Insurance - What and Why

Reading auto insurance policies can be like trying to decipher advanced calculus. It’s not really that difficult if you understand a few basic terms: Collision, Comprehensive, Bodily Injury Liability and Property Injury Liability are main terms you need to fully understand.

The higher the deductible you elect, the lower your premiums will cost you. Just like medical insurance, you’d have to pay that deductible amount first and then the insurance company would pay for the remaining charges for the repair.

You’ll appreciate Collision Coverage in the event you need repairs or replacements if your vehicle collides with another vehicle or property.

Another term to become intimately familiar with is Comprehensive Coverage. This is the coverage that pays for damage caused from falling objects, fire, certain natural disasters, theft, and vandalism. Deductibles work the same way as with Collision; the more out of pocket costs to you, the less your insurance premium.

In addition to knowing how much Collision and Comprehensive coverage you have, you’ll want to know about your liability coverage. Let’s say you rear-end another driver. Or your foot slips off the brake onto the gas pedal and you plow down a mailbox. Your liability coverage will kick in and pay for the damages that you caused with your insured vehicle. You liability coverage will, or could, include bodily injury (people) and property damage.

You don’t want to go without Bodily Injury Coverage. If you were at fault in an accident and others involved needed to go to the hospital and/or lost wages from missing work, those costs would come out of your pocket if you are not insured with Bodily Injury Coverage. It doesn’t take a genius to know how quickly those amounts can add up.

This type of coverage can also help you in the event the other party takes legal action against you. Many states require you to carry Bodily Injury Coverage.

The other part of liability includes Property Damage coverage. Can you imagine how much it might cost should you accidentally drive into the side of someone’s home (if, for example, your brakes fail?)

You wouldn’t want to be caught without property damage insurance should you need to pay for repairs to another vehicle, building, or anything else you might hit. As with Bodily Injury coverage, Property Damage coverage also helps protect you in the event of a related lawsuit.

Every policy will have its limits and various degrees of coverage. It’s important that you understand the basics of what you are paying for and why it is necessary. No one plans for an accident, be prepared!

If you’re fortunate, or depending on how you look at it, unfortunate to live in one of the twelve states that are under a no fault auto insurance system, you can cause an accident, yet your insurance company won’t pay for the other parties’ damages.

If you live in a No-fault state (DC, FL, HI, KS, KY, MA, MI, MN, NJ, NY, ND, PA, UT) that means you live in a state that both requires drivers to carry insurance for their own protection and places limitations on their ability to sue other drivers for damages.

Your auto insurance company will pay for your damages (up to your policy limits), regardless of who was at fault for the accident. Any other drivers involved will be covered by their auto insurance policies. Since all are required to carry insurance, in theory, there should be no uninsured motorists in those states. Stop laughing; the term “in theory” was used!

These states opted for the no fault insurance system because it guarantees every driver immediate medical treatment in the event of an accident. Further, it’s intended to reduce the legal and administrative fees associated with insurance claims.

Again, in theory, this should result in lower premiums. Unfortunately, often times the liability issues that still remain will actually drive premium costs up.

However, because no state is pure no fault, drivers can always be held financially responsible for the cost of injuries they cause in certain circumstances – that’s the loop hole. Some states allow injured parties to sue if their injuries meet certain standard for severity, while others allow it when total costs reach a certain dollar level.

Below is a classic case of a no-fault situation. Neighbor lived in a four-plex apartment building. It had a 4-stall garage along with a 4-stall wide driveway. Because the driveway was so wide it was second nature for the tenants to pull out of their parking spots and turn around in the driveway instead of backing into the street.

One Sunday afternoon, one of the tenants decided to go visit a friend. She got into her car and began backing out of the driveway in her normal manner. When all of a sudden she felt a bump and heard a scream. At first she thought she ran over her cat who would occasionally escape. She opened her car door and found half of a body. Scared half out of her mind, she shut the car off and ran into the house and immediately called 911.

The driver was too scared to go outside at that point. As far as she knew, the half body, belonging to one of her neighbors, was still under the car and the driver was certain the injuries were serious. Her left rear wheel had crossed her body from her thigh on one side on the diagonal to above her pelvic region.

The driver later learned that some strong man from across the street came over and picked up the car so she could get out from underneath.

The neighbor announced that she was feeling fine and didn’t want to go to the hospital. But the police and ambulance didn’t feel the same way so they took her the four blocks to the hospital. Turns out the neighbor was sunbathing behind her car and somehow the driver didn’t see her when she walked to her car. She ended up with no broken bones, no internal injuries; just a tire track from her right thigh across to her left stomach.

The driver felt absolutely terrible, accepted full responsibility, wanted to do everything and more to make it up to her. The next day, the driver phoned the insurance company to explain to them what had happened. They asked her two questions. #1 Does she drive? (yes) and #2 Does she own a car? (yes). The insurance company informed the driver that due to No Fault insurance the neighbor’s own car insurance would have to cover the medical costs. The driver was clearly at fault, yet the driver’s insurance wouldn’t cover the damages even though it was her fault.

The driver went as far as to tell the neighbor to sue her since it was her fault and she felt totally responsible. The neighbor merely responded, “It was just an accident.” The lesson here - next time lay on the grass, instead of the drive way to sunbathe and risk the doggy doo.

Interesting No-Fault system, wouldn’t you say?

Car insurance is one of the most irritating of bills for the average family. It’s getting more and more expensive to insure your car just as it is getting more and more expensive to run your car.

With fuel costs escalating out of control car running costs are becoming a serious burden for the average family, especially families with more than one car. For this reason more and more people are looking for ways to control the costs associated with their family transport.

And whereas you can’t bring the price of gas down you can do something to reduce your car insurance costs.

Car insurance rates are a reflection of the perceived risk that the insurance company takes on when it insures you. If the company sees the risks as higher then the insurance premium will be higher. If they see the risks of insuring you as lower then this also will reflect in your car insurance premium.

So reducing your premium is all about doing things to demonstrate that the risk when insuring your car is low.

7 Tips To Reducing Car Insurance Costs.

1. A major factor for any car insurance company in assessing the insurance premium you pay comes down to the type of car you drive. Different types of car attract different levels of premium because, in particular, different types of car are driven by different types of people, who may have different types of risk profile.

   Sports cars, for example, will usually show a higher rate of accidents than staid boring family cars.

   And there are always certain types of cars which attract thieves more than others, and this is reflected in the premiums you pay to insure them.

   Your insurance company can tell you which types of cars are cheaper or more expensive to insure, so before you buy a car make some enquiries about whether that type of car is a high insurance premium car.

2. Consider your deductible. This is the amount you pay first out of any claim, and the cost of your policy is directly related to the amount of your deductible. Higher deductible - lower premium. So consider carefully whether you could afford to pay a higher amount first from any accident and raise your deductible. If so, you will get lower premiums.
3. Safety and anti theft devices can reduce the insurance costs for a car. Talk to your insurance company and find out if there are any safety or anti theft devices that you can install to reduce your premium.

   Then consider installing them making sure that you notify your insurance company once you have done so. And why not ring up your company and make sure that they are aware of any safety and anti theft devices you already have, if they aren’t you may get a reduction.

4. Drive carefully. It may sound obvious but as insurance premiums are related to risk then your manner of driving is related to your insurance premiums. Safer driver equals lower premiums. It may not seem so at the time but those traffic violations or speeding fines reflect in your bill.
5. Don’t just pay your premium each time it comes around without investigating if you can do better. Car insurance rates vary all the time and so even if it was the best rate last year it may not be this year. Every year shop around to see if you can do better, you may be surprised.
6. Have a look at other insurance policies you have with other companies. Many insurers offer discounts for combining all your family insurance with their company. Find out who they are and get a quote on all your policies combined.
7. Always look online for a competitive quote. Most of the major players and brokers are represented online and it is extremely competitive. It is very easy to get an online quote, just go to Google and search for car insurance quote and start looking.

These are just a few of the things that you can do, but there are plenty more. Educate yourself about your car insurance, find out all you can about it and be prepared to shop around once you know exactly what you do need, and what you don’t. You will find cheaper insurance.

Let your fingers do the walking… Remember that Yellow Pages Ad Campaign? Excellent advice if you’re shopping for auto insurance . Shop around and do it yearly.

Don’t just keep paying the invoice over and over without comparison shopping. Below are a few suggestions to help you get the best deal available on your automobile insurance policy.

Insurance agents really have a lot of leeway. They can price match and they can offer many discounts. There are also many decisions you can make about your policy that will save you a bundle. For example, if you change your deductible on your collision from a $50 deductible to a $1000 deductible, you’re inline for a huge premium savings. If you don’t think you could come up with $1000 out of pocket, then change it to a $500 deductible; you’ll still save a sizable amount on your annual premium payment.

You can also get more of a savings if you change your comprehensive deductible. Many people needlessly carry full coverage on their older vehicle. They originally purchased the vehicle new, paid for full coverage and to this day, continue to pay the same high rate. Their ten year old vehicle may be worth $1000 or less, yet they continue to pay $250-$450 every six months (total $500 to $900 dollars a year) to keep full coverage on their old vehicle.

However, if they have an accident and totaled their vehicle, the insurance company will only pay them the wholesale value of the vehicle. The amount they would receive could be $1000 or less. A vehicle that old just needs the insurance that protects the other person in case of an accident.

Another method to save more on your insurance is by combining your vehicles and other insurance together to get you additional savings. All insurance companies offer a multi-car discount (if yours doesn’t, it’s time to switch companies). Further, many will discount more if you have your homeowners or renters policy with them.

There are a few other discounts that you may not be taking advantage of. It seems obvious, but make sure you are getting the correct rate for your age. There are discounts for various ages than can save you lots of money. Check with your agent on this one.

Also, alarm systems on your vehicle are usually good for a discount. Additionally, anti-lock brakes and air bags can also help lower your premiums.

Don’t just keep paying the invoice when it comes in. Your insurance bill should be an automatic trigger for you to make a few phone calls to see if you can save even more money on your auto insurance premiums.

Affordable health insurance - it seems, especially today, those words just don’t belong together in the same sentence, especially if you’re paying your own premiums. Health insurance monthly premiums have become the biggest single expense in our lives - surpassing even mortgage payments.

In fact, if you have any permanent health problems, such as diabetes, or have had cancer at one time in your family history, your monthly cost could easily be more than the house and car payment combined.

Shopping for affordable health insurance can certainly be an eye-opener. If you have always had a health insurance benefit where you work - especially a state or federal employee - and now have to buy your own, you may not be able to afford the level of health insurance coverage you have become used to.

Affordable health insurance, however, is definitely available -if you know how and where to look.

When you are looking for affordable insurance, you want the lowest cost per year that will fit your budget, of course. But, even more importantly, you want a company that has a good record for paying without fighting with you on every detail.

Just as there is a car for just about any budget, there is also an insurance policy. You may not be able to afford a “Cadillac” policy - but then you probably don’t need all the frills anyway.

Shopping for health insurance on the web is the easiest and best way to find affordable insurance. Here are five reasons why.

1. You don’t need a local agent to help you submit the claims for health insurance. The medical provider does it for you. You save money because the health insurance company saves money by not paying the agent commission. This could amount to an 8% to 12% savings to you.
2. All the top health insurance companies are at your fingertips on the internet. Most local agents can only quote you from the few companies that they represent. They may not offer you what is best for you financially or health-wise since they can only pick from what  they happen to have available.
3. Health insurance companies have to be extremely competitive because it is so quick and easy to compare them with their competitors on the internet today. In the past you would have had to visit physically eight to ten agents to do a similar comparison. Most folks just didn’t have the time or desire for that.
4. You can change your coverage, deductibles, and payment options with just a few clicks rather than going through the paperwork delay with a local agent (and then finding out he/she made a mistake - more delay).
5. Charging to a credit card means you aren’t going to forget a payment and be without insurance. Also, it gives you another 30 days before you actually have to pay. Also, many companies today give an additional discount for “auto-pay”.

The key, however, to finding any affordable insurance policy is realizing that the purpose of any health insurance is to protect you from a major financial loss - not to protect you from spending small money on clinic visits and sliver removal.

These small expenses may be cumbersome but they generally will not hurt you. It’s the $100,000 heart operation that will break you. That’s the financial disaster health insurance was originally designed to prevent.

Also, keep this in mind. Health insurance, as with any insurance, is a gamble. You are gambling that you will draw out more than you pay in. Your health insurance company is gambling they will pay out less.

The odds are in their favor for two reasons. They have all the facts for millions of families to average out, so they know the risk in advance. Also, they get to set the rules and the prices. The higher you set your deductible, the more risk you take. This is not a bad thing at all. You will most likely be the winner in the long run.

Yes, finding a good health insurance plan that you can afford is much easier than most people think.

Taking more of the risk with higher deductibles, spending a little time on the internet comparing eight to ten different companies, and deleting coverage that you will not likely need (such as maternity for many folks) will make it very possible to find your own affordable health insurance.

Homeowner’s insurance equals peace of mind. Your home is one of your largest life investments and to lose the value and equity in your home from an unseen disaster would be a tremendous burden to your family.

Your home is the place you and your family feel safe and secure. There should not ever be a question as to whether you should have homeowners insurance, rather a question as to what types of homeowner’s insurance you need and how much coverage suits your personal situation and geographical location.

There are many different types of homeowner’s coverage available. And there are many companies from which to gain coverage.Also keep in mind that many mortgage companies will require proof of insurance before they will loan money for a home.

The Internet is a safe and easy way to peruse local homeowners insurance agencies in your neighborhood, town or state. It’s also a great idea to ask friends and family members about their specific likes and dislikes concerning their own insurance companies.

There will always be some companies that do not have their customers’ best interest at heart, but these companies don’t last long. There are many reputable companies that are pleased to do business with you and have knowledgeable staff to help solve some of the mysteries and myths of homeowners insurance.

This type of insurance is a unique service provided to individuals who own homes and want their investment and equity protected from unforeseen accidents or disasters.

Simply put - if you live in Oklahoma you may need wind damage coverage and if you live in Baton Rouge you may need to seriously consider flood insurance.

Whatever your needs, what is best for you and your home can be determined quickly and easily. Never assume that your homeowners policy covers everything. Flood and earthquake damages are often excluded and you should always be very clear on exactly what is covered.

It is always helpful to have good communication with your agent and a direct way to contact someone at your insurance company any time, night or day. You should have confidence in your insurance agent since this is the person you will be dealing with in case a claim must be made.

You deserve the assurance that your needs will be of the utmost importance during a natural disaster. This is a time when your entire life could be turned up side down. The agent should encourage questions from you and must never avoid those questions or treat them as unimportant.

To some people, perhaps living in very safe areas, homeowners insurance may seem like an unnecessary expense. On the contrary, if you need to utilize the coverage you have you will find homeowners insurance a true blessing.

From natural disasters such as flooding, hurricanes, tornadoes or mudslides to the next-door neighbor accidentally breaking an ankle on your front porch, homeowners insurance provides a distinct and personal security to the existence and security of your home and a solid peace of mind.

Life Insurance. What does this mean to you?

For some it means security, knowing that their family or business is safe should they unexpectedly pass away. For others it conjures up images of pushy salesmen and confusion about what they are buying.

By learning about the different life insurance policies available you can make an informed decision that will give you peace of mind and satisfaction with your responsible decision.

There are three main types of policies. Here is a brief explanation of what they mean:

Whole Life

Whole life insurance is a permanent insurance. This means that the policy stays in effect for your ‘whole life’ as long as premiums (payments) are up to date.

The cost of whole life insurance premiums will usually be more than the cost of an equivalent amount of term insurance because the cost is averaged. While the cost of term insurance goes up with each renewal, whole life insurance never needs renewing. Instead of paying smaller premiums when you’re young and high premiums as you age, whole life premiums stay the same.

In some policies a savings option can be added which can be used to borrow against.

Universal Life

Universal life insurance is another form of permanent insurance. Like whole life the policy is in effect until you die. You never need to renew the policy (regardless of health) and the premiums will never go up.

Universal life also incorporates other financial services including a savings plan that can be made in addition to the policy. Otherwise the policy can be surrendered in exchange for the savings that have accumulated. Policy owners can often choose from many options including adding another person to the policy, managing their own investments or using the savings to cover the costs of premiums.

Universal life insurance is the most expensive option because of the amount of flexibility and options.

Term

Term insurance is the least expensive life insurance policy option. Term insurance is selected for a certain period of time (term) such as; 1 year, 5 years, 10 years or 20 years.

Term insurance is a good choice for young families with dependants and high debts (such as a mortgage) that they will be no longer be responsible for in 15 to 20 years when the policy ends. Term insurance has no cash value – it cannot be borrowed against or cashed in. If the policy ends and the individual wants to renew the policy the cost of premiums will be higher.

Using term insurance to cover the basic financial requirements of an individual while also instituting a separate savings plan may reduce the need for insurance later in life.

Policy Riders

Depending on the needs of an individual there are other options that can be purchased with certain insurance policies.

The additions to the life insurance policy are called ‘riders’. This includes adding a spouse, including disability income insurance, Accident and Sickness (A&S), Accidental Death and Dismemberment (AD&D) as well as customized choices for taking loans or cash payouts on certain policies.

Talk to an insurance broker who will explain the benefits of each feature and recommends only what best suits your needs. With a bit of understanding you can make the most responsible choice with your money and be confident your family or business is provided for.

Nobody likes shopping for insurance. Health insurance is especially troublesome to compare and shop. Thousands of medical insurance companies are clamoring for your business. Each of those thousands has hundreds of plans. It’s even more complex because each plan has different expenses, deductibles, and other large and small details. Here are some major points to consider when shopping for a medical insurance quote.

The Premiums You Pay Each Month

There is a major cost associated with a medical insurance quote. It is the monthly cost, also called a premium. As an insurance customer, you pay this premium every month, even if you do not use the insurance. Your medical insurance quote should clearly show the premium cost.

Costs Associated With Each Claim

When you seek actual medical treatment, there are additional costs you might incur. You might be required to pay a fixed amount per doctor or hospital visit. This amount might also be a percentage of the total bill. These incidental costs vary based on the medical problem, your policy, whether the hospital or doctor are in your network, and many more. Be sure your medical insurance quote lists these costs clearly.

The Cost Of Your Deductible

With many medical insurance plans, benefits do not begin until you pay a certain amount first. This is called the deductible, because the insurance company deducts it from the amount for which they are willing to pay benefits. Plans with high deductibles often have lower premiums, and vice-versa. Ensure that the deductible is plainly shown on your medical insurance quote.

Extra Costs Out Of Your Pocket

The insurance may not cover the entire claim amount, even if the deductible has been paid. Patients are often responsible for paying a small percentage of the post-deductible expenses. This percentage can be 20 percent to 30 percent, depending on your policy. Make sure you understand these out of pocket costs on your medical insurance quote.

Getting Treatment Outside Your Network

Some insurance plans pay the most benefits when the patient visits doctors recommended by the plan. This list of doctors is called the network. Therefore you are advised to use only doctors inside the network. That is not always possible, however, if you are traveling outside your network area. In that case, be sure your medical insurance quote explicitly states any differences in network costs.

You can shop for medical insurance and stare at quotes until your eyes cross. It is a very important task, however, and can save you a great deal of money should a medical emergency strike. The best way to compare plans from different companies is to get a medical insurance quote from each one. Then compare the items listed above, as well as the other costs and details. Then you can select the best health insurance plan for your family and budget.

Although many people think it is an unnecessary expense, health insurance for your pet can actually save you money and spare you from making a tough decision between the life of your dog and paying the bills should a serious health issue arise.

Just like everything else today, Veterinary cost have skyrocketed. When you do not have [tac-tec]pet insurance[/tac-tec] you must pay for every visit whether they be routine or emergency. This can run into thousands of dollars so why not get some help?

If your pet spends a lot of time outdoors it stands a good chance of coming down with an infection of some kind. This may range from an infected cut to a full blown parasitic infestation (maybe from something he ate.) Those can be expensive to clear up.

Just like personal health insurance, health insurance for your pet has annual premiums and, of course a deductible. The premium price depends on the exact breed and type of policy and if you have more than one pet you can usually get a discount.

As with the premium, the deductibles vary. Typically it is around $100 a year. There are many policies to choose from based on your pets age, breed, lifestyle and pre-existing conditions.

There’s a pet health plan to please almost everyone. Some plans cover most everything from annual checkups to vaccinations, spaying, neutering and any medications as well as ay sickness and, of course accidents. These policies, of course will be the most costly.

But if you can handle the yearly costs of your healthy pet just fine and want something just in case he becomes injured or sick, you can get a policy that will cover just these occasions.

Getting a new health insurance policy for your pet is similar to getting one for yourself - emergency coverage begins as soon as you sign up with your first payment and there is a 30 day waiting period for illness and other routine claims.

When considering health insurance for your pet, be aware that his age will affect the coverage. Most policies cover the dog starting at 6 weeks of age. On the other end, you may not be able to get coverage for your pet if he is more than 8 years old. Once your pet is covered, however, he will be able to retain coverage past 8 years of age.

Getting health insurance for your pet should be a serious consideration for any pet owner. Think of it as the normal expense for having your pet. It’s well worth it and it really set your mind at east to know that should your pet need expensive medical treatment to save his life - you’ll be covered.

Term life insurance is one of two basic types of life insurance. The alternative is ]permanent life insurance. Both types have some advantages and it’s really a matter of preference as to which is best for you.

When you purchase term life insurance, you pay a premium and the policy is then put in place for a specific amount of time or “term.” The term varies but a monthly premium is very common. By contrast, permanent life insurance is an agreement between you and the insurance company that you will keep the policy in effect on a permanent basis.

One of the major differences is that term life insurance premiums may change without notice. When you lock the price of permanent life insurance in, that price is to remain constant throughout the life of the policy. For those young people who are smart enough to take out a permanent policy, the advantage is that those low rates will remain the same.

Another advantage of the permanent life insurance over the term life insurance is that permanent insurance policies can be used as collateral or borrowed against. This happens as the amount paid in premiums begins to build up. Term life insurance is only paid upon the death of the insured and there’s never a cash value to the term life insurance policy.

On the other hand, term life insurance is usually much easier to obtain. You can often get a term life insurance policy without a physical of any kind. All you need to do is sign on the dotted line and start making premiums.

Finding an agent for a term life insurance policy is also pretty easy to accomplish. You’ll find lots of online sources of term life insurance and that’s a good way to get some rates for the sake of comparison. If you have a good idea of the amount of term life insurance you need, you can quickly get an online quote to determine how much the premiums are going to be.

The amount of term life insurance you need depends on what you hope to accomplish with the policy. Remember that the term life insurance policy will never be of any use to the insured until death.

If you want the policy to pay off funeral expenses, you’ll probably be needing a policy for around $10,000. Most people are hoping to leave their loved ones and family with enough cash from the term life insurance policy to pay off debts and keep the family going. That might mean you want at least a $50,000 or $100,000 policy.