Winning With Finances - Coming to Terms With Insurance

To navigate the maze of insurance options, it's helpful to understand the terminology:
Annuity- A life insurance product that pays benefits over the benefactor's lifetime Appraisal- A survey to determine a property's value (to insure in case of loss) Claim- A documented demand for benefits, as provided by the insurance policy Co-pay- The fee you pay for health-care services; insurance will pay its part Coverage- The defined scope of insurance protection Deductible-The amount you pay on claims, before the insurance company's payments begin Policy- A written insurance contract or certificate and all attachments Premium- The amount(s) you pay to purchase / continue insurance coverage Rider - A modification regarding provisions of a policy, i.e. adding / excluding coverage Risk- The chance / probability of loss, or the amount of loss for the insuring company Term- An affordable form of life insurance or a length of time or... Terms- The written conditions of an agreement Whole life- "Permanent" life insurance, valid your whole life, as are the premiums you pay (It has a savings amount (cash value) attached to a life insurance policy.)

Not all Insurance is Created Equal
The most common thing about insurance is the wide variety of coverage and prices. Lifestyles affect insurance rates. Bad habits, like smoking, can affect not only health insurance, but auto, home / renter's, and life insurance, as well. Your credit score can also make a difference. It's all about risk. The insurance companies want low-risk individuals; otherwise they will charge steeper rates to high-risk clients.
It pays to comparison shop for any type of insurance. Life insurance rates, for instance, can vary greatly according to age, length of insured time (term), and other factors. Ask your insurance agent if discounts are available for combining multiple types of insurance. Grouping vehicle, home, and life insurance with the same company can result in a sizeable discount on all the products in the group. After comparing, thoroughly understand any policy terms and conditions before you sign your documents

Protection - When You're Not There to Protect
To adequately protect loved ones in case of personal loss of life, it is recommended to have life insurance coverage of 6-10 times the amount of yearly income. This could cover a mortgage, future education expenses, and keep the same quality of life for your family.
Whole Life vs. Term Insurance: Why combine a savings account with a more-expensive Whole Life insurance policy? You could most likely get a better return on your "savings" through a different investment vehicle. Cash value within a typical whole life policy may not begin until the 3rd year. If you need your money, you must borrow and pay it back. If you die, all "savings" would be lost, and only the insurance value would be paid.
Term Insurance gives your more coverage at a lower price for a specific term, such as 10, 20, or 30 years.

When Enough is Enough
Everyone adult should have health insurance, personal property protection, vehicle insurance, and especially if a parent, life insurance. For other types of insurance, it's important to weigh the cost factor against the protection. Why add in-case-of-death-insurance to your mortgage loan if your life insurance would cover this expense? Credit card companies offer life, disability, & job-loss insurance to insure they will be paid.

Are the standard warranties enough coverage? An $1100 extended car warranty under a 5-year loan contract with interest...adds up to an astronomical amount. If you saved that amount for emergencies or your next car, you could earn interest, instead of paying it. Likewise, there may be no need to extend an appliance warranty if you already have a home-service repair contract. For electronics-computers, monitors, portable products, etc., extended warranties can be a wise choice. Take time to review the contract terms.

Struggling with Debt? A free debt consultation could bring a little assurance to your life, knowing you could be out of debt in 3 to 5 years, if you follow the plan.