Apollo Had Some Death Bets

https://www.bloomberg.com/opinion/articles/2024-04-30/apollo-had-some-death-bets

Life insurance is, financially, a bet on your early death. If you buy a 20-year term life insurance policy with a $5 million death benefit and premiums of $25,000 a year,1 and you live for 21 more years, then you pay a total of $500,000 in premiums and get back $0 in benefits. If you buy that same policy and die the day after you buy it, you pay roughly $0 of premiums and get back $5 million of benefits. The earlier you die, the better you do. Financially. Only financially. Otherwise you’d prefer to die later.

Of course the central problem is that, if the insurance policy does pay out the $5 million, you don’t get it. You’re dead; that is the prerequisite for getting the money. Somebody else gets it. Ordinarily that somebody else will be your heirs: your spouse, your children, whoever. You hope that they too will prefer that you die later, even if it means that they don’t get the $5 million,2 but that is not always true, and murdering your spouse for the life insurance money is a fairly common plot element in fiction and also in real life.

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  "title": "Apollo Had Some Death Bets",
  "type": "story",
  "url": "https://www.bloomberg.com/opinion/articles/2024-04-30/apollo-had-some-death-bets"
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{
  "author": "Matt Levine",
  "date": "2024-04-30T18:31:19.679Z",
  "description": "STOLI, Delta One, CZ’s sentencing and Chumbawumba at McKinsey.",
  "image": "https://assets.bwbx.io/images/users/iqjWHBFdfxIU/ihwOkOAs35RM/v0/1200x800.jpg",
  "logo": "https://logo.clearbit.com/bloomberg.com",
  "publisher": "Bloomberg",
  "title": "Apollo Had Some Death Bets",
  "url": "https://www.bloomberg.com/opinion/articles/2024-04-30/apollo-had-some-death-bets"
}

{
  "url": "https://www.bloomberg.com/opinion/articles/2024-04-30/apollo-had-some-death-bets",
  "title": "Apollo Had Some Death Bets",
  "description": "Life insurance is, financially, a bet on your early death. If you buy a 20-year term life insurance policy with a $5 million death benefit and premiums of $25,000 a year,1 and you live for 21 more years, then...",
  "links": [
    "https://www.bloomberg.com/opinion/articles/2024-04-30/apollo-had-some-death-bets"
  ],
  "image": "https://assets.bwbx.io/images/users/iqjWHBFdfxIU/ihwOkOAs35RM/v0/1200x800.jpg",
  "content": "<div><p>Life insurance is, financially, a bet on your early death. If you buy a 20-year term life insurance policy with a $5 million death benefit and premiums of $25,000 a year,<a target=\"_blank\" href=\"https://www.bloomberg.com/opinion/articles/2024-04-30/apollo-had-some-death-bets#footer-ref-footnote-1\"><span>1</span></a> and you live for 21 more years, then you pay a total of $500,000 in premiums and get back $0 in benefits. If you buy that same policy and die the day after you buy it, you pay roughly $0 of premiums and get back $5 million of benefits. The earlier you die, the better you do. Financially. Only financially. Otherwise you’d prefer to die later.</p><p>Of course the central problem is that, if the insurance policy <em>does </em>pay out the $5 million, <em>you </em>don’t get it. You’re dead; that is the prerequisite for getting the money. Somebody else gets it. Ordinarily that somebody else will be your heirs: your spouse, your children, whoever. You hope that they too will prefer that you die later, even if it means that they don’t get the $5 million,<a target=\"_blank\" href=\"https://www.bloomberg.com/opinion/articles/2024-04-30/apollo-had-some-death-bets#footer-ref-footnote-2\"><span>2</span></a> but that is not always true, and murdering your spouse for the life insurance money is a fairly common plot element in <a href=\"https://en.wikipedia.org/wiki/Double_Indemnity\" target=\"_blank\">fiction</a> and also in <a href=\"https://www.mirror.co.uk/news/us-news/man-killed-wife-used-insurance-32688960\" target=\"_blank\">real life</a>.</p></div>",
  "author": "Matt Levine",
  "favicon": "https://www.bloomberg.com/favicon-blue.png",
  "source": "bloomberg.com",
  "published": "2024-04-30T18:31:19.679Z",
  "ttr": 39,
  "type": "article"
}