kids or just a wife or just a husband. You can get quotes from agents if you feel comfortable. But if the person starts trying to sell you something else, run the other away.

You can get huge savings on life insurance these days. Clark prefers that you buy level term insurance, which allows you to buy coverage for a certain amount of time. You hope that it never pays off and that you outlive your policy. But if it does your family members are set. Clark saw the news in the Allentown Morning Call, which publishes a lot of great consumer articles. This report shows that term policies have dropped by 50 percent over the past 10 years. So, if you took out a policy in the mid ‘90s or even early in the 21st century, you can replace your policy for a much lower price. Why have prices dropped so much? The first reason is because of the Internet. The second reason is because people are living longer and outliving their policies. So, reshop your policy and you could pay much less each month. You may pay a little more, but you want to buy only from companies rated either A+ or A++ by A.M. Best. And be sure to run away if someone tries to suggest variable life or universal life insurance.

Clark has some great news for you on the insurance and health care front. Many insurance companies are now writing policies to current and former cancer patients, according to the Dow Jones News Wires.

One major life insurance company announced this week that it will offer insurance to women with early stage breast cancer at the same rate as women who are free of the disease.

It used to be that having the Big "C" meant you were not insurable. But actuaries are finding that survival rates for cancer are so high these days that they’re happy to sell you life insurance.

So, if you’ve been denied health insurance because of cancer, you should shop around and see if you’re eligible now.

People have gotten far more comfortable buying life insurance, thanks in part to the Internet. Without salespeople, consumers are able to get quotes without pressure. And the Internet has allowed people to see the massive difference in costs from company to company. Level term life insurance has become the standard. You buy it for a certain amount of time, whether it’s 20 years, 30 year or 40 years. A 25-year-old with two young children, for example, may get a 20-year policy that would carry your children through young adulthood if you die. The policy only pays if you die, so it’s very simple. In addition, insurance costs much less and is going to continue to drop in price. Most people would be best buying term life insurance. The exception is if you make more than $300,000 a year, in which case whole life would work better for you.

There is a lot of confusion these days over what types of insurance you really need. There are only three. But first let’s discuss the kinds of insurance you don’t need. One kind of insurance you should never buy is credit life insurance, also known as “croak and choke.” Mortgage life insurance is the technical term. The salespeople pretend it’s a great idea, claiming that if you die your debts are paid off. But how important is it to pay off your debts when you’re gone? Basically, with this insurance, the bank gets paid off and gets your money instead of your heirs. In addition, the premiums are about 10 times as high as traditional types of life insurance. Mortgage life’s cousin is credit life insurance, and you are pushed to get this when you buy a car or other big purchase. These are sold as protection for you, but really they provide protection for the bank. So, it’s essentially like putting lipstick on a pig. Maybe it looks better, but it’s still a pig. Another popular item is the variable annuity. It’s almost never a good idea to buy one of these because there are monstrous commissions. What about cancer insurance? If you get cancer, you need health insurance and term life insurance, and that’s it. And, if you can’t work and need replacement of your income, you want disability insurance. Those are the only three you need. All the others you can chuck. What about your car? You don’t need rental insurance when renting a car, first of all. If you get in an accident, you’ll owe regardless of whether you have insurance. And usually your credit cards or auto insurance company has some type of temporary rental car coverage. PEC or “personal effects coverage,” which covers things stolen out of your rental car, is not necessary either.

Is it s good idea to buy insurance from your place of business? In almost all cases, the answer is no. Kathy Kristoff did an analysis of buying group insurance industry through employers, and it’s a total ripoff. In some cases, people are paying almost 200 percent more for these policies. That’s because people get this insurance without any kind of exam, and companies jack up rates for this reason. The better shape you’re in, the more you’ll save when buying your own policy. It will save you hundreds if not thousands of dollars a year. Just make sure you pass the medical screening tests for an individual policy before you dump the employer plan. Clark likes level term life insurance, where people can buy a policy for 20, 30, 40 years or whatever you need for “replacement of income” for your survivors. Also, it’s a good idea to get quotes on level term from actual insurance salespeople and online.

If you have your homeowner’s insurance with MetLife, Clark has some good news for you. The company is now offering free ID theft help as part of your policy. The first two states to try this out are Florida and New York, but it will probably expand across the country. That’s good news because, as an adult, you have a one in 15 percent chance of having your identity stolen. So, this is the real coverage from an insurance company. MetLife is actually hiring an outside company that will prepare your affidavits and contact police for you. Hopefully, more insurance companies will join MetLife. But in the meantime, it’s up to banks, credit card companies and retailers to protect its customers and create some legislation with some real teeth in it. We’ll see how it works and let you know!

Clark has been on the air since the mid-80s and he remembers getting a flurry of panicked calls about a failed insurance company known as Executive Life in 1991. The company was one of the largest in the industry at the time and callers were wondering if their policies would be okay and their money would be safe. At the time, Clark figured it would take a few years to resolve the issue and told them so. Well, today he picked up the L.A. Times and saw an article about customers still being affected by the failure of this company. The headline read, “Customers of Executive Life Fear Big Losses.” So, 13 years later, customers are still out money that they may not ever get back. You may wonder how this is possible, but there are serious problems with the insurance industry. One of the major problems is that insurance is regulated by each state and there is no federal equivalent that protects people. Therefore, funds are not secure and there is no guarantee that you will get your money back if a company fails. So how do you protect yourself? If you’re buying life insurance, disability insurance or any long-term insurance, you must do your homework. Buying homeowner’s and auto insurance is different because these are short-term. But you need to know the financial strength of a company when it comes to other types. And, it’s only a mouse click away. Go to ambest.com, which grades insurance companies. All you need to do is pick a company that is A++ or A+. Those are the best companies out there and they’re likely to stick around. Clark never imagined that the insurance industry would fail policyholders so badly, but it has. So, make your choices wisely

Clark has been on the air since the mid-80s and he remembers getting a flurry of panicked calls about a failed insurance company known as Executive Life in 1991. The company was one of the largest in the industry at the time and callers were wondering if their policies would be okay and their money would be safe. At the time, Clark figured it would take a few years to resolve the issue and told them so. Well, today he picked up the L.A. Times and saw an article about customers still being affected by the failure of this company. The headline read, “Customers of Executive Life Fear Big Losses.” So, 13 years later, customers are still out money that they may not ever get back. You may wonder how this is possible, but there are serious problems with the insurance industry. One of the major problems is that insurance is regulated by each state and there is no federal equivalent that protects people. Therefore, funds are not secure and there is no guarantee that you will get your money back if a company fails. So how do you protect yourself? If you’re buying life insurance, disability insurance or any long-term insurance, you must do your homework. Buying homeowner’s and auto insurance is different because these are short-term. But you need to know the financial strength of a company when it comes to other types. And, it’s only a mouse click away. Go to ambest.com, which grades insurance companies. All you need to do is pick a company that is A++ or A+. Those are the best companies out there and they’re likely to stick around. Clark never imagined that the insurance industry would fail policyholders so badly, but it has. So, make your choices wisely.

For years, Clark has encouraged his listeners to shop around for insurance coverage of any kind. Health coverage is a bit hard to shop for, but the others are fairly easy. It’s just boring. But there may be a deeper, more evil reason why people see such wide price differences between companies. Consumers may have been paying tons more in premiums because of kickbacks that deceitful insurance companies were receiving. The first phase involved sales of insurance from company to company. The second phase involved ripping off people who get benefits from their employer. These companies were basically charging a huge mark-up on the insurance offered through an employer. There is also a third phase, which involves the direct sale of insurance to individuals. So, it’s now even more important that you shop the marketplace when your renewal comes up. Use the Internet, word of mouth and traditional resources before you buy. Treat insurance as if it were a car you would like to buy. It’s always a good idea to shop first with the companies Consumer Reports recommends. They are Amica Mutual, USAA and Cincinnati Insurance. And, decade after decade they have been the most reliable companies. Best in service doesn’t necessarily mean best in price, but sometimes it’s worth it to go with the best.

Clark talks a lot about life insurance in his books. It not a terribly exciting topic, but it’s important. Life insurance should basically be just death coverage. No savings payoffs; simple is better in this case. In fact, Clark finds that term insurance is now selling itself. People are shopping for simple death coverage. It is cheap and necessary. But because people’s lifestyles are not as healthy as they should be, or used to be, fewer people will actually qualify for the best rate – often called “super preferred” or “preferred plus.” But even the normal, preferred rates are very good these days. For instance, the New York Times reported that a 52- year old man could buy a 20-year, $1 million d policy for $300 a month. This is a great rate! As a general rule, ten times the family income is a good amount to buy. Look into buying from an A++ or A+ company only. The term you buy may be a 10, 20, or 30, year policy. It is offered with the same cost over the life of the policy. A top-rated company will have licensed sales people who will be knowledgeable about what you need. This is called level term insurance. Clark recommends that you contact independent agents. The help of a professional when deciding can be invaluable.

Clark is 49 years old and he will consider buying long term care insurance in the next 8 to 10 years. LTC insurance is something about 80 percent of people should have. But many people mistakenly think Medicare pays for the insurance. That is not the case. Medicare pays for a short stay in a hospital. Medicaid confuses the subject even more because Medicaid can pay for nursing care help, but it's only for the indigent. So, if you're not poor, but your not ultra rich either, long term care insurance is for you. The trouble is that there are many rogue companies out there that will take your money but provide no care for your loved ones. Insurance companies pay for your long term care, and long term care coverage pays for care in nursing home or home health care if you need it there. So far, Clark has found only eight companies that are financially sound and worth your while to consider. You can find them here on Clark's site. Your parents may need your help with this topic, so be sure you do your research early. At 60, it will cost you $3,000 a year. But the older you are when you buy it, the more expensive it is.

The insurance business has many ups and downs, and it can get really confusing when you consider all of the choices for life insurance. Now, there is another alternative. Companies are now offering insurance that gives you all of the money you paid in if you live past the maturity date on the policy. You will pay about 40 percent more for this policy than you will for regular policies. The two main types of life insurance are term and whole life. Term insurance just pays out money when you die. Whole life is much more expensive because it pays a death benefit and it’s a savings account. The truth is that most people do better with term insurance than they do with whole life insurance. So, what about this new kind of insurance? If you follow all of the rules, it can be a great return. But there are a lot of issues and ifs that arise. Most people bail on these policies before they’re up because they are sick of paying so much money. And, there is the chance that you will die before it ends. So, stick with simple term insurance if you don’t want the uncertainty and risk. It’s very easy to shop for term insurance online at the various comparison sites.

Clark has talked about how to buy life insurance and annuities before on the show, but apparently he hasn’t done a very good job because the questions keep coming up. First of all, you want the company you buy from to be financially healthy. If an insurance company goes under, your policy is practically worthless. The state insurance guarantee systems are ineffective and they expose people to massive losses and delays. There is no equivalent to the insurance you receive when putting your money in a bank – known as FDIC. So, it’s up to you to protect yourself. There are several insurance rating services, and the one Clark likes to suggest you use is A.M. Best - ambest.com. The company rates insurance providers on grades from “A” to “F”. And, you only want an “A+” or “A++” company. An “A-rated” company is okay, and with a “B” or less is no good. If you have no one who depends on you for income, then you probably don’t need life insurance. But if you do, then you need a substantial amount. And, Clark likes term life insurance best. Most agents don’t like to sell you this because they’re low commission sales. But they offer you great coverage. If you’ve got a lot of working years left, you want to consider a 30-year policy. If you’re a little older, a 20-year term would work. And, so on. Agents will probably push “variable universal life,” but there is almost no one who can benefit from this type of insurance. If you make more than $350,000 a year, you may benefit. Otherwise, stick with term life insurance. As a general rule, you want to take out an amount that is 10 times your annual income. If you make $50,000 a year, buying a $500,000 life insurance policy is a good idea. And when someone approaches you about buying an annuity, you want to run away as fast as you can.