Archive for the ‘Insurance’ Category

Life Insurance: When and Why

By: Green Panda | Date posted: June 08, 2011 (5:00 am)

I don’t think many people enjoy talking about life insurance when they’re just starting off their families sand careers, but it’s a vital topic to cover. Part of being young is feeling as if you could conquer the world. You’re probably not thinking about what would happen if you were dead due to an accident or an illness. Unfortunately, tragedy can strike randomly and your family may be faced with that situation.

How do you know if you should start thinking about life insurance? How can you figure out how much you need? How do you find the right companies?

When Do You Need Life Insurance

If you’re single and have no dependents, life insurance probably shouldn’t be a priority for you now. If you’re married or have a family, however, you may want to look into further. Don’t just think about it when you have kids though. The key is seeing if there is anyone who is dependent on your income to survive. It may be your spouse, children, disabled relatives, or your parents if they live with you.

cash for life insurance

Life Insurance Questions

Take a few minutes to answer a few questions about life insurance and  your family’s plans for the future. The answers can help you determine how much you need to get for your policy.

  • If something would happen to you and/or your spouse, how would your family live?
  • Will the money be needed for 6 months, a year, 3 years? In other words, how much of a cushion do you feel comfortable with to get your family back on their feet?
  • How will your kid(s) be cared for if you and your spouse pass?

They may be uncomfortable questions, but they are necessary. You want to get the right policy for your family’s specific needs.

Finding the Right Life Insurance

Your next step is to find a reputable company that can help you create a policy that will provide the coverage you need at a reasonable price. Finding the best life insurance companies isn’t an impossible task. Shop around to get quotes and ask your personal network who they would recommend and why. I would also ask them who they would avoid as well. You don’t want your loved ones struggling to get the money that they’re entitled to. This is how you could compare life insurance quotes and their services.

My sister in law and her family had to unfortunately go through this additional stress for almost two years before the company would release the money.

Thoughts on Life Insurance

Besides getting life insurance, you also want to looking into making a will to make sure your family knows your wishes. When family is in the midst of grief having a clarity as to what you’d like done can help ease the burden and stress. If you haven’t gotten it already you may also want to look into getting the right health insurance for your needs.

Photo Credit: seanmcmenemy

I Just Got Hired…Help Me Choose My Benefits!

By: Kristina | Date posted: May 31, 2011 (7:30 am)

Our first job can be overwhelming with the new beginning, the change of environment, as well as all of our new employee benefits that come along with our total benefits package.  It is important to fully understand our employee benefits in order to maximize our options.  Along with our annual salary our employer usually offers us several insurance options in our total benefits package.  These insurance options include Medical and Dental insurance, as well as Short Term and Long Term Disability insurance along with Life Insurance.

Employers offer a fixed number of benefit credits to their employees (based on their family situation) along with various levels of insurance coverage.  Each different level of insurance has a cost, which is deducted from the total amount of our benefit credits.  If we choose insurance coverage that is more expensive than our total amount of benefit credits the difference will be deducted from our pay check throughout the year.

 

Medical and Dental Insurance Benefits

Medical and Dental Benefits are the most important factor when choosing our new employee benefits.   These benefits include various insurance coverage’s such as prescription drugs, doctor visits, eyeglasses, specialist consultations, as well as dental procedures and routine check-ups.

While most of our other employee benefit options are chosen on an annual basis, there is usually a 2 year lock in period for Medical and Dental insurance benefits.  The level of insurance coverage that we choose is also applicable for our spouse and children.

 

Short Term and Long Term Disability Insurance

Short Term and Long Term Disability Insurance are often referred to as Income Replacement Plans or Income Supplements.  In case we are hospitalized or otherwise unable to work Short Term and Long Term Disability will provide us with a regular income to supplement the loss of income from our employer.

Short Term Disability Insurance is usually available for the first 6-8 weeks of our absence from work.  It can supplement 80% to 100% of our regular income.  Long Term Disability Insurance usually provides an income supplement of 50%-70% depending on the option that we choose.  Long Term Disability Insurance can also be adjusted to the annual increase in the cost of living; this is referred to as COLA, cost of living adjustment.  Some insurance plans have a maximum number of years that can be covered by Long Term Disability Insurance.

 

Personal Life Insurance

Our employer usually offers a base life insurance which is equal to the amount of one times our annual salary.  This is included in our base insurance coverage and is not deducted from our benefit credits.  We can buy additional segments of personal life insurance equal to our annual salary such as two, three, or four times our annual base salary.

Additional Life Insurance can also be purchased for our spouse and our children, usually in increments of $10,000.  Upon death our Life Insurance proceeds are paid directly to our beneficiary as a lump sum payment.  Life Insurance proceeds do not pass through probate.

 

Emergency Travel and Out of Country Insurance

Emergency Travel Insurance and Out of Country Insurance protect us while travelling abroad.  Travel Insurance usually covers expenses such as emergency procedures and hospital visits while we are out of the country.  It also provides a referral service which gives us access to the best doctors in the country that we are visiting.

Emergency Travel and Out of Country Insurance is available for an unlimited number of vacations throughout the year, however it usually only covers a particular number of days such as the first 17 or 30 days of our trip.  It is important to note that this insurance does not cover loss of baggage or trip delays and cancellations, this is a separate form of insurance that may be provided by our credit card company or the travel agency.

 

Critical Illness Insurance

Critical Illness Insurance provides us with a lump sum of money if we are ever diagnosed with a fatal disease such as cancer.  In my experience I have seen Critical Illness Insurance sold in increments of $25,000.

Our Total Benefits Package is a great added benefit which is offered to Employees at discount group rates by our Employer.  We should take advantage of these because it could cost a lot more if we needed to buy these insurance coverage’s on our own.

 

Photo by Ted Percival

 

Baby on the Way: Life Insurance & Making a Will

By: Green Panda | Date posted: April 06, 2011 (5:00 am)

Having a baby on the way can be exciting as you are preparing for his or her arrival. However, it can also be stressful as you start looking at the financial implications of expanding your family. I wanted to share some tips and thoughts on two big financial and legal decision you have to make: life insurance and wills.

Are you ready with a sound life insurance policy? Do you know the two major types of life insurance policies available? Have you already prepared a will? How will you need to update it for you child?

Do You Have Life Insurance?

Life insurance comes with two major types of policies – term and whole. Each has it’s own pros and cons. You have to weigh for yourself what is best for you and your family.

Which Type of Life Insurance is Right for You?

Term life insurance will cover you for a specific amount in a specified time period, such as 10,20, 30 years. If you die after the term ends and you haven’t gotten a new policy, then you will not be covered. Between the two options, it’s usually much cheaper with premiums. We both have term life policies at our home.

Understand that a term life insurance policy doesn’t have a savings component to it. You can invest the difference in savings between the two types of policies and come out ahead. Term life insurance is an option to consider as you move towards becoming self-insured in the future.

Whole life insurance is a bit more complicated as it’s an insurance policy that contains some savings portion to it.  For some people the benefit of this policy is the cash value piece to it.  Some policyholders find comfort in having some ‘forced savings’ built in.

You have to sit down and decide which insurance policy fits your family’s finances better. When you have an idea of what type of life insurance policy you need, it pays to compare rates with different, yet reputable insurance companies.

Do You Have a Will Ready?

No one likes to think of the end of their life, but being prepared for it can ease the emotional and financial burden to your surviving loved ones. What do you ned to include in your will? Here are some ideas to get you started:

  • Name Your Executor - Who is legally responsible to carry out your wishes? Think very carefully before selecting this person.
  • Name the Guardian of Your Child(ren) - Another huge decision that you’ll need to really think through on. Make sure you check with the person to see if they are able and willing to handle this huge responsibility.
  • Asset Distribution - Be as clear as possible on who gets what.
  • Debt Repayment - Ease the difficult process by stating how you want final expenses and remaining debts settled. You can have one of your financial accounts designated to handle the transactions.

Using a will template as a guideline can help you get started, but you’ll still need to make sure all your bases are covered. You need to make sure that your will is valid in your state and that your will executor is able to follow through on your last wishes.

More Posts on Babies and Finances

If you’re looking at cutting your baby expenses, please check out some of my other posts on the topic:

Photo Credit: limaoscarjuliet

I’m Only 20! Do I Need Life Insurance?

By: Kristina | Date posted: November 29, 2010 (2:27 am)

The answer to this question is yes. Everyone needs to have life insurance. Of course the amount of life insurance depends on everyone’s personal financial situation; which includes their assets, liabilities, and family situation.  But the short answer to this question is yes, everyone needs to have life insurance.

Why Do I Need Life Insurance?

If you are in your 20’s than life insurance may not be your financial priority. You may be thinking about paying off student loans, planning a summer trip around Europe, or focusing on paying for tuition and books.  However, life insurance should be somewhere on your list of financial priorities….even if it’s at the bottom of your list.

Our expenses do not stop after death.  The most obvious reason for life insurance is to cover any outstanding debts that are existing at the time of our death.  Believe it or not student loans, credit cards, and car loans all have to be paid off in full, even if the owner is deceased.

Even if we don’t have any debts, we will still need to have enough life insurance to cover our final expenses upon death.  Believe it or not, death is actually a very costly expense.  It would not be ideal for our family members to grieve over their loss while trying to find the money to cover all of our final expenses.

How Much Life Insurance Do I Need?

Funeral arrangements including the burial ceremony, the casket or cremation, a mass, and the flowers can also be a very costly expense.  If we do not have life insurance to cover our funeral arrangements, our family will be obligated to pay for any final expenses out of their pocket.

If we are renting an apartment, the lease is not void upon death.  The landlord will usually charge the equivalent of 3 months’ rent to break the lease.  This is another added final expense upon death.

They say that two things in life are certain, death and taxes.  This could not be more true.  There are two tax returns that need to be filed in the year of someone’s death.  The regular annual tax return needs to be filed, along with a final tax return.

Life insurance is a safe way to ensure that all debts will be paid off, and all expenses will be paid at the time of death.  For someone who does not have any debts, I would recommend $20,000 to $25,000 of life insurance to cover all final costs and expenses. Of course this is a general statement and the amount of personal life insurance is different for every individual.

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GET THE MOST OUT OF YOUR CREDIT CARD

By: Mike | Date posted: November 09, 2010 (5:00 am)

According to the Survey of Consumer Payment Choice, Federal Reserve Bank of Boston, January 2010, “There are over 609.8 million credit cards held by U.S. consumers,” and according to the same source the average number of credit cards held by cardholders is a staggering 3.5. Out of the cardholders in the US, how many of you actually use your credit card to reward yourself? According to the same report, 60% of consumers have a rewards credit card, but do you get the most out of it?

Rewards Credit Cards

Rewards credit cards are there to give you something back for spending your hard earned cash, and in some cases you can get some very good deals. The most common type of reward credit card is of course the cash back credit card; their rise into the credit card market has been nothing short of incredible. The credit card provider will reward you with a percentage of cash back based on how much you spent on your card during the month; this can sometimes be as high as 5%. If you fund quite a lot of expenditure on your card from month to month, then 5% may be quite a big chunk of money so finding the right deal for you is important.

Other Reward Cards to Suit You

o Airline / Travel credit cards – This type of reward card is perfect if you consider yourself to be a frequent flyer. Using one of these credit cards you can build up air miles whenever you fly. You can then redeem your miles at a later date and use them on whatever you want, from hotels to flights and other special discounts. If you regularly fly then this is a great option.

o Business credit cards – If you own your own company, then you could be missing out by not having a business credit card. Business credit cards offer a whole range of benefits, including business and supplier discounts. Different providers offer different advantages so make sure you have check out your options before signing on the dotted line.

o Travel insurance credit cards – You can now get credit cards that offer complimentary travel insurance, they are great if you travel regularly and it can save you a lot of money in travel insurance.

o Purchase credit cards – These cards are great if you use your credit card on a regular basis. Using a purchase credit card, you can gain 12 months interest free, meaning you can pay for something and you have a whole year interest free to pay the amount back, without incurrent any other charges.

o Bad-credit credit cards – These credit cards are great if you are struggling with bad credit. They give you a chance to appear reliable to lenders and your credit score will improve.

o Credit builder credit cards – These cards are great if you are just starting out. They offer a really good way of starting to build your personal credit rating.

o Fuel credit cards – If spending your hard earned cash on your daily journey to work bothers you, then why not fund your purchases on a fuel credit card. You can get big savings on fuel and purchases from specific gas stations.

Above are some examples of how you can use a credit card to your advantage, there are so many types of credit card on the market that you should check out the options to find the best credit card to suit you.

Bio:

This article was written by Andreas Nicolaides, finance and savings writer from UK based MoneySupermarket.com.

Save Money on Your Car Insurance

By: Green Panda | Date posted: October 06, 2010 (5:00 am)

For some college students, having car is a necessary expense. You may live off campus, you may have a job on the other side of town, or your city lacks a solid public transportation system. Whatever the reason, if you have a car you need to keep your expenses manageable.

A big expense with owning a car is having the proper insurance for it. The average annual car insurance premium for Americans ages 18-25 is $1566. It can be much higher if you live in a major metropolitan city.

How You Can Lower Your Bill

If possible, see if you can lower your premiums without sacrificing coverage.

  • Stay on your parents’ plan – As a college student you can receive some wonderful benefits. One of them is taking advantage of your parents lower premiums. Simply pay them the additional premiums for keeping you on.
  • Increase your deductible – If you have your own plan, see if you can increase your deductible. The higher it is, the lower your premiums are. However, if you have no emergency fund to cover the deductible, then wait.
  • Be a fantastic driver - Avoiding speeding tickets can save you big time. You may already have higher premiums than your family even if you’re a better driver due to your age.
  • Keep your grades up – Being on the deal list isn’t just good for scholarships, you can also a discount on your insurance premiums.

Shopping Around Can Save You Money

It might take some legwork, but looking at other companies can prove to be fruitful. My mother was able to get my brother’s portion of the premium lowered just by mentioning she was hunting for a better deal. Cutting 30% of her bill wasn’t bad for a 10 minute phone call.

As you’re shopping around, have a copy of your current policy. It is easy to forget what your policy exactly covers. I’d also go ahead and ask friends what they think of their own insurance. The cheapest policy might not be the best.

Thoughts on Car Insurance

Have you been able to cut down on your car insurance premiums? Which companies do you recommend?

Getting Life Insurance in Your 20s

By: Green Panda | Date posted: April 28, 2010 (8:00 am)

A couple of months ago we increased our life insurance coverage after we finished with buying our home. Since our needs adjusted we decided to shop around and find a deal that would work for us. I’m happy to say we got our coverage and while it didn’t completely as planned, it’s helped us have a financial net for a worst case scenario.

I know life insurance isn’t on many people minds when dealing with debt and trying to start investing, but it’s an important part of your finances. If you’re single and have no dependents, life insurance may not be something that you need. In general, you should consider getting life insurance if you have someone depending on your income, like a spouse or your child(ren).

Factors in Life Insurance

Insurance companies weigh several factors for your life insurance premiums. Some factors you have complete control over, such as occupation and lifestyle, while others are outside your control. They include:

  • Age
  • Gender (women tend to live longer and that’s factored in)
  • Personal and Family Health History
  • Occupation
  • Smoker/Non-Smoker
  • Occupation (some are more hazardous than others)
  • Insurance Coverage and Add-ons

As you can see, purchasing life insurance in your 20s can help you get some of the lowest rates. Depending on your health and lifestyle, you can also qualify for even lower premiums. To confirm you’re in good health, many insurance companies will have a relatively easy medical exam done either at your home or work to get some blood and urine samples.

We had both of ours done at our home after work. It was quick and easy and the nurse was completely professional and friendly. It took an hour for both of and that was due to some small talk.

Deciding on How Much Life Insurance You Need

I’m a fan of MSN’s Life Insurance Needs Estimator to get an amount that would fit for our circumstances. We discussed the results and decided that we wanted to get enough insurance to pay off the townhouse in case one of us dies. We figured having no mortgage and a bit of cash would give the surviving spouse some peace of mind.

How much do YOU need for life insurance? Some experts say you should have 8-10x your annual income. Other say enough to pay off all of your debts and enough to expenses for some years. If you have children, it’ll probably be smarter to get more insurance coverage than if you were married with no kids. If you’re planning on having kids, consider factoring that into your coverage amount.

Life Insurance Companies to Check Out

If you’re looking to shop around for the best deal on your life insurance policy, here are some of the popular companies to check out.

While this is not all of the life insurance companies available to compare, these companies have a reputation of offering competitive rates if you ask around. You might also consider Clarifinancial, which can reduce the amount of phone calls and time spent filling out your information.

What We Got for Our Life Insurance Policies

I have a 30 year $150,000 term life policy from our insurance agent. I qualified for the elite preferred program and I feel comfortable with what I got. My husband has a 20 year term plan for the same amount. While he blood work and urine test came out great, he’s blood pressure readings were a bit off and he was put in the regular category. He has to go to the doctor and get another test done to get a better rate.

We got a small discount on our life insurance premiums by making semi-annual payments instead of monthly payments.If you’re looking for more tips on saving on your life insurance premiums, check out an earlier post I wrote.

Your Advice on Buying Life Insurance

I’d love to hear your tips on getting the best deal on life insurance. If you have life insurance, how much coverage do you have? Do you think that’s enough? How did you determine the amount? What company gave you the best deal?

Should I Get Renters Insurance?

By: Green Panda | Date posted: January 11, 2010 (8:12 pm)

If you are renting a place and don’t have renters insurance, you should really look into getting a policy. Besides helping out when you lose some or all of your possessions, it can help you with temporary housing should the need arise.

Shop around to find a good deal on renters insurance.

Shop around to find a good deal on renters insurance.

How Much Renters Insurance Do You Need?

You want enough to cover your needs, but you don’t want to pay too much either. Start off by doing an inventory of what you have and deciding a ballpark figure of how much it would take to recoup what you could lose if there was a fire. According to MSN Money, expect to pay $150-300/year for coverage of around $30,000.

You may also keep in mind that you have to get separate riders for earthquakes and floods if you live in high risk areas for those. Double check with the agent that you’re getting replacement value with the policy and not actual cash value. Replacement value will cover the price it takes now to replace an item, not the depreciated value of the item.

Companies to Shop Around and Compare

It really does pay to shop around for insurance. I managed to save half of my old car insurance premiums by calling different companies and comparing rates.

  • Liberty Mutual: 1-800-837-5254
  • Nationwide: 1-877-669-6877
  • State Farm: The company encourages you to find a local agent to get a quote.
  • Allstate: 1-866-726-2814
  • Geico: 1-800-841-2964
  • Progressive: 1-800-PROGRESSIVE

    • Discounts You May Get

    In addition to finding good prices on premiums, you should work on getting as many discounts as you can qualify for. Some things that may lower your premiums include:

    • Security/Alarm system
    • Smoke Detector
    • Sprinkler System
    • Non-smokers
    • Credit score

    Your Take

    What tips do you have on finding affordable renters insurance?

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