Posts Tagged ‘Premiums’
Life insurance is a good thing to have, especially if you are running a business or are earning a good salary from a reliable company. However, you may end up having more problems if you do not understand the entire coverage or skip the fine print. It is important that you know the possible risks to make the right choices that will give you security.
Price Disadvantage
Cost is among the most common pitfalls of life insurance. A lot of guaranteed life insurance policies are made to support funeral expenses only. Most policies actually do not provide benefit values higher than $15,000 to $20,000. These policies are quite expensive since the insurance company only has to base the premiums on the gender and age of the applicant.
Because of this, a lot of individuals may be paying the insurance company more in the premiums they applied for than the death benefit of the plan. It means that the insurance policy does not even perform better compared to a savings account. Currently, the National Association of Insurance Commissioners is trying to alleviate the problem.
Paying More Than What You Deserve
Graded benefit periods is a feature in guaranteed life insurance policies wherein the insurance company keeps itself protected from individuals who want to apply for insurance while having only a possible short time to live. There may be indications in the policy that if the person dies within a certain period of time after the policy is provided, the insurance company will only be responsible for paying the premiums, and interest accrued to the applicant. Further financial support will not be given.
It is recommended to get a thorough physical exam and medical check-up first to determine if you are eligible for traditional insurance. If you become eligible for traditional insurance, you may discover that you need to pay less to get more benefits compared to getting a guaranteed life insurance policy. Guaranteed life insurance becomes a good alternative if you find it difficult to apply for other policies because of your age or current health condition. A financial advisor will help you determine and find other possible options.
Stringent Requirements
Insurance companies actually have the right to refuse coverage to individuals who appear very unhealthy or have conditions like obesity, diabetes, cancer, tumor, etc. There is actually a very long list of conditions given to insurance agents to turn down individuals should they have one or more of the given items on the list.
Middle-age individuals have to pay more for term life insurance, compared to younger applicants. The cost of renewable term life insurance may also be higher than a standard policy. The policy, however, can be renewed without the person having to go for a physical exam. There are also policies that require new medical records each time you wish to renew the policy.
Young adults have a better chance of getting reliable security by investment in permanent life insurance than term life insurance. Permanent life insurance will insure the person until the time of death, so it never expires. After the premiums are set, these can no longer change regardless of changes in the person’s health status, weight or age. Permanent life insurance will cost more for younger individuals, but term life insurance will cost more for middle age people.
Choosing the best life insurance company can be a daunting task. There are a lot of life insurance companies, and while some are nationally known and Fortune 500 corporations such as MetLife and Pacific Life, they usually aren’t that widely known and many have regional fame only.
Life insurance companies compete on different selling points. Some try to stake their claim to be the best by offering lower premiums, while others admit their premiums for a similar policy are higher but they have other benefits such as better customer service, better financial stability, quicker payout times in case of a claim, a wider array of products, and so on.
You will want to take a look at all these things that life insurers compete on when making your decision who to apply with. But two things to consider first are: whether or not the company is a MetLife or someone like that; and whether or not you received any referrals to a company you’re checking into. Generally speaking, larger life insurance companies got that way for good reason and do have a lot of financial strength behind them; and, if someone you know and trust referred you to set up an appointment with an agent from a company they’re now covered by they likely received good customer service and a policy that they are happy with.
WHAT TO LOOK FOR
But to begin with in choosing the best life insurance company for your needs, you have to find one that’s licensed to do business in the state where you are applying for coverage (you are either a resident or work professionally in that state). If you’re unsure, contact that state’s insurance bureau.
Once you’re accomplished this, begin getting information about a company’s different offerings. Not all life insurance policies of the same duration and death benefit are the same, and there are some policies offered by one company not offered by another. You may want to set up meetings in your home with agents from various local companies, but you have to keep in mind every single one of them will want to “close” you (sell you a policy) at the meeting, and each meeting could take a couple of hours.
It can be very helpful to talk to a local financial advisor or life insurance broker who has access to or is licensed with dozens of companies. You can typically meet with them for free and they usually won’t try to close you on the first meeting because they specialize in offering you and advising you on choices.
Check a company’s background as thoroughly as you can. Check out any name you recognize first, as there’s a probability they’re reliable and strong. Three things you are looking for in particular here are: length of time the company’s been around; the company’s financial strength as rated by independent ratings companies A.M. Best, Fitch, Moody’s, Standard & Poor’s, and Weiss (and check all five of them for every company–some of the raters won’t have rated all the companies you check out); and, if you can find any, any information on how fast and how hassle-free a company is with paying claims.
(Note: when you check the ratings agencies they use different rating scales and symbols; look at them carefully).
Speaking of claims, see if a company in question has consumer complaints against it or has had agents involved in a scam. This information is easy to find with an Internet search. Check nationally and within your state’s insurance bureau.
If you meet with agents from different companies in person, take careful mental notes on them to see who seems the most personable, the most helpful, and the most knowledgeable. If you go with that company he’ll likely become your agent–do you want to have to interact with him and his company? Otherwise, ask friends and relatives and the financial professional you contacted who they find to give the best customer service.
Most people, of course, just want to compare premiums. This is a big mistake. Premium pricing is important to consider, but it’s the last consideration. Do not take one company over the others because they have the cheapest premiums unless they are also strong on every other category mentioned above. Premiums can be used to choose between two very similar companies, however. And also remember to only compare premiums between similar policies.
Follow these guidelines and the best life insurance company for you can be found.
A life insurance policy is one of those things that you pay money for but hope you never have to use. It is a good idea to have this type of coverage though because it can make the difference between your family living comfortably or struggling to battle poverty if you should happen to die prematurely. There are many different types of life insurance available today and in this article were going to take a closer look at renewable term life insurance.
A term insurance policy is a good option for a lot of people. A term policy is considerably less expensive than a permanent life insurance policy. The reason for this is because a term policy will expire at some point whereas with a permanent or whole life insurance policy a death benefit will be paid out at some point. Because of the increased risk to the company with a permanent policy they are forced to charge higher premiums.
For people who like the idea of lower premium payments but are worried about their policy expiring leaving them without coverage there is the option of a renewable term life insurance policy. This type of policy can be set up to automatically renew every year usually without any health questions or medical exams being required. It is possible however that the premium payments will increase at the time of renewal but the good news is there will be no lapse in coverage.
If you have a renewable term life insurance policy and decided one day that you would prefer to have whole life insurance, many companies will allow you to convert your term insurance into a whole life policy. This too can usually be done without the need for any additional underwriting or medical exams. With so much competition in the insurance field today there are lots of new options available allowing people to put together a package that is perfect for their individual needs. Another great benefit of competition is that it opens up opportunities to save money. The prices that insurance companies charge for the different types of coverage can vary greatly from one company to another. Because of this you can spend a few minutes online getting multiple quotes and easily find a company that will give you the coverage you need at the best possible price.
Component car insurance is simply another description for the insurance used to cover a kit car – in other words, insurance for a car built from its basic components. Whether you call it a component car or a kit car, however, you’ll also know that there is likely to come a time when it needs to be insured if you are intending to drive it on the public highway. To this extent, component car insurance typically shares many of the same features as any other type of motor insurance (a choice of third party, third party fire and theft, or comprehensive levels of cover; an insurance excess that might help to reduce the cost of premiums; and other factors such as your age, occupation and where you live).
Though some of the basics might be shared, there are a number of important aspects that make insuring a kit or component car somewhat different – so out of the ordinary, in fact, that the experienced advice of a specialist insurance provider might often pay dividends. Some of the points worthy of particular attention are:
Values – your component car is one of a kind (almost by definition) and the insurer lacks any table of mass production models with which to compare it. Instead, the value of your one-off vehicle needs to be agreed with the insurer. Naturally, this agreement is necessary in the event of the whole car being written off or stolen and you claim its replacement value from the insurer; Update values – one of the great attractions of a kit car is that you might choose to add components piece by piece until you’ve built exactly the vehicle you want. Adding the components, however, is also likely to be adding to the value, so it is important to consider advising the insurer every time the vehicle increases in value; Work in progress – whilst you’re building your car, you might be storing some of the components until the time comes to fit them, or others might still be in transit. It is likely to be worth your while ensuring that any such components are insured against loss, theft or damage; Scrap – you probably don’t want to feel as though you’re tempting fate by asking the insurer about salvage in the event of your kit car being written off, but this might be of particular interest to the owner of a component car. If the car becomes an insurance write-off, for example, you might want to ensure that the insurer allows you to retain salvage rights (you then typically retrieve all the components – including the damaged ones – which might help you to rebuild the car all over again); Public liability – if you intend entering you car for shows or rallies, it is worth considering a component car insurance that includes public liability cover in the event that members of the public claim for any injuries or damage to their property caused by your car.
If you are 80 years old up to age 85, there are a few companies that will offer you life insurance, so long as you are in good health. Due to the high cost of premiums, most people that fit into this age bracket typically buy a small policy to cover burial and funeral expenses. This is usually between $5,000.00 and $15,000.00.
The average cost of a funeral in the United States is approaching $7,000.00.
Seniors today are living longer and longer, so you should expect that the price of burial and final expenses will continue to rise over the next decade. Everything always seems to go up in price, year after year. Therefore, when choosing the amount of coverage to purchase, you should take into consideration that although a reasonable funeral costs $7,000.00 today, five years from now it may be $8,000.00 or more.
Be Cautious.
Do not cancel any policy that you already have, nor should you allow any insurance agent to talk you into replacing any policy that you have with a new one. Insurance agents get paid on a commission and there are some that are looking out for their commission check more than they are looking out for you. So be cautious and protect the investments and policies that you already have in force.
For example, if you have a $5,000.00 policy already, do not cancel that policy to get a $7,000.00 policy. Only buy a $2,000.00 policy to add to the $5,000.000 policy that you have. I would advise any client to only add to and not replace any policy that they have been paying on for years.
Bob had been an agent about 18 months and he was free falling. When he was recruited his sales manager assured him he’d be making $100,000 a year by the end of his first year. After all, he was already a successful sales person. It was just a matter of moving from selling a tangible product to selling an intangible product, right?
Bob’s sales manager failed to mention a few things. Like how many new agents earn $100,000 by the end of their first year, and the number of new agents still in business after two years. Bob’s recruiter never mentioned that the insurance company doesn’t expect more than 3% of the new agents to last more than two years. He also didn’t mention that Bob’s experience of earning around $20,000 his first year and then earning even less in year two really isn’t uncommon.
The insurance company recruiter didn’t mention that the insurance company wins whether Bob makes it or not. They know Bob will sell his family and friends and few others. They also know that once Bob is out of the business they’ll continue to receive their premiums and won’t have to pay Bob his commission.
Unfortunately, once you hit the free fall stage like Bob you run out of time before you can save yourself because you simply don’t have the money to continue. However, there are a few things you must do to avoid sharing Bob’s experience:
o Learn how to promote yourself so you consistently attract highly qualified prospects to you
o Position yourself as a trusted adviser rather than a dreaded salesperson
o Uniquely package your services increasing your clients desire to work with you
You don’t even have to know how to do these things better than anyone else. You just have to do them well enough to produce some results. After that you have the luxury of making improvements. It isn’t that top producers do things so much better than everyone else. It is that top producers consistently do the small things that ensure their success when everyone else doesn’t.