Archive for December 2011

Auto Insurance Quotes For Holiday

Posted on Dec 26, 2011 by Admin

There's never reliable information on driving habits. Everything changes as the price of gas rises and falls, and as family budgets come under more pressure. All we can say with any certainty is, regardless of the state of the economy, people do try to get together to celebrate the holidays as a family. This can mean traveling significant distances and it's where the budgets come in. When people have the money, they tend to drive to the nearest airport and board a plane. Even though the new security measures can threaten the privacy of your junk, most people find flying better than sitting in a car for long periods of time. Yet, when you add up the cost of the tickets plus the need to rent a vehicle at the other end, you can save so much money if you all get into a car and share the driving to where you are going.
So let's say you decide to make the long drive, here are a few basic precautions before you set off. First, the farther you are proposing to drive at a busy time of the year, the higher the risk of an accident. Sadly, the holidays bring out a lot of weekend drivers who suddenly switch from short runs to a long journey. They tend to lose concentration. Some even fall asleep at the wheel. So now is the time to think carefully about collision and comprehensive cover (assuming you don't already have them), and check your health insurance to ensure there will be enough money to cover any visits to the ER out-of-state should you have an accident. That way, you can avoid unpleasant surprises if your journey is interrupted.
Now spend a little money on some routine maintenance. You trust your vehicle when it's just running around locally. A long run is a whole different ballgame so check the tires and have the engine serviced. The last thing you want is a breakdown in the middle of nowhere when no local garages want to come out and rescue you. Remember to pack emergency supplies should you be stuck by the road in bad weather.
Now suppose you decide to rent a big comfortable people mover for the journey or you fly and rent at the airport. You need to think carefully about insuring the rental. The rental company must give you the basic minimum liability insurance for the state(s) in which you will be driving. Remember, most of these policies do not cover you if you drive into Canada or Mexico. Now the big decision. Even if you have a collision and comprehensive policy on your own vehicle that covers you when you drive a rental, you can find your premium rates climb if you make a claim. It therefore makes sense to buy the Loss Damage Waiver. This pays all the bills if the rental is damaged or stolen. Finally, check your homeowners insurance to see whether all your possessions will be covered in a rental vehicle. It's probably better to deal with this before you confirm the rental agreement. Get auto insurance quotes for the different possible types of cover. If you are paying for the rental by credit card, there may be some auto insurance thrown in but check the terms and conditions carefully.

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Long-Term Care And Annuities

Posted on Dec 22, 2011 by Admin

If a family unexpectedly loses one of the incomes, the effect can be devastating. If we look around, there are tens of thousands of two-income families struggling to make ends meet. If unemployment cuts off one income you always hope this is just a temporary blip. But if the worst has happened, there's no recovery. This means every family should aim to carry some level of financial protection. Sadly, the statistics show less than 45% of families have an insurance policy. That's millions of household with children who will have no money to replace the lost income. So we should all make insurance a priority, particularly when economic times are uncertain.

One of the factors that should focus our attention is the decision by the Obama administration not to go forward with the Community Living Assistance Supports and Services Act (CLASS). This was intended to help people in need of long-term health care, but the costs of a public-supported approach are too high. This will leave it for the private insurers to continue to offer products to the market. So, if you suffer an injury or disease that leaves you in need of long-term nursing care, it's possible you can use the insurance policy on your life to help pay for that care. Assuming there's a cash value to the policy with a reasonable amount already accumulated, you can borrow this money or use the policy as security for a loan. Alternatively, you can either surrender the policy or sell it on the secondary market. With a conventional policy, this gives you a lump sum with which to pay for long-term nursing care. Except this is an inefficient approach.

If you borrow money, you have to pay it back or you end up with serious debt problems. The surrender or sale of the policy gives you a cash sum without strings attached. You can use the money until it has gone. The best option is to have a policy with an annuity built in. This way, you can trigger the annuity should the need arise or leave the investment to accumulate for the benefit of your descendants. Why provide for the possibility of long-term care? Medical science has been increasing life expectancy. As we live longer, the risk of needing long-term care also increases. So far, medical costs have been rising faster than inflation. The federal government has seen the problem and has helped with the Pension Protection Act of 2010 which allows accumulating cash value to be used to pay long-term care expenses without being caught by income tax.

When you consider how many boomers will retire over the next twenty years and who will need nursing care as they grow more frail, the urgency of getting life insurance quotes to explore the options should be obvious. If you do not already have a permanent life policy with an annuity option built in, look very carefully at the likely cash value in the current policy. When you know how much might be available should you borrow or sell the policy, get life insurance quotes to buy an annuity. That will give you guide prices for the purchase if the need should arise suddenly. Leaving it to the last minute to do your research can lead to mistakes.

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Buying Term Life Cover

Posted on Dec 14, 2011 by Admin

As a young person, life insurance is one of these "do I really have to?" things to think about. No one wants to consider the possibility of dying. At a time when we are optimistic about all the good outcomes coming out way if we work hard, it's unreasonably pessimistic to start worrying about when it might all end. Yet, if you don't invest a little time considering the options, circumstances can overtake you and make it difficult to insure your life later on. Let's take a simple possibility. Right now, you are reasonably fit and quite thin. Suppose you stop exercising when you leave high school or college. If you get a job, it's sitting at a desk. If you join the ranks of the unemployed, the couch may beckon. Are you still going to eat big portions of unhealthy food? Most people do. That means you could be overweight in a few years time. This seriously increases the risks of diabetes and heart disease. It also makes it tougher to get through the medical examination to get your life insured. Indeed, it's not unknown for the insurance company to make it a condition you lose weight before the policy is confirmed.
Yet we mentioned the possibility you might not get a job. Sadly, youth unemployment is at an all-time high and even graduates are finding it difficult to find paying work - let's ignore the unpaid internships that are nothing more than slave labor without the benefits of free housing and food. Without a paying job, finding the money to pay the premiums is almost impossible unless your parents help out. This is always going to encourage you to think about term insurance. This is the cheap option, giving you some cover for not that much money. So, as a twentysomething, you buy a term policy expiring when you are fortysomething. At this point you can discover you made a mistake when buying.
If all you bought was a fixed term of years, the policy ends and you are left without any cover. You have to start again when your health is going to be less good. Indeed, many discover they are uninsurable because they have developed health problems that will likely shorten their lives. So here comes the pitch. When you buy the term insurance, ensure it's convertible into a permanent life policy. That way, assuming you pay your premiums on time, renewal as a term policy or conversion into a permanent policy is guaranteed regardless whether your health has declined. This way, as your personal circumstances and financial needs change, you can upgrade without penalty. Starting off with a term policy is not a bad decision. It satisfies a simple needs and gives adequate protection in the short-term. So build in flexibility by buying a convertible policy. Upgrading to whole life is usually the best option, offering the smallest premium increase with some cash value. If your financial situation is strong, converting to a life insurance policy with a better investment option may give you better returns. Remember these benefits can be personal because, once you have a cash value, you can borrow that money or use the policy as security for a loan. Alternatively you can sell it on the secondary market.

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Bundling Auto And Home Policies

Posted on Dec 13, 2011 by Admin

In these difficult economic times, everyone is playing the game of looking for savings on the must-haves. When the job may be lost because of cuts in state or federal budgets - for example, if the defense cuts follow on from the failure of the Supercommittee to agree a deficit reduction package, thousands of jobs will be lost - no one wants big regular commitments. That means discounts is the name of the game when it comes to shopping for insurance. Putting the question of the deductible to one side, the most common saving comes from bundling an auto with a homeowners policy. Insurers usually offer not less than 10% in premium rates which, in these difficult times, can be a good deal. Of course, before you sign up, you complete the shopping around, getting quotes for the policies separately and bundled together from several different companies. Never assume you cannot do better separately if you change insurers.
So far, all this is completely straightforward. In a free market, you can make savings and the insurer gets more business. This should be a win/win situation. Except, in some states like North Carolina, the free market is being twisted by some insurers. The strategy adopted by some of the larger companies like Allstate is aggressive, writing to existing homeowners policyholders to refuse renewal unless they switch their vehicle insurance to a bundle. In some states like New York, this forced bundling is illegal, breaching provisions on anti-rebating and anti-discrimination. In states where this is legal, the insurers justify this mandate on the basis of their business economics.
It's a fact of the business that insuring people's vehicles is highly profitable, but insuring homes is break-even or potentially loss-making. When you look at the last two years, the majority of companies have made a loss because of the increasingly bad weather. Indeed, 2010 was a record-breaking year for claims and this year has already passed the 2010 total. In the past, the insurers would simply have raised their premium rates to cover the losses, but most states now cap rate increases. Insurance Commissioners have become more protective of consumer rights. This means insurers are trying to get back into profitability on homeowners policies by forcing people to transfer insurance for their vehicles. It doesn't work the other way round. Because vehicle insurance is profitable, there's no requirement to bundle a homeowners policy. Indeed, given the choice, many insurers would no doubt like to terminate all homeowners policies.
So when you start shopping around and ask for auto insurance quotes from all the top companies in your state, remember to look carefully at their bundling rules. It's entirely possible there will be nothing but good news with discounts you can enjoy without penalty. But be very careful to read the small print. You should also consider what your reaction will be if, as in North Carolina, you suddenly get a letter from one insurer requiring you to cancel policies with another insurer and consolidate all policies with the one insurer. First get auto insurance quotes with a view to changing insurer and then make a formal complaint to your Insurance Commissioner. The more people who complain and move their business, the better.

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