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Types of Insurance

In life, it's impossible to know what's ahead. However, that doesn't mean you can't prepare yourself for certain events. While natural disasters and car accidents can't be predicted, you can get insurance to protect you should they ever affect you. Whether you want to protect your home, your automobile, or your health and well-being, there are plans to help you take life's challenges in stride.

Home insurance protects those who invest a great deal of money in their properties. Few investments are larger than a home, and any damages a residence incurs can seriously impact its value. Fortunately, it's possible to protect yourself from losing a great deal should anything catastrophic ever occur. You can protect yourself from flooding that occurs from natural and man-made disasters. You can also protect yourself from fire. In addition, homeowners can secure plans that protect them should a tree fall on their home or any other instance where massive amounts of damage occur.

Auto insurance is required to drive a vehicle. While every effort can be made to increase safety on roadways, it's still somewhat common for accidents to occur. This is why it's required by law to have a policy in place for you and your vehicle. Some people want the most affordable policy out there, and plan on being extra careful to ensure no accidents occur. Others want a plan that will offer a great deal of protection if they get in a wreck.

The law also now requires health insurance. Medical emergencies in particular can be quite expensive, and it can be difficult for most people to pay large hospital bills when they have an emergency. Fortunately, a health plan can make it so the insurer will pay for a considerable portion of any medical services. With the passage of the Affordable Care Act, insurers are now unable to refuse a person coverage if they have a preexisting condition. This is great news for those who suffer from a disease that requires them to need medical treatment on a regular basis.

While paying for insurance may seem like a big investment, it's not when you consider the alternative. You can hope you'll never experience anything as catastrophic as a flood or a serious injury, but you can never rule out the possibility. As a result, you should do what you can to protect what you care about the most. Some people get all their property insured, while others only get the policies they're legally required to hold. Find an agent and provider that will help you determine the types of coverage you need. A good agent will be willing to work with you when things are in order and when you need to file a claim.

Flood Insurance Fallacies

What happens when your home is inundated with water? Is this disaster covered by your standard homeowner's policy? Unfortunately, the answer is no. Damage caused to your home by flooding waters is not covered anywhere in your basic homeowner's policy. Unfortunately, many people learn that this statement is untrue when it is too late.

Having flood insurance is the only way to be somewhat safe when it comes to your home protecting your home from water damage. Across the United States, only about 20% of the homes that are at risk for flooding are covered by some type of flood insurance. Most major private coverage providers do not want to insure people against flooding because of adverse selection. This means that the number of people who are making claims against flooding damage is greater than the number of people who want to protect their homes from the possibility of flood damage, so private insurers see this as something that will not bring them any profit.

However, in certain flood prone areas, the government requires that flood insurance be purchased in order to secure mortgage loans from federally accredited agencies. This coverage does not go into effect until thirty days after the policy has been purchased, unless the person lives in a floodplain. This purchase of flood coverage, provided by the government, went into effect in 1968 under the National Flood Insurance Program. Many people have criticized this program because it helps people rebuild in areas that are vulnerable to flooding, without any of their premiums ever going up. Homes and areas that were flooded over twenty times are still able to be covered without the threat of rising premiums.

Flooding is defined as inundation of an area of two or more acres, or two or more properties that are usually dry land. Flooding can be brought on by hurricanes, earthquakes, tornados, levee breaches, and other natural disasters. Unfortunately, if flooding occurs due to an earthquake, the damage from flooding is not covered by the earthquake insurance. Flood damage is not covered under any other type of policy a homeowner could hold.

In the United Kingdom people who are living in a flood prone area are supposed to flood proof their homes, or they risk facing much higher coverage premiums. In Canada, no flooding coverage even exists.

Flood coverage is an argument that has been fought about for decades, but until you live in an area that is threatened by flooding, a person will never understand how important it is to have the government's support behind the coverage

Keep Your Business Protected With Van Insurance

Plumbers, electricians, carpenters and many more businesses rely on their vehicles to get them to and from customers to carry out work on-site. This means that their vehicle is probably the most important asset of their business, providing them with transport and a place to keep tools and equipment.

The best van insurance will keep your business safe as you travel on the road to and from clients on a daily basis. Of course in order to drive on the road you need a driving license and adequate cover to be completely legal, so having protection in cover is a must have product.

The first thing you want to ensure is protected is the vehicle. When choosing cover, whether approaching a broker directly or using an online application, you will have to select from three options.

The first of these options is third party cover. This protects you in the event of an accident. Though it only protects third party vehicles and does not protect your vehicle in any way. This is the most basic cover available.

Then there is the third party, fire and theft cover. This is the same as third party with the addition of protecting your vehicle against theft and fire. Again, if you are involved in an accident, this level of cover will not protect your vehicle, which means any repairs or replacement is to be paid for out of your own wallet.

The best van insurance is comprehensive cover. This level of cover protects you in the event of an accident by cover your vehicle and any third party vehicles or property. It also covers you against fire and theft and is the highest level of cover available, saving you money in the long run.

Because you will carry your tools and equipment with you at all times, you want to ensure these are protected should they be damaged during an accident or stolen while you sit with a customer providing them with a quote for work.

Replacing your tools can be an expensive exercise if you don't have the right level of cover in place. In the event your vehicle is broken into and your tools are stolen, you can have the repairs to the vehicle and tools replaced with one quick and easy phone call and a fast claims process.

When looking for the best van insurance you want to find out about your excess options. Some companies will allow you to pay what is called "voluntary excess." This enables you to pay a lower premium amount and a higher excess amount should you ever need to claim. This is ideal for companies that haven't claimed for many years but still require a good level of cover to keep them protected on a daily basis.

There are other ways to keep your premium down. If you aren't the only driver for the business that uses the vehicle, ensure all drivers are over twenty five and have clean driving licenses. Younger drivers are considered a risk to insurers as they are more likely to have an accident. This also applies to drivers with convictions and penalty points on their licenses. So keep it clean and older and you can enjoy more affordable premiums.

Ask the insurer if they will take your no claims into consideration. If you have had a private auto policy for years and have built up years of no claims, they may take this into consideration when providing you with a quote, as you are seen as a safe risk to their business.

Life Insurance Myths and Facts

Life insurance as part of an overall financial portfolio is rife with mythology and misinformation. In this article, I will address some of the myths that continue to circulate and provide useful information to help consumers make some rational decisions on the purchase of this important personal asset.

In an earlier article ("Why Buying Term and Investing the Difference is One Big FAIL!"), I discussed why buying term insurance and investing the difference is generally inferior to simply buying a cash value life insurance product. For the vast majority of people, buying term and spending the difference is the default, meaning that the theory of building greater wealth through a systematic investment program rarely materializes. Further, term policies can get painfully expensive in middle age, resulting in people dropping their policies, or, if they purchased a level term product for a long period, say 10 to 20 years, they may find their health will make them uninsurable or the cost beyond their means when the time comes to replace the expired policy. And they often find that the returns on the investment portion of their portfolio do not come close to equaling the life insurance coverage they need.

The second issue deals with taxes: the "invest the difference" part of the equation will almost invariably have tax consequences: unrealized capital gains and dividends for non-retirement investment accounts will result in a tax bill. What that means is that, as the fund manager buys and sells stocks for the portfolio, the capital gains on those transactions result in a tax liability. Similarly, dividends that are reinvested are also taxable. In both cases, you will be getting IRS Form 1099s in the mail around January of each year, which will show the gains and dividends and must be accounted for at tax time. In both cases, you will have no money in your pocket but you will have more in taxes to pay. This effectively lowers your rate of return.

Whole life insurance products don't have either tax problem: the dividends grow tax-free and the cash value can be paid out later in life on a tax-free basis. And, of course, the death benefit is not subject to income tax if paid out (although it could be subject to estate tax).

I now continue with others myths concerning life insurance. Probably the biggest one is that young, single people don't need to buy life insurance. This myth developed and has been promulgated by the popular financial services publications because life insurance is supposed to protect survivors' ability to remain financially solvent in the event a breadwinner dies prematurely. Therefore, according to this myth, young people, who are typically single, don't need life insurance.

The fact is, that young, single people will almost invariably get the most preferred premiums: even substantial whole life policies are relatively inexpensive. And because young people are typically in the best health of their lives, they are unwritten at the best rates. As one gets older, the risk of having a rated policy due to health issues increases, which can dramatically increase the cost. In addition the cash value of these policies not have a far larger time horizon to accumulate.

For example, using the projections of a top-rated mutual insurance company, a $500,000 policy at age 21 will have a monthly premium of approximately $320 per month; waiting until age 31, the monthly premium increases to approximately $470 per month, and waiting until age 41 increases the monthly premium to approximately $730 per month, or more than double the premium at age 21.

What is more interesting is the cash accumulation for each example: starting the policy at age 21 provides over $600,000 in cash value at age 65 and over $1,175,000 in death benefit; at age 31 the cash value is a little over $454,000 at age 65 with a death benefit of approximately $931,000, and starting the policy at age 41 provides a little over $322,000 in cash value and a $754,000 death benefit.

Now, keep in mind, the amount of death benefit needed to maintain a lifestyle for a family will typically increase as both responsibilities and income increase. However, the earlier you start the life insurance component of your financial portfolio, the less expensive it will be and the more you will have accumulated for yourself or your heirs later in life. And a guaranteed insurability rider will allow a person to purchase additional coverage at specified times without having to prove insurability.

The next myth is that employer provided life insurance is sufficient to provide the necessary income for a family if the employee dies. Typically, most companies that offer life insurance as a benefit will provide coverage equal to one year's salary, with the employee given the option to purchase additional coverage up to around five times their salary. These are always term policies, and generally only remain in force only during the time of employment.

Another myth is that only people with dependents need life insurance. People who are married and have no children still should begin a life insurance portfolio. Even if no children are planned, the surviving spouse will need a source of income to maintain a lifestyle and replace what the decedent generated while alive, even if the surviving spouse works. And if children are planned, then getting a life insurance plan in place while a person is young and healthy will make the costs more manageable as family expenses increase. And with the trend toward having children later in life, getting a permanent life insurance policy makes a lot of sense: the policy has grown in value, and the health problems that would preclude underwriting an older age are no longer an issue and the cost of maintaining a policy purchased at a young age is far more affordable.

A big myth perpetuated by the popular press is that life insurance brokers and agents are more interested in selling the product that makes them the most commission, not the one that provides the best coverage for the client. The vast majority of agents and brokers are highly ethical professionals. They are going to provide the best plan for their customers not only because of their ethics, but because it makes good business sense for them. A good agent is looking for a client for life, not a one-time transaction. And he or she is also wants to maintain an impeccable professional reputation: word that an agent is doing the wrong thing just to increase commissions will spread quickly and will destroy his or her reputation very quickly. It also can result in censure or loss of license by the state insurance commission.

This article discusses some of the key myths that agents deal with regularly as they deal with prospective clients. Unfortunately, journalists who lack training in the complexities of insurance, authors trying to sell books, or companies that peddle an "insurance solution" to demonize the rest of the industry and make themselves to be the only ethical players in the business, often perpetuate these myths (if you run into one of these agents, head in the other direction!). Life insurance may seem like a simple product to most people, which make them susceptible to the myths I discussed. In fact, building the right insurance portfolio is often a complex undertaking, that involves decisions about needs, affordability, and long term goals to find the right product mix that provides affordable and needed protection. That means working with a professional in the business who will provide the right solution for each client, not a "one size fits all" solution that likely will not meet the needs of the client.

The Top 4 Reasons to Cover Your Holiday Responsibly

It's easy for a degree of carelessness to creep into your holiday preparation. But if you're planning on getting away, experiencing something new, refreshing your outlook and rejuvenating your mind, this should not preclude you from organising your travel insurance in a responsible way.

Unforeseen illness

If you are looking forward to a swathe of pristine sand, a vista of munificent valleys, or the fresh air of a luxurious mountain forest, you probably don't want to give any thought to unexpected illness. But since by its very nature such illness is unforeseen, it is vital to cover your holiday when you consider its potential to occur. You should be aware of the susceptibility of your body to be prone to illness in the particular destinations that you wish to visit, and this can save you from a great deal of hassle.

Unpredictable theft or accidents

More and more exotic places around the world are opening up to travellers. It seems the old stereotypes of the fearful old tourist and the fickle young adventurer are being shattered. Young and old are exploring regions that once were unknown or taboo but are now fascinating tourist hubs. But new, fresh and strange places can invite crime, which usually targets tourists. Hence it is wise to cover your holiday after considering, with realism not hysteria, the potential for theft or even accidents in the places you are about to visit.

The safety of children

Travelling with children is a very special and rewarding experience. It can be exhausting yet ultimately fulfilling. When children are involved, you will rightly be concerned about making sure the insurance protects your kids first and foremost - even more so, it's vital to cover your holiday appropriately. Carefully investigate providers and the types of plans that they offer to make sure that your children's particular needs are catered for. When it comes to your family's safety, it pays to be doubly responsible.

The need for a good provider

Recklessness should never be a deciding factor when it comes time to cover your holiday; there are a plethora of providers out there and some simply stand out above the others. Choosing a good provider can make all the difference; no one wants to spend ages hunting out an accurate quote, to hand over payment and then find the provider difficult to contact during an emergency. Ultimately, the best providers will give quick quotes, efficient payment means, round-the-clock contact and very clear and extensive support should anything occur on your trip. Of course, the best insurance is the one you never need to think about while you are tanning yourself on a golden beach! The best way to have peace of mind that your insurer will step up and help out if you need them is by researching your insurance responsibly before your trip.

Patrick Chong is the Managing Director of Insuremore. We provide low cost travel insurance and offer a range of policies to cover your holiday, including single-trip, multi-trip and family insurance. For all your insurance needs, Insuremore can help you in the quickest and most cost-efficient way.

Tips for Finding Low Priced Insurance for Your Next Holiday

How easy is it really to find low priced insurance that will suit whatever budget you are trying to stick to for your holiday? Some people don't take the time to look properly, which is a great shame, because with a little know how you can hunt out some very good deals indeed. Here's how to do it.

Don't just go to the big name companies

There is no guarantee a famous name company will provide you with the cheapest cover. Look at as many companies as you can and compare policies carefully. Some online comparison sites will compare dozens of providers in one fell swoop, but none can cover them all. Make sure you plug the gaps and find providers that aren't covered by these websites.

Consider what you really need

Some policies have add-ons that not everyone will require. Always check the small print and the details of the policy to see whether you can knock off any extras you don't actually need. This can reduce the price you pay and lead you towards a low priced insurance policy that will suit you better.

Get a multi-trip policy to cover more than one holiday

Many people regularly go on more than one trip a year. If this includes you, make sure you search for a multi-trip policy to cover all the trips you intend to make in a single 12-month period. Not only will it save you time, as you won't have to book other policies in the future, you will save money overall as well.

Go to a specialised insurer if you need one

It might sound obvious but the big companies tend to cater for the masses. If you need a more detailed policy - perhaps to cover extreme sports or an illness that you take medication for - you might find a cheaper policy elsewhere.

As you can see, there are a number of techniques you can use to help you find low priced insurance for your holiday. In some cases you may use one method and turn up nothing cheaper; on the other hand the first option you choose might produce great results and a cheaper policy. Always be sure to check every avenue and option open to you so you can enjoy the best array of low priced insurance policies possible.

We all tend to look for a good deal when it comes to booking a holiday abroad, however travel insurance can often be an afterthought. It's either something that gets booked along with the holiday (an expensive option) or something we pick with little thought at all. But, clearly, you don't have to settle for this approach. With a little advice and time on your hands, you can get an excellent deal on this very necessary commodity.