Cryonics

[ciphergoth]

I'm considering signing up with the Cryonics Institute. Are you signed up? I'd be interested to hear your reasons why or why not. It does of course sound crazy, but when you press past that initial reaction to find out why it's crazy, I haven't heard a really satisfactory argument yet, and I'm interested to hear what people think. There are many reasons it might not work, but are there reasons to think it's really unlikely to work? How likely does recovery need to be for it to be worth it?

Comments

[lizw.livejournal.com]

Oh, I see - I thought you were talking about insurance that would specifically pay for the cost of cryonics in addition to a normal life insurance payout, rather than just taking the ordinary payout and using it for life insurance. I wouldn't be surprised if someone like BRIT would do the former as a publicity stunt, they're known for that kind of thing. I don't think the latter will actually work - when you take out life insurance, you have to name a beneficiary, and it becomes their money. You can't force them to use it to pay for your cryonics, and I'd be concerned that even an informal agreement with them to use it in that way might invalidate the insurance, or at least render the proceeds taxable and/or liable to be used to pay your debts. I can also envisage difficulties with the definition of death, if you're using the policy for something it wasn't intended for.

As for how they make money on the deal - it's mostly because they've got 40 years to invest the money, reinsure or do various other clever things with the policy. There's a market in selling on the right to receive the premiums, for instance. The typical loss ratio on life insurance is around 110%, meaning that for every £1 taken in premium, about £1.10 is eventually paid out, but the long contract periods give them the opportunity to make enough of an investment return that they still make a decent profit (maybe around 15% of total premiums).

[lizw.livejournal.com]

Er, and in case it isn't obvious, the reason a policy that promises to pay £30,000 may only pay out £3,300 on average basically boils down to "very careful actuarial calculations" - they basically expect you to live beyond 78, and they expect a proportion of people to lose the paperwork, stop paying the premiums, die of causes that are excluded, and so on and so forth.

[ciphergoth.livejournal.com]

So I should expect that I'm also much more likely than not to be among that great majority for whom they don't have to pay out? That makes it sound like less of a good deal.

For this purpose, I'd need insurance that pays out no matter how old you are when you die. That doesn't seem like something anyone would offer to me, but I've been told otherwise...

[drdoug.livejournal.com]

You should certainly expect that the insurance company will make considerably more on the deal than you pay them. They will budget for a profit even after all their costs. This is how insurance works - there's no
magic that turns small sums into large ones, it's just risk pooling. The expectation value for the holder of an insurance policy is less than its cost to the holder. Or the insurer goes bust, which is the another way things go wrong.

The other thing you're missing is inflation. £30k now will pay for a budget freezing but it certainly won't in 40 years' time, unless we have had cataclysmic deflation.

[lovingboth]

An indication as to how much is made from term life insurance is the way that when we did it around JA's birth, the first 15 months of premiums went to pay the commission. So the insurer gets no money for more than the first year of a 18 year policy and still expects to profit.

[lizw.livejournal.com]

That kind of insurance does exist - it's called "whole life insurance" - but it's considerably more expensive.

[lovingboth]

This train of thought had occurred to me. Looking it up on a comparison site, for a 39 year old in London, £100k whole life is about £85 a month now.

If you want the payout to be indexed with inflation, the cheapest company offering that a) ignores RPI increases of less than 1%, b) won't increase by more than 10% - so a few years of 1970s/80s level inflation will wipe out most of the value - and c) will up your premium by twice RPI. Another one will increase both cover and premiums by 5% a year.

If you want it to index better than that, you're looking at about £240 a month.

[ciphergoth.livejournal.com]

What comparison site did you use? Thanks!

[lovingboth]

I can't remember. The companies it came up with were all 'household names' so I'd expect them all to be fine.

[ciphergoth.livejournal.com]

Any guesses? I've tried three sites (moneysupermarket.com, uswitch.com, moneynet.co.uk) and all three have a fixed field for how many years of cover you want; I can't figure out how to get information about whole life insurance from any of them.

[lovingboth]

(Checks browser history)

bestdealinsurance.co.uk

It defaulted to term insurance, but you can tell it you want whole life.

[lizw.livejournal.com]

Just to be clear, I should note that whole life insurance may get you round a practical problem, but the same legal problems apply as with term insurance.

[ciphergoth.livejournal.com]

Many thanks again for all your advice here. I shall try and find out what other cryonics people in the UK have done, and if I find something that seems workable and affordable I'll ask for advice again - cheers!

[lizw.livejournal.com]

You're welcome - happy to help in any way I can.

[lizw.livejournal.com]

Actually, while we're on the financial side of this, another thought: it occurs to me that you need to think not only of the cost of the actual cryopreservation and revival, but the cost of the presumed new medical treatment for whatever you were suffering from when you "died", plus the cost of living after revival. Your skills will be out of date, and you won't be able to rely on waking up in a legal system or economy where revived people (or anyone at all, necessarily) will be entitled to a pension or benefits or education grants. So it seems to me you'd need to have made some sort of investment pre-death (or via instruction in your will) that you think would plausibly produce, during the time you expect to be suspended, enough money to live on at least for the time it would take you to retrain, after allowing for inflation. Even that assumes that you'd be employable at all (think age discrimination, disability discrimination if the process doesn't leave you functioning perfectly, prejudice against people seen to have "cheated" death, etc); you might need to have enough of a fund to meet your living expenses for the rest of your life. How do CI suggest people address that?

[ciphergoth.livejournal.com]

Thanks, this is very helpful. I had hoped to directly name the Cryonics Institute as a benificiary, is that not possible? Is it possible to name more than one benificiary in general? Should I be trying to goad BRIT into insuring me as a publicity stunt? :-)/2

[drdoug.livejournal.com]

There is an obvious problem in having people ( or companies) as beneficiaries of life insurance who do not have an interest in the insured person living a long and productive life. So it's often illegal.

[lizw.livejournal.com]

You can name more than one beneficiary, but however many there are, they all have to be people who stand to lose financially by your death, which seems to rule out the Cryonics Institute. The amount you insure also can't exceed a reasonable pre-estimate of the amount of that loss (as I know to my cost, because I've had a client shout down the phone at me because I was telling him his clever investment scheme wasn't going to qualify as life insurance). All this is based on English insurance law, of course, and you could equally take out a US law policy (or any other law, really, but your chances of finding someone who'll do something this unconventional are going to be best in the English or US markets, I suspect). US insurance law is based on English insurance law, but is typically a bit more friendly to the insured. I don't know whether it differs in these specific respects. It also varies considerably from state to state. Looking at the CI website, they have a list of insurance agents that they claim can sell you a policy that will do what you want, but the word "agent" rather than "independent broker" tends to suggest they're tied to selling policies from specific companies and won't be able to give you independent advice. If you're going to go that route, you'll probably need to find a US insurance lawyer who can look it over for you, and preferably an independent broker. Failing that, at the very least ask the agent how many of these policies they've sold and how many have actually paid out. Wherever you go, with a product that's specifically designed to pay for cryonics, you can be fairly confident the insurer won't try to use legal loopholes to get out of paying (at least not ones that are specifically related to cryonics - they'll still enforce express policy terms such as exclusions), but it's far more difficult to exclude the risk that the tax authorities will get involved.

Another concern I'd have would be logistical - it can take months to get an actual cheque from a life insurance policy, so are CI going to do the work in advance of getting payment? Again, how many people have they actually cryopreserved using insurance funds?

[ciphergoth.livejournal.com]

As I understand it, if they're satisfied you have a policy in place they preserve first and cash checks later, but I'll double-check that - thanks for the red flag.

[ciphergoth.livejournal.com]

Thanks as always for such detailed and valuable words!

My financial advisor has told me I should seek legal advice before filling in the Absolute Trust forms. Any tips on the right way to go about this? I'm guessing he means advice "on the record" as it were rather than asking my knowledgeable friends, just wondering if there's a better way than Google to find a good firm at a reasonable price. Thanks!

[lizw.livejournal.com]

Fwiw, I'm not convinced that writing the policy in trust gets round the problems. I think "on the record" legal advice is an excellent idea. I know a couple of firms that could probably do this, but they're all in the City, so I suspect you wouldn't like their rates. You could try the Law Society's directory of solicitors. You absolutely need a firm that lists insurance law as one of their specialisms, and when you speak to them, you need to check that they advise on life insurance and not just non-life. You preferably also want a firm that lists something like estate planning or wealth managment - the Law Society doesn't list those separately, which means firms that do it will probably have listed themselves under tax law, trust law or wills/probate. Unfortunately you can only search for one category at a time, though, so the easiest thing is probably to see what hits you get for insurance and then check the websites of those firms to see what else they offer.