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10 Important Tips for Buying Life Insurance
Tips for Buying Life Insurance | asuranci.com
Looking to buy life insurance for the first time? Then asking yourself this questions:
How much life insurance do I need?
What kind of life insurance policy is best?
Which life insurance company should I buy from?
Shopping for life insurance can become an overwhelming task. There's no question that buying life insurance for the first time, like any other new experience, can be more than a bit daunting.
Below are ten important tips for buying life insurance, especially if it's your first time.
Tips for Buying Life Insurance
1. Know Why You Need Life Insurance
Life insurance is a serious investment that shouldn't be made on the spur of the moment. Don't buy a policy just because someone says you should. Many people hear ads about life insurance so many times that they begin to feel an instinctive concern about needing life insurance. The truth is, however, not everyone needs life insurance.
Buying Life Insurance
The purpose of life insurance is to provide financial support for your dependents if you are no longer around to do it yourself. If you don't have any dependents, you probably don't need to spend money on life insurance. If you are contributing significantly to the financial well-being of someone in your life, you think about protect from any financial gaps that might occur if you no longer able to provide the same support. The key is to understand why you need life insurance before you begin shopping for a policy.
2. Understand the Type of Life Insurance Policy You Need
There are two basic types of life insurance policies: life and whole life. Term life insurance policies last for a specified period of time. Term life is less expensive than whole life because it usually expires before the benefits are used.
Whole life insurance lasts from the day you the policy until the day you die, no matter. A whole life policy is more expensive because the coverage could last a few years or several decades. Whole life policies can be borrowed against at a high interest rate, while term life policies.
3. Know When to Choose Term Life Insurance
If you are in a situation your dependents will not rely on you financially forever, your best bet is probably a term life policy. For example, many parents choose term life policies that are in effect until their children move out and become financially independent. Once kids are, there is no reason to continue paying for life insurance. Your beneficiaries will rely on your contributions.
4. Know How Much to Buy Life Insurance
Understanding the potential needs of your beneficiaries can also help you decide how much life insurance you should have. Don’t follow any “rule of thumb” guidelines you may read. Your needs are specific to you. Your decision will depend on the math.
How much money do your dependents need each year and for how long? Because your children are likely different ages, that number is different for each beneficiary. Calculate the needs of each dependent annually, multiple times the number of years support is needed and then add those numbers together so all dependents have what they need.
The amount of money your family or heirs will receive after your death is called a death benefit. To determine the proper amount of life insurance, online calculators can be helpful. You can also get a ballpark figure using any number of formulas. The easiest way is to simply take your annual salary and multiply by 8.
5. Take Advantage of The “Free Look” Period.
Even after your policy issues, you'll typically have what is called a free look period. During this time, you'll have a certain number of days in which to make changes to your policy, or even reject it altogether. Be sure to ask your company representative how long your free look period is and when it begins. If for some reason you don't feel the policy is right for you, this is the time when you can change your mind with no financial obligation.
6. Compare Similar Life Insurance Products.
When getting price quotes on life insurance, be sure that you are comparing similar products. Because term life generally has lower premiums than a permanent life policy, there can be a big price difference for a $75,000 term policy compared to a $75,000 permanent policy. Depending on your coverage needs, it's important to look at every angle, not just the monthly premium.
7. Understand that life insurance is designed for protection.
Your main purpose for getting life insurance should be to protect your beneficiaries financially in the event of your death. While permanent life insurance policies have the potential to earn cash value over time, they are not meant as investment vehicles.
Life insurance is designed to provide families with financial security in the event of the death of a spouse or parent. Life insurance protection can help pay off mortgages, help provide a college education, help to fund retirement, help provide charitable bequests, and, of course, help in estate planning. In short, if others depend on your income for support, you should strongly consider life insurance.
8. Enhance your coverage with policy riders if necessary.
When you select a policy, ask your company representative about the types of policy riders that may be available to you. Riders or endorsements are ways in which you can customize your policy to meet your needs and budget.
9. Buy from a reputable life insurance company.
Your life insurance policy is meant to financially protect the people you love when you are no longer here to do so yourself. Do some homework on the life insurance company that you are considering buying from and learn more about how to select a reliable life insurance company.
An insurance policy is only as good as the company that backs it.
You want to make sure you choose a company you can rely on to be around for as long as you'll need your coverage, and one that invests premiums in a highly prudent manner in order to pay the claims of its policyholders.
That is 9 Important Tips for Buying Life Insurance. The last important tips for buying life insurance is looking for your deep heart. Is it important?
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All About No Down Payment Auto Insurance
No Down Payment Auto Insurance | asuranci.com Would you rather prefer to pay monthly, so the car insurance premium does not put a heavy toll on your personal or household budget plan? Then No Down Payment Auto Insurance is the right choice for you.
Definition of No Down Payment Auto Insurance
Insurance is a contract. A payment is generally needed to get your car insurance coverage started. Because auto insurance is a contract, you must pay for services before they are rendered. You promise to pay your premium or a portion of your premium to start, and the insurance company will provide you coverage for those items named in your policy.
Car Insurance for Bad Drivers
There are usually two options provided in contract: The first option is to pay the premium in full outright. The second option is to pay an insurance down payment, or a portion of the policy up front, then make monthly payments over the life of the policy. An increase in the down payment can reduce monthly insurance costs for the consumer. Generally insurance companies charge a slightly higher premium for those consumers that pay monthly than those who pay for their policy up front. A number of Insurance companies are providing no down payment auto insurance policies these days. But to save time and money during your effort, it could be better if you seek assistance from some reliable and reputed national online car insurance service provider. Such a move could enable you to secure vital local guidance while analyzing various options which could be available at your disposal. By securing our services, you could be helped to locate a no deposit or down payment auto insurance option with a favourable monthly premium payment schedule that is easier to manage and sustain.
How to Get No Down Payment on Auto Insurance?
The most efficient way to find no down payment car insurance is to get free quotes online. But aside from that, you can also ask your employer or the human resource department of your company if they can recommend any provider. In many cases, auto insurance companies offer discounts for their packages if the applicant is working for a particular company. The discounts provided vary, but it’s not uncommon for these companies to provide low down payment as a way to entice buyers.
Advantages of No Down Payment Auto Insurance
- Manageable Payments: Instead of having to pay the deposit along with your first payment, you just make your first payment - No Confusion: Calculating your insurance payments becomes easier when you do not have to account for the deposit. All you need to do is pay the same amount each month as long as nothing changes about your policy. - Pay the Same Amount Each Month - Pay Less to the Insurance Company - Works Better with Budgets
Disadvantages of No Down Payment Auto Insurance
- High Standards To receive this type of coverage you will need to have an excellent credit rating and a good history of payments with insurance companies. You may have to raise your credit score a bit or show additional evidence of your good payment history. - Higher Fees You may notice extra costs that are added to the policy itself which mean that you save less money. - Fewer Opportunities Car insurance with no down payment is not the easiest to find as many insurance companies do not openly boast about having such a policy. It only exists as a lure for individuals who have good credit scores that otherwise might not consider their insurance agency. A no down payment policy is one that you will need to consider to lower the total cost you pay to insurance companies. Choosing no down payment auto insurance offers many more advantages than disadvantages. However, you may find that the higher fees and stricter standards for obtaining this type of policy may not be worth the effort even if it saves you some money every six months.
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5 Types of Auto Insurance Coverage
Types of Auto Insurance Coverage | asuranci.com How do you know what types of auto insurance coverage you need? Is it required by your state? Are there ways to save money and still have the right amount of auto insurance coverage? Below we detail 5 types of auto insurance coverages and provide a few scenarios where you would benefit from having a non-required coverage added to your policy along with some tips to save some money depending on your vehicle and budget.
Types of Auto Insurance Coverage
Here are some common auto insurance coverage options.
Liability Coverage
Personal Injury Protection
Collision Coverage
Comprehensive Coverage
Uninsured and Underinsured Motorist Coverage
1. Liability Insurance
All states require a minimum amount of liability coverage in order to legally drive a vehicle. Liability insurance covers you when driving any vehicle you own or if you drive someone else’s car with their permission. Liability coverage is perhaps the most important type of protection that auto insurance policies offer, and the one that almost all states require. Bodily injury liability applies to damages you cause to others. It covers their medical bills and lost wages. Property damage liability pays to repair or replace property that you damage or destroy. This includes other cars or property, such as fences. It can also pay for "pain and suffering" damages if someone sues you after a car accident. Almost all states and the District of Columbia require minimum liability coverage amounts by law.
Types of Auto Insurance Coverage
2. Personal Injury Protection
While Comprehensive coverage may be something you don’t need to purchase, Personal Injury Protection (PIP) is something you should. The costs associated from an accident can quickly add up, and in order to cover those costs Personal Injury Protection is available. Personal Injury Protection (PIP) and Medical (MedPay) coverage pays for both medical expenses and lost wages to the policyholder and any passengers injured in the vehicle in the event of an accident. Some experts advise people with good medical and disability policies to only take on the lowest limit of PIP coverage required by their state. Some states, such as New Jersey, allow drivers to reject PIP entirely.
3. Comprehensive Coverage
What if something happens to your car that is unrelated to a covered accident - weather damage, you hit a deer, your car is stolen - will your insurance company cover the loss? Liability insurance and collision coverage cover accidents, but not these situations. These situations are covered by Comprehensive coverage. Comprehensive coverage is one of those things that is great to have if it fits in your budget. Anti-theft and tracking devices on cars can make this coverage slightly more affordable, but carrying this type of insurance can be costly, and may not be necessary, especially if your car is easily replaceable.
4. Collision Coverage
Collision coverage insures you in the event of any kind of accident, whether it's with another car or an object, such as a utility pole or fire hydrant. If you have an older car, and the cost of repairing or replacing your car is likely more than its value, you may want to waive both collision and comprehensive coverage. Unlike liability coverage, this type of coverage is not required by law, but according to 2008 NAIC data, 77 percent of insured drivers purchase comprehensive coverage in addition to liability insurance and 72 percent buy collision coverage. Furthermore, your bank (if you are financing your car) or your leasing company (if you are leasing your car) will likely require that you carry this coverage until you have paid for your car in full or for the life of the lease.
5. Uninsured Motorist coverage
Uninsured Motorist coverage provides you protection from crashes with motorists not carrying car insurance, as well as covering you in the event of a hit-and-run accident. Also, uninsured motorist insurance coverage comes into play when an at-fault driver doesn't have enough liability coverage to pay for the damages from an accident. Most states require drivers to carry some level of uninsured motorist coverage. You need uninsured motorist coverage if you’re involved in an accident with:
A driver who carries no auto insurance whatsoever
A driver who carries insurance coverage that falls below the state’s required minimums
A driver who is insured by a company that is financially unable to cover your losses
A driver who hits you and flees the scene.
Saving tip: It's usually relatively inexpensive to add uninsured/underinsured motorist protection to your car insurance policy, especially considering the amount of protection it offers.
Things to Remember About Auto Insurance Coverage
There are a variety of insurance types that you can combine to find the best coverage for your needs Certain types are required by state, so make sure you find out your state’s regulations for insurance An easy way to save on auto insurance is by comparing free insurance quotes from several companies Most of these coverages are optional, and adding them to your policy will increase your premium. When in doubt, ask your agent to clearly explain the car insurance coverage options to you. Choosing the bare minimum coverages doesn’t always generate cheap insurance quotes. In fact, your cheap insurance quotes may be higher than anticipated when you select bare minimum coverages. Carriers provide cheap insurance quotes to those who carry the least amount of risk. Minimum coverages make you a higher risk and this increased risk makes your cheap insurance quotes more expensive. Even if you don’t want the most coverage, choose coverages higher than state minimums to generate more competitive, cheap insurance quotes. Thank you.
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Short Term Medical Insurance in USA
Short Term Medical Insurance | asuranci.com
Short Term health insurance, sometimes called Term health insurance or Temporary health insurance, is a flexible health insurance coverage solution when you need coverage for a period of transition in your life.
Short Term health insurance is designed to help bridge gaps in your health care coverage during times of transition. And if you’ll pardon the pun, you’ll find no “shortage” of information online telling you what Short Term Medical insurance isn’t or what it can’t do for you. But for many people, and for many situations, the best Short Term health insurance plan they can find may just be the right solution.
Short Term insurance may be for you if you're:
Unable to apply for Affordable Care Act (ACA), also called Obamacare, coverage because you missed Open Enrollment and you don't qualify for Special Enrollment
Waiting for your ACA coverage to start
Looking for coverage to bridge you to Medicare
Turning 26 and coming off your parent's insurance
Between jobs or waiting for benefits to begin at your new job
Healthy and under 65
For these situations and many others, Short Term health insurance, also called Temporary health insurance or Term health insurance, might be right for you. It can fill that gap in coverage until you can choose a longer term solution.
How To Lower Costs for Short Term Health Insurance
Choose a higher deductible.
Choose a plan with fewer benefits.
Pay your total premium up front.
Choose a Per Cause Deductible option.
Purchasing a short-term medical insurance plan will make you ineligible for any guaranteed issue individual health plans commonly referred to as HIPAA Plans. HIPAA plans are usually very expensive and are generally intended for people with pre-existing medical conditions who would have trouble getting health insurance otherwise. If you wish to maintain your eligibility for HIPAA plans, you should not purchase a short-term plan. Please consult your benefits advisor to discuss your rights under the Health Insurance Portability and Accountability Act (HIPAA) and other rights under state law.
Short Term Medical Insurance
Short-term health insurance plans typically do not cover pre-existing medical conditions. The definition of a pre-existing condition varies by state, but, in general, short-term health insurance policies exclude coverage for conditions that have been diagnosed or treated within the previous 3 to 5 years. If you have an existing medical condition, you may want to research whether you can extend your current insurance. Employer-sponsored insurance can be extended under a government-regulated option commonly referred to as COBRA, which you should seriously consider if you have an existing medical condition. Maybe you want to know about:
Health Insurance Policy
Short Term Medical Insurance in USA
Types of Health Insurance Plans
Short Term Medical Insurance in USA
The easiest solution is to buy temporary insurance while staying in another state. Insurance issued in another state is valid in New York and allows treatment with any doctor or hospital in the U.S. There is no requirement that the address on temporary health insurance be your permanent residential address. Some New Yorkers residents purchase health insurance while staying at their out-of-state colleges, while at their second home in another state or while on vacation or visiting relatives. The insurance covers treatment while they are away from home as well as with the doctors and hospitals at home in New York. Almost all short term medical insurance is purchased online and most offer immediate download of the policy and insurance ID cards. Most insurance companies allow you to have the policy mailed back to a New York address if you will be returning from your trip soon.
The only other possible alternatives we can offer are:
Core Health Insurance – a limited benefit policy that does a fairly good job at mimicking the benefits of major medical insurance
International Medical Insurance - for individuals who are not permanent residents of U.S.
Inbound Immigrant Insurance – for individuals who have recently moved to the U.S.
If none of these options will work then it is especially important to explore all options to keep, extend or convert prior health insurance regardless of the higher cost.
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Best Car Insurance - Tips to Buying Car Insurance
Best Car Insurance - How To Find It Car insurance is an insurance technique acquired by the car proprietor to safe secure hisher vehicle against burglary, disaster and whatever other incident achieved. Car insurance covers protected vehicle and ensured party, and a couple times it covers pariahs in addition. Unmistakable car insurance methodologies have assorted terms, guidelines and conditions under which, these things are secured. Today considerable amounts of car insurance methodologies are available in the market and it is really to a great degree troublesome task to purchase the best car insurance for the safeguard of your vehicle. Here are a couple tips, which can be used to find the best car insurance for your dim boomer.
Tips to Buying car Insurance
Buying car Insurance
Tips 1: Starting Out
As to car insurance, you should be sufficient covered if you get in an accident anyway you would lean toward not to pay any more than you have to. So in what capacity may you investigate your way through this shady subject? Keep telling yourself there is money to be saved. What sum? Hundreds, even thousands, consistently. For example, one of our editors composed the lion's share of his insurance information into a comparative insurance advantage. The quotes (for to a great degree basic extension on two old cars) stretched out from $1,006 to $1,807 — a qualification of $801 a year. In the event that you're starting at now dumping thousands into your insurance association's coffers in light of a few tickets, an accident or an imperfect FICO score, shopping your system against others may be positively legitimized paying little respect to the effort.
Look at it in this manner — you can change over the money you save into the purchase of something you've pined for a long time. Hold that goal in your mind.
Step 2: How Much Coverage Do You Need?
To find the right car insurance, start by comprehending the measure of extension you require. This vacillates from state to state. So delay for a moment to find what degree is required where you live. Make an once-over of the unmistakable sorts of degree and subsequently return for the accompanying step. (You will find an once-over of each state's necessities and an illumination of the diverse sorts of insurance in "How Much car Insurance Do You Really Need?" Also, take a gander at "Little-Known however Important Insurance Issues" as it has a glossary of central insurance wording.) Since you understand what is required, you can pick what you require additionally. A couple people are exceptionally careful. They build their lives as for most critical situation circumstances. Insurance associations worship these people. That is by virtue of insurance associations perceive what your chances are of being in a disaster, and how likely it is for your car to be hurt or stolen. The information the insurance association has assembled over before decades is crunched into "actuarial tables" that give insurance adjustors a quick look at the probability of practically any occasion. So what measure of insurance would it be fitting for you to buy past your state's base? Authorities recommend that if you have a lot of advantages you should get enough hazard extension to guarantee them. For instance, if you purchase $50,000 of considerable damage chance extension however have $100,000 in assets, legal advisors could seek after your fortunes if there should arise an occurrence of an accident in which you're at fault and the other party's clinic costs outperform $50,000. General recommendations for commitment limits are $50,000 generous mischief chance for one individual hurt in a setback, $100,000 for all people hurt in a disaster and $25,000 property hurt hazard (that is, 50/100/25) given that half of the cars out on the town are worth more than $20,000. Here afresh, in any case, let your cash related condition be your guide. In case you have no points of interest, don't buy excess degree. Another issue to consider is that the limits of any uninsured and furthermore underinsured driver scope that you purchase can't outperform the cutoff purposes of your hazard scope. Such extension, he expressed, can be imperative, as it will cover lost pay on the off chance that you're out of work for some time in the wake of being hurt in an essential mishap. You're driving inclinations may similarly be an idea. If your past is stacked with collapsed guards, in case you have a lead foot or a lengthy drive on a misleading winding road, then you should get more broad extension. Keep in mind that you don't have to buy affect and broad degree. In case your vehicle is more settled, if you have a better than average driving record and if there is a low likelihood that it would be totaled in an incident, however a high likelihood of it being stolen, you could buy finish yet not affect.
Step 3: Review Your Driving Record and Current Insurance Policy
Before you begin searching for insurance you should check the going with: the status of your driving record, your present degree and the premiums you are paying. You should recognize what number of tickets you have had starting late. However, time plays traps and our memories smother troublesome events. If you can't recall to what degree that speeding ticket has been on your record, check with your state's DMV. If your record will soon improve, and the concentrations you earned will finally vanish, hold up until that happens before you get refers to. Nothing drives up the cost of insurance like a frightful driving record. In like manner, you should contact your car insurance association or pull out a present bill. Jot down the measure of degree you have and what you are paying for it. Watch the yearly and month to month cost of your insurance since countless quotes will be given both ways. By and by you have a figure as a top need to endeavor to beat.
Step 4: Solicit Competitive Quotes
Since you have settled on a couple of realistic and philosophical decisions, it's an incredible chance to start shopping. Begin by setting aside around a hour for this errand. Bring each one of your records — your stream insurance approach, your driver allow number and your vehicle enlistment. Drink a great deal of coffee. Have a phone at your elbow. Moreover, clearly, control up your PC. Begin with the online organizations. If you go to InsWeb.com or other online insurance refer to regions, you can sort in your information and get a summary of comparable quotes. These structures take around 15 minutes to wrap up. In case this bores you, essentially remind yourself the sum you will save and that you can use the money to buy something not too bad for yourself. If the entire shopping process takes both of you hours to complete and you save $800, you're effectively procuring $400 a hour. A few things to recall: 1) When you use refer to regions, you may not get minute refers to. A couple of associations may contact you later by email, and some that are not "prompt providers" may put you in contact with an area administrator, who will then figure a quote for you. (A "quick provider," like Geico, pitches an insurance game plan to you particularly; unique associations like State Farm offer insurance through adjacent experts. We'll discuss the points of interest and detriments of each later.) 2) It's hard to get refers to from these regions in all states — if you live in New Jersey, for instance, you'll probably imagine that its speedier to get the phone, since most go down arrangements in this state at present don't give online quotes. You can in like manner try getting refers to from a part of the insurance associations recorded on the Edmunds.com Web site — Liberty Mutual, Geico or Progressive. These structures will take around 10 minutes each to wrap up.
Step 5: Record and Compare Quotes
While you're asking about associations, make notes in an alternate PC record or on a touch of paper isolated into orders. This will shield you from replicating your attempts. When you visit the different online insurance regions, you should watch a couple of things: Yearly and month to month rates for the assorted sorts of extension — make an indicate keep quite far a comparable with the objective that you can make "one write to it's coherent partner" connections A 800 number to call for request you can't get tended to on the web: The insurance association's portion game plan (When is your portion due? What occurs on the off chance that you're late in making a portion?)
Step 6: Work the Phones
When you have drained your online choices, it's an awesome chance to work the phones. Those associations you haven't had the ability to get an online quote from should be come to. From time to time, doing this strategy verbally can truly go speedier than the online accomplice, giving you have every one of the information as for your driver allow and vehicle enlistment close inside reach. When you get a quote, try to confirm the cost. In like manner, demand that they fax or email the quote to you as a record.
Step 7: Look for Discounts
While speaking with the insurance associations' telephone agents, guarantee you examine all decisions relating to discounts. Insurance associations give refunds for a not too bad driving record, incredible FICO rating, security equipment (for example, electronically checked moderating components), certain occupations or master affiliations and the sky is the point of confinement from that point. For more bearing here, take a gander at "How to Save Money on car Insurance."
Step 8: Choosing the Right Insurance Company
You now have the greater part of the data before you that you have to settle on a choice. In any case, there is something more to consider. You can obviously observe which organization is slightest costly, however when you require them to cover a claim, what sort of occupation will they do? To put it another way, which is the most solid insurance organization? Beneath, we offer various issues to manage your reasoning and help you achieve a choice: Visit your state's division of insurance and check buyer grievance proportions and essential rate examination reviews. Connect with neighborhood body shops or dealerships you trust and ask which insurance organizations they prescribe. Consider reaching an insurance operator for extra data about a specific organization. Look at the money related quality appraisals for an insurance organization by alluding to the A.M. Best and Standard and Poor's evaluations. Investigate J.D. Power and Associates' shopper fulfillment overviews surveying car insurance organizations.
Step 9: Review the Policy Before You Sign
So, you've done your research, and you've decided on a company. Before you sign, though, read the policy. In addition to verifying that it contains the coverage you want, there are two clauses that you should look for in the contract: Retain your right to sue. "Find out if you are giving up your right to go to court and will be forced into arbitration if there is a disagreement [between you and the insurance company]," one expert advised. "You're much better off if you don't give up this right…. It makes it easier for [insurers] to take advantage of you." If you find a clause to this effect, all isn't necessarily lost. "At least in theory, a contract is a mutual agreement, so you should be able to cross out that line in the policy," he said. If the company won't agree to the policy sans clause, then you should probably take your business elsewhere. Avoid aftermarket parts requirements. If an insurance company has written in the policy that "new factory," "like kind and quality" or "aftermarket parts" may be used for body shop repairs, go to another company, one expert advised. If you own a relatively new car that you plan to keep for a while, you will probably be much happier if you spend a little more time researching companies on the front end rather than try to fight the company when you have a claim.
Step 10: Cancel Your Old Policy
After you lock in the insurance policy you want with the company you select, you have two more things to do. The first is to cancel coverage with your existing insurance company. Second, if your state requires you to carry proof of insurance, make sure you either have it in your wallet or the glove compartment of your car (some experts discourage this, however — if your car is stolen, the thief has everything he needs to prove the vehicle is his). Now, there's one last thing to do: reward yourself for saving so much money on car insurance. Checklist Determine your state's insurance requirements. Consider your own financial situation in relation to the required insurance and consider buying more to protect your assets. Review the status of your driving record — do you have any outstanding tickets or points on your driver license? Check your current coverage to find out how much in premiums you are paying. Inquire about discounts you might qualify for such as a multiple policy discount. Evaluate the reliability of the insurance company you're considering by visiting your state's insurance Web site. If you have chosen a new insurance company, remember to cancel your old policy.
Compare Car Insurance Rates
To have an idea about online Auto insurance quotes, you just need to compare car insurance rates provided to you by various Auto insurance companies:
Name of Company
Get Online insurance quote Premium Rate Rank in USA 1
Esurance
Click here 1 2
Geico
Click here 2 3
Allstate
Click here 3 4
State Farm
Click here 4 5
21st Century Insurance
Click here 5 6
AAA
Click here 6 7
Progressive
Click here 7 8
Nationwide
Click here 8 9
Liberty Mutual
Click here 9 10.
American Family
Click here10
To locate best auto insurance, you are requested to make a search on your own. First of all go to local auto insurance providers. Compare auto insurance quotes provided by them. Most of auto insurance providers have their websites, you can go there and request for car insurance quotes online, if you own a car. Compare their quotes and find best auto insurance for your vehicle. Always remember that bargaining is the key to buy cheap auto insurance. After comparing auto insurance quotes apply for the best one for you and your vehicle. While applying given them details as much as you can such as your name, address, zip code, your marital status, car’s annual commuting miles and safety features because as default they can offer you high quotes without any specific benefits. Hence, to buy a cheap and best auto insurance always give full details about you and your vehicle. Sometimes insurance companies provide specific offers. Thus always look for offers, as they can deduct your premium from £200 to £400. Before signing your application form read each and every point of fine print, as they can protect your right. With keeping these simple tips in mind you can find best auto insurance policy.
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Types of Health Insurance Plans
Types of Health Insurance Plans | asuranci.com Health is a basic issue related to any individual and it should be managed. This impacts the whole gathering of a man so in case you purchase health insurance for yourself then it is benefitting you and most of your family and society. Health insurance is acquired from an insurance association and you ought to pay certain measure of money which will be used to pay your facility charge later on. This is really an ensured way to deal with keep an eye on your own health. Anyone can get it by paying through his credit or charge cards. Online health insurance has a lot of favorable circumstances and a bit of the best health insurance points of interest are given thunder. Particular health insurance courses of action are available in two sorts: Indemnity and Managed Care Plans. There is only two important differentiations between the two game plans. The sum you will pay as premium and the strategy for paying your bills.
Types of Health Insurance Plans
Repayment solitary health insurance is also more expensive than Managed Care and that is the reason a large number individuals settle on the Managed Health Care Plans. To the extent points of interest and danger secured, the reimbursement particular health insurance plan is the one that covers the basics of health more totally. It is similarly the most settled sort of health insurance. Repayment orchestrate obliges you to pay a bit of the restorative costs with the insurance provider paying the change remaining. The most benefitted plan is the 80-20 where you are required to pay 80% of the restorative costs brought about and the insurance provider pays the remaining 20%. Premiums are charged in like way. The higher the entirety you make plans to pay, the lower will be the month to month premium charged by the insurance provider. The association picks the rate of compensation on the preface of ordinary costs charged by pros and specialists in your general region for restorative organizations. You either pay the costs blunt and ensure from the insurance association later or have your master send the bill to them particularly. Administered health mind game plans are more well known in light of the way that they are more sensible when stood out from repayment organizes. The first rate rates are lower also anyway you are not at flexibility to pick your specialist or expert association and have limited choice. Maybe you want to know about:
Health Insurance Policy
Short Term Medical Insurance in USA
Types of Health Insurance Plans
Types of Health Insurance Plans
Each insurance brand may offer no less than one of these four ordinary sorts of plans:
Health bolster affiliations (HMOs)
Favored provider affiliations (PPOs)
Specific provider affiliations (EPOs)
Motivation behind organization (POS) orchestrates
High-deductible health organizes (HDHPs), which may be associated with health venture accounts (HSAs)
Delay for a minute to make sense of how these game plans differ. Being familiar with the game plan sorts can help you pick one to fit your budgetary arrangement and meet your health mind needs. To take in the specifics about a brand's particular health orchestrate, look at its summary of points of interest.
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Types of Car Insurance & What You Need To Know
The several Types of Car Insurance & What You Need To Know To help you understand car insurance a lttle bit more, we've listed some matters on the finer factors. Find out what coverage is available when it comes to car insurance and what will suit your needs. Types of Car Insurance These are the common types of car insurance policies: Comprehensive cover: This includes the price of repairs to or replacement of your own vehicle and property whether you are at fault or not. It can also cover the price tag on emergency repairs, transportation costs and destruction caused by other drivers. Third Party Fire & Theft cover: Alternative party, Open fire and Theft covers you for loss or harm to your car if it is stolen or catches fire in addition to your liability for damage caused by your car to other people's property.
3rd party property cover: Covers damage that you have caused to another person's vehicle or property. It does not cover the price of harm to your own car. It usually includes legal costs, limited damage by uninsured drivers and promises service. Compulsory third party insurance (CTP): Otherwise known as 'green slip' insurance, CTP is required of each registered driver in Quotes. It indemnifies drivers who are legally liable for personal injury to another party in case of a car accident. This can include other drivers, passengers, bicyclists and pedestrians. Each State has a different process for CTP and Sign up. See your Condition Federal government for details. Additional coverage options: Besides the standard cover provided some Insurance providers will have additional features and benefits available, they may include New car replacement, protected No State Bonus and choice of repairer. You should look at each policy and see that the features and benefits are what you are looking for in an insurance plan. Precisely what is the difference between Agreed Value and Market Value? Most insurers will also give you the option of market or decided value in the event that your car is written off. Market value represents industry value of the car at the time of the state, taking into account the condition of the car based on its age, make and model. Agreed value is the value of the car as agreed by both you and the insurance provider and is fixed until the policy renewal date. Maybe you want to know about:
Tips to Buying Car Insurance
Estimating Car Insurance Rates
Finding Cheap Online Car Insurance
How To Get Cheap Car Insurance
What is an Excess? A surplus is the amount you'll have to pay in the event of a claim. For example , if your excess is $500 and your claim will be worth $1, two hundred, you will pay the first $500 and the insurance provider the remaining $700. Found in the event of a much more serious accident, in which your vehicle is written off, the excess amount will typically be deducted from the final claim repayment. Generally speaking, there are three types of excessive: Basic excess: This is the minimum payment that you are obliged to make in the event of a claim. The surplus amount will be particular on your Certificate of Insurance. Voluntary excess: This is an additional amount, on top of your fixed excess, that you consent to pay in the event of a claim. Elevating your excess effectively reduces the financial risk transported by your insurer, which should thereby lower your premium. Age (inexperienced driver) excess: Where an insurance policy features a new new driver, or drivers under the age of 25 years, a greater excess will normally apply. This includes nominated drivers as well as the principal driver. Points to think about when it comes to your excess: It may be worth increasing your excess to save money on your insurance premium. But before you do, consider the car you drive and what happens in the event of a claim. For instance, if you drive an old, low-cost vehicle it might not be advantageous to increase your excess. After all, you don't want to pay out more than your vehicle is worth! In the event of an accident, consider the difference between your declare amount and your basic excess. Always look at the impact a declare may have on your No Claim Bonus entitlement and the effect on premiums in future years. Buying Car Insurance At their most basic, insurance should protect you and your family up against the effects of a loss to your person or property. Yet with the different cover options available, it can get somewhat more complicated than that. Read our top tips below for buying car insurance.
Tips for buying car insurance:
Establish what coverage you require
Compare coverage quotes
Understand the advantages of car insurance
Learn the vocabulary - our glossary will help
Know your automobile and your driving history
Determine how much you can afford
Review insurance company qualifications
Review the fine print out of your coverage
Find out how to lower your premium
Types of Insurance
1. Mandatory Third Party (CTP) CTP InsuranceCTP, as the name proposes, is necessary and you won't have the capacity to enroll your vehicle until this insurance is set up. What does CTP insurance cover? CTP gives you assurance against cases for pay in the event that you harm or slaughter somebody in an engine vehicle mischance. The particular conditions change from state to state, so make certain to check how it functions in your state What it doesn't cover: CTP doesn't safeguard against the cost of repairs to any vehicles or property – yours or anybody else's. While it is the least expensive and most essential type of cover, remember that having just CTP insurance abandons you at critical money related hazard if you harm a vehicle or other property having a place with another person. You can discover more about CTP car insurance here. 2. Outsider Property This is the most fundamental type of discretionary car insurance, and gives you budgetary cover in the event that you make harm property as opposed to a man; for instance somebody's prized car, watercraft or caravan. What does outsider insurance cover? – Third Party Property covers harm brought on by your car to other individuals' property. It will likewise take care of your legitimate expenses in the event that you end up plainly entangled in lawful procedures subsequently of the harm created. What it doesn't cover: Third gathering property doesn't take care of the expense of any repairs or substitution of your own car, with the exception of under some restricted conditions through a few safety net providers. So it's like CTP in that it just gives cover to other individuals and their property, as opposed to you and yours too. Breaking into car 3. Outsider, Fire and Theft In the event that you would prefer not to pay for first class insurance yet do need some level of assurance for your own car, Third Party, Fire and Theft insurance is the following alternative. What does outsider insurance cover? – notwithstanding covering harm to the property of others, Third Party, Fire and Theft insurance additionally gives some constrained cover to your own car if it's harmed or lost because of flame or burglary. What it doesn't cover: This insurance doesn't take care of the expense of repairs to your vehicle in the event that it is included in a car crash. What are the odds of your car being stolen? As indicated by the National Motor Vehicle Theft Reduction Council, a vehicle is stolen like clockwork in Australia. The larger part of robberies are "here and now burglaries" yet there is likewise a sensibly extent of "revenue driven" burglaries. 4. Thorough Car Insurance This is the top-level insurance cover alternative and will unquestionably give you the best true serenity – but at the same time it's the most costly! What does extensive car insurance cover? – It covers everything said in the past insurance choices above, and furthermore it covers coincidental harm to your own particular car, regardless of who is to blame. There are additionally a scope of discretionary additional items, including substitution vehicles and no-overabundance windscreen substitution. When they say complete, they certainly would not joke about this. What it doesn't cover: Even complete insurance has restrictions. It by and large won't cover harm brought about by another person driving your car, unless they are approved to do as such on your arrangement. It additionally won't cover harm brought about if the driver was over the legitimate liquor restrict or influenced by medications. Furthermore your car must be roadworthy and you should hold a legitimate driver's permit. Picking the car insurance believe it or not for you will depend to a limited extent on what you can bear. Preferably, however, pick the best cover you can manage. Begin your inquiry by perusing our free Car Insurance Star Rating Report and utilizing our site to analyze car insurance approaches. On the off chance that you ensure that you comprehend the contrasts between the different sorts of car insurance, and what you should be secured for, you're in good shape!
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Finding Cheap Online Car Insurance
Finding cheap online car insurance Car insurance is something that we all need and should command careful consideration. When in the market for car insurance coverage, and with so many car insurance companies to choose from, it can be a bit confusing when trying to decide on the best and most affordable coverage for your vehicle. With the convenience of the internet, finding all the information required to get the best deals and rates can easily be accomplished online. Finding a reputable car insurance company is a job within itself, and like buying a home, it is imperative you clearly understand what you are getting. When in search of cheaper car insurance rates you should take into account all the factors that can affect your car insurance premiums. So before you sign on the dotted line, read the fine print of car Insurance Policy to insure you are getting the necessary coverage to protect yourself. It happens time and time again, when the car owner gets into an accident or fender bender, the coverage they thought they were paying for is not part of their policy which can lead to out-of-pocket expenses.
Get several car insurance quotes
Cheap Online Car Insurance
Some key factors when shopping for cheap car insurance is to first make sure you get at least three or four quotes since the price you pay for your car insurance can vary by hundreds of pounds. Finding cheaper insurance rates depends on your previous driving records, to include any type of infraction such as speeding, seat belt and car accidents. Age, gender and the type of car you are seeking car insurance coverage on including the age of the vehicle, will clearly be critical factors in determining your annual car premiums. It is equally important to find a car insurance company that can answer any questions you may have and how quickly they handle claims fairly and efficiently. Once you decide on a quote you are satisfied with, before agreeing to anything check with your state insurance department about the company’s history. Finding out the financial well-being of an insurable institution and the number ratio of consumer complaints, could avoid headaches or any future regrets.
Learn the facts about car insurance
Some other ways of saving money is to ask your insurance broker or agent for a higher deductible. The deductive is the amount of money you pay before the insurance company pays out on your claim. The purpose of requesting a higher deductible can lower your car rates substantially. When you increase the deductible from £500 to £1,000 you can potentially save you over 40% on your car insurance rates simply because the insurance company will pay out less for your claim. However, if you know that you can not pay out the higher deductible should something happen to your car in the instance of an accident, and then it is best to remain at a lower deductible. When figuring out the appropriate insurance coverage for your car, take into account the age of the car. This could also influence your car premium, for example you may want to consider excluding the collision or comprehensive coverage on an older car. It is not cost saving to yourself when you continue to pay full coverage on a car worth less than amount you pay for your insurance coverage. If the car has a market value of £2,000 or less, you would not want to pay more in premiums since you will never get back what you are paying out. You can easily find out the current market value of your car in order to find out what coverage you will require from a number of valued sources such as banks, car dealerships, or go online and use the search term, “finding the value of your vehicle”. You can find several reputable services such as, www.kbb.com or www.nadaguides.com where all you have to do is type in the applicable information about your car and instantly you will have the market value. As the saying goes, an educated consumer is a smart consumer, the more you understand prior to purchasing car insurance, you will be able to make an informed and valued decision. Maybe you want to know about:
Tips to Buying Car Insurance
Estimating Car Insurance Rates
How To Get Cheap Car Insurance
Types of Car Insurance
Finding The Cheapest Car Insurance Quote
Research studies indicate that a car is broken into or stolen every 19 seconds in the United States. In such a scenario, you need to ensure that you have found the cheapest car insurance quote. However, the trick is to amalgamate the duality of robust coverage and affordability. Thus, finding the cheapest car insurance quote is not merely a hunt for the lowest premium. Do your Homework right! Start with doing your homework right. Spend time and understand the insurance imperatives as laid down by the state law. Evaluate the minimum coverage requirements in-force. Compare Apples to Apples! Don’t compare just purely on the basis of rates. The key to finding the Cheapest car Insurance Quote is to compare all the pertinent elements that go into providing comprehensive coverage at any given price. In the United States, getting insurance quotes from leading insurers and comparison-shopping is very easy. Be ruthless when you compare across quotes and choose the one with the optimal coverage at the most affordable cost. Also, when comparing across plans, compare apples to apples. This essentially means that you price-evaluate plans with the same coverage, features and benefits. Online Quote Comparison! There are various websites that offer online quote comparison service. These websites offer access to instant online car insurance quotes, let you compare coverage, view, modify coverage tiers. However, keep away from websites that also sell car insurance online, as their quotes could be biased and misleading. Don’t get fooled by lower deductibles! A lower deductible does not mean that you have got yourself a dream bargain. Think long term; avoid having a short term vision. A low deductible means that you would end up paying a higher premium. Be smart and opt for a plan with a higher deductible. What matters is the ultimate cost of the coverage, considering all eventualities. Do keep in mind that car insurance is not a ‘cost’ – but a great way to protect yourself, and family, with the car. So, keep the human element in mind and act prudently. Tread with care!
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Estimating Car Insurance Rates: What You Need to Know
How much car insurance should you buy?
There are two answers:
First, you need enough insurance to drive legally. Find out your state car insurance minimum requirements.
Second, you need enough car insurance to protect your life from turning into a living hell if you have a car accident. That can be as easy as buying the minimum coverage. Or it can be much more complicated.
Not all car insurance coverage is the same. Many people overpay for coverages they don’t need, while others don’t have enough coverage but don’t know until it’s too late. This tool will help you decide what coverage options you need. It will make shopping around for the best insurance rates a lot easier, and it takes less than one minute!
car accident
Choosing the Right Car Insurance Coverage
Getting the right level of car insurance is not one size fits all. What is most important to one consumer isn’t necessary for another.
That’s why it’s critical to get the car insurance that fits your needs.
Car Insurance Coverage Calculator is a quick way to find the right car insurance levels and options for you. While getting the cheapest car insurance is most important for some consumers, another person may want the broadest possible protection. Our calculator understands that personalization is vital when deciding on the best car insurance coverage for your situation.
The calculator includes a short questionnaire that asks you questions about:
Your zip code
Net worth
Age of your vehicle
Deductible level
Whether you own, lease or finance your vehicle
If cheapest car insurance or best protection is most important to you
After completing the questions, the calculator will tell you the right level of insurance for you. You’ll also know whether you are paying for unneeded car insurance coverage or if you don’t have the right level of insurance to protect you and your family’s finances.
Maybe you want to know about:
Tips to Buying Car Insurance
Finding Cheap Online Car Insurance
How To Get Cheap Car Insurance
Types of Car Insurance
How Much Car Insurance do I Need?
The calculator recommends the right level of car insurance coverage for you based on your answers. This coverage can include:
Bodily injury liability
Property damage liability
Uninsured/Underinsured motorist bodily injury
Umbrella liability policy
Comprehensive and collision
Personal injury protection
Gap insurance
How much does my age affect my car insurance rates?
Auto insurers penalize inexperience rather than age. Of course, the vast majority of inexperienced drivers are teenagers. Rates for 16-year-olds can double or even triple their parents’ car insurance annual premiums.
The less experienced the driver, the higher the rates. Among drivers with clean records and no accidents, no other factor changes rates more.
Statistically, inexperienced drivers crash – a lot – and so they are the riskiest category of drivers to insure. Car insurance rates reflect this high risk.
Is there any difference between insurance companies?
Insurance companies must follow state laws, but within those laws they price coverage based on their own underwriting rules and guidelines. One insurance company may look at your driving record for five years, another only for three. The surcharge for a speeding ticket may raise your insurance by 10 percent with one carrier but only 5 percent with another.
You should shop around and get quotes from several carriers. Make sure you are comparing apples to apples -- the same coverages with each insurer -- and check the reliability and financial stability of the insurance carrier.
Finally, make an informed decision about who you want to be insured with for the best price and protection. Don’t let a small savings drive you away from an insurance company you know and trust.
Personal Injury Protection, or Medical Payments, pays for your own medical expenses, any lost wages and whatever other costs may arise when you're injured in an accident, in some states. It usually pays about 80 % of the losses. It also pays a death benefit. PIP is required in New York, New Jersey, Florida, Arkansas, Delaware, Hawaii, Kansas, Kentucky, Maryland, Massachusetts, Michigan, Minnesota, North Dakota, Oregon, Pennsylvania and Utah.
A few states require you to purchase auto insurance that covers your medical expenses, pain and suffering losses and, in some states, motor damage in the incident where the other motorist is at fault and is either not insured or underinsured. See the chart below to find out if it applies to you.
State
Liability limits (in thousands of dollars)
Uninsured/Underinsured motorist coverage required?
Alabama
25/50/25
No
Alaska
50/100/25
No
Arizona
15/30/10
No
Arkansas
25/50/25
No
California
15/30/5
No
Colorado
25/50/15
No
Connecticut
20/40/10
Yes
Delaware
15/30/10
No
D.C.
25/50/10
Yes
Florida
10/20/10
No
Georgia
25/50/25
No
Hawaii
20/40/10
No
Idaho
25/50/15
No
Illinois
20/40/15
Yes
Indiana
25/50/10
No
Iowa
20/40/15
No
Kansas
25/50/10
Yes
Kentucky
25/50/10
No
Louisiana
10/20/10
No
Maine
50/100/25
Yes
Maryland
20/40/15
Yes
Massachusetts
20/40/5
Yes
Michigan
20/40/10
No
Minnesota
30/60/10
Yes
Mississippi
25/50/25
No
Missouri
25/50/10
Yes
Montana
25/50/10
No
Nebraska
25/50/25
No
Nevada
15/30/10
No
New Hampshire
Not required 25/50/25
Yes
New Jersey
15/30/5
Yes
New Mexico
25/50/10
No
New York
25/50/10
Yes
North Carolina
30/60/25
Yes
North Dakota
25/50/25
Yes
Ohio
12.5/25/7.5
No
Oklahoma
25/50/25
No
Oregon
25/50/10
Yes
Pennsylvania
15/30/5
No
Rhode Island
25/50/25
Yes
South Carolina
25/50/25
Yes
South Dakota
25/50/25
Yes
Tennessee
25/50/10
No
Texas
25/50/25
No
Utah
25/65/15
No
Vermont
25/50/10
Yes
Virginia
25/50/20
Yes
Washington
25/50/10
No
West Virginia
20/40/10
Yes
Wisconsin
Not required 25/50/10
Yes
Wyoming
25/50/20
No
Even though each state has minimum (or no) requirements for bodily injury liability, this is probably in your better interest to go for higher limits. If someone else is injured and you are at fault, the minimum liability coverage may not cover their medical expenses, in which case their attorney will most probably come after your assets. It is recommended to purchase 100/300 limits of bodily injury liability. While, if your personal assets don't amount too much, you do not have a whole lot for them to worry about, so the minimum requirements might actually suit you and will save you cash.
Apart from various forms of liability insurance, there is collision and comprehensive auto insurance coverage to consider. Collision covers damage to the policyholder's motor (car) resulting from running into anything, be it anything e.g. another car, a fire hydrant, or a light post. Comprehensive coverage takes care of your car from theft, fire, falling objects, explosions, or other unexpected problems.
Collision and comprehensive coverage are required in most lease contracts, and are necessary if you drive an expensive car. If you're driving an old car, on the contrary, and the value of your premium and your deductible are close to or exceed the value of your car, you might want to consider doing without this coverage.
Before purchasing any kind of auto insurance, be sure to study your other insurance policies so you don't end up paying for something you don't need. If you have a good health insurance plan, you might get away with purchasing the bare minimum PIP coverage or none at all if your state doesn't require that. However, you might end up paying a co-pay and deductible that would not apply if you have PIP or MedPay.
Uninsured or underinsured motorist coverage might also be a smart buy, even if you have full medical coverage, as it can pay for your injury and suffering damages. If u work for any organization that offers road side assistance, you don't need to purchase that yourself. The similar thing applies to mechanical breakdown insurance if you own a newly financed or leased vehicle which is still under warranty.
It is easy to be resentful of the money spent on auto insurance. Keep in mind that auto insurance will most likely come to your rescue at some point of time, so it's essential to purchase a worthwhile policy. You must know what coverage you must have and know what additional coverage fits your lifestyle. Then if in case any trouble strikes, you'll be ready for it in advance.
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How To Get Cheap Car Insurance
How to get the best car insurance deals
While a ‘one-size-fits-all’ car insurance policy doesn’t exist, there are steps you can take to find the best car insurance deals for you.
Car insurers calculate premiums using a range of factors including age, driving experience, occupation, and car usage. As a result, the best car insurance deals for one driver could be wrong for someone else.
At its most simple, car insurance covers you if your car is stolen or involved in a road accident. It also protects other road users if you cause damage to their vehicle or property.
The cost of insurance – your premium – is based on how much of a risk insurers perceive you to be. For example, if you are a youngster ready to hit the highway after just passing your test, or you have had more than a prang or two, you will pay more.
Cheap Car Insurance
However, if you can prove you are not a risk by keeping accident-free and storing your car safely, you will pay much less.
How To Get Cheap Car Insurance
There are a number of different things you can do to help cut the cost of your car insurance premium and get cheaper car insurance, including:
Paying a higher voluntary excess (the extra amount you’d pay in the event of a claim)
Limiting who drives your car to just yourself, or you plus a named driver
Parking your car in a garage or driveway away from the street
Keeping your mileage low (doing less than the average of 8,000 miles per year according to the National Travel Survey)
Fitting a security device such as an alarm, tracker, or immobiliser
For more ideas on how to reduce your insurance costs, read our car insurance guides.
Maybe you want to know about:
Tips to Buying Car Insurance
Estimating Car Insurance Rates
Finding Cheap Online Car Insurance
Types of Car Insurance
Getting the best car insurance deals for your car
The make and model of your car can be a hugely important factor in determining the cost of your car insurance cover. Each car is sorted into an insurance group, based on its value, power, and cost of repair. The lower a car’s insurance group, the less it typically costs to insure. You can learn more in our guide on car insurance groups and the cheapest cars to insure.
Whatever car you drive, it’s worth considering all types of cover (comprehensive, third party fire and theft, and third party only) to get the best car insurance deal for you. Take a look at our dedicated guide to learn more about the different types of car insurance policies.
If you have a high performance vehicle or classic car then the best car insurance companies for you will be specialist providers who understand the risks.
Classic car insurance quotes will usually take into consideration the costs of replacing original parts and general maintenance.
Cars with cosmetic or mechanical modifications also tend to be more expensive so steer clear of these if finding the cheapest insurance deals is the most important factor for you.
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10 Reasons Why Insurance is Important
Why Insurance is Essential for Us | asuranci.com
You insure your car and your home. But nothing is more important than your life and your ability to make a living. So it makes good sense to insure your greatest asset – you!
As we move through life, find a partner, raise a family, and maybe start a business, the importance of insurance in a long term plan increases. That’s because insurance is all about providing a financial safety net that helps you to take care of yourself and those you love when you need it the most.
Insurance is tricky. It's not like buying a chair or a shirt or groceries. When you buy insurance, you're buying a promise. It's a promise that if something catastrophic happens to your business, your carrier is going to assist you to make your business whole again. Sometimes, though, it's tempting to question the value of insurance because it is an intangible product.
Why Insurance is Important
Insurance is important because it protects a person or entity from extreme financial loss or responsibility due to an unfortunate emergency, accident or negative unforeseen event. There are many different kinds of insurance, some of which cover a person and some of which cover businesses and other entities.
Let's back up and take a big-picture view of why insurance matters. Here are ten reasons why insurance is important.
10 Reasons Why Insurance Matters
Why is insurance important? Let’s look at ten key reasons.
1. Insurance meaning protection for you and your family
Your family depend on your financial support to enjoy a decent standard of living, which is why insurance is especially important once you start a family. It means the people who matter most in your life may be protected from financial hardship if the unexpected happens.
2. Insurance reduce stress during difficult times
None of us know what lies around the corner. Unforeseen tragedies such as illness, injury or permanent disability, even death – can leave you and your family facing tremendous emotional stress, and even grief. With insurance in place, you or your family’s financial stress will be reduced, and you can focus on recovery and rebuilding your lives.
3. To enjoy financial security
No matter what your financial position is today, an unexpected event can see it all unravel very quickly. Insurance offers a payout so that if there is an unforeseen event you and your family can hopefully continue to move forward.
4. Insurance Grants Peace of Mind
Insurance, an intangible, provides another intangible: peace of mind. Business owners can take on certain business ventures because they can shift the risk — thanks to insurance. This reason is the counterpart to No. 2 — lenders require insurance. Insurance is the required (by lenders) safety net that lets entrepreneurs explore opportunity.
5. A legacy to leave behind
A lump sum death benefit can secure the financial future for your children and protect their standard of living.
6. Lenders Require Insurance
Lenders require that you have insurance. Think about it: Mortgage lenders want proof of insurance before you buy or build a new building. In short, to get the money your business needs to keep going, it’s likely you enjoy the benefits of insurance. Without insurance, your winning business model can't get the funding it needs to take its first step, or your established business model can't get the funding to evolve and better compete.
7. Insurance is Compulsory in Some States
Insurance is important because sometimes it's the law! A great example of this is auto insurance. Auto insurance is compulsory in Wisconsin. Auto insurance helps mitigate the risk of life on the road. Workers' compensation is a form of compulsory insurance that's required in most states.
8. Insurance Ensures Family and Business Stability
Insurance is a safety net for when risks go wrong. Life insurance can support the life of a family, should a member be lost. It’s similar for a business. Should a key member or piece of equipment go out of commission, the business can carry on, thanks to insurance. This reason why insurance is important dovetails nicely with peace of mind (No. 4). It all goes back to the idea that insurance, when activated, makes policyholders whole again.
9. Insurance Protects the Small Guys
With insurance, however, the little guys have support if they want to take a risk, which means they stick around longer. What it comes down to is that insurance helps prevent monopolies from forming.
10. Insurance is the Right Thing to Do
A sobering example of insurance in action is the West Fertilizer Co. explosion in Texas this spring. The explosion did $100 million in damage to the community, including schools and hospitals. The fertilizer company had only $1 million in general liability coverage.
Now the city is suing West Fertilizer and likely will win all of the company’s remaining property and assets that were not damaged by the disaster. This is because the fertilizer company did not have enough insurance. What’s more is the city also is suing the suppliers to the fertilizer plant, claiming they knew they were supplying inherently dangerous materials. In the case of the West, Texas, plant explosion, insurance could have helped a community to recover after a crisis.
Insurance is something many business owners don't want to think about. But whether they think about insurance, with hope it's there, allowing for transfer of risk and providing a safety net for new opportunities.
Every day we face different problems like natural and uncontrolled human activities which could lost our ,millions of property. Therefore to overcome those property insurance is important. As insurance is the main way of business and individuals to reduce financial impact of a risk occurring in the near future. There are different types of insurance,as homeowner insurance,vehicle insurance,life insurance,animals and crops insurance.So, if we face the problem in the near future then we may overcome the value of it if we have done insurance of it.
Home insurance is important because if the natural disaster like,flood ,landslide,fire damages the property of the home then it could be overcome but some may be expectation. This type of insurance is famous all over the world.
Identity theft insurance is also becoming popular in these days because if the you lost your identity card then other impersonal may use it and take advantages.Even the criminals are using this card to withdraw the bank balance and rent a house along with the information in it to get the job.It can be avoided by the following points:
you must keep the amount of personal information in your purse or wallet to the bare minimum. Carrying of additional credits cards and your social security cards or passport unless it is very much essential.
be careful do not give out the personal information,whether on the pone or on the social medium unless you have initiated the contact or sure you you know whom you are dealing with.
You probably should shred any documents containing personal information such as credits cards numbers bank statement,charge receipts or credit card application,before disposing them.
If you are victim of a crime ,report to the police station or credit card company as possible as you can to secure your credit card .
Animals insurance is also essential for us,more essential for farmers because if you love your pets or you are doing the farm of animals then you must probably benefited.If animals get sick then the insurance company obviously help you.So, it is also important.
Vehicle insurance is the most popular insurance in the world.If you have done the insurance of the vehicles then you may be overcome it if your vehicle get accident or got theft.So motor vehicle is also essential.
Therefore, insurance is very much essential for us. Everything we lost would be overcome and it makes our life much easier and safer.
Maybe you want to know about:
Basic Concepts of Insurance
10 Reasons Why Insurance is Important
Health Insurance Policy
Types of Life Insurance Policies
What Is Insurance : Insurance Definition
Fundamental Insurance Concept
The word peril, loss and hazard terms sound synonymously but the words used in the insurance are quite different and those words should be distinguished carefully. As the insurance is the unseen and unintended loss to the owner and for the organization. For instance, if the price of the gadgets decreases by the value of market or be by its ages. Although the decreases surely lost made the loss, but the loss in the term of insurance is not called as loss. Additionally for instance, if destruction of the same gadgets is done through the fire then it is unintended and unseen and so we can consider it as loss.
Insurance fundamental
Common loss exposure is listed below;
Personal
Liability and
Property
Personal Losses
The injury, illness, and premature death are the example of it.
liability losses
The property which we cannot become legally responsible to pay back for injuries or other damages property. For instance, you have a pet and that pet harm others. For eg if you have a dog at home and that bites children, then probably you should be liable for the child heath. Additionally if you have a bike and you accidently have a accident and held you as a fault, then probably you may have to liable to pay for the damages you have caused.
property losses
The property loss by the unintended accidents like, fire, vehicle accident, storm damages that brought to the business are mentioned as property loss. It involves the destruction of commercial or let it be personal.
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What Is Insurance : Insurance Definition
Insurance Definition | asuranci.com
In one form or another, we all own insurance. Whether it's auto, medical, liability, disability or life, insurance serves as an excellent risk-management and wealth-preservation tool. Having the right kind of insurance is a critical component of any good financial plan. While most of us own insurance, many of us don't understand what it is or how it works. In this tutorial, we'll review the basics of insurance and how it works, then take you through the main types of insurance out there.
Insurance Definition
A promise of compensation for specific potential future losses in exchange for a periodic payment. Insurance is designed to protect the financial well-being of an individual, company or other entity in the case of unexpected loss. Some forms of insurance are required by law, while others are optional. Agreeing to the terms of an insurance policy creates a contract between the insured and the insurer. In exchange for payments from the insured (called premiums), the insurer agrees to pay the policy holder a sum of money upon the occurrence of a specific event.
Insurance is a form of risk management in which the insured transfers the cost of potential loss to another entity in exchange for monetary compensation known as the premium. (For background reading, see The History Of Insurance In America.)
Insurance allows individuals, businesses and other entities to protect themselves against significant potential losses and financial hardship at a reasonably affordable rate. We say "significant" because if the potential loss is small, then it doesn't make sense to pay a premium to protect against the loss. After all, you would not pay a monthly premium to protect against a $50 loss because this would not be considered a financial hardship for most.
Insurance is appropriate when you want to protect against a significant monetary loss. Take life insurance as an example. If you are the primary breadwinner in your home, the loss of income that your family would experience as a result of our premature death is considered a significant loss and hardship that you should protect them against. It would be very difficult for your family to replace your income, so the monthly premiums ensure that if you die, your income will be replaced by the insured amount. The same principle applies to many other forms of insurance. If the potential loss will have a detrimental effect on the person or entity, insurance makes sense.
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What Is Insurance : Insurance Definition
Everyone that wants to protect themselves or someone else against financial hardship should consider insurance. This may include:
Protecting family after one's death from loss of income
Ensuring debt repayment after death
Covering contingent liabilities
Protecting against the death of a key employee or person in your business
Buying out a partner or co-shareholder after his or her death
Protecting your business from business interruption and loss of income
Protecting yourself against unforeseeable health expenses
Protecting your home against theft, fire, flood and other hazards
Protecting yourself against lawsuits
Protecting yourself in the event of disability
Protecting your car against theft or losses incurred because of accidents
How does insurance work?
Insurance works by pooling risk.What does this mean? It simply means that a large group of people who want to insure against a particular loss pay their premiums into what we will call the insurance bucket, or pool. Because the number of insured individuals is so large, insurance companies can use statistical analysis to project what their actual losses will be within the given class. They know that not all insured individuals will suffer losses at the same time or at all. This allows the insurance companies to operate profitably and at the same time pay for claims that may arise. For instance, most people have auto insurance but only a few actually get into an accident. You pay for the probability of the loss and for the protection that you will be paid for losses in the event they occur.
Risks
Life is full of risks - some are preventable or can at least be minimized, some are avoidable and some are completely unforeseeable. What's important to know about risk when thinking about insurance is the type of risk, the effect of that risk, the cost of the risk and what you can do to mitigate the risk. Let's take the example of driving a car. (For more insight on the concept of risk, see Determining Risk And The Risk Pyramid.)
Type of risk: Bodily injury, total loss of vehicle, having to fix your car
The effect: Spending time in the hospital, having to rent a car and having to make car payments for a car that no longer exists
The costs: Can range from small to very large
Mitigating risk: Not driving at all (risk avoidance), becoming a safe driver (you still have to contend with other drivers), or transferring the risk to someone else (insurance)
Let's explore this concept of risk management (or mitigation) principles a little deeper and look at how you may apply them. The basic risk management tools indicate that risks that could bring financial losses and whose severity cannot be reduced should be transferred. You should also consider the relationship between the cost of risk transfer and the value of transferring that risk.
Risk Control
There are two ways that risks can be controlled. You can avoid the risk altogether, or you can choose to reduce your risk.
Risk Financing
If you decide to retain your risk exposures, then you can either transfer that risk (ie. to an insurance company), or you retain that risk either voluntarily (ie. you identify and accept the risk) or involuntarily (you identify the risk, but no insurance is available).
Risk Sharing
Finally, you may also decide to share risk. For example, a business owner may decide that while he is willing to assume the risk of a new venture, he may want to share the risk with other owners by incorporating his business.
So, back to our driving example. If you could get rid of the risk altogether, there would be no need for insurance. The only way this might happen in this case would be to avoid driving altogether. Also, if the cost of the loss or the effect of the loss is reasonable to you, then you may not need insurance.
For risks that involve a high severity of loss and a low frequency of loss, then risk transference (ie. insurance) is probably the most appropriate protection technique. Insurance is appropriate if the loss will cause you or your loved ones a significant financial loss or inconvenience. Do keep in mind that in some instances, you are required to purchase insurance (i.e. if operating a motor vehicle). For risks that are of low loss severity but high loss frequency, the most suitable method is either retention or reduction because the cost to transfer (or insure) the risk might be costly. In other words, some damages are so inexpensive that it's worth taking the risk of having to pay for them yourself, rather than forking extra money over to the insurance company each month.
The Risk Management Process
After you have determined that you would like to insure against a loss, the next step is to seek out insurance coverage. Here you have many options available to you but it's always best to shop around. You can go directly to the insurer through an agent, who can bind the policy. The process of binding a policy is simply a written acknowledgement identifying the main components of your insurance contract. It is intended to provide temporary insurance protection to the consumer pending a formal policy being issued by the insurance company. It should be noted that agents work exclusively for the insurance company. There are two types of agents:
Captive Agents: Captive agents represent a single insurance company and are required to only do business with that one company.
Independent Agent: Independent agents represent multiple companies and work on behalf of the client (not the insurance company) to find the most appropriate policy.
Underwriting
Underwriting is the process of evaluating the risk to be insured. This is done by the insurer when determining how likely it is that the loss will occur, how much the loss could be and then using this information to determine how much you should pay to insure against the risk. The underwriting process will enable the insurer to determine what applicants meet their approval standards. For example, an insurance company might only accept applicants that they estimate will have actual loss experiences that are comparable to the expected loss experience factored into the company's premium fees. Depending on the type of insurance product you are buying, the underwriting process may examine your health records, driving history, insurable interest etc.
The concept of "insurable interest" stems from the idea that insurance is meant to protect and compensate for losses for an individual or individuals who may be adversely affected by a specific loss. Insurance is not meant to be a profit center for the policy's beneficiary. People are considered to have an insurable interest on their lives, the life of their spouses (possibly domestic partners) and dependents. Business partners may also have an insurable interest on each other and businesses can have an insurable interest in the lives of their employees, especially any key employees.
Insurance Contract
The insurance contract is a legal document that spells out the coverage, features, conditions and limitations of an insurance policy. It is critical that you read the contract and ask questions if you don't understand the coverage. You don't want to pay for the insurance and then find out that what you thought was covered isn't included. (For more insight, read Understand Your Insurance Contract.)
Insurance terminology you should know:
Bound: Once the insurance has been accepted and is in place, it is called "bound". The process of being bound is called the binding process.
Insurer: A person or company that accepts the risk of loss and compensates the insured in the event of loss in exchange for a premium or payment. This is usually an insurance company.
Insured: The person or company transferring the risk of loss to a third party through a contractual agreement (insurance policy). This is the person or entity who will be compensated for loss by an insurer under the terms of the insurance contract.
Insurance Rider/Endorsement: An attachment to an insurance policy that alters the policy's coverage or terms. (To learn more, read Let Life Insurance Riders Drive Your Coverage.)
Insurance Umbrella Policy: When insurance coverage is insufficient, an umbrella policy may be purchased to cover losses above the limit of an underlying policy or policies, such as homeowners and auto insurance. While it applies to losses over the dollar amount in the underlying policies, terms of coverage are sometimes broader than those of underlying policies.
Insurable Interest: In order to insure something or someone, the insured must provide proof that the loss will have a genuine economic impact in the event the loss occurs. Without an insurable interest, insurers will not cover the loss. It is worth noting that for property insurance policies, an insurable interest must exist during the underwriting process and at the time of loss. However, unlike with property insurance, with life insurance, an insurable interest must exist at the time of purchase only.
Even though the basics of how to save money on insurance is the same for all insurance types, each insurance type has its own unique set of tips and tricks. Almost more importantly, each insurance type has it’s own set of deadlines, laws, and rules. You can save serious money by knowing the rules, knowing the facts, and knowing a few tips and tricks. So, let’s cover some of the most important basics of insurance including the different insurance types.
If you drive, you need auto insurance.
If you own a home, you need home owner’s insurance.
If you make more than the tax filing threshold, you have to have health insurance.
Most people will find some type of life insurance to be a smart buy.
Basic things, like extended warranties and knowing how the FDIC works, are important.
In fact, insurance is a very important and vast subject.
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Health Insurance Policy
Health Insurance Policy | asuranci.com Health insurance is insurance against the risk of incurring medical expenses among individuals. By estimating the overall risk of health care and health system expenses, among a targeted group, an insurer can develop a routine finance structure, such as a monthly premium or payroll tax, to ensure that money is available to pay for the health care benefits specified in the insurance agreement. The benefit is administered by a central organization such as a government agency, private business, or not-for-profit entity.
According to the Health Insurance Association of America, health insurance is defined as coverage that provides for the payments of benefits as a result of sickness or injury. It includes insurance for losses from accident, medical expense, disability, or accidental death and dismemberment.
A Health Insurance Policy
A contract between an insurance provider (e.g. an insurance company or a government) and an individual or his/her sponsor (e.g. an employer or a community organization). The contract can be renewable (e.g. annually, monthly) or lifelong in the case of private insurance, or be mandatory for all citizens in the case of national plans. The type and amount of health care costs that will be covered by the health insurance provider are specified in writing, in a member contract or "Evidence of Coverage" booklet for private insurance, or in a national health policy for public insurance.
(US specific) Provided by an employer-sponsored self-funded ERISA plan. The company generally advertises that they have one of the big insurance companies. However, in an ERISA case, that insurance company "doesn't engage in the act of insurance", they just administer it. Therefore, ERISA plans are not subject to state laws. ERISA plans are governed by federal law under the jurisdiction of the US Department of Labor (USDOL). The specific benefits or coverage details are found in the Summary Plan Description (SPD). An appeal must go through the insurance company, then to the Employer's Plan Fiduciary. If still required, the Fiduciary's decision can be brought to the USDOL to review for ERISA compliance, and then file a lawsuit in federal court.
The individual insured person's obligations may take several forms:
Premium: The amount the policy-holder or their sponsor (e.g. an employer) pays to the health plan to purchase health coverage.
Deductible: The amount that the insured must pay out-of-pocket before the health insurer pays its share. For example, policy-holders might have to pay a $500 deductible per year, before any of their health care is covered by the health insurer. It may take several doctor's visits or prescription refills before the insured person reaches the deductible and the insurance company starts to pay for care. Furthermore, most policies do not apply co-pays for doctor's visits or prescriptions against your deductible.
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Co-payment: The amount that the insured person must pay out of pocket before the health insurer pays for a particular visit or service. For example, an insured person might pay a $45 co-payment for a doctor's visit, or to obtain a prescription. A co-payment must be paid each time a particular service is obtained.
Coinsurance: Instead of, or in addition to, paying a fixed amount up front (a co-payment), the co-insurance is a percentage of the total cost that insured person may also pay. For example, the member might have to pay 20% of the cost of a surgery over and above a co-payment, while the insurance company pays the other 80%. If there is an upper limit on coinsurance, the policy-holder could end up owing very little, or a great deal, depending on the actual costs of the services they obtain.
Exclusions: Not all services are covered. The insured are generally expected to pay the full cost of non-covered services out of their own pockets.
Coverage limits: Some health insurance policies only pay for health care up to a certain dollar amount. The insured person may be expected to pay any charges in excess of the health plan's maximum payment for a specific service. In addition, some insurance company schemes have annual or lifetime coverage maxima. In these cases, the health plan will stop payment when they reach the benefit maximum, and the policy-holder must pay all remaining costs.
Out-of-pocket maxima: Similar to coverage limits, except that in this case, the insured person's payment obligation ends when they reach the out-of-pocket maximum, and health insurance pays all further covered costs. Out-of-pocket maxima can be limited to a specific benefit category (such as prescription drugs) or can apply to all coverage provided during a specific benefit year.
Capitation: An amount paid by an insurer to a health care provider, for which the provider agrees to treat all members of the insurer.
In-Network Provider: (U.S. term) A health care provider on a list of providers preselected by the insurer. The insurer will offer discounted coinsurance or co-payments, or additional benefits, to a plan member to see an in-network provider. Generally, providers in network are providers who have a contract with the insurer to accept rates further discounted from the "usual and customary" charges the insurer pays to out-of-network providers.
Prior Authorization: A certification or authorization that an insurer provides prior to medical service occurring. Obtaining an authorization means that the insurer is obligated to pay for the service, assuming it matches what was authorized. Many smaller, routine services do not require authorization.
Explanation of Benefits: A document that may be sent by an insurer to a patient explaining what was covered for a medical service, and how payment amount and patient responsibility amount were determined.
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Basic Concepts of Insurance
10 Reasons Why Insurance is Important
Health Insurance Policy
Types of Life Insurance Policies
What Is Insurance : Insurance Definition
Prescription drug plans are a form of insurance offered through some health insurance plans. In the U.S., the patient usually pays a copayment and the prescription drug insurance part or all of the balance for drugs covered in the formulary of the plan. Such plans are routinely part of national health insurance programs. For example, in the province of Quebec, Canada, prescription drug insurance is universally required as part of the public health insurance plan, but may be purchased and administered either through private or group plans, or through the public plan.
Some, if not most, health care providers in the United States will agree to bill the insurance company if patients are willing to sign an agreement that they will be responsible for the amount that the insurance company doesn't pay. The insurance company pays out of network providers according to "reasonable and customary" charges, which may be less than the provider's usual fee. The provider may also have a separate contract with the insurer to accept what amounts to a discounted rate or capitation to the provider's standard charges. It generally costs the patient less to use an in-network provider.
We can resume health insurance terminology as the 'provider' as we can say it may be clinic, doctor, hospital, laboratory, pharmacy or health care practitioner. The person with the health insurance coverage's, 'insured' is the owner of the health insurance policy.
Health insurance is a type of insurance coverage that covers the cost of an insured individual's medical and surgical expenses. Besides that, depending on the type of health insurance coverage either the insured pays costs out-of-pocket and is then reimbursed or the insurer makes payments directly to the provider. Health insurance is commonly included in employer benefit packages and seen as an employment perk in USA.
In some countries, health care coverage is provided by the state and is seen as every citizen's right, such as Canada and United Kingdom. It is classed along with public education, firefighters, street lighting, public road networks, and police as a part of a public service for the nation.
In country like USA, we can see health insurance coverage is somewhat different from the others country. Health insurance is done by everyone, with the exception of some groups, such as veterans, elderly and/or disabled people. It is the individual's responsibility to be insured. Most recently, Obama Administration has introduced laws making it mandatory for everybody to have health insurance, obviously there are penalties for those who fail to have a policy of some kind.
Everybody at some time in their life and often on many occasions surely will need some kind of medical attention and treatment. Whenever medical care is required, mostly the patient should be able to concentrate on getting better with their health, rather than wondering whether he/she has got the resources to pay for all the bills. Most recently, This view is becoming more commonly held in nearly all the developed nations.
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Types of Life Insurance Policies
Types of Life Insurance Policies | asuranci.com
Insurance companies have present different levels of policies to suit different needs of public. At the time of confirming to buy a policy, a person must know firstly the amount of premium he will have to pay, secondly time span of insurance, and thirdly.sum insured with or without bonus. The following are the types of life insurance policies:
Types Of Life Insurance Policies
Whole life policy
Endowment policy
Term policy
Other life policies
Types Of Life Insurance Policies
1) Whole Life policy
In this type of policy the insured have to pay premium throughout his life or up to limited years. The amount is paid to the nominee of the insured on his death. This done for the protection of nominee's family. The rate of premium in the policy is low as compared to other policies of life insurance because amount is payable in the whole life. This type of policy has no financial gain to insured. It can be further classified into following types:
Ordinary whole life policy
Limited Premium whole life policy
Single Premium whole life policy
2) Endowment Policy
This type of policy is issued for a fixed specific period of time. Insured is payable to the policyholder on the maturity of the policy. Endowment policy is very popular because it makes provision for the security of the family. The following are the types of this policy:
Ordinary endowment policy
Pure endowment policy
Double Endowment policy
Deferred endowment policy.
3) Term Policy
It's a very old policy which is for 1, 2, 5 or 10 years. The money is paid back only after the death of the nominee. If the nominee survives more than the insured time than company will not pay back the amount. We have to make knowledge that it's neither saving nor investment. It has following types:
Straight Term policy
Convertible Term Policy
Decreasing Term Policy
Renewal Term Policy
4) Other Life Policies
Some of the types of life insurance are as follows:
Single Premium Insurance
Joint Life Policy
Group Life Insurance
Multipurpose Insurance Policy
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What Is Insurance : Insurance Definition
Types of Life Insurance
Life insurance protection comes in many forms, and not all policies are created equal, as you will soon discover. While the death benefit amounts may be the same, the costs, structure, durations, etc. vary tremendously across the types of policies.
Whole Life
Whole life insurance provides guaranteed insurance protection for the entire life of the insured, otherwise known as permanent coverage. These policies carry a "cash value" component that grows tax deferred at a contractually guaranteed amount (usually a low interest rate) until the contract is surrendered. The premiums are usually level for the life of the insured and the death benefit is guaranteed for the insured's lifetime.
With whole life payments, part of your premium is applied toward the insurance portion of your policy, another part of your premium goes toward administrative expenses and the balance of your premium goes toward the investment, or cash, portion of your policy. The interest you accumulate through the investment portion of your policy is tax-free until you withdraw it (if that is allowed under the terms of your policy). Any withdrawal you make will typically be tax free up to your basis in the policy. Your basis is the amount of premiums you have paid into the policy minus any prior dividends paid or previous withdrawals. Any amounts withdrawn above your basis may be taxed as ordinary income. As you might expect, given their permanent protection, these policies tend to have a much higher initial premium than other types of life insurance. But, the cash build up in the policy can be used toward premium payments, provided cash is available. This is known as a participating whole life policy, which combines the benefits of permanent life insurance protection with a savings component, and provides the policy owner some additional payment flexibility.
Universal Life
Universal life insurance, also known as flexible premium or adjustable life, is a variation of whole life insurance. Like whole life, it is also a permanent policy providing cash value benefits based on current interest rates. The feature that distinguishes this policy from its whole life cousin is that the premiums, cash values and level amount of protection can each be adjusted up or down during the contract term as the insured's needs change. Cash values earn an interest rate that is set periodically by the insurance company and is generally guaranteed not to drop below a certain level.
Variable Life
Variable life insurance is designed to combine the traditional protection and savings features of whole life insurance with the growth potential of investment funds. This type of policy is comprised of two distinct components: the general account and the separate account. The general account is the reserve or liability account of the insurance provider, and is not allocated to the individual policy. The separate account is comprised of various investment funds within the insurance company's portfolio, such as an equity fund, a money market fund, a bond fund, or some combination of these. Because of this underlying investment feature, the value of the cash and death benefit may fluctuate, thus the name "variable life".
Variable Universal Life
Variable universal life insurance combines the features of universal life with variable life and gives the consumer the flexibility of adjusting premiums, death benefits and the selection of investment choices. These policies are technically classified as securities and are therefore subject to Securities and Exchange Commission (SEC) regulation and the oversight of the state insurance commissioner. Unfortunately, all the investment risk lies with the policy owner; as a result, the death benefit value may rise or fall depending on the success of the policy's underlying investments. However, policies may provide some type of guarantee that at least a minimum death benefit will be paid to beneficiaries.
Term Life
One of the most commonly used policies is term life insurance. Term insurance can help protect your beneficiaries against financial loss resulting from your death; it pays the face amount of the policy, but only provides protection for a definite, but limited, amount of time. Term policies do not build cash values and the maximum term period is usually 30 years. Term policies are useful when there is a limited time needed for protection and when the dollars available for coverage are limited. The premiums for these types of policies are significantly lower than the costs for whole life. They also (initially) provide more insurance protection per dollar spent than any form of permanent policies. Unfortunately, the cost of premiums increases as the policy owner gets older and as the end of the specified term nears. (To learn more, read Buying Life Insurance: Term Vs. Permanent and What is term insurance?)
Term polices can have some variations, including, but not limited to:
Annual Renewable and Convertible Term: This policy provides protection for one year, but allows the insured to renew the policy for successive periods thereafter, but at higher premiums without having to furnish evidence of insurability. These policies may also be converted into whole life policies without any additional underwriting.
Level Term: This policy has an initial guaranteed premium level for specified periods; the longer the guarantee, the greater the cost to the buyer (but usually still far more affordable than permanent policies). These policies may be renewed after the guarantee period, but the premiums do increase as the insured gets older.
Decreasing Term: This policy has a level premium, but the amount of the death benefit decreases with time. This is often used in conjunction with mortgage debt protection.
Many term life insurance policies have major features that provide additional flexibility for the insured/policyholder. A renewability feature, perhaps the most important feature associated with term policies, guarantees that the insured can renew the policy for a limited number of years (ie. a term between 5 and 30 years) based on attained age. Convertibility provisions permit the policy owner to exchange a term contract for permanent coverage within a specific time frame without providing additional evidence of insurability.
Food for Thought
Many insurance consumers only need to replace their income until they've reached retirement age, have accumulated a fair amount of wealth, or their dependents are old enough to take care of themselves. When evaluating life insurance policies for you and your family, you must carefully consider the purchase of temporary versus permanent coverage. As you have just read, there are many differences in how policies may be structured and how death benefits are determined. There are also vast differences in their pricing and in the duration of life insurance protection.
Many consumers opt to buy term insurance as a temporary risk protection and then invest the savings (the difference between the cost of term and what they would have paid for permanent coverage) into an alternative investment, such as a brokerage account, mutual fund or retirement plan.
TYPES OF LIFE INSURANCE POLICIES
You know that you need life insurance. However, with the wide variety of insurance policies available, you may find choosing the right one difficult. It's really not as confusing as it seems, however, once you understand the basic types of life insurance policies.
Term life insurance
With a term policy, you get "pure" life insurance coverage. Term insurance provides a death benefit for only a specific period of time. If you die during the coverage period, your beneficiary (the person you named to collect the insurance proceeds) receives the death benefit (the face amount of the policy). If you live past the term period, your coverage ends, and you get nothing back.
Term insurance is available for periods ranging from 1 year to 30 years or more. You may be able to renew the policy for a new term without regard to your health, but at a higher rate. Your premium goes toward administrative expenses, company profit, and a reserve account that pays claims to those who die during the term period. As you get older, the chance that you will die increases. To cover this increasing risk, your premiums will likewise rise at regular intervals. For this reason, premiums that were quite inexpensive at the time you initially purchased your term policy will become much more expensive as you get older. Most term insurance also has a conversion feature that allows you to switch your coverage to some type of permanent insurance without answering health questions.
Traditional whole life insurance--guaranteed premiums
Whole life insurance is a type of permanent insurance or cash value insurance. Unlike term insurance, which provides coverage for a particular period of time, permanent insurance provides coverage for your entire life. When you make premium payments, you pay more than is needed to pay for the current costs of insurance coverage and expenses. The excess payment is credited to a cash value account. This cash value account allows the insurance company to charge a level, guaranteed premium* and to provide a death benefit and cash value throughout the life of the policy.
As you make payments, the cash value account grows. With traditional whole life insurance, the cash value account is guaranteed* and held in the insurance company's general portfolio--you don't get to choose how the cash value account is invested. However, the cash value can potentially grow beyond its guaranteed amount through the payment of dividends (profits earned by a "mutual" insurer). The cash value grows tax deferred and can either be used as collateral to borrow from the insurance company or be directly accessed through a partial or complete surrender of the policy. It is important to note, however, that a policy loan or partial surrender will reduce the policy's death benefit, and a complete surrender will terminate coverage altogether.
If you live to the policy's maturity date, the policy will "endow," and the insurance company will pay the accumulated cash value (equal at maturity to the death benefit) to you.
Universal life--openness and flexibility
Universal life is another type of permanent life insurance with a death benefit and a cash value account. Like whole life insurance, the cash value is held in the insurance company's general portfolio--you don't get to choose how the account is invested. Unlike traditional whole life, universal life insurance allows you flexibility in making premium payments.
A universal life insurance policy will generally provide very broad premium guidelines (i.e., minimum and maximum premium payments), but within these guidelines you can choose how much and when you pay premiums. Reducing or increasing premiums will impact the growth of the cash value component and possibly the death benefit. You are also free to change the policy's death benefit directly (again, within the limits set out by the policy) as your financial circumstances change. Be aware, however, that if you want to raise the amount of coverage, you'll need to go through the insurability process again, probably including a new medical exam, and your premiums will increase.
Universal life policies reveal all aspects of the policy's cost structure, including the cost of insurance (the portion set aside to pay claims) and expenses. This information is not always available with other types of policies. Another feature of universal life is the option to add the cash value to the face amount when the death benefit is paid. For example, say you die when you have $200,000 of cash value within your $1 million policy. If you chose the enhanced benefit option, your beneficiary receives $1.2 million. Keep in mind, however, that nothing is free--the increased benefit is reflected in premium calculations.
Variable life--you make the investment decisions
Like other types of permanent life insurance, variable life insurance has a cash value account. A variable life insurance policy, however, allows you to choose how your cash value account is invested. A variable life policy generally contains several investment options, known as subaccounts, that are professionally managed to pursue a stated investment objective. Choices can range from a fixed interest subaccount to a highly volatile international growth subaccount. Variable life insurance policies require a fixed annual premium for the life of the policy and may provide a minimum guaranteed death benefit*. If the cash value account exceeds a certain amount, the death benefit will increase.
Variable universal life--the ultimate in flexibility
Variable universal life combines all of the options and flexibility of universal life with the investment choices of a variable policy. It is a true hybrid product, and you make most of the policy decisions. You decide how often and how much your premium payments are to be, within guidelines. With most variable universal life policies, you get no guaranteed minimum cash value or death benefit. Your premium payments in excess of administrative costs and the cost of insurance are invested in the variable subaccounts that you choose.
As with both variable and universal life insurance, your policy may lapse if the cash value account falls below a certain level. Low-interest loans can be taken against your cash value account, and cash withdrawals are available. However, keep in mind that your policy's face amount is reduced by the amount of a policy withdrawal, and withdrawals may be taxable. You have the option of choosing a fixed or enhanced death benefit. Today, most variable universal life policies offer a rider that guarantees the death benefit at a certain level regardless of the performance of the subaccounts, provided that a stated minimum premium is paid for a predetermined number of years*.
*Any guarantees associated with payment of death benefits, income options, or rates of return are subject to the claims-paying ability of the insurer.
Joint or survivorship life for you and your spouse
Some married couples choose to buy insurance together within the same policy. These policies take the form of either a joint first-to-die or a joint second-to-die (survivorship) design. With first-to-die, the death benefit is paid at the death of the spouse who dies first. With second-to-die, no death benefit is paid until both spouses are deceased. Second-to-die policies are commonly used in estate planning to create a pool of funds to pay estate taxes and other expenses due at the death of the second spouse. Joint and survivorship policies are generally available under any type of permanent life insurance. Other than the fact that two people are insured under one policy, the policy characteristics remain the same.
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Basic Concepts of Insurance
Basic Concepts of Insurance | asuranci.com Insurance is an economic institution that allows the transfer of financial risk from an individual to a pooled group of risks by means of a two-party contract. Insurance markets can exist because of the law of large numbers, which states that, for a series of independent and identically distributed random variables (such as automobile insurance claims), the variance of the average amount of a claim payment decreases as the number of claims increases. However, natural hazards-such as earthquakes, floods, and hurricanes—are classified as catastrophic risks. There is a high probability that many structures would be damaged or destroyed at the same time.
One way that insurers reduce the magnitude of their catastrophic losses is by employing high deductibles. The use of coinsurance, whereby the insurer pays a fraction of any loss that occurs, produces an effect similar to a deductible. Another way of limiting potential losses is for the insurer to place caps on the maximum amount of coverage on any given piece of property. An additional option is for the insurer to buy reinsurance.
Basic Concepts of Insurance
Insurance is based on the concept of risk pooling or risk sharing of losses. Basically under this concept, all individuals suffering a similar risk, place an agreed sum into a pool and the monies collected are used to indemnify any contributing individual against any loss arising out of the risk. The pool can either be managed by the individuals or paid to and managed by a company. In the former, the plan is known as mutual insurance while in the latter, the company managing the pool is known as a stock life insurance company.
For example, supposing in a certain typhoon prone community, there are 2000 houses, each worth $100000 and each is exposed to the same probability of being destroyed by a typhoon. In a particular year, if the statistics indicate that two of the houses will be destroyed by typhoon, this means that each house owner is relatively safe as he only faces a 0.1% chance that his house will be destroyed. However, should he be so unlucky as to constitute the 0.1%, his loss will be devastating. However, by setting up a common fund of $200000 to be used to compensate any two houseowners hit by typhoon, each house owner gains the assurance that any loss arising from the risk is minimised. Further, to accumulate this fund, each household only needs to contribute an affordable premium of $100. Each house owner therefore, pays a premium of $100 to buy peace of mind.
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Human beings are exposed to different kinds of risks, Such as loss of property by fire, untimely death, and loss in accidents. They are uncertain. It is impossible to eliminate financial loss arising from an uncertain event with the help of insurance. Thus, insurance is a financial mechanism to reduce or eliminate the financial loss due to risk .However, it can neither eliminate nor reduce the risk, but only provides protection against them .Insurance is a way of sharing a risk among the peoples.
Basic Concepts of Insurance
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What Is Insurance : Insurance Definition
The nature of insurance can be expressed clearly by an example. Suppose there are 20,000 houses in a village each values Rs: 200000. On the basis of experience it is ascertained that four houses are destroyed by fire each year. Thus, it is clear that fire will catch in four houses next year. But, it cannot be ascertained as to which house will catch house.
Nobody knows who those unfortunate individuals will be. One cannot foretell when and who would suffer loss. But everyone is afraid of the risk to which they are exposed. That is, everyone is likely to suffer from a loss of Rs: 200000 which is a big burden for an individual. They can find a method of providing protection against this risk by establishing a common fund to which each contributes Rs: 80 very years. The four unfortunate householders can be compensated by the created fund. It is in this cooperative measures that insurance originated. In fact, the most important from of risk transfer is insurance.
Insurance protects a person and his dependents from loss arising from future uncertain events such as fire, flood, accidents, early death, etc. It should be remembered that the loss cannot be eliminated by insurance but it spreads over a large number of persons. The function of insurance is to distribute the loss of few persons into many persons. We have to make the idea that the insurance is a process of sharing risks.
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