How much do you know about life insurance? If you are like most people, you know you need it and you know it can be expensive. That about sums up my understanding of life insurance before I bought my first life insurance policy. But after my wife and I were married, I had to think about how she would be provided for if something were to happen to me. So I researched my options and bought enough life insurance that I felt confident she would be OK if I were to die before her.
Life insurance can be a complicated issue and it is definitely something you need to consider as it applies to your specific situation. That means learn more about it, then buy the best policy for your needs, not the best policy for the person selling it to you. One way you can learn a little about the difference between term life insurance and permanent life insurance is through a new online game by AXA Equitable.
Pass it On – A Game of Chance, from AXA Equitable
I’ll be the first to admit that while life insurance is important, it isn’t the most exciting topic in the world. But this game made the topic a little more interesting.
Why play? Well, it’s free, it’s fun, you can learn more about life insurance (which is a good thing!), and you can enter to win a cash prize of $25,000 or $15,000. Pass It One will help answer the following questions:
- Will the financial decisions you make today impact your family tomorrow?
- What if you never buy life insurance?
- What is the difference between term life insurance and permanent life insurance?
Play for yourself and play for charity. When you play this game, you can enter to win a $25,000 or $15,000 cash prize. In addition, you can vote for 3 charities supported by AXA Equitable. The three charities are The American Red Cross, CARE, and Scholarship America. These three organizations will receive a grant based on the number of votes they receive during the campaign period, so this is a chance to learn something valuable to help provide for your family, as well as pay it forward to one of three great charities.
How to play the game
Go to the game website where you will choose an avatar and create a virtual family. There are several avatars and family arrangements to choose from, including a single person family, newlyweds, family with children, single parents, empty nesters, and custom configurations – in short, there is something for everyone.
Collect gold. The next step is to start playing the game. I’m not big on reading instructions for these types of things, but it’s pretty self-explanatory for the most part. The object of the game is to collect gold and avoid losing it (more on this in a moment). To walk, click on a button and a direction to walk, then start walking. You can collect gold by either stopping on the square it is on or by walking through the square. Be careful though, as you can only walk through a square one time. if you walk into an object such as a wall, you will need to turn and continue walking in a different direction until you have finished walking the number of steps required.
Don’t lose your gold (i.e. protect yourself). There are a few ways you can lose gold. The first is by running into a Gremlin, a little red monster – you can’t miss it. There are other obstacles which pop up from time to time, such as cracks in the sidewalk. These are announced and you can’t miss them.
The third way to avoid losing gold is, you guessed it – buy life insurance. Life insurance in this game is represented by a silver or gold shield. When your avatar walks through the square you are presented with the option of buying either term life insurance (silver) or permanent life insurance (gold).
Which is better – term life or permanent life insurance? In the context of this game, term life insurance has very little value. It cost $1,500 in gold coins and offered $5,000 of protection, which lasted 3 turns. The permanent life insurance shield cost $3,750 in gold and offered $15,000 in protection, which did not expire. Three times the protection for less than three times the cost, and it never expires? Sign me up! (only in the context of this game of course).
*Note about choosing types of life insurance: If you choose term, it is gone after three turns and you will have the opportunity to purchase more life insurance the next time you come across a shield. If you purchase permanent life insurance you are only given the opportunity to upgrade your policy; you can’t mix the two types if insurance. the upgrade cost an additional $2,500 gold coins and brought the total cost to $6,250 for $25,000 in protection.
Collect stars – or tap into your life insurance policy. At certain points in the game you can collect gold stars, which are “Collectibles.” These collectibles represent how the cash value component of your life insurance could potentially be used to address future life needs. Of course, taking a loan or withdrawal from your life insurance policy isn’t without its risks. Doing so can reduce the policy cash value and decrease the death benefit. It can also increase the likelihood of the policy lapsing… which can lead to a lapse of life insurance coverage and possibly tax ramifications. In short, meet with a financial advisor before tapping into your life insurance funds.
Thoughts on the game
I love the 3D graphics. The game is fairly fun once you get the hang of it, and it throws a few curve balls your way. It also shares information about insurance policies at different points in the game, which adds an educational element. The game also isn’t a hard sell, at least, not for AXA insurance products. I did, however, feel that the game was pointing people toward buying a permanent life insurance policy while not giving term life insurance as much credit. For example, spending $1,500 for $5,000 worth of insurance which lasts 3 turns before it is gone forever doesn’t seem like good value when you can spend less than three times that amount and get 3 times the coverage with no expiration. But the numbers may scale differently in life. As with all financial products and services, I recommend doing your research to determine which type of policy is best for your needs, then compare insurance providers to find the right policy to protect your family.