By. Online Car Insurance
The reason we compare car insurance quotes from multiple car insurance companies is to make sure we‘re getting the best rates possible. Of course nobody wants to pay more money than they have to, but in the other hand we also want to make sure that our car insurance company is going to respond quickly and fairly in case of an accident.
What is unknown to many is that there is not one single car insurance company that is cheaper than others. One particular car insurance company can be the cheapest for one person but the most expensive for another. Each car insurance company has a certain category of drivers they want to insure. If you fit their category they will offer you a cheap rate, if you don’t, they will offer you an expensive rate. That is their way of filtering the people they want and do not want to insure. That is the reason we need to compare insurance rates from multiple car insurance companies, to find out which company will offer us the cheapest rate. The key is to find the company that offers the cheapest rate for you, but of course, it is important to compare rates from quality companies only.
There are many quality car insurance companies out there; however, some of those quality companies also have a high price to go along with them. How do we find a quality company for a cheap price? That, my friend, is the key question.
The traditional method of shopping for car insurance is to call around which we all know can be a long process. Another drawback of shopping for car insurance by phone is the probability of getting caught with the old “bait and hook” trick. That is when someone gives you a low quote by phone and hikes it up on you when you go into their office to purchase the car insurance policy.
In today’s world, luckily, we have the internet. The internet makes life a lot easier for all of us. Using the internet, we can shop for many types of things we may need which include shopping for car insurance.
Shopping for car insurance online is the best way to compare rates from multiple car insurance companies. Online, you can also read about a company’s history and make sure they’re a quality company. Most companies offer instant online car insurance quotes thorough their websites which makes obtaining car insurance quotes a lot easier than the traditional method of shopping by phone. Better yet, there are some websites that offer online car insurance quotes from multiple companies with one simple process. You can even purchase your car insurance online if you like the price. One such website is OnlineAutoInsurance.com. There, you can obtain quotes from quality companies such as Progressive, AIG, Infinity, GMAC, Bristol West, and several more. All with one simple process!
Sunday, July 6, 2008
How to Read an Insurance Policy
By. Aditi
Remember Hurricane Katrina? In addition to the physical devastation and loss of lives, it resulted in an insurance nightmare for many business owners and homeowners, because their insurance policies did not cover damages caused by hurricanes, tornadoes, etc. As a lawyer, I read a lot of insurance policies. Hurricane Katrina is an extreme example, but it illustrates a scenario I see all the time in my practice: many people do not realize until it is too late that their insurance policies are inadequate or unequipped to shield them from financial losses or other damages.
Almost every adult owns some type of insurance policy. Vehicle, homeowner, medical, directors & officers liability, commercial property, professional liability and travel insurance are but some examples. Other than having a general understanding of the type of coverage we have and the coverage amounts (and, of course, the premium amount), many of us don’t know how to read and understand our policies and grasp how they work in the event that we need to rely on them.
The following is some basic information that will assist you if you are a policy owner or if you are contemplating purchasing insurance.
1. What documents constitute an insurance policy?
Usually, when you take out insurance, your insurance company will provide you with an insurance certificate or “declarations” page. This lists the items insured, and the amounts. The declarations may also refer to certain policy “exclusions.” However, as a policy owner you really should be asking the insurer for a copy of the complete policy, and any policy booklet that they may issue as a companion interpretive guide. In the event that you need to rely on your policy, the Declaration document is not helpful. Furthermore, reviewing the entire policy gives you an opportunity to understand or identify any “gaps” in coverage – i.e. matters that are not covered by your insurance and for which you may want to consider obtaining extra coverage through another insurance company.
2. Do you know what your policy “limits” are, and are they sufficient?
The amount of insurance coverage you obtain is called your insurance limits. If you own a vehicle, you will have purchased liability insurance with limits of $500,000, $1,000,000 or $2,000,000, this means that if someone sues you as a result of a car accident, your insurance policy will respond to that lawsuit to the extent of the limits you have purchased. These limits are sufficient for most people, however, did you know that if you are injured in a car accident and you sue the at-fault driver who only has limits of $500,000, yet your damages far exceed that amount, and then there is a clause in your policy that will allow you to access your own policy for the shortfall? If the liability limits in your motor vehicle insurance policy is $1,000,000, then there may be an extra $500,000 available to you. That is where having an understanding of the importance of the limits of your policy will assist you when you are making the decision to purchase insurance.
It is important to discuss with your broker all of the possible circumstances that may result in you having to access your insurance policy. This discussion will dictate the amount of insurance coverage you ultimately decide to purchase. If you do not purchase insurance with sufficient limits, then, in the case of liability insurance for example, if you are sued for an amount that exceeds the limits of your policy, you will personally be on the hook for the balance – which means that your assets and income may be vulnerable to garnishment. In the case of property insurance, you will have to personally pay for any damages that are not covered by your policy – if these damages are excessive or exorbitant, the financial consequences may be disastrous.
3. What are “Exclusions”?
In my experience, it’s the exclusion clauses that leave policyholders vulnerable and most policyholders do not read them. I draw your attention once again to Hurricane Katrina. Exclusion clauses identify the events or circumstances that will result in there being no coverage under the policy. For example, residential and commercial property insurance policies may contain an exclusion for theft caused when the premises remains unlocked or unoccupied. Do you run a business out of your home? If so, most homeowner’s policies will not cover any damages caused by or a result of commercial activities. Many professional liability policies contain exclusions for damages caused by fraud or dishonest conduct. If you own a large commercial building, your property insurance may contain exclusion for certain types of boiler and furnace mishaps (i.e. those caused by wear and tear, for example). And most travel insurance policies exclude health care coverage for illnesses causally related to pre-existing or prior medical conditions, even where those conditions have been dormant for some time.
The insurance company and broker have a duty to draw all policy exclusions to your attention. Many insurers accomplish this task by sending you a letter at the outset of the policy period, advising you to review the exclusion section of the policy. Some insurers do not do this. Regardless, in order to protect yourself, when you take out your policy, ask the insurer and your broker (if you are dealing with one) to identify all the policy exclusions. The exclusion clauses are often densely worded and convoluted. Therefore, if you do not understand them, you must point advise your insurer and ask for an explanation. If you think one of the exclusions may even potentially affect you in the future, you should speak to your broker about obtaining additional coverage for the excluded item from another insurance company, or, you may ask the insurer if you can purchase an enhanced form of coverage. For example, if you own a lakefront cottage and are worried about the potential for water leakage into the basement, review your policy carefully to ensure that this type of water damage is covered, if it is not covered, you will want to purchase supplemental coverage.
4. Policy Conditions
Policy conditions are pre-requisites to coverage. They are events or conditions that are necessary to keep the insurance in place. Payment of the premium by a certain date is a simple example. Another is maintaining a security alarm as a pre-condition to insurance against losses caused by theft. Other conditions relate to the policyholder’s obligations once a claim arises – that is, the reporting requirements. The reporting requirements dictate when and how you should report a claim to your insurance company. Some policies require that you report the claim in writing and within a certain period of time. In some policies, coverage will be triggered by notifying the insurer by phone – as many of you who have been in car accidents know.
There is almost always a time limit within which you can report a claim. Some insurance policies spell this out explicitly in the policy, others simply say that notice to the insurers must be given after an incident “forthwith” or “immediately.” Regardless of the wording used, if you suspect that you have a claim that may be covered by your policy, you should report it.
Policy conditions should be regarded in the same manner as exclusions, since failure to abide by them will result in a lack of coverage. Therefore, it is important that you have a complete understanding of what they are when you purchase your policy.
5. Insurer’s Obligations When a Claim Arises
Insurers have a duty to deal with you in good faith. When you make a claim under your policy, your insurer has a duty to assist you in processing your claim, to act in your best interests and to not take an unreasonable position on coverage. If the insurer makes a coverage decision that has no basis in the policy, then it may be subject to a complaint to the Financial Services Commission of Ontario, or in a lawsuit it may be vulnerable to a claim for punitive or aggravated damages.
6. The Role of the Broker
I have previously written on this site about the role and obligations of your insurance broker. Having an understanding of how your policy works and your policy exclusions allows you to have a meaningful discussion with your broker about what your insurance needs really are. Some of the additional questions that may arise out of this discussion, and which may result in your decision to purchase additional or enhanced insurance, are listed below.
* Do you own property outside of Ontario or conduct any business activities outside of Ontario?
* Do you conduct any business activities in your own home?
* Are you a voluntary or paid officer or director of a corporation? Are you aware that you may be sued in this capacity and that insurance may be available to protect you in this instance?
* Does your workplace medical-dental policy provide sufficient coverage for all possible health-care contingencies?
* Do you travel regularly outside of Ontario and/or internationally? Are you over the age of 65 and travel regularly?
Remember Hurricane Katrina? In addition to the physical devastation and loss of lives, it resulted in an insurance nightmare for many business owners and homeowners, because their insurance policies did not cover damages caused by hurricanes, tornadoes, etc. As a lawyer, I read a lot of insurance policies. Hurricane Katrina is an extreme example, but it illustrates a scenario I see all the time in my practice: many people do not realize until it is too late that their insurance policies are inadequate or unequipped to shield them from financial losses or other damages.
Almost every adult owns some type of insurance policy. Vehicle, homeowner, medical, directors & officers liability, commercial property, professional liability and travel insurance are but some examples. Other than having a general understanding of the type of coverage we have and the coverage amounts (and, of course, the premium amount), many of us don’t know how to read and understand our policies and grasp how they work in the event that we need to rely on them.
The following is some basic information that will assist you if you are a policy owner or if you are contemplating purchasing insurance.
1. What documents constitute an insurance policy?
Usually, when you take out insurance, your insurance company will provide you with an insurance certificate or “declarations” page. This lists the items insured, and the amounts. The declarations may also refer to certain policy “exclusions.” However, as a policy owner you really should be asking the insurer for a copy of the complete policy, and any policy booklet that they may issue as a companion interpretive guide. In the event that you need to rely on your policy, the Declaration document is not helpful. Furthermore, reviewing the entire policy gives you an opportunity to understand or identify any “gaps” in coverage – i.e. matters that are not covered by your insurance and for which you may want to consider obtaining extra coverage through another insurance company.
2. Do you know what your policy “limits” are, and are they sufficient?
The amount of insurance coverage you obtain is called your insurance limits. If you own a vehicle, you will have purchased liability insurance with limits of $500,000, $1,000,000 or $2,000,000, this means that if someone sues you as a result of a car accident, your insurance policy will respond to that lawsuit to the extent of the limits you have purchased. These limits are sufficient for most people, however, did you know that if you are injured in a car accident and you sue the at-fault driver who only has limits of $500,000, yet your damages far exceed that amount, and then there is a clause in your policy that will allow you to access your own policy for the shortfall? If the liability limits in your motor vehicle insurance policy is $1,000,000, then there may be an extra $500,000 available to you. That is where having an understanding of the importance of the limits of your policy will assist you when you are making the decision to purchase insurance.
It is important to discuss with your broker all of the possible circumstances that may result in you having to access your insurance policy. This discussion will dictate the amount of insurance coverage you ultimately decide to purchase. If you do not purchase insurance with sufficient limits, then, in the case of liability insurance for example, if you are sued for an amount that exceeds the limits of your policy, you will personally be on the hook for the balance – which means that your assets and income may be vulnerable to garnishment. In the case of property insurance, you will have to personally pay for any damages that are not covered by your policy – if these damages are excessive or exorbitant, the financial consequences may be disastrous.
3. What are “Exclusions”?
In my experience, it’s the exclusion clauses that leave policyholders vulnerable and most policyholders do not read them. I draw your attention once again to Hurricane Katrina. Exclusion clauses identify the events or circumstances that will result in there being no coverage under the policy. For example, residential and commercial property insurance policies may contain an exclusion for theft caused when the premises remains unlocked or unoccupied. Do you run a business out of your home? If so, most homeowner’s policies will not cover any damages caused by or a result of commercial activities. Many professional liability policies contain exclusions for damages caused by fraud or dishonest conduct. If you own a large commercial building, your property insurance may contain exclusion for certain types of boiler and furnace mishaps (i.e. those caused by wear and tear, for example). And most travel insurance policies exclude health care coverage for illnesses causally related to pre-existing or prior medical conditions, even where those conditions have been dormant for some time.
The insurance company and broker have a duty to draw all policy exclusions to your attention. Many insurers accomplish this task by sending you a letter at the outset of the policy period, advising you to review the exclusion section of the policy. Some insurers do not do this. Regardless, in order to protect yourself, when you take out your policy, ask the insurer and your broker (if you are dealing with one) to identify all the policy exclusions. The exclusion clauses are often densely worded and convoluted. Therefore, if you do not understand them, you must point advise your insurer and ask for an explanation. If you think one of the exclusions may even potentially affect you in the future, you should speak to your broker about obtaining additional coverage for the excluded item from another insurance company, or, you may ask the insurer if you can purchase an enhanced form of coverage. For example, if you own a lakefront cottage and are worried about the potential for water leakage into the basement, review your policy carefully to ensure that this type of water damage is covered, if it is not covered, you will want to purchase supplemental coverage.
4. Policy Conditions
Policy conditions are pre-requisites to coverage. They are events or conditions that are necessary to keep the insurance in place. Payment of the premium by a certain date is a simple example. Another is maintaining a security alarm as a pre-condition to insurance against losses caused by theft. Other conditions relate to the policyholder’s obligations once a claim arises – that is, the reporting requirements. The reporting requirements dictate when and how you should report a claim to your insurance company. Some policies require that you report the claim in writing and within a certain period of time. In some policies, coverage will be triggered by notifying the insurer by phone – as many of you who have been in car accidents know.
There is almost always a time limit within which you can report a claim. Some insurance policies spell this out explicitly in the policy, others simply say that notice to the insurers must be given after an incident “forthwith” or “immediately.” Regardless of the wording used, if you suspect that you have a claim that may be covered by your policy, you should report it.
Policy conditions should be regarded in the same manner as exclusions, since failure to abide by them will result in a lack of coverage. Therefore, it is important that you have a complete understanding of what they are when you purchase your policy.
5. Insurer’s Obligations When a Claim Arises
Insurers have a duty to deal with you in good faith. When you make a claim under your policy, your insurer has a duty to assist you in processing your claim, to act in your best interests and to not take an unreasonable position on coverage. If the insurer makes a coverage decision that has no basis in the policy, then it may be subject to a complaint to the Financial Services Commission of Ontario, or in a lawsuit it may be vulnerable to a claim for punitive or aggravated damages.
6. The Role of the Broker
I have previously written on this site about the role and obligations of your insurance broker. Having an understanding of how your policy works and your policy exclusions allows you to have a meaningful discussion with your broker about what your insurance needs really are. Some of the additional questions that may arise out of this discussion, and which may result in your decision to purchase additional or enhanced insurance, are listed below.
* Do you own property outside of Ontario or conduct any business activities outside of Ontario?
* Do you conduct any business activities in your own home?
* Are you a voluntary or paid officer or director of a corporation? Are you aware that you may be sued in this capacity and that insurance may be available to protect you in this instance?
* Does your workplace medical-dental policy provide sufficient coverage for all possible health-care contingencies?
* Do you travel regularly outside of Ontario and/or internationally? Are you over the age of 65 and travel regularly?
Different Types Of Life Insurance
By. Sarah Martin
Universal life insurance is a variation of whole life insurance. It is a blend of term insurance and a savings account. It earns interest at a money market rate, the policy holder paying an annual fee for coverage, which includes a fee for managing the policy. Funds not used for paying the life insurance earn a tax deferred interest.
With a universal life insurance policy, the premium can fluctuate. The policy holder decides how much to devote toward insurance and how much toward savings. The face amount of the policy can be changed as well as the amount of premium payments and how often they are paid. However, the insured must make certain their savings are large enough to cover the monthly premiums for the insurance as well as the policy expenses. If the savings are not sufficient enough, the monthly charges will consume the cash value and the policy will be of no value.
Universal life insurance offers two options. The first option is keeping the death benefits the same from year to year if the policy holder does not request any changes. The second option is having the death benefit at any time stay equal to the original face value in addition to the policy's cash worth.
Universal life insurance can often give an elevated interest rate when inflation rises, even if the insuring company guarantees a low rate. Because of this risk, premiums are lower for whole life insurance but pricier for term insurance for younger individuals. In addition, when the price for managing the policy is added to the premium, the policy holder will receive a lower return on their investment. It is crucial to keep in mind that changes in interest rates will affect both a policy holder's yields and premiums.
Variable Life Insurance
Variable life insurance is a type of permanent life insurance that allows the holder to target their premium to one or more detached investment funds. These funds can be fixed income investments, stocks, bonds, or money market funds. Depending on the company policy, the holder can change their investments from two to five times annually. Unlike universal life insurance, with variable life insurance the insured can manage the investment of their cash value.
The policy, however, can be risky because the investment has the ability to rise or fall. The cash value and investment will differ, depending on what the investment fund does. The death benefit cannot fall below the total amount of life insurance primarily purchased. As with traditional whole life insurance, the policy holder pays fixed premiums and can borrow against the policy at either fixed or variable rates.
Because an individual decides where to invest their money and put themselves at risk, variable life insurance should be considered. Insurers must, by law, offer variable life insurance by prospectus. A prospectus is a document that gives the prospective policy holder important facts concerning the company and the policy. Variable life insurance can often cost more than other varieties of cash value life insurance. According to current laws the cash value of variable life insurance, similar to those of universal life insurance and whole life insurance, cannot be taxed until the policy holder cashes in their policy.
Universal Variable Life Insurance
Universal variable life insurance is also commonly referred to as flexible premium variable life insurance. This kind of policy combines the flexible features found in universal life insurance policies and the investment alternatives of variable life insurance. As with universal life insurance, the policy holder can choose to raise or lower their premiums in a single policy. As with variable life insurance, individuals have the right to decide how their cash worth will be invested.
The insurance company does not have to make any kind of guarantee on the policy holder's cash value. With universal variable life insurance, the value of the cash fund is in direct relation to the market worth of the assets in the cash worth fund. Therefore, a policy holder could have $15,000 in net cash worth one day and $10,000 on the following day, dependent on market fluctuation. Thus, one of the central problems with universal variable life insurance is that the policy holder can lose their insurance coverage.
Adjustable Life Insurance
Adjustable life insurance is another variety of permanent protection that allows the policy holder to change the amount of their premiums. They can also increase or decrease the face amount of the policy, or lessen the protection period. If the policy holder increases the death benefit, they must prove that they are still in fact insurable.
Universal life insurance is a variation of whole life insurance. It is a blend of term insurance and a savings account. It earns interest at a money market rate, the policy holder paying an annual fee for coverage, which includes a fee for managing the policy. Funds not used for paying the life insurance earn a tax deferred interest.
With a universal life insurance policy, the premium can fluctuate. The policy holder decides how much to devote toward insurance and how much toward savings. The face amount of the policy can be changed as well as the amount of premium payments and how often they are paid. However, the insured must make certain their savings are large enough to cover the monthly premiums for the insurance as well as the policy expenses. If the savings are not sufficient enough, the monthly charges will consume the cash value and the policy will be of no value.
Universal life insurance offers two options. The first option is keeping the death benefits the same from year to year if the policy holder does not request any changes. The second option is having the death benefit at any time stay equal to the original face value in addition to the policy's cash worth.
Universal life insurance can often give an elevated interest rate when inflation rises, even if the insuring company guarantees a low rate. Because of this risk, premiums are lower for whole life insurance but pricier for term insurance for younger individuals. In addition, when the price for managing the policy is added to the premium, the policy holder will receive a lower return on their investment. It is crucial to keep in mind that changes in interest rates will affect both a policy holder's yields and premiums.
Variable Life Insurance
Variable life insurance is a type of permanent life insurance that allows the holder to target their premium to one or more detached investment funds. These funds can be fixed income investments, stocks, bonds, or money market funds. Depending on the company policy, the holder can change their investments from two to five times annually. Unlike universal life insurance, with variable life insurance the insured can manage the investment of their cash value.
The policy, however, can be risky because the investment has the ability to rise or fall. The cash value and investment will differ, depending on what the investment fund does. The death benefit cannot fall below the total amount of life insurance primarily purchased. As with traditional whole life insurance, the policy holder pays fixed premiums and can borrow against the policy at either fixed or variable rates.
Because an individual decides where to invest their money and put themselves at risk, variable life insurance should be considered. Insurers must, by law, offer variable life insurance by prospectus. A prospectus is a document that gives the prospective policy holder important facts concerning the company and the policy. Variable life insurance can often cost more than other varieties of cash value life insurance. According to current laws the cash value of variable life insurance, similar to those of universal life insurance and whole life insurance, cannot be taxed until the policy holder cashes in their policy.
Universal Variable Life Insurance
Universal variable life insurance is also commonly referred to as flexible premium variable life insurance. This kind of policy combines the flexible features found in universal life insurance policies and the investment alternatives of variable life insurance. As with universal life insurance, the policy holder can choose to raise or lower their premiums in a single policy. As with variable life insurance, individuals have the right to decide how their cash worth will be invested.
The insurance company does not have to make any kind of guarantee on the policy holder's cash value. With universal variable life insurance, the value of the cash fund is in direct relation to the market worth of the assets in the cash worth fund. Therefore, a policy holder could have $15,000 in net cash worth one day and $10,000 on the following day, dependent on market fluctuation. Thus, one of the central problems with universal variable life insurance is that the policy holder can lose their insurance coverage.
Adjustable Life Insurance
Adjustable life insurance is another variety of permanent protection that allows the policy holder to change the amount of their premiums. They can also increase or decrease the face amount of the policy, or lessen the protection period. If the policy holder increases the death benefit, they must prove that they are still in fact insurable.
Tuesday, July 1, 2008
Why Use an Auto Insurance Broker
By. Dave J. Davies
Do you know the value of an auto insurance broker? Many people go shopping for auto insurance on their own, which can be a big mistake. Thousands of people are under insured and don't even know they are. Or you could be paying much more than you need to on insurance.
Do you know what the minimal requirements are for your state? Many states have different requirements, so if you move from one state to another, your previous coverage might not be enough. Without having this minimal insurance, you could face heavy fines or even lose your license.
The minimal requirements your state requires you to have also might not be enough to cover any damages to your car. If you were ever in an accident, would your insurance replace your car? Would it pay for damages? How about medical bills?
Auto insurance is important to think about. If you should ever have an accident, you might not be able to continue working. You might lose the vehicle and the other driver might not have the insurance to cover you. Are you willing to risk everything? Are you positive your insurance will cover it all?
After an accident is not the time to be thinking about insurance, but looking through all the different insurance options can be confusing at best. Where can you go to get the information you need to get the insurance that's right for you, not just for the insurance companies?
This is where an auto insurance broker comes in. An insurance broker can go through insurance polices with you and help you to select the best insurance for you. Their goal is to set you up with what you need.
There are many misunderstandings about auto insurance brokers. For starters, you don't pay them to help you. They get a commission no matter which package you chose from them, so having you pick one package over another isn't so much of a priority.
Do You Know Insurance?
Here are a few types of insurances your policy might or might not cover now.
Fully Comprehensive Auto Insurance For Your Car
This type of insurance, the fully comprehensive auto insurance, is probably the most expensive type you will be offered. If your car is financed by a bank or finance company, you need this insurance.
Fully comprehensive auto insurance insures the car and the owner against any number of events. These include accident and theft. The benefit is that it doesn't matter who is at fault, you're still covered in case your car is in an accident or stolen. If the other driver doesn't have insurance or is under insured you'll still be able to make a claim.
Did you know that insurance policies don't cover 100% of the car? This is especially true for brand new cars. They might insure 80% of the car's total value, maybe even less. This helps insure that fraud is prevented on their side, but might leave you paying out if you're ever in an accident of some sort. Do you know how much your insurance covers?
Third Party, Fire & Theft Insurance
Let's say you've already paid off your car loan. You own a car clean and clear. You may need to still have third party, fire and theft auto insurance. This is especially true if you still retain some form of intrinsic value on your car.
While this type of insurance might be less expensive, the only problem is that you are only covered when an accident occurs with a third party. Which means if you damage your own car, hitting a tree or the such, you'd have to pay for the damages. Also, if you aren't at fault in the accident, your insurance likely won't pay for your insurance, as it doesn't usually cover you if the third party doesn't have insurance.
Separate Third Party Insurance Policy
This policy will cover you if you are at fault in an accident with a third party. This is one of the cheapest sort of auto insurance. Those car owners whose cars are very old or have no value to them will often choose this type of auto insurance.
There are other types of insurance you should be aware of and knowing how much of each type of insurance you will need can lead to even more questions. If you have questions, an auto insurance broker can help.
How the Process with an Auto Insurance Broker Works
It starts with you picking an auto insurance broker that will work with you. You can check the phone book or online to find out whom is local to your area. Ask questions from others on who they recommend.
Local insurance brokers generally get you the best deals for your area. They might know the national auto insurance providers, like Safe Auto, GEICO, or Progressive, but they might also know some local insurance providers, or smaller insurance companies that are just as good, and can be more helpful to you since they are more localized.
Your insurance broker will also be able to help you select which insurance is right for you and your vehicle. You'll save money and you'll get more for your dollar with coverage that will cover you correctly in case of an accident. This includes if the accident was your fault or someone else's.
The best part is, your insurance broker is working for you. They get their commission no matter what package you select, and in most cases you can get the options you want. Your broker will help you to understand those options so you can pick the ones you want.
So if you haven't worked with an insurance broker, it is about time to get someone on your side. Your broker is there to help you, answer your questions, and make sure you are safe on the road. Do a bit of research online for local auto insurance brokers.
Do you know the value of an auto insurance broker? Many people go shopping for auto insurance on their own, which can be a big mistake. Thousands of people are under insured and don't even know they are. Or you could be paying much more than you need to on insurance.
Do you know what the minimal requirements are for your state? Many states have different requirements, so if you move from one state to another, your previous coverage might not be enough. Without having this minimal insurance, you could face heavy fines or even lose your license.
The minimal requirements your state requires you to have also might not be enough to cover any damages to your car. If you were ever in an accident, would your insurance replace your car? Would it pay for damages? How about medical bills?
Auto insurance is important to think about. If you should ever have an accident, you might not be able to continue working. You might lose the vehicle and the other driver might not have the insurance to cover you. Are you willing to risk everything? Are you positive your insurance will cover it all?
After an accident is not the time to be thinking about insurance, but looking through all the different insurance options can be confusing at best. Where can you go to get the information you need to get the insurance that's right for you, not just for the insurance companies?
This is where an auto insurance broker comes in. An insurance broker can go through insurance polices with you and help you to select the best insurance for you. Their goal is to set you up with what you need.
There are many misunderstandings about auto insurance brokers. For starters, you don't pay them to help you. They get a commission no matter which package you chose from them, so having you pick one package over another isn't so much of a priority.
Do You Know Insurance?
Here are a few types of insurances your policy might or might not cover now.
Fully Comprehensive Auto Insurance For Your Car
This type of insurance, the fully comprehensive auto insurance, is probably the most expensive type you will be offered. If your car is financed by a bank or finance company, you need this insurance.
Fully comprehensive auto insurance insures the car and the owner against any number of events. These include accident and theft. The benefit is that it doesn't matter who is at fault, you're still covered in case your car is in an accident or stolen. If the other driver doesn't have insurance or is under insured you'll still be able to make a claim.
Did you know that insurance policies don't cover 100% of the car? This is especially true for brand new cars. They might insure 80% of the car's total value, maybe even less. This helps insure that fraud is prevented on their side, but might leave you paying out if you're ever in an accident of some sort. Do you know how much your insurance covers?
Third Party, Fire & Theft Insurance
Let's say you've already paid off your car loan. You own a car clean and clear. You may need to still have third party, fire and theft auto insurance. This is especially true if you still retain some form of intrinsic value on your car.
While this type of insurance might be less expensive, the only problem is that you are only covered when an accident occurs with a third party. Which means if you damage your own car, hitting a tree or the such, you'd have to pay for the damages. Also, if you aren't at fault in the accident, your insurance likely won't pay for your insurance, as it doesn't usually cover you if the third party doesn't have insurance.
Separate Third Party Insurance Policy
This policy will cover you if you are at fault in an accident with a third party. This is one of the cheapest sort of auto insurance. Those car owners whose cars are very old or have no value to them will often choose this type of auto insurance.
There are other types of insurance you should be aware of and knowing how much of each type of insurance you will need can lead to even more questions. If you have questions, an auto insurance broker can help.
How the Process with an Auto Insurance Broker Works
It starts with you picking an auto insurance broker that will work with you. You can check the phone book or online to find out whom is local to your area. Ask questions from others on who they recommend.
Local insurance brokers generally get you the best deals for your area. They might know the national auto insurance providers, like Safe Auto, GEICO, or Progressive, but they might also know some local insurance providers, or smaller insurance companies that are just as good, and can be more helpful to you since they are more localized.
Your insurance broker will also be able to help you select which insurance is right for you and your vehicle. You'll save money and you'll get more for your dollar with coverage that will cover you correctly in case of an accident. This includes if the accident was your fault or someone else's.
The best part is, your insurance broker is working for you. They get their commission no matter what package you select, and in most cases you can get the options you want. Your broker will help you to understand those options so you can pick the ones you want.
So if you haven't worked with an insurance broker, it is about time to get someone on your side. Your broker is there to help you, answer your questions, and make sure you are safe on the road. Do a bit of research online for local auto insurance brokers.
Sunday, June 29, 2008
Life Insurance Guide and Glossary
by. Christina Costa
Life insurance has a vocabulary all its own. Some insurance terms might sound familiar, but have a different meaning when used in the life insurance world.
The following glossary provides insurance terms and life insurance definitions to help you speak the "language of life."
There are basically two types of life insurance, Universal Life and Term Life.
Term Life
This is the simplest form of life and the most popular. It is intended to provide large amount insurance for a fixed period of time, but for those on a budget. Payments are fixed for the term of the policy which can last, 5, 10, 20, or 30 years.
Universal Life
Universal Life Insurance lasts for the duration of your life and has a cash value. The premium payments are above the cost of the insurance and the extra payment amount is credited towards the cash value in addition to interest paid.
The amount of interest credit by the insurer is often tied to a financial index, so it is possible to see gains or losses of the overall cash value depending on how the indexes perform. The potential benefit of Universal Life is as a stable investment vehicle.
Beneficiary
The beneficiary of your insurance policy is the person designated by you to receive the policy benefits upon your death. You may designate that the benefits from your policy be allocated to multiple beneficiaries. And you may change your beneficiary designations at any time.
Coverage Amount / Face Amount
The initial value of the policy to be paid to the insured's beneficiary or beneficiaries in the event of the death of the insured while the policy is in force.
This value does not include adjustments for outstanding policy loans, withdrawals, dividends, paid-up additions or late/outstanding premium payments.
Health & Lifestyle Profile
The premiums that insurance companies charge for life insurance are also based in large part on the overall health and lifestyle profile of the proposed insured.
Typically, individuals in good health who do not use any kind of tobacco products or engage in any hazardous activities will be able to obtain less expensive coverage than individuals who are in poor health or who use tobacco or who engage in hazardous activities.
Different insurance companies use different criteria in determining the health status and lifestyle of the proposed insured.
Date of Birth
The premiums that insurance companies charge for life insurance are based in large part on the age of the proposed insured. Some companies use the attained age of the insured in this calculation, while other companies use the nearest age of the insured.
Insured
An individual who is currently covered under an existing life insurance policy.
Length of Coverage
Different term life insurance policies have different durations.
10, 15, 20, and 30-year term life insurance policies are very common. A 10-year level term policy will have an initial 10-year period in which premiums are level.
Premium
This is a payment to a life insurance company in exchange for a life insurance policy. The payment typically does not change on term life for the length of the policy.
Premium Mode
The frequency in which premiums are paid. Typically, the total annual premium is slightly higher when payments are spread out over the course of the year as opposed to being paid all at once.
For example, a policy with a $200 annual premium may also offer a $101 semiannual premium ($202 total annual cost), a $52 quarterly premium ($208 annual cost) and an $18 monthly bank draft premium ($216 annual cost).
Proposed Insured
An individual who is applying for coverage under a life insurance policy. (See also: Insured).
Underwriting Classification
(See: Health & Lifestyle Profile, above).
Sex
The gender (male or female) of the insured or proposed insured.
Underwriting Guidelines
Underwriting guidelines are the health and lifestyle criteria for the proposed insured that insurance companies use to determine the appropriate underwriting classification upon which to base the premiums for the coverage.
These criteria typically include age, gender, tobacco use, height/weight build, and family history of heart disease or cancer, cholesterol levels, blood pressure levels, specific health conditions, driving record, hazardous occupation or activities.
Also, military service, aviation, foreign travel or residency, U.S. citizenship and felony criminal activity. It is important that all of these underwriting guidelines are taken into consideration when evaluating any premiums quoted for life insurance coverage.
State of Residence
The state in which the insured or proposed insured resides. It is not unusual for a given insurance company to be licensed to conduct business in some states and not in others depending on their licensing.
If an insurance company is not licensed to do business in a particular state, the company may not offer any of its products in that state.
If an insurance company is licensed to do business in a particular state, each of the company's products must be individually approved for sale in that state. It is not unusual for a given insurance company to have products that are approved for sale in one state and not approved for sale in others.
Life insurance has a vocabulary all its own. Some insurance terms might sound familiar, but have a different meaning when used in the life insurance world.
The following glossary provides insurance terms and life insurance definitions to help you speak the "language of life."
There are basically two types of life insurance, Universal Life and Term Life.
Term Life
This is the simplest form of life and the most popular. It is intended to provide large amount insurance for a fixed period of time, but for those on a budget. Payments are fixed for the term of the policy which can last, 5, 10, 20, or 30 years.
Universal Life
Universal Life Insurance lasts for the duration of your life and has a cash value. The premium payments are above the cost of the insurance and the extra payment amount is credited towards the cash value in addition to interest paid.
The amount of interest credit by the insurer is often tied to a financial index, so it is possible to see gains or losses of the overall cash value depending on how the indexes perform. The potential benefit of Universal Life is as a stable investment vehicle.
Beneficiary
The beneficiary of your insurance policy is the person designated by you to receive the policy benefits upon your death. You may designate that the benefits from your policy be allocated to multiple beneficiaries. And you may change your beneficiary designations at any time.
Coverage Amount / Face Amount
The initial value of the policy to be paid to the insured's beneficiary or beneficiaries in the event of the death of the insured while the policy is in force.
This value does not include adjustments for outstanding policy loans, withdrawals, dividends, paid-up additions or late/outstanding premium payments.
Health & Lifestyle Profile
The premiums that insurance companies charge for life insurance are also based in large part on the overall health and lifestyle profile of the proposed insured.
Typically, individuals in good health who do not use any kind of tobacco products or engage in any hazardous activities will be able to obtain less expensive coverage than individuals who are in poor health or who use tobacco or who engage in hazardous activities.
Different insurance companies use different criteria in determining the health status and lifestyle of the proposed insured.
Date of Birth
The premiums that insurance companies charge for life insurance are based in large part on the age of the proposed insured. Some companies use the attained age of the insured in this calculation, while other companies use the nearest age of the insured.
Insured
An individual who is currently covered under an existing life insurance policy.
Length of Coverage
Different term life insurance policies have different durations.
10, 15, 20, and 30-year term life insurance policies are very common. A 10-year level term policy will have an initial 10-year period in which premiums are level.
Premium
This is a payment to a life insurance company in exchange for a life insurance policy. The payment typically does not change on term life for the length of the policy.
Premium Mode
The frequency in which premiums are paid. Typically, the total annual premium is slightly higher when payments are spread out over the course of the year as opposed to being paid all at once.
For example, a policy with a $200 annual premium may also offer a $101 semiannual premium ($202 total annual cost), a $52 quarterly premium ($208 annual cost) and an $18 monthly bank draft premium ($216 annual cost).
Proposed Insured
An individual who is applying for coverage under a life insurance policy. (See also: Insured).
Underwriting Classification
(See: Health & Lifestyle Profile, above).
Sex
The gender (male or female) of the insured or proposed insured.
Underwriting Guidelines
Underwriting guidelines are the health and lifestyle criteria for the proposed insured that insurance companies use to determine the appropriate underwriting classification upon which to base the premiums for the coverage.
These criteria typically include age, gender, tobacco use, height/weight build, and family history of heart disease or cancer, cholesterol levels, blood pressure levels, specific health conditions, driving record, hazardous occupation or activities.
Also, military service, aviation, foreign travel or residency, U.S. citizenship and felony criminal activity. It is important that all of these underwriting guidelines are taken into consideration when evaluating any premiums quoted for life insurance coverage.
State of Residence
The state in which the insured or proposed insured resides. It is not unusual for a given insurance company to be licensed to conduct business in some states and not in others depending on their licensing.
If an insurance company is not licensed to do business in a particular state, the company may not offer any of its products in that state.
If an insurance company is licensed to do business in a particular state, each of the company's products must be individually approved for sale in that state. It is not unusual for a given insurance company to have products that are approved for sale in one state and not approved for sale in others.
Friday, June 20, 2008
Group Health Insurance Benefits: How to Keep Health Insurance Coverage 100%
Author: Pennsylvania Health Insurance
How To Keep Health Insurance Coverage 100%
Only 5% of employers in the U.S. still offer 100% coverage for their employees’ health insurance benefits. Other employers are choosing high copay plans or high deductible plans. Most others are passing their increase in health care costs on to their employees.
Fact: Health Care Premiums are rising faster than workers wages
Premiums for employer-sponsored health insurance rose an average of 6.1 percent in 2007, less than the 7.7 percent increase reported last year but still higher than the increase in workers’ wages (3.7 percent) and the overall inflation rate (2.6 percent), according to the 2007 Employer Health Benefits Survey conducted by the Kaiser Family Foundation and the Health Research and Educational Trust.
The 6.1 percent average increase this year was the slowest rate of premium growth since 1999, when premiums rose 5.3 percent. Since 2001, premiums for family coverage have increased 78 percent, while wages have increased 19 percent and inflation has increased 17 percent.
The average premium for family coverage in 2007 is $12,106. On average, workers now pay $3,281 out of their paychecks to cover their share of the cost of a family policy. While premiums continue to rise faster than wages, this year’s gap of 2.4 percentage points is much smaller than the 10.9 percentage point gap recorded four years ago, when premiums rose 13.9 percent and
wages grew just 3 percent. (Agent Sales Journal Nov. 2007)
Lets Keep it 100% coverage and reduce the premiums
This is a strategy from Easy To Insure Me .com
We will use 2 equations for a 15-employee group: Current and Future Solution
Equation 1 Current
15 employees
(Yearly Premium) $100,000=Health Care
Equation 2 Future Solution
(Yearly Premium) $60,000 + $15,000 (employees x deductibles) = $75,000 maximum exposure
100% coverage and the employer pays for the deductible
while still saving 20% to 40%
**We say maximum exposure because not all employees will satisfy the deductible
Call 215 944 3079 and ask for Chad Levin for more information
How To Keep Health Insurance Coverage 100%
Only 5% of employers in the U.S. still offer 100% coverage for their employees’ health insurance benefits. Other employers are choosing high copay plans or high deductible plans. Most others are passing their increase in health care costs on to their employees.
Fact: Health Care Premiums are rising faster than workers wages
Premiums for employer-sponsored health insurance rose an average of 6.1 percent in 2007, less than the 7.7 percent increase reported last year but still higher than the increase in workers’ wages (3.7 percent) and the overall inflation rate (2.6 percent), according to the 2007 Employer Health Benefits Survey conducted by the Kaiser Family Foundation and the Health Research and Educational Trust.
The 6.1 percent average increase this year was the slowest rate of premium growth since 1999, when premiums rose 5.3 percent. Since 2001, premiums for family coverage have increased 78 percent, while wages have increased 19 percent and inflation has increased 17 percent.
The average premium for family coverage in 2007 is $12,106. On average, workers now pay $3,281 out of their paychecks to cover their share of the cost of a family policy. While premiums continue to rise faster than wages, this year’s gap of 2.4 percentage points is much smaller than the 10.9 percentage point gap recorded four years ago, when premiums rose 13.9 percent and
wages grew just 3 percent. (Agent Sales Journal Nov. 2007)
Lets Keep it 100% coverage and reduce the premiums
This is a strategy from Easy To Insure Me .com
We will use 2 equations for a 15-employee group: Current and Future Solution
Equation 1 Current
15 employees
(Yearly Premium) $100,000=Health Care
Equation 2 Future Solution
(Yearly Premium) $60,000 + $15,000 (employees x deductibles) = $75,000 maximum exposure
100% coverage and the employer pays for the deductible
while still saving 20% to 40%
**We say maximum exposure because not all employees will satisfy the deductible
Call 215 944 3079 and ask for Chad Levin for more information
Buying Life Insurance After Being Diagnosed With Cancer
Author: Insure.com
The American Cancer Society estimates doctors will diagnose over 1.4 million new cases of cancer in the U.S. in 2007, with more than 559,650 cancer-related deaths. If you are among the majority of cancer patients and survive for at least five years following your diagnosis, you may face another fight: buying life insurance.
Buying life insurance for cancer patients is challenging, but not necessarily impossible. Your chances for securing a policy depend greatly on the type, stage and grade of the cancer, and even on the treatment plan. There is a relationship between the rate you'll receive and the curability of your cancer. Certain types of skin cancer, for example, are considered very low risk by life insurance companies and a skin cancer history may not even impact premiums.
Applicants with common and treatable forms of breast and prostate cancer may be able to get a "standard" rating under ideal circumstances. But patients with a history of leukemia or colon cancer may fall into a "substandard" or "high substandard" rating at best, or receive declines. Anyone with cancer that has metastasized likely won't be able to obtain a policy.
Dr. Charles Levy, senior vice president and chief medical director of AIG American General Domestic Life Insurance Cos., says, "We're better and better able to differentiate the risks of individual cancers." Life insurers like AIG American General have sophisticated tables to determine premiums, where they can factor in cancer types and treatments. The end result is better premiums because applicants aren't lumped together as an "average."
Most insurers will not offer a policy to someone who is still undergoing treatment for cancer. Depending on your type of cancer, the life insurer may also want to add a surcharge, also called a temporary flat extra. For example, AIG American General sometimes charges temporary flat extras for two to five years, depending on the applicant's cancer and treatment. The good news is that although these extra premiums can be expensive, they will automatically disappear after a set period of time.
Cancer insurance risk specialists
While a dedicated life insurance agent will search cancer insurance companies to find insurers that will sell you a life insurance policy, in some cases you may be better off seeking out a broker who specializes in finding life insurance for people who have a history of cancer.
These brokers will know the specific questions underwriters will want answered when considering your application. Many brokers have developed relationships with several insurers, so they know which companies offer the best-priced life insurance policies for cancer survivors. Some brokers have experts who specialize in gathering your medical records and organizing them.
By directing your application to life insurers that will view your application most favorably, these brokers will help you find the most accurate price quotes and the lowest premiums for life insurance. Always check the financial strength of the insurer before you buy any policy and be sure that the agent or broker you choose is licensed in your state.
Life insurance strategies for cancer survivors
If you are a healthy cancer survivor, life insurance is even more feasible. There are things you can do to ensure you're getting the best premium offers possible for your situation.
1. Gather all possible medical records before you apply, from the first pathology report to medical records to treatment records. That ensures medical underwriters have the most complete picture of you, your health, and your cancer history. Having all those records before you apply for cancer insurance will reduce delays in your application process, because your life insurer is going to request them and will wait for them. The information you provide can garner you better premiums in the end: The less life insurer underwriters knows about you, the more likely they are to have to assume you are the highest risk and offer you high premiums accordingly. According to Levy, "If it's fuzzy, we're more likely to err on the side of conservatism."
2. Make sure you have complied with your doctor's treatment plans. For example, says Levy, if your doctor asked to see you back in one year and you haven't been back in four years, get to your doctor for your check-up before you apply for life insurance. Your life insurer is not going to offer you a policy without before seeing the results of that check-up. Similarly, if you've had breast cancer and you're due for a mammogram in December and you apply for cancer insurance in October, your life insurer will likely wait for the results of your next mammogram.
3. Get prices from several companies. Policy costs can vary a great deal among companies.
4. See if you can get group life insurance through a professional, fraternal, membership, or political organization to which you belong.
5. Consider a "graded" policy (one with limited benefits) if you cannot get full death benefits. In the first few years of a graded policy, the company pays only the premiums and part of the face value if the insured person dies of a condition, such as cancer, that existed before the policy took effect. If the insured person dies after the specified grading-in period, the company will pay the full face amount of the policy.
If your cancer has been successfully treated, and you are otherwise in good health, you can likely obtain a cancer life insurance policy. If you can show that you are healthy and your treatments have gone well, several insurers may compete for your business.
The American Cancer Society estimates doctors will diagnose over 1.4 million new cases of cancer in the U.S. in 2007, with more than 559,650 cancer-related deaths. If you are among the majority of cancer patients and survive for at least five years following your diagnosis, you may face another fight: buying life insurance.
Buying life insurance for cancer patients is challenging, but not necessarily impossible. Your chances for securing a policy depend greatly on the type, stage and grade of the cancer, and even on the treatment plan. There is a relationship between the rate you'll receive and the curability of your cancer. Certain types of skin cancer, for example, are considered very low risk by life insurance companies and a skin cancer history may not even impact premiums.
Applicants with common and treatable forms of breast and prostate cancer may be able to get a "standard" rating under ideal circumstances. But patients with a history of leukemia or colon cancer may fall into a "substandard" or "high substandard" rating at best, or receive declines. Anyone with cancer that has metastasized likely won't be able to obtain a policy.
Dr. Charles Levy, senior vice president and chief medical director of AIG American General Domestic Life Insurance Cos., says, "We're better and better able to differentiate the risks of individual cancers." Life insurers like AIG American General have sophisticated tables to determine premiums, where they can factor in cancer types and treatments. The end result is better premiums because applicants aren't lumped together as an "average."
Most insurers will not offer a policy to someone who is still undergoing treatment for cancer. Depending on your type of cancer, the life insurer may also want to add a surcharge, also called a temporary flat extra. For example, AIG American General sometimes charges temporary flat extras for two to five years, depending on the applicant's cancer and treatment. The good news is that although these extra premiums can be expensive, they will automatically disappear after a set period of time.
Cancer insurance risk specialists
While a dedicated life insurance agent will search cancer insurance companies to find insurers that will sell you a life insurance policy, in some cases you may be better off seeking out a broker who specializes in finding life insurance for people who have a history of cancer.
These brokers will know the specific questions underwriters will want answered when considering your application. Many brokers have developed relationships with several insurers, so they know which companies offer the best-priced life insurance policies for cancer survivors. Some brokers have experts who specialize in gathering your medical records and organizing them.
By directing your application to life insurers that will view your application most favorably, these brokers will help you find the most accurate price quotes and the lowest premiums for life insurance. Always check the financial strength of the insurer before you buy any policy and be sure that the agent or broker you choose is licensed in your state.
Life insurance strategies for cancer survivors
If you are a healthy cancer survivor, life insurance is even more feasible. There are things you can do to ensure you're getting the best premium offers possible for your situation.
1. Gather all possible medical records before you apply, from the first pathology report to medical records to treatment records. That ensures medical underwriters have the most complete picture of you, your health, and your cancer history. Having all those records before you apply for cancer insurance will reduce delays in your application process, because your life insurer is going to request them and will wait for them. The information you provide can garner you better premiums in the end: The less life insurer underwriters knows about you, the more likely they are to have to assume you are the highest risk and offer you high premiums accordingly. According to Levy, "If it's fuzzy, we're more likely to err on the side of conservatism."
2. Make sure you have complied with your doctor's treatment plans. For example, says Levy, if your doctor asked to see you back in one year and you haven't been back in four years, get to your doctor for your check-up before you apply for life insurance. Your life insurer is not going to offer you a policy without before seeing the results of that check-up. Similarly, if you've had breast cancer and you're due for a mammogram in December and you apply for cancer insurance in October, your life insurer will likely wait for the results of your next mammogram.
3. Get prices from several companies. Policy costs can vary a great deal among companies.
4. See if you can get group life insurance through a professional, fraternal, membership, or political organization to which you belong.
5. Consider a "graded" policy (one with limited benefits) if you cannot get full death benefits. In the first few years of a graded policy, the company pays only the premiums and part of the face value if the insured person dies of a condition, such as cancer, that existed before the policy took effect. If the insured person dies after the specified grading-in period, the company will pay the full face amount of the policy.
If your cancer has been successfully treated, and you are otherwise in good health, you can likely obtain a cancer life insurance policy. If you can show that you are healthy and your treatments have gone well, several insurers may compete for your business.
How to Collect on Lost Life Insurance Policies
Author: Insure.com
A relative has just died. He had a life insurance policy with you listed as the beneficiary. There's just one problem: the life insurance policy is missing. You have no idea which insurance company wrote it.
If you find the missing life insurance policy in the future, are you still eligible to receive the death benefit?
Hope they paid their insurance bills
If you're a beneficiary and you find the lost life insurance policy shortly after the insured dies (within six months to a year, for example), claiming the death benefit should be trouble-free.
First, determine if the insured had term or permanent life insurance. If the insured held a term policy, you'll receive the death benefit if he died before the end of the policy term. If he died after the policy expiration date, you would get nothing.
If the insured had a permanent life policy, you'll receive the money if the death occurred while the policy was "in force," meaning all premium payments were made up until the time of death. If the death was a while ago, you'll receive the benefit with interest from the date of death.
If the life insurance policy lapsed — meaning the insured stopped making premium payments before he died — there's a chance you might get nothing. When a permanent life insurance policy lapses, most insurance companies switch its status from permanent insurance to one of two options:
"Extended term" — The insurance company uses the cash value of the policy to buy a term life insurance policy for the same death benefit using the cash value of the policy. The death benefit will continue for the longest period the cash value will purchase.
"Reduced paid up" — The insurance company will keep the policy in force permanently, but will reduce the death benefit.
Gerry Brogla, an actuary for State Farm, says in the majority of the cases at his company, the permanent policy continues as extended term if it lapses. At State Farm, extended term is the default option for most permanent policies.
If the policy lapses, and the extended-term period expires before the insured dies, the policy is worthless and the life insurance beneficiary will get nothing. If the insured dies before the extended-term period is up, the beneficiary will receive the death benefit. If the policy lapsed because the insured died (thus ending premium payments and causing the insurance to be placed in extended-term status), the beneficiary will still collect the full death benefit, regardless of when the extended term was up. The beneficiary always needs to supply the insurance company with a death certificate to verify the date of death.
There is no time limit during which a life insurance beneficiary must step forward to collect the money, according to Jack Dolan, spokesman for the American Council of Life Insurers. "If a person shows up 30 years after [the insured's] death, the company still makes good on it," Dolan assures.
What happens if no one ever reports the death?
If the insured dies and the insurance company does not learn of the death, the policy lapses. Insurance companies will take steps to find out why a policyholder stopped making payments.
When an insurance company stops getting payments, it sends letters to the insured informing him the policy may lapse as a result of unpaid premiums. If the letters go unanswered, the company might initiate a search to find the insured. If that comes up empty, the company will then lapse the policy.
If a beneficiary to a policy never steps forward, it unfortunately means the insured paid money to a policy throughout his life and his beneficiaries never see a penny. This is why its a good idea to make sure beneficiaries are aware of any life insurance policies you have.
If you're lucky, the state may have your money
In some cases when a beneficiary fails to claim a death benefit for several years, the money is transferred to the state where the insurance policy was purchased under the escheat laws.
If a company knows an insured died and it cannot find the beneficiary, it must turn the full death benefit over to the state comptroller's department within three to five years of the insured's death. The money is transferred to the state where the insured bought the policy. The money is considered "unclaimed property" and gets lumped in with dormant bank accounts and uncollected rent deposits. The comptroller's department maintains a database that lists the names and addresses of lost life insurance beneficiaries.
Many states will try to contact life insurance beneficiaries in an effort to pay the death benefits. In Texas, for example, the names and addresses of the beneficiaries are published annually in each county in the state. In New York, the Web site of the New York State Comptroller's Office of Unclaimed Funds has an online search to find any unclaimed death benefits owed to you. You can find out the procedures in your state by contacting the office of your state comptroller or treasurer.
Keep in mind your chances of finding the policy with the state are slim. The insurance company has no obligation to hand the money over to the state if it's unaware the insured died. In most cases, it's the beneficiary who contacts the insurance company.
Also, the insurer only transfers the money to the state three to five years after it cannot find the beneficiary but knows the insured died. If the state doesn't have the death benefit, it's likely the insurer is still looking for the beneficiary or doesn't know the policyholder has died.
Unclaimed death benefits are rarely transferred to the state. Dave Potter, a spokesman for Hartford Life, says less than 1 percent of his company's death benefits go unclaimed.
Del Chance, a life insurance claims manager at State Farm, says, "Turning over life policy benefits to an individual state after the death of an insured is extremely rare. State Farm utilizes their own search techniques as well as outside vendors to locate lost beneficiaries in the event of the death of one of our insureds. By and large these procedures have always located the beneficiary.
Tips for making sure your life insurance beneficiaries get your death benefit:
1. Give your beneficiaries your policy information. It can be a difficult and awkward conversation, but an important one.
2. Keep all your financial records (especially your life insurance policies) in one place. Don't force your beneficiaries to search your house from top to bottom after you die.
Tips for looking for lost life insurance policies:
1. Go through canceled checks or contact your relative's bank for copies of old checks. Look for checks made out to insurance companies.
2. Ask those who may have known about your relative's finances. Speak with the relative's lawyer, banker or accountant. Also contact the relative's insurance agent.
3. Contact your relative's past employers. They might know of possible group life insurance. The insured might have also purchased supplemental life insurance through work.
4. Check the mail for a year. Premium bills and policy-status notices are usually sent annually.
5. Look at income tax returns for the past two years. Check for interest income from policies or expenses paid to life insurance companies.
6. Contact the Medical Information Bureau. If your relative bought life insurance fairly recently, there might be a trail of the companies to which he applied. The Medical Information Bureau (MIB) maintains a database that might show if insurers requested your relative's medical information within the past seven years. Record searches can be requested through the MIB's Policy Locator Service and cost $75. The MIB says that nearly 30 percent of searches turn up leads.
A relative has just died. He had a life insurance policy with you listed as the beneficiary. There's just one problem: the life insurance policy is missing. You have no idea which insurance company wrote it.
If you find the missing life insurance policy in the future, are you still eligible to receive the death benefit?
Hope they paid their insurance bills
If you're a beneficiary and you find the lost life insurance policy shortly after the insured dies (within six months to a year, for example), claiming the death benefit should be trouble-free.
First, determine if the insured had term or permanent life insurance. If the insured held a term policy, you'll receive the death benefit if he died before the end of the policy term. If he died after the policy expiration date, you would get nothing.
If the insured had a permanent life policy, you'll receive the money if the death occurred while the policy was "in force," meaning all premium payments were made up until the time of death. If the death was a while ago, you'll receive the benefit with interest from the date of death.
If the life insurance policy lapsed — meaning the insured stopped making premium payments before he died — there's a chance you might get nothing. When a permanent life insurance policy lapses, most insurance companies switch its status from permanent insurance to one of two options:
"Extended term" — The insurance company uses the cash value of the policy to buy a term life insurance policy for the same death benefit using the cash value of the policy. The death benefit will continue for the longest period the cash value will purchase.
"Reduced paid up" — The insurance company will keep the policy in force permanently, but will reduce the death benefit.
Gerry Brogla, an actuary for State Farm, says in the majority of the cases at his company, the permanent policy continues as extended term if it lapses. At State Farm, extended term is the default option for most permanent policies.
If the policy lapses, and the extended-term period expires before the insured dies, the policy is worthless and the life insurance beneficiary will get nothing. If the insured dies before the extended-term period is up, the beneficiary will receive the death benefit. If the policy lapsed because the insured died (thus ending premium payments and causing the insurance to be placed in extended-term status), the beneficiary will still collect the full death benefit, regardless of when the extended term was up. The beneficiary always needs to supply the insurance company with a death certificate to verify the date of death.
There is no time limit during which a life insurance beneficiary must step forward to collect the money, according to Jack Dolan, spokesman for the American Council of Life Insurers. "If a person shows up 30 years after [the insured's] death, the company still makes good on it," Dolan assures.
What happens if no one ever reports the death?
If the insured dies and the insurance company does not learn of the death, the policy lapses. Insurance companies will take steps to find out why a policyholder stopped making payments.
When an insurance company stops getting payments, it sends letters to the insured informing him the policy may lapse as a result of unpaid premiums. If the letters go unanswered, the company might initiate a search to find the insured. If that comes up empty, the company will then lapse the policy.
If a beneficiary to a policy never steps forward, it unfortunately means the insured paid money to a policy throughout his life and his beneficiaries never see a penny. This is why its a good idea to make sure beneficiaries are aware of any life insurance policies you have.
If you're lucky, the state may have your money
In some cases when a beneficiary fails to claim a death benefit for several years, the money is transferred to the state where the insurance policy was purchased under the escheat laws.
If a company knows an insured died and it cannot find the beneficiary, it must turn the full death benefit over to the state comptroller's department within three to five years of the insured's death. The money is transferred to the state where the insured bought the policy. The money is considered "unclaimed property" and gets lumped in with dormant bank accounts and uncollected rent deposits. The comptroller's department maintains a database that lists the names and addresses of lost life insurance beneficiaries.
Many states will try to contact life insurance beneficiaries in an effort to pay the death benefits. In Texas, for example, the names and addresses of the beneficiaries are published annually in each county in the state. In New York, the Web site of the New York State Comptroller's Office of Unclaimed Funds has an online search to find any unclaimed death benefits owed to you. You can find out the procedures in your state by contacting the office of your state comptroller or treasurer.
Keep in mind your chances of finding the policy with the state are slim. The insurance company has no obligation to hand the money over to the state if it's unaware the insured died. In most cases, it's the beneficiary who contacts the insurance company.
Also, the insurer only transfers the money to the state three to five years after it cannot find the beneficiary but knows the insured died. If the state doesn't have the death benefit, it's likely the insurer is still looking for the beneficiary or doesn't know the policyholder has died.
Unclaimed death benefits are rarely transferred to the state. Dave Potter, a spokesman for Hartford Life, says less than 1 percent of his company's death benefits go unclaimed.
Del Chance, a life insurance claims manager at State Farm, says, "Turning over life policy benefits to an individual state after the death of an insured is extremely rare. State Farm utilizes their own search techniques as well as outside vendors to locate lost beneficiaries in the event of the death of one of our insureds. By and large these procedures have always located the beneficiary.
Tips for making sure your life insurance beneficiaries get your death benefit:
1. Give your beneficiaries your policy information. It can be a difficult and awkward conversation, but an important one.
2. Keep all your financial records (especially your life insurance policies) in one place. Don't force your beneficiaries to search your house from top to bottom after you die.
Tips for looking for lost life insurance policies:
1. Go through canceled checks or contact your relative's bank for copies of old checks. Look for checks made out to insurance companies.
2. Ask those who may have known about your relative's finances. Speak with the relative's lawyer, banker or accountant. Also contact the relative's insurance agent.
3. Contact your relative's past employers. They might know of possible group life insurance. The insured might have also purchased supplemental life insurance through work.
4. Check the mail for a year. Premium bills and policy-status notices are usually sent annually.
5. Look at income tax returns for the past two years. Check for interest income from policies or expenses paid to life insurance companies.
6. Contact the Medical Information Bureau. If your relative bought life insurance fairly recently, there might be a trail of the companies to which he applied. The Medical Information Bureau (MIB) maintains a database that might show if insurers requested your relative's medical information within the past seven years. Record searches can be requested through the MIB's Policy Locator Service and cost $75. The MIB says that nearly 30 percent of searches turn up leads.
Thursday, June 19, 2008
7 Tips For Buying Life Insurance...
The classic and best reason for an individual to buy life insurance is for protection against dying too soon. The person buying life insurance should be primarily concerned with seeing that his or her survivors do not face a financial handicap. There may be other reasons that apply: Life insurance is also purchased to pay estate taxes.
Business relationships often require life insurance or can benefit from it, for example. Annuities offer a secure way for consumers to make sure they don’t outlive their money. Beware of anyone who tries to sell you life insurance as an “investment.” Life insurance should be purchased for the protection it will give you...
Here are seven tips for consumers who are in the market for life insurance:
1. Know what you need:
The classic and best reason for an individual to buy life insurance is for protection against dying too soon. The person buying life insurance should be primarily concerned with seeing that his or her survivors do not face a financial handicap. There may be other reasons that apply: Life insurance is also purchased to pay estate taxes. Business relationships often require life insurance or can benefit from it, for example. Annuities offer a secure way for consumers to make sure they don’t outlive their money. Beware of anyone who tries to sell you life insurance as an “investment.” Life insurance should be purchased for the protection it will give you.
Term life insurance:
Most consumer advocates feel that term insurance is the best life insurance buy. Term is different from “whole life” or “ordinary life” in that you build up no equity, or cash value. In term, you pay each year for the cost of insurance, which typically increases annually as your chances of being alive the next year decline. Most term policies are renewable on an annual basis, and some have level premiums or a decreasing death benefit for a stated period — one, five or ten years, or even to a specified age.
Whole life insurance:
Whole, or “ordinary,” life insurance is usually sold with a level premium. In the early years of the policy, the annual premium will be higher than comparable term insurance. (But because its premiums are level, whole life’s annual premiums may eventually be less than term.) Whole life policies build up a cash value that consumers can withdraw or borrow against. There are many variations of whole life. Premiums may be payable for a specified number of years on a limited-payment basis. Consumers also may have the option of a single premium paying all of the premiums at once with a single lump sum.
2. Know the company you are buying from:
You can check the financial stability of any life insurance company through several reputable national rating companies. Some ratings are available at public libraries.
3. Shop around for rates:
Life insurance is a competitive marketplace, and much of the competition focuses on price. Don’t hesitate to seek premium quotes from several different companies.
4. Shop for your own needs:
If term insurance fits, that’s what you should shop for. If you want to lower your premium at all costs, you may want to consider using a direct writer a company that cuts costs by operating without agents. Consider your own convenience, however: Do you want personal contact with an agent? Or if you buy an annuity, how fast can you get to your money in case of an emergency? If you are buying whole life, how fast does your money accumulate? What will the cash value be in one year? Three years? Ten years?
5. Update your coverage as your circumstances change:
Don’t be misled by someone who tells you you should buy additional policies for children as they are born. Children rarely have an income and seldom require life insurance. But your situation may change dramatically from year to year. Review your net worth every few years and reconsider the prospects your survivors may face if you die.
6. Don’t let yourself get fast-talked into changes:
Some life insurance policyholders in recent years have fallen victim to a practice called “twisting” or “churning.” Churning occurs when your coverage is changed only to benefit the seller even though you may suffer a loss in the process. Churning often happens when people with cash-value policies are persuaded to convert their coverage to another policy, often one with a promise of better benefits. The problem is that the cash value of the original policy is raided in order to pay for the new policy. Luckless consumers may not realize until years later that the “higher” benefit policy is actually worth only a fraction of the value of the original policy.
7. Never buy a policy you don’t understand:
If you are given illustrations or booklets, save that material with your policy. If your agent or company cannot explain the policy terms to your satisfaction, shop elsewhere. Make sure you understand the guarantees in your policy (not just the agent’s promises of returns) and the surrender penalties if you choose to drop the policy at any time. These costs are often hidden in a life insurance or annuity policy.
Many states require drivers to carry a proof-of-insurance card with them when driving. Ask your insurer for a card, and keep it in your wallet or in your car.
Business relationships often require life insurance or can benefit from it, for example. Annuities offer a secure way for consumers to make sure they don’t outlive their money. Beware of anyone who tries to sell you life insurance as an “investment.” Life insurance should be purchased for the protection it will give you...
Here are seven tips for consumers who are in the market for life insurance:
1. Know what you need:
The classic and best reason for an individual to buy life insurance is for protection against dying too soon. The person buying life insurance should be primarily concerned with seeing that his or her survivors do not face a financial handicap. There may be other reasons that apply: Life insurance is also purchased to pay estate taxes. Business relationships often require life insurance or can benefit from it, for example. Annuities offer a secure way for consumers to make sure they don’t outlive their money. Beware of anyone who tries to sell you life insurance as an “investment.” Life insurance should be purchased for the protection it will give you.
Term life insurance:
Most consumer advocates feel that term insurance is the best life insurance buy. Term is different from “whole life” or “ordinary life” in that you build up no equity, or cash value. In term, you pay each year for the cost of insurance, which typically increases annually as your chances of being alive the next year decline. Most term policies are renewable on an annual basis, and some have level premiums or a decreasing death benefit for a stated period — one, five or ten years, or even to a specified age.
Whole life insurance:
Whole, or “ordinary,” life insurance is usually sold with a level premium. In the early years of the policy, the annual premium will be higher than comparable term insurance. (But because its premiums are level, whole life’s annual premiums may eventually be less than term.) Whole life policies build up a cash value that consumers can withdraw or borrow against. There are many variations of whole life. Premiums may be payable for a specified number of years on a limited-payment basis. Consumers also may have the option of a single premium paying all of the premiums at once with a single lump sum.
2. Know the company you are buying from:
You can check the financial stability of any life insurance company through several reputable national rating companies. Some ratings are available at public libraries.
3. Shop around for rates:
Life insurance is a competitive marketplace, and much of the competition focuses on price. Don’t hesitate to seek premium quotes from several different companies.
4. Shop for your own needs:
If term insurance fits, that’s what you should shop for. If you want to lower your premium at all costs, you may want to consider using a direct writer a company that cuts costs by operating without agents. Consider your own convenience, however: Do you want personal contact with an agent? Or if you buy an annuity, how fast can you get to your money in case of an emergency? If you are buying whole life, how fast does your money accumulate? What will the cash value be in one year? Three years? Ten years?
5. Update your coverage as your circumstances change:
Don’t be misled by someone who tells you you should buy additional policies for children as they are born. Children rarely have an income and seldom require life insurance. But your situation may change dramatically from year to year. Review your net worth every few years and reconsider the prospects your survivors may face if you die.
6. Don’t let yourself get fast-talked into changes:
Some life insurance policyholders in recent years have fallen victim to a practice called “twisting” or “churning.” Churning occurs when your coverage is changed only to benefit the seller even though you may suffer a loss in the process. Churning often happens when people with cash-value policies are persuaded to convert their coverage to another policy, often one with a promise of better benefits. The problem is that the cash value of the original policy is raided in order to pay for the new policy. Luckless consumers may not realize until years later that the “higher” benefit policy is actually worth only a fraction of the value of the original policy.
7. Never buy a policy you don’t understand:
If you are given illustrations or booklets, save that material with your policy. If your agent or company cannot explain the policy terms to your satisfaction, shop elsewhere. Make sure you understand the guarantees in your policy (not just the agent’s promises of returns) and the surrender penalties if you choose to drop the policy at any time. These costs are often hidden in a life insurance or annuity policy.
Many states require drivers to carry a proof-of-insurance card with them when driving. Ask your insurer for a card, and keep it in your wallet or in your car.
9 Ways To Lower Your Auto Insurance Costs
1. Shop Around
Prices vary from company to company, so it pays to shop around. Get at least three price quotes. You can call companies directly or access information on the Internet. Your state insurance department may also provide comparisons of prices charged by major insurers. (State insurance department phone numbers and Web sites can be found here.)
You buy insurance to protect you financially and provide peace of mind. It's important to pick a company that is financially stable. Check the financial health of insurance companies with rating companies such as A.M. Best (http://www.ambest.com) and Standard & Poor’s (http://www.standardandpoors.com/) and consult consumer magazines.
Get quotes from different types of insurance companies. Some sell through their own agents. These agencies have the same name as the insurance company. Some sell through independent agents who offer policies from several insurance companies. Others do not use agents. They sell directly to consumers over the phone or via the Internet.
Don't shop price alone. Ask friends and relatives for their recommendations. Contact your state insurance department to find out whether they provide information on consumer complaints by company. Pick an agent or company representative that takes the time to answer your questions. You can use the checklist on the back of this brochure to help you compare quotes from insurers and on the same coverage.
2. Before You Buy a Car, Compare Insurance Costs
Before you buy a new or used car, check into insurance costs. Car insurance premiums are based in part on the car’s sticker price, the cost to repair it, its overall safety record, and the likelihood of theft. Many insurers offer discounts for features that reduce the risk of injuries or theft. These include daytime running lights and anti-theft devices. To help you decide what car to buy, you can get information from the Insurance Institute for Highway Safety (www.iihs.org).
3. Ask for Higher Deductibles
Deductibles are what you pay before your insurance policy kicks in. By requesting higher deductibles, you can lower your costs substantially. For example, increasing your deductible from $200 to $500 could reduce your collision and comprehensive coverage cost by 15 to 30 percent. Going to a $1,000 deductible can save you 40 percent or more. Before choosing a higher deductible, be sure you have enough money set aside to pay it if you have a claim.
4. Reduce Coverage on Older Cars
Consider dropping collision and/or comprehensive coverages on older cars. If your car is worth less than 10 times the premium, purchasing the coverage may not be cost effective. Auto dealers and banks can tell you the worth of cars. Or you can look it up online at Kelley’s Blue Book (http://www.kbb.com). Review your coverage at renewal time to make sure your insurance needs haven’t changed.
5. Buy your Homeowners and Auto Coverage from the Same Insurer
Many insurers will give you a break if you buy two or more types of insurance. You may also get a reduction if you have more than one vehicle insured with the same company. Some insurers reduce the rates for long-time customers. But it still makes sense to shop around! You may save money buying from different insurance companies, compared with a multi-policy discount.
6. Maintain a Good Credit Record
Establishing a solid credit history can cut your insurance costs. Insurers are increasingly using credit information to price auto insurance policies. To protect your credit standing, pay your bills on time, don't obtain more credit than you need and keep your credit balances as low as possible. Check your credit record on a regular basis and have any errors corrected promptly so that your record remains accurate.
7. Take Advantage of Low Mileage Discounts
Some companies offer discounts to motorists who drive a lower than average number of miles a year. Low mileage discounts can also apply to drivers who car pool to work.
8. Ask about Group Insurance
Some companies offer reductions to drivers who get insurance through a group plan from their employers, through professional, business and alumni groups, or other associations. Ask your employer and inquire with groups or clubs you are a member of to see if this is possible.
9. Seek Out Other Discounts
Companies offer discounts to policyholders who have not had any accidents or moving violations for a number of years. You may also get a discount if you take a defensive driving course. If there is a young driver on the policy who is a good student, has taken a drivers education course or is at a college out of the area without a car, you may also qualify for a lower rate.
By Insurance Information Institute
Prices vary from company to company, so it pays to shop around. Get at least three price quotes. You can call companies directly or access information on the Internet. Your state insurance department may also provide comparisons of prices charged by major insurers. (State insurance department phone numbers and Web sites can be found here.)
You buy insurance to protect you financially and provide peace of mind. It's important to pick a company that is financially stable. Check the financial health of insurance companies with rating companies such as A.M. Best (http://www.ambest.com) and Standard & Poor’s (http://www.standardandpoors.com/) and consult consumer magazines.
Get quotes from different types of insurance companies. Some sell through their own agents. These agencies have the same name as the insurance company. Some sell through independent agents who offer policies from several insurance companies. Others do not use agents. They sell directly to consumers over the phone or via the Internet.
Don't shop price alone. Ask friends and relatives for their recommendations. Contact your state insurance department to find out whether they provide information on consumer complaints by company. Pick an agent or company representative that takes the time to answer your questions. You can use the checklist on the back of this brochure to help you compare quotes from insurers and on the same coverage.
2. Before You Buy a Car, Compare Insurance Costs
Before you buy a new or used car, check into insurance costs. Car insurance premiums are based in part on the car’s sticker price, the cost to repair it, its overall safety record, and the likelihood of theft. Many insurers offer discounts for features that reduce the risk of injuries or theft. These include daytime running lights and anti-theft devices. To help you decide what car to buy, you can get information from the Insurance Institute for Highway Safety (www.iihs.org).
3. Ask for Higher Deductibles
Deductibles are what you pay before your insurance policy kicks in. By requesting higher deductibles, you can lower your costs substantially. For example, increasing your deductible from $200 to $500 could reduce your collision and comprehensive coverage cost by 15 to 30 percent. Going to a $1,000 deductible can save you 40 percent or more. Before choosing a higher deductible, be sure you have enough money set aside to pay it if you have a claim.
4. Reduce Coverage on Older Cars
Consider dropping collision and/or comprehensive coverages on older cars. If your car is worth less than 10 times the premium, purchasing the coverage may not be cost effective. Auto dealers and banks can tell you the worth of cars. Or you can look it up online at Kelley’s Blue Book (http://www.kbb.com). Review your coverage at renewal time to make sure your insurance needs haven’t changed.
5. Buy your Homeowners and Auto Coverage from the Same Insurer
Many insurers will give you a break if you buy two or more types of insurance. You may also get a reduction if you have more than one vehicle insured with the same company. Some insurers reduce the rates for long-time customers. But it still makes sense to shop around! You may save money buying from different insurance companies, compared with a multi-policy discount.
6. Maintain a Good Credit Record
Establishing a solid credit history can cut your insurance costs. Insurers are increasingly using credit information to price auto insurance policies. To protect your credit standing, pay your bills on time, don't obtain more credit than you need and keep your credit balances as low as possible. Check your credit record on a regular basis and have any errors corrected promptly so that your record remains accurate.
7. Take Advantage of Low Mileage Discounts
Some companies offer discounts to motorists who drive a lower than average number of miles a year. Low mileage discounts can also apply to drivers who car pool to work.
8. Ask about Group Insurance
Some companies offer reductions to drivers who get insurance through a group plan from their employers, through professional, business and alumni groups, or other associations. Ask your employer and inquire with groups or clubs you are a member of to see if this is possible.
9. Seek Out Other Discounts
Companies offer discounts to policyholders who have not had any accidents or moving violations for a number of years. You may also get a discount if you take a defensive driving course. If there is a young driver on the policy who is a good student, has taken a drivers education course or is at a college out of the area without a car, you may also qualify for a lower rate.
By Insurance Information Institute
Tips on Selecting An Insurance Company
Collision Repair Industry INSIGHT's Consumer Checklist for the Careful Consumer
When shopping for auto insurance, do a little homework first, shop around, and select your insurer carefully. Your insurer should offer both fair prices and excellent service. These tips will help you find the right insurer for you:
Know your state's auto insurance requirements:
Most states require you to carry a minimum amount of liability coverage. Many states have "no-fault" auto insurance systems. Coverage for medical costs for you and your passengers is optional in some states. Coverage for damage to your car is optional.
Write up your personal auto insurance profile:
List pertinent information concerning what type of vehicle you drive, where you drive, who else drives, what your driving record is, where you live, what optional safety features your car has. This profile will make the next step easier.
Comparison Shop:
Prices for the same coverage can vary by hundreds of dollars, so it pays to shop around. Ask your friends, check the Yellow Pages, and call your state insurance department for guidance. Contact insurance agents or companies for general pricing information. Select a few insurers for personalized quotes.
Meet with potential insurance agents:
Make a few appointments, bring your personal auto insurance profile with you, and ask questions. You want a fair price AND quality service. Ask about available discounts, higher deductibles, service options and claims procedures after accidents. Take notes.
Compare Again:
Consider cost, coverage offered, and quality of service available. Select your insurer.
Read your policy:
Yes, even the fine print! Ask questions. Keep your policy at hand. Call your insurer to keep your policy up-to-date, inform your agent of any changes (new car, new job, new driver, etc.), and ask periodically about any possible discounts. Review your policy yearly with your insurer.
Keep your insurance information with you:
Many states require drivers to carry a proof-of-insurance card with them when driving. Ask your insurer for a card, and keep it in your wallet or in your car.
When shopping for auto insurance, do a little homework first, shop around, and select your insurer carefully. Your insurer should offer both fair prices and excellent service. These tips will help you find the right insurer for you:
Know your state's auto insurance requirements:
Most states require you to carry a minimum amount of liability coverage. Many states have "no-fault" auto insurance systems. Coverage for medical costs for you and your passengers is optional in some states. Coverage for damage to your car is optional.
Write up your personal auto insurance profile:
List pertinent information concerning what type of vehicle you drive, where you drive, who else drives, what your driving record is, where you live, what optional safety features your car has. This profile will make the next step easier.
Comparison Shop:
Prices for the same coverage can vary by hundreds of dollars, so it pays to shop around. Ask your friends, check the Yellow Pages, and call your state insurance department for guidance. Contact insurance agents or companies for general pricing information. Select a few insurers for personalized quotes.
Meet with potential insurance agents:
Make a few appointments, bring your personal auto insurance profile with you, and ask questions. You want a fair price AND quality service. Ask about available discounts, higher deductibles, service options and claims procedures after accidents. Take notes.
Compare Again:
Consider cost, coverage offered, and quality of service available. Select your insurer.
Read your policy:
Yes, even the fine print! Ask questions. Keep your policy at hand. Call your insurer to keep your policy up-to-date, inform your agent of any changes (new car, new job, new driver, etc.), and ask periodically about any possible discounts. Review your policy yearly with your insurer.
Keep your insurance information with you:
Many states require drivers to carry a proof-of-insurance card with them when driving. Ask your insurer for a card, and keep it in your wallet or in your car.
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