Tips to Select the Best Life Insurance

You have probably already discovered by searching online or speaking with an agent that there are many different types of life insurance and just as many different reasons to purchase it. As an agent, I often get calls from people telling me they need life insurance. When I ask what amount they need or what they plan to use it for, the conversation seems to get disconnected pretty quick. Simply put, life insurance is a funding vehicle to transfer a risk or fulfill a need. Most people understand that someday they will die and that their surviving loved ones will be responsible for the costs of the burial. By the way, that happens to be about $8k to $10k today. A working spouse is certainly aware that upon their death the surviving spouse is going to be stuck with a mortgage and other household expenses. We could go on and on. So then, how are we to determine the proper amount of life insurance and which kind should we buy?

It’s called “needs analysis” and the good news is that you can find these free programs all over the internet by using your favorite search engine. A good example of a simple needs analysis calculator can be accessed at http://www.lifehappens.org/life-insurance-needs-calculator/. Some go more in depth than others but for the sake of this article let’s stay simple. Simply go to your needs analysis calculator and input the requested data and you will get a number that you should attempt to cover. Now beware, if you are younger and have a mortgage, vehicle loans, small children, and not much invested into retirement, this number is going to be pretty scary. However, since you are younger, you are going to buy insurance cheaper and have more time to get your ducks in a row. It is very important when purchasing life insurance that you buy what you can comfortably afford. Do not, I repeat, do not put yourself in a position where it is a stretch to make the life insurance payment. When times get tough this will be the first expense you eliminate and you will have wasted your investment. Instead, consider the different types of products along with the costs and set up a plan that will fulfill your needs.

Term Life – this is the lowest cost product. It is like renting insurance. You buy it in a specific block of time and pay a specific monthly payment. Very useful for young adults with a lot of debt.

Universal Life – this is similar to Term but has an account attached to it that earns interest. The intention is to pay a lower premium and use the interest accrued to support the cost of insurance. These policies will usually build cash value that you can access in the event of an emergency.

Whole Life – this is a guaranteed premium policy that is setup to last a lifetime and build cash value. As long as you pay the established premium it will not cancel. This product is especially useful to pay for final expenses. Buy it when you are younger as it gets pretty expensive with age.

There are many other products out there that are a variation of the basics that I have listed. My best tip for anyone looking to purchase the right amount of insurance at the right price is to call a broker who will assist you with your needs analysis and then have access to many companies to put together the best plan at the best price. If you are just looking to by a $15,000 benefit policy, go online, it’s very easy.

I am an experienced insurance agent with over 20 years in the P&C and Life insurance industries. I have been an agency owner, manager, consultant and producer at agencies in Florida and Georgia. Since I read quite a lot, I consider myself knowledgeable in many different areas.

Sosteen517

Car Insurance Pitfalls

In today's technology driven world, you would assume that most consumers would be educated when it comes to auto insurance, but it appears that such is not the case. In fact, many consumers begin looking for product information after making this important purchase rather than before.

Liability limits

Many agents will offer reduced limits in order to offer a low price. Don't fall for it! Bodily Injury Liability (BI) is what pays for the other driver's injuries if you are in an at-fault accident. 20/40 won't cut it, especially if more than one person is injured or worse yet - killed. What most consumers do not realize is the savings for these lower limits is not that significant. Every driver should carry at least 50/100 or better yet 100/300. In today's economy it is very easy to rack up more than $25,000 in medical expenses after a visit to the emergency room or short hospital stay. When you consider all the tests you'll be subjected to and bills from three different specialists, the final bill can become staggering. One should also consider that you could be charged with an at-fault accident when it really is not your fault - like hitting someone from behind when they slam on breaks to miss a squirrel!

Property Damage Liability

The same advice applies with this coverage as well. Property Damage Liability (PD) is what pays when you hit someone's vehicle or other property. $25,000 won't cut it! Most vehicles on the road today cost much more than $25k and what happens if you hit 3 of them? In Illinois the required minimum is $15k. There are bicycles out there that cost $15k! Think about this for just a minute - you lose control of your car on a back road in Illinois and take out 3 milk cows in a pasture.. That cattle owner is going to want the price of replacing those cows plus the value of the milk they would have produced over their lifetime. As another example, imagine you manage to crash into a nice lady driving an expensive rental car. Your policy has to pay to repair the damage to the car AND LOSS OF RENTAL INCOME WHILE THE CAR IS UNDER REPAIR! If you have $10k or $25k limits, you will most likely be paying out of pocket.

Uninsured/Underinsured Motorist Coverage

This very important coverage happens to be an optional coverage. It will pay for injuries to you or damage to your vehicle caused by an uninsured or underinsured driver. When you consider the minimum limit requirement in most states, and the inability of the state to track insurance for every driver, your chances of being hit by an uninsured or underinsured are a compelling reason to purchase this coverage. Also, in most cases, a personal injury attorney will not accept your case on a contingency if you do not have this coverage. 

Buying insufficient insurance coverage to save a little money on your monthly payment will in most cases come back to haunt the consumer. It is every vehicle owner’s responsibility to make certain that their insurance policy will respond favorably when a simple error results in unintentional property damage and injuries.

I am an experienced insurance agent with over 20 years in the P&C and Life insurance industries. I have been an agency owner, manager, consultant and producer at agencies in Florida and Georgia. Since I read quite a lot, I consider myself knowledgeable in many different areas.
Sosteen517

The Pitfalls of Health Insurance

With the considerable amount of companies offering health insurance in so many shapes and sizes, it is understandable why the consumer remains at a disadvantage when selecting coverage for them and their family members. Most comprehensive insurance plans contain the same types of coverage but there can be significant differences in how they are delivered and for how much money. The three main areas of concern with any comprehensive policy that needs to be investigated are:

Co-Pay
The co-pay in the insurance policy is the amount the insured must pay out of pocket before any benefits are paid for doctor visits. Also, the co-pay usually applies to different providers. For example the policy may requires a $35 co-pay for the primary doctor visit, a $60 co-pay for a visit to a specialist and a $100 co-pay for treatment in an emergency room or clinic. The consumer should determine these fees up front and take them into consideration before purchasing the policy.

Deductible
The insurance policy deductible is the amount the insured must pay out of pocket for certain services before the insurance company will pay benefits. Deductibles will typically apply to hospital stays, diagnostic tests and medical equipment. In today’s marketplace, many companies have elected to offer higher deductibles rather than substantially raising their rates. This is a typical marketing tactic that many industries use to soften the pain of price increases. The extremely high deductibles being offered in current insurance plans can potentially bankrupt a family in the event of a serious illness or injury. The consumer needs to be aware of their exposure and plan for it.

Co-Insurance
Co-insurance is the percentage of costs for a covered claim that is paid by the insured instead of the insurance company. For example, many companies offer an 80/20 split to help keep rates more affordable. This split however, means the insured is responsible for 20% of their medical costs and the insurance company is responsible for 80%. There is usually however, an out-of-pocket maximum for the insured that is stated on an annual basis. For example, your policy may pay on an 80/20 split but have a maximum out of pocket of $10,000. This means that once this maximum has been reached, the insurer will begin to pay 100% of expenses.

There are many insurance companies marketing many different flavors and sizes of insurance plans. The consumer should do the research before purchasing and better yet, get advice from a reputable and knowledgeable agent.

I am an experienced insurance agent with over 20 years in the P&C and Life insurance industries. I have been an agency owner, manager, consultant and producer at agencies in Florida and Georgia. Since I read quite a lot, I consider myself knowledgeable in many different areas.

Sosteen517