George Kamel - Insurance Agents Will Hate This Video

Episode Date: July 16, 2025

🎥 Watch my video The 8 Types of Insurance You Need Immediately.   The insurance world is full of overpriced junk you don’t need. In this episode, find out which common insurance policies are a total waste of money, plus two popular add-ons that are straight-up scams.   Next Steps: 🛡️ Are you protected with the right insurance? Take our five-minute Coverage Checkup. 📈 Are you on track with the Baby Steps? Get a free personalized plan.  💵 Start your free budget today. Download the EveryDollar app!    Connect With Our Sponsors: Get 20% off when you join DeleteMe. Learn more about opening a high-yield savings account with Laurel Road. Get up to 40% off Cozy Earth with code GEORGE.   Explore More From Ramsey Network:  🎙️ The Ramsey Show   🍸 Smart Money Happy Hour 💸 The Ramsey Show Highlights 🧠 The Dr. John Delony Show 💡 The Rachel Cruze Show 🪑 Front Row Seat with Ken Coleman 📈 EntreLeadership   Ramsey Solutions Privacy Policy Learn more about your ad choices. Visit megaphone.fm/adchoices

The insurance industry is a lot like a gas station bathroom. It's highly suss and should be approached with great caution, trepidation, and a lot of TP layered on the seat. So in this video, you're going to find out which pointless and predatory insurance policies you can stop wasting money on. Plus, stick around to the end to learn which two popular insurance add-ons are complete scams. To start, quick reminder, the purpose of insurance is to transfer the financial risk to the insurance companies for things that we can't cash flow out of pocket. So you don't need flat tire insurance, but you do need car. car insurance because you can handle the cost of a flat tire, but the cost of your car and potentially someone else's, probably not.

All right. Now that we're on the same page about the purpose of this stuff, let's look at the first insurance you should not buy. Credit life and credit disability. Here's how this works. Let's say you take out a loan on a fancy jet ski. But when you take out the loan, the lender says, well, in order to get this loan, you also need to buy insurance on your life.

That way, if you die, it'll pay off the old C-Doo. That's how credit life insurance works. And it's the same thing with credit disability. If you become disabled, it'll pay off your loan. Now, here's the problem. It's basically life insurance and disability insurance, but it's 50 to 100 times more expensive. So the cost of a $10,000 life insurance policy

on your $10,000 loan could have bought a million-dollar term life insurance policy. And if you're still not following here, getting 10K when you could have got a million is a bad trade. Not to mention, some of these lenders make more on the sale of the credit life insurance than they do making the loans, which makes selling you insurance somehow scammier than selling you debt. A plot twist, Not even Tom Clancy saw coming.

Clancy fans, where you were! You're dead, aren't you? You're all dead. I'm not dead yet. Next up on insurance that you should not buy is mortgage life insurance, which is very similar to our last insurance villain, because it pays off your mortgage if you should pass. And that might sound like a good thing, but this is super gimmicky and targets our emotions.

The salesperson will say something like, well, if you go out in a freak pickleball accident, how will your spouse pay the mortgage? But what they failed to mention is that the mortgage life insurance is 10 to 20 times more expensive than regular life insurance. And here's the math. If you've got a $400,000 mortgage life insurance, you could have bought $4 million to $8 million worth of term life

for the same exact price. Now, one caveat here is that mortgage life often doesn't require a medical exam to qualify. So if you're uninsurable because of health issues or because you're Ryan Gosling stunt double, mortgage life is a viable option because at least you can get a little bit of life insurance that you couldn't otherwise.

But remember, you are paying a pretty penny for it. Next one, double indemnity and accidental death, which sounds like it could be the subtitle of a Jason Bourne movie, only this time starring Jesse Eisenberg. Plot twist, the villain is his social awkwardness. But he will overcome, he will succeed. I have like a lot of anxiety about this. This type of insurance only pays out if you die by accident.

So if you only have accidental life insurance covering you, but you die of a heart attack, your family will get precisely zero dollars. Now, a lot of people are still tempted to get this because it's really cheap, but it turns out it's so cheap because there's hardly any probability this accidental death is actually going to occur. So the bottom line is you don't need more or different life insurance for your family if you die by accident.

So just stick with term life insurance, which will cover you regardless of how you go to that big budget meeting in the sky. And let's get the guidelines real quick on how much term life to get. You want to get 10 to 12 times your annual income in a term life policy. So if you make 50 grand, you want at least a half million dollar policy, and you want that for a 15 to 20 year term. The key is, if you follow the plan that I teach on this channel, 15 to 20 years from now, you're going to be self-insured because your nest egg, your assets, your home will be paid for. You're going to have plenty to cover your family's income should you pass.

All right. Next type of insurance to avoid is cancer insurance, which, as the name implies, pays you if you get cancer. But guess what? Your health insurance will cover you if you get cancer. So cancer insurance is just unnecessary. Now, getting cancer is one thing. But if you are a cancer, here's your daily horoscope. Oh, boy.

I don't even know if I should read it. I don't know if you can handle it. You know how cancer is going to be. Trust your heart's gentle guidance every moment. Today you'll feel calm and hopeful as small joys guide your choices, bringing confidence and clarity into your day with simple smiles and honest feelings. Your natural empathy shines today, helping you connect with friends and family in a warm, genuine way. Trust your gut when making plans and stay open to small, spontaneous, joyful moments.

Balance, rest, and action. And you'll find optimism and steady energy to move forward. As a Gemini, I've had enough. No, I'm not even a Gemini. Don't get it twisted. You boys bill for tough. All right, I apologize for that. But we needed something a little lighter after the cancer talk.

A lame attempt at humor, swinging a miss. Next up on terrible insurance, prepaid burial insurance. Now, quick disclaimer here, I do believe in pre-planning your funeral to take that burden off of your loved ones. And my loved ones already know to lay me down on a bed of lens wipes in the president casket by prime via Costco.com.

So by all means, pre-plan, pre-arrange, work out all the details you want. Just don't prepay. Because listen, the funeral industry is making way more money, collecting your money now and investing it for 40 years before you die, than they are burying people. Don't believe me? Well, let's pretend that you're 40 years old,

you're a regular at the Y, and you eat your Oikos Triple Zero every morning. You're healthy, so there's a high probability you will make it to the age of 80, at least. But the good people at the funeral home are selling prepaid burials for only $5,000. So you decide to go for it, so your family won't have to worry about the cost when you kick the bucket 40 years down the road. But what if instead you took that $5,000, you put it into a good growth stock mutual fund that averages 10% over that 40 years?

Well, that $5,000 without adding anything else to it, would grow to around $268,000, which is exactly how much I plan on spending on my funeral. I want a bounce house. I want a DJ Caled there. Barring any future drama, DJ Caled, I reserve the right to remove DJ Caled from my funeral. If scandals were to arise, you just got to be safe. You smart. You very smart. Anyway, that's what the funeral home is doing with your money. And if you had invested instead of paying for this prepaid burial, you'd have a quarter million more dollars to leave a legacy to your family, which I'm going to guess they would prefer to have over the prepaid burial.

We've had a lot of death talk for the last little bit, so let's take a moment for a pallet cleanser to talk about something you can do to make the most of your money while your bucket remaineth, uncicked if. And that's keeping your savings in a high-yield savings account with online bank, Laurel Road, one of the sponsors of today's video. You see, unlike most brick-and-mortar banks, Laurel Road's high-yield savings accounts offer top to your APY that lets your money grow way faster than it would in a traditional savings account.

And I personally use them because they never charge any weird maintenance fees and your deposits are FDIC insured. Plus, there's no minimum balance required to open an account. So get started today by going to Laurelroad.com slash George or click the link in the description. Another thing that living, breathing people need to worry about is protecting themselves online. Because did you know, your home address, your phone number,

even your family members' names are all out there on data broker websites. and that makes them an easy target for scammers, AI impersonators, and digital harassment. And that's why I use DeleteMe, another sponsor of today's video. They help protect your info by scrubbing it from these data broker sites and sending you a customized report every few months that shows exactly what they removed and from where. And right now, you can get 20% off any DeleteMe plan by going to join DeleteMe.com slash George or by using the link in the description. Next insurance on the list that you can skip may come as a surprise to you, dental and vision.

Now, it's not because your teeth and your eyes are not important. I mean, they're on my list of most important body parts. Just above brains and right below heart. No, it's because if you go and buy dental and vision insurance on your own and you actually run the numbers out on it, it's almost never worth it. Mathematically, you could have just saved up and paid for your dental visits, cleanings, x-rays, the occasional root canal, wisdom tooth removal, or whatever you need without insurance.

Same goes for eye care. So I would just tell you to self-insure, unless it's subsidized or covered by your employer, in which case, take it. That's a sweet deal. Next insurance to skip is probably something your neighbor Jeff is known for peddling at the cul-de-sac barbecue. And that is Whole Life Insurance. If you're unfamiliar,

whole-life insurance covers you for your entire life instead of a term policy, which covers you for 15, 20, 25 years. And Whole Life also includes a savings account called cash value. The idea is that part of your monthly payment goes toward your death benefit, which is the money your family would get if you die, and part of it gets saved in this cash-value account.

Sounds kind of nice, but then again, so did having your toddler help feed the dogs. She ate it all. She ate all the dog food. The baby human ate the dog food. The question is, what does she know that we don't? Are mush peas that bad, or is dog food that good? People need to know. Whole life and any other kind of permanent life insurance is a terrible idea. For starters, it costs way more than term life insurance could be as much as 17 times more. And that's because it's trying to be two things at once, insurance and investing. And it does both of them very poorly. Not to mention, the cash value in most accounts only grows at 1 to 2%, which FYI isn't even keeping up with inflation.

And here's the kicker. When you die, your family doesn't even get the cash value in most cases. They only get the death benefit. Who gets the cash value? The insurance company. No Bueno. So next time you find yourself getting cornered by Jeff by the condiment station, remember, Whole Life agents get big commissions, sometimes up to 90% of your first year's premium.

That's why they want to push it over term life. They make money whether it's good for you or not. In this case, it is not. Okay, we're rounding third headed towards home, which I'm told is a sports analogy that means wrapping up. But there are two more insurance add-ons that people are often talked into getting, and spoiler, total scams.

The first is return of premium or R-O-P. You'll see this add-on on almost any kind of insurance these days. And basically, it says, if you don't use the policy you have, the insurance company will give you your premiums back and the policy will have been for free. But of course, you have to pay extra for it. So was it really free?

So same story as before. If you take that amount you would have paid extra for ROP and invest it, it would more than return your premiums whether you use the policy or not. The other scam is the add-on or rider called waiver of premium, which is similar. It says, hey, if you become seriously disabled and can't work, we'll waive your premium payments and still keep your insurance active. And again, this one sounds like a good move, but just know, this costs extra, and there are strict rules around what qualifies as disabled.

Insurance companies do be picky like that. So what's the smarter option here? Just get long-term disability and don't fool with this crap. Okay, we just talked a lot about the insurances you don't need to pay for. But what about the ones you actually do need? Well, out of the thousands of insurance options available to you, there are only eight that you actually need. That's right, eight.

So to find out what those are, keep watching this next video coming up or check out the link in the description. As always, hit that like and subscribe button to get more money content like this. Thanks for watching. We'll see you next time.