How Life Insurance Providers Are Screwing You Over! – Dave Ramsey Rant

Don’t waste money on cash value life insurance. Get a term life policy today:


In this video, Dave reads an article about universal life insurance and explains why it’s the “the worst of the worst” of financial products. Unlike term and whole life insurance, universal life insurance allows buyers to have flexible premium payments. But eventually, the cost increases and those buyers are faced with an unattractive choice: pay an extremely high premium or collapse the policy altogether.

Here’s how universal life insurance works:

A portion of your premium covers your insurance and a portion builds cash value as an investment. The insurance is based on an annual renewable term, meaning that the cost of your insurance increases as you get older because statistically speaking, your probably of death is higher when you age.

So let’s say you pay a $200 premium at age 35, with $50 of that covering your insurance and $150 going towards your cash value investment. By the time you’re 60, the cost of your insurance might be $250. You’re still only paying a $200 premium, so the extra $50 starts coming out of the savings you’ve been investing for years. Once your savings are gone, the insurance company comes knocking at your door, demanding you either pay a higher premium to cover the increasing cost of insurance or you won’t be covered anymore. Now you’re left with no savings and potentially no insurance.

In this scenario, you could have been paying a fraction of the cost for term life insurance and had separate investments that your life insurance company can never touch. Dave recommends getting 10-12 times your income in term life insurance and

If your insurance policy is building cash value, you’re getting screwed. Get term life insurance today:


Read more about the different types of life insurance:

Make sure you have enough insurance with the 5 Minute Coverage Checkup:

Life insurance is NOT an investment. Watch Dave explain:


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21 Responses

  1. cicyouth says:

    Do your homework!

  2. derek flint says:

    I teach financial planning classes and I agree with Dave. The ONLY life insurance I would recommend would be term insurance . Even then I would advise people to have no life insurance unless they have a dependent. The value of a persons estate is usually more than enough to cover the costs of a funeral.

  3. Kristie Hansen says:

    I thought the older peoples policies are higher because their is less time to pay in to the policy, where a younger policy holder will make the company much more money that an older person.
    Do you think of your self as an honest man?

  4. Kristie Hansen says:

    Can you tell me if life insurance policies on the whole are honouring their policies if the policy holder dies from one of the experimental injections that people are running to get?

  5. Chitown Rider says:

    I got a accidental insurance from global life covers some cost of going to ER room. What do you think of that?

  6. Darlene Achille says:

    Hello Brother Ramsey, is Zander the only insurance company you suggest?

  7. IREBAA says:

    Yes, Zander Insurance is a paid advertiser for Dave Ramsey. Dave come on.

  8. Amanda Thompson says:

    Guys Dave Ramsey does not know what he is talking about when it comes to life insurance. I have a universal life policy on myself and I love it. Term insurance becomes very expensive as you get older and you drop the policy. Whole life and universal life are much better long term!

  9. Barry says:

    Thrivant Financial sold me a Universal policy years ago that ate itself up by the time I was 60. Afterwards the salesman that sold it to us lived here his entire life decided to move away.

  10. Gene Benarick says:

    Transamerica is a bunch of crooks, they won't pay the cash value of the policy I'm trying to terminate. Don't waste your money with Transamerica They are crooks.

  11. Joe Traveler says:

    How about the National life insurance with living benefits with critical illness benefits? is it legit? they will pay you if you were diagnosed with cancer?

  12. Marcos says:

    So you're telling us which ones are bad how about telling us which ones are good? So far-term looks peachy to me. thanks for the knowledge

  13. Dianne Louisy says:

    Ridiculous!. Permanent policies have saved MANY of my clients during this pandemic. Universal Life is one type of permanent policy that I am not fond off and that many companies sell to clients without disclosing how improper funding can zero out the policy. So it's not the policy but agents who do not adequately educate. The wealthiest families have always used permanent Life Insurance as leverage and as part of their financial portfolio,

  14. Thai's list of blessings Burnette says:

    Thats what i got Dave. Thanks for the info. Your the best. But ill stick to term

  15. Rebecca King says:

    DAVE RAMSEY PLEASE WARN PEOPLE! I knew that I wasn't going to earn enough money this year to qualify for Obamacare so I assumed that my coverage would end at the end of 2020. However, Anthem enrolled me in a new plan without my consent and I just got a letter today showing that they stole almost $500 from my checking account to provide insurance coverage for ONE MONTH! If I had picked a plan myself I probably would have paid nothing due to my present income. I am sure this has happened to plenty of other people too, who can least afford it. I am sure many people like myself thought that their coverage would end if they didn't choose a plan. I can't believe they had the audacity to steal a month's wages from my checking account without my consent! I would appreciate it greatly if you would warn others about this. I am sure that I am not the only one who got cheated this way.

  16. David Wilkerson says:

    Dave Ramsey is NOT a licensed life insurance agent. He does not know what he's talking about!

  17. Daniel B says:

    Read Kim Butler "busting the life insurance lies". Whole life is a wonderful product and has been around for hundreds of years for a reason.

  18. Shyanne Wipp says:

    I signed up for Combined Insurance in 2014. It was a big mistake. This was a guy who went to my church at that time and he was very mean to me. When I signed up with him all of a sudden he became very nice to me because he knows he's getting money from me. Two months later it all of a sudden turned out to be chaos. Him and his buddies started spreading rumors about me. This was in a church. If Jesus was there in physical form He would've drove out those people and said to them "You have made my church a den of thieves". Also I had to pay an extra $150 for the premium. Bad choices! Now I know how to be careful with my money.

  19. James Shannon says:

    One aspect Dave hasn’t mentioned is the Cash value piece. The insurance is one piece. But it’s NOT THE POINT OF THE POLICY. You can get the minimum coverage(death benefit) and invest the rest… but he is right about it being complicated and easily poorly designed. Many people don’t understand it. And that’s how you get burned.

  20. Fury Fire07 says:

    What is the most affordable and beneficial permanent life insurance plans and coverage in NY?

  21. A B says:

    Don't take Hack Ramsey's advice.

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