KISS High-end Life Insurance?

The Wall Street Journal is reporting that Gene Simmons has finally gotten into the insurance business. Gene Simmons, as you may know, is the lead singer of the rock group KISS. He has been exploring new and exciting ways to slap the KISS logo on any and all products for the last three decades. At this point, his marketing and merchandising efforts have long since jumped the shark. I could come up with something witty, but that would just be a waste of time. Honestly, I’m curious why it took him so long to finally get involved in this market.

Mr. Simmons’s new group, Cool Springs Life Equity Strategy, was launched last month to tap into a lucrative demographic: entertainers, sports stars and other people with a net worth of $20 million or more who need a life-insurance policy of $10 million or greater. The firm’s founders, who include David R. Carpenter, formerly of insurance powerhouse Transamerica, believe there is big opportunity to sell jumbo insurance policies to rich people.

Yes, undoubtedly there is.

“I’ve been in the business my whole career, and life-insurance executives do not have audiences,” adds Mr. Carpenter, the Transamerica veteran. “Gene has audiences. Gene has the reputation [as] a genius merchandiser and marketer. He has great ways of conceptualizing products.”

So, slapping “KISS” on anything nearby, regardless of quality, equates with genius merchandiser? While the KISS army might be dumb enough to buy any stupid thing you sell, people in the market for this amount of insurance are probably not going to be fooled by the whizz-bang feature of having Gene Simmons on the label. Failing that, their lawyers should stop them from succumbing to Gene’s hypnotic advertising powers.

But Gene would never lead you astray, would he?

Some advisers and estate-planning attorneys (Including this one-ed.) aren’t enthusiastic about the notion of borrowing money to pay insurance premiums under any circumstances. They say borrowing costs can run higher than the buyer expects, or the arrangements can run into other problems, such as a bank tightening its collateral requirements. One of the biggest concerns is that borrowing programs presume that savings within the policy will earn more than the interest on the loan—but if interest rates spike sharply, the borrowing costs could jump ahead of interest earnings.

Thankfully, the Journal was good enough to find a lawyer to talk about this so I don’t have to.

“Tell me when Alice Cooper comes out with one”

Um, yeah. What he said.

Religion and the Law

Last month, Nergal found himself in a lot of trouble with Polish authorities because he destroyed a Bible on stage in 2007. Poland has a law that prohibits the offending of someone’s religious feelings, and he managed to offend several people. Could a law like this be passed in the United States?

The quick answer is no, though there are, as always, some exceptions. At the most basic level, the First Amendment keeps the government out of religion as well as the regulating-speech business. There is a plethora of diverse beliefs about the ultimate nature of the universe, and the US government is not going to get in your way if you choose to believe in any one of them. Essentially, you can believe any crazy thing you wish, but you may not be able to practice your religion if it involves breaking a law that is not related to your religious beliefs.

Religious freedoms are protected by two separate clauses in the First Amendment. The first, the Establishment Clause, prevents the government from establishing a national religion and promoting one religion over another. The Free Exercise Clause protects you in your religious beliefs, though it won’t prevent the government from prohibiting certain acts.

The Establishment Clause (“Congress shall make no law respecting an establishment of religion”) was the Framers’ way of preventing religious warfare by keeping the government out of religion, which had been a problem for European governments. Under the Establishment Clause, laws will be Constitutional if there is a non-religious reason for the law, the effect of the law must be neither to advance nor inhibit religion, and there must not be excessive entanglement with religion. Justice Hugo Black once wrote that it is no part of our government to be creating and writing prayers. In effect, it prevents [religious fanatics of one sect] from using the power of government to domesticate the [godless pagans of another sect] who didn’t have the sense to go to believe as they do.

As an example, just about any government-sponsored religious activity in public schools is unconstitutional. This has been used not only to prevent student-lead prayers to start the school day, but also prayers that are voluntary or at football games. Based on what we’ve learned from Varsity Blues and Friday Night Lights, some of you may rightly claim that high school football in Texas is 1) not voluntary, and 2) a quasi-religious function sponsored by the government, but that is a different discussion. While the government cannot support one religion by allowing prayers, it must allow religious groups access to facilities on the same terms as non-religious groups.

What about religious monuments? The Ten Commandments are fairly important to a number of religions, but does that mean that they can be placed on public grounds? The answer is a definitive maybe, and on first blush it depends upon where you are. In 2005, two cases about the placement of the Ten Commandments were decided by the Supreme Court. Their display in Kentucky courthouses was found to violate the Constitution, while the Texas Capitol did not. The Court held that Texas could have the display because it had been on the grounds for over forty years, that it had been donated by a non-religious group, and it was part of a larger display of the moral principals underlying the legal system.

The First Amendment continues into the Free Exercise clause (“or prohibiting the free exercise thereof”), which protects you in your religious beliefs. This allows you to believe any crazy thing that you please without any interference from the government. The important distinction is that while you can believe anything you want in the practice of your religion, it does not allow you to challenge a neutral law of general applicability. As long as the law is passed without a view to attacking a particular religion, but for the wider community, it will pass this test.

While it is all well and good for you to believe that you need to drink and drive as a necessary part of the exercise of your religious beliefs, you step outside of your First Amendment protections when you start acting on that belief. On the other hand, if the local government was not too fond of your sect and its Tuesday-night-apple-pie-baking-party heresies and passed a law banning them, that would not pass Constitutional muster.

There is a lot that I still have not discussed regarding the protections of the First Amendment, and I’ll be coming back to this in future posts. Next time, we’ll get into naming your band and what protections you have in your name.