Cory and Tisha read a recent newspaper article stating that

Cory and Tisha read a recent newspaper article stating that personal bankruptcy and other financial problems often result from uninsured losses. This made them curious about their own insurance coverage, so they have come back to you for assistance. Because they want to buy a home very soon, they are also interested in homeowner’s insurance. They compiled the following information for you to review.

Life Insurance

Health Insurance

Tisha’s employer provides a comprehensive major medical insurance policy that covers all members of the Dumont family with an 80/20 coinsurance provision. The Oumonts are subject to a 5500 annual family deductible. Tisha’s employer deducts 5267 per month toward the premium: her employer pays the remainder of the premium. Because Tisha’s company offered the better coverage. Cory chose to “opt our of his coverage and receives a monthly “opt out fee of $100 per month (included in gross income).

Automobile Insurance (Both Cars)

Umbrella Liability insurance

None

Disability Insurance

Tisha: 52.000 per month up to 6 months; premium paid by employer

Cory: None

Homeowner’s/Renter’s Insurance

HO.4 renter’s insurance policy with $25.000 of actual cash value coverage on personal property and an annual premium of 5600.

Cory’s been on the Internet again, this time to read about universal life and variable life Insurance. He has asked your opinion about purchasing one of these policies to provide additional insurance coverage for his family. What would you advise him to do? Defend your answer.