What Type of Life Insurance Policy Should You Get

The primary purpose for getting life insurance will always be to protect the people you care about in case something were to happen to you. How much capital would you need in order to pay off debts, support your loved ones, or to take care of all your affairs?

After you understand what priorities you would like to protect through life insurance it is fairly easy to determine the correct amount of coverage.

What Type Of Life Insurance

The next question is what type of coverage will best serve your needs. In order to get the right amount of coverage you also have to make sure that the premiums fit comfortably into your budget.

Term Insurance Benefits

Term insurance is less expensive than whole life insurance, because you are renting the insurance. Your coverage is considered pure insurance in this case, because it doesn’t develop cash value or participate in company dividends.

Instead it allows you to get the right amount of protection for the least expensive premiums available. Term insurance has also developed over the years to offer more comprehensive options. You can get a return-of-premiums policy where you pay more during the life of the policy, but the insurance company refunds all of your premiums at the end of the fixed term.

There are also term policies that allow you to lock in your age and health for the remainder of your life, so that you can have the coverage and premiums locked in for the rest of your life. This is a great and inexpensive way to obtain permanent insurance.

How Long Should You Lock In Your Premiums

The longer you can lock in your premiums the more advantageous it will be in the long run. The insurance company takes into consideration the mortality risk during the level period of the term. If you are 35 and you get a level 20-term policy then the rates will be fixed until you are 55. And because you are locking in the premiums at a younger age, the average risk and rates will be less than if you were to lock in your premiums at 55.

Most people have an insurance need that will last throughout the rest of their lives. If you can permanently lock in a portion of your insurance at a younger age this can save you substantially on premiums. It happens quite often where people will have to apply for new coverage after the fixed rates on their current policy have expired, and because they are now older and have to pay much more in premiums.

Your health is also locked in when you first take the policy out. Many people looking for insurance in their fifties or sixties are dealing with some type of medical condition that makes the cost of life insurance double or triple in cost. The same logic that applies to locking in your age is also good to keep in mind when locking in your health. We don’t know what is going to happen to us, and if we have our insurance locked in then our insurability and premiums will be unaffected by a medical event.

Level Term Insurance

I always recommend getting a level-term policy as opposed to one that will start off lower and increase premiums each and every year. The level term policies allow you to lock in your age and health for the remainder of the term, whereas the increasing-premium policies become more expensive every year based on your new age.

Because term insurance is a less expensive way to get the right amount of protection, I believe that it is the right choice for a large majority of people looking at life insurance.

Cash Value Life Insurance: When To Consider It

First A Word Of Caution About How The Life Insurance Industry Operates

An agent who pushes one company above the others is doing his or her clients a disservice. Every company has its positives and negatives and each company has focused on certain demographics to try to create a competitive edge. There are 17 life insurance companies in the fortune 500 alone. These companies have very similar investment portfolios and conduct business in ways that are more common than not. Eight of these companies are mutual, nine are stock companies, and they all operate in order to make a profit. The most important thing that anybody can do is to have an agent who can help them shop the market for the company that is going to fit their needs best. Somebody that is a smoker with high blood pressure is going to have better options outside of the companies that target nonsmokers without health conditions. Finding the least expensive company on the market for your age and health can save you thousands of dollars.

I used to work for an insurance agency where we only sold a single triple-A-rated-insurance company. When I worked for this agency, my fellow agents and I were especially inculcated with the benefits of this company’s whole life insurance. This situation is not unique.

Captive agencies have managers that groom agents to push one company because they get paid commissions when their agents sell these products. Please don’t assume that life insurance agents are experts on the benefits of different companies and types of insurance plans, because many of them are unaware of the benefits beyond their own company. Instead of consulting their clients and shopping the market they push a single product that doesn’t always match up well. There are far too many people being given advice from agents to consider whole life insurance, because they are trained to present the same products to every client.

When You Are Considering An Insurance Company It Will Always Be Advantageous For Some People And Ill Advised For Others

If you sit down with an agent who goes over a list of benefits about a single insurance company, keep in mind that most benefits are really trade-offs. For instance, if a company is a triple-A rated insurance company than they are probably also more conservative with whom they insure. A triple-A rating is great, but it is really only necessary if you plan on participating in the companies dividends, or in other words buying their whole life insurance. There is no need to pay extra money for the privilege of having a triple-A rated company as many agents insist. A.M. Best considers a company with an A-rating to be in excellent financial health and there are many A-rated companies with less expensive insurance offers if you are not planning on participating in whole life.

When Whole Life Insurance is a Good Idea

For some people, whole life insurance can be a great complement to their financial security. I have sold whole life insurance based on the following benefits.
1) It has a guaranteed return that will consistently build up the cash value in the policy.
2) It gives policyholders permanent insurance so that they are insured throughout their lifetime.
3) It allows them to stop paying premiums after a certain number of years, because the dividends from the company will be enough to keep the policy in force.
4) It allows policyholders to take cash from the policy in the form of a loan, so that you have another option if liquidity is needed.
5) The growth of the policy is tax deferred and tax-free as long as long as the policy is kept in force.

The problem can be that many of these benefits point to life insurance as an asset or investment. Life insurance should always be considered for the death benefit first and foremost. If you have already maxed out both your Roth Ira and 401(k), have at least three months of expenses in accessible savings, and are looking for something else to build up savings then whole-life insurance can be a good option. The point is that whole life insurance is a good choice when you have the ability to max out your qualified retirement funds and are looking to complement your savings with a conservative tie in to your life insurance.

Whole life can be a mistake for a couple of reasons

There are risks when putting your money into whole life insurance. The risks aren’t always clearly explained, because the agents focus on the guaranteed dividends that will grow the cash value every year. However, one significant risk is buying into whole-life insurance, paying the premiums for a number of years, and then not being able to keep up with the premiums down the road. Life insurance companies bank on this happening to a certain percentage of policyholders.
If this occurs you are in danger of losing thousands of dollars in paid premiums without the benefit of accumulating any cash value. When a policy lapses or you can’t keep up with whole life premiums then the insurance company will retain your premiums without you having any cash value built up or any insurance in force.
These whole life polices are structured to have large front end expenses and it will take at least a couple of years before your premiums start to build up cash value. It takes about ten years before the amount of premiums you put into the policy will equal the cash value in the policy.

How Cash Value In Whole Life Insurance Works

The other risk with whole life insurance is not understanding how the cash value in the policy works and taking out too much of it. The cash value in the policy is liquid, but the insurance company will let you take out about 97% of it in order to protect against the policy lapsing. Any cash that is taken out of the policy is loaned from the policy at interest.

Lets assume that you are in the first 20 years of your whole life policy and are taking a loan from the cash value in the policy. The loaned interest rate is 8.0 %, the non-loaned dividend interest rate is 6.85%, and the loaned-dividend interest is rate is 7.9 %. Notice that the insurance company steps up the interest rate on the loaned amount or the amount borrowed from your cash value. This mitigates the cost of the loan, but the loan still creates an ongoing obligation to pay interest. For instance the cost of borrowing here would be 6.95 %.

(The loaned interest rate (8.0 %) + (the non-loaned dividend interest rate (6.85%) – the loaned-dividend interest rate (7.9%)) = cost of borrowing (6.95%).

The cash value in the policy is really a double-edged sword, because it leads to a significant risk that you will not be able to keep up with the premiums. It is practically intended for people who can repay the loan quickly so that the policy continues to develop dividends instead of an obligation to pay interest. It is great for people who aren’t ever tempted to borrow from the policy, because the dividends will compound and eventually be able to cover the cost of annual premiums. When this occurs the risk of lapsing will be negligible. However, this takes quite some time to achieve and it truly depends on how disciplined you can afford to be with the additional cost of these premiums. If you would rather have control of your money up front there is an argument that you can buy term and invest the rest instead of leveraging the insurance companies general fund.

Your Personality Profile And Budget Must Be In Line

I recommend taking a look at both your budget and how much control you want over your money for at least the next ten years if you are considering whole life. Because term insurance can now permanently lock in your age and health in the same manner as whole life insurance, the biggest question is whether or not you want control over investing the difference in premiums. Many people prefer whole life insurance because they don’t have to think about investing the difference; the insurance company does it for them. They can also grow their death benefit by the amount of growth in cash value and act as their own creditor if they ever want to borrow cash from the policy.

A Couple Other Points About Whole Life Insurance

The cash value component in a whole life insurance policy needs to be addressed. The first is that cash value is based on compounding dividends. So the longer you keep the paying premiums the more advantageous it is. The second is that if you go with a reliable insurance company they will usually pay non-guaranteed dividends that are based on the results of an insurance companies investments. This is when rating is important to consider, because you are now participating in these dividends. Also if you have allowed the cash value to grow and take out modest loans from the policy later in life, you will most likely have enough in dividends to keep pace beyond the ongoing obligation of interest. However if you do surrender the policy the gains will be taxed as capital gains and you will have to pay a surrender charge as well. If the policy is in force and you pass away while there are still outstanding loans, the death benefit will be paid out after it covers the cost of the loans that you have taken from the policy.

Term Insurance Vs. Whole Life

I believe the most important factor in all of this is the human element. If you are patient, conservative, and comfortably able to continue paying premiums without the temptation to borrow from the cash-value then you are a good candidate for whole life insurance. The majority of people have fluctuating budgets and circumstances where they are better off with something that locks in their age and health and gives them the opportunity to invest the difference elsewhere.

If you are looking to find the right type of insurance look no further. I am a licensed agent, business owner, and financial author and my goal is to consult people on the best options available in the life insurance market. I am licensed in over ten states and have helped thousands of people find a policy based on their priorities and saving them money. To get a free online quote go to:

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Avoid These Six Common Life Insurance Mistakes

Life insurance is one of the most important components of any individual’s financial plan. However there is lot of misunderstanding about life insurance, mainly due to the way life insurance products have been sold over the years in India. We have discussed some common mistakes insurance buyers should avoid when buying insurance policies.

1. Underestimating insurance requirement: Many life insurance buyers choose their insurance covers or sum assured, based on the plans their agents want to sell and how much premium they can afford. This a wrong approach. Your insurance requirement is a function of your financial situation, and has nothing do with what products are available. Many insurance buyers use thumb rules like 10 times annual income for cover. Some financial advisers say that a cover of 10 times your annual income is adequate because it gives your family 10 years worth of income, when you are gone. But this is not always correct. Suppose, you have 20 year mortgage or home loan. How will your family pay the EMIs after 10 years, when most of the loan is still outstanding? Suppose you have very young children. Your family will run out of income, when your children need it the most, e.g. for their higher education. Insurance buyers need to consider several factors in deciding how much insurance cover is adequate for them.

· Repayment of the entire outstanding debt (e.g. home loan, car loan etc.) of the policy holder

· After debt repayment, the cover or sum assured should have surplus funds to generate enough monthly income to cover all the living expenses of the dependents of the policy holder, factoring in inflation

· After debt repayment and generating monthly income, the sum assured should also be adequate to meet future obligations of the policy holder, like children’s education, marriage etc.

2. Choosing the cheapest policy: Many insurance buyers like to buy policies that are cheaper. This is another serious mistake. A cheap policy is no good, if the insurance company for some reason or another cannot fulfil the claim in the event of an untimely death. Even if the insurer fulfils the claim, if it takes a very long time to fulfil the claim it is certainly not a desirable situation for family of the insured to be in. You should look at metrics like Claims Settlement Ratio and Duration wise settlement of death claims of different life insurance companies, to select an insurer, that will honour its obligation in fulfilling your claim in a timely manner, should such an unfortunate situation arise. Data on these metrics for all the insurance companies in India is available in the IRDA annual report (on the IRDA website). You should also check claim settlement reviews online and only then choose a company that has a good track record of settling claims.

3. Treating life insurance as an investment and buying the wrong plan: The common misconception about life insurance is that, it is also as a good investment or retirement planning solution. This misconception is largely due to some insurance agents who like to sell expensive policies to earn high commissions. If you compare returns from life insurance to other investment options, it simply does not make sense as an investment. If you are a young investor with a long time horizon, equity is the best wealth creation instrument. Over a 20 year time horizon, investment in equity funds through SIP will result in a corpus that is at least three or four times the maturity amount of life insurance plan with a 20 year term, with the same investment. Life insurance should always been seen as protection for your family, in the event of an untimely death. Investment should be a completely separate consideration. Even though insurance companies sell Unit Linked Insurance Plans (ULIPs) as attractive investment products, for your own evaluation you should separate the insurance component and investment component and pay careful attention to what portion of your premium actually gets allocated to investments. In the early years of a ULIP policy, only a small amount goes to buying units.

A good financial planner will always advise you to buy term insurance plan. A term plan is the purest form of insurance and is a straightforward protection policy. The premium of term insurance plans is much less than other types of insurance plans, and it leaves the policy holders with a much larger investible surplus that they can invest in investment products like mutual funds that give much higher returns in the long term, compared to endowment or money back plans. If you are a term insurance policy holder, under some specific situations, you may opt for other types of insurance (e.g. ULIP, endowment or money back plans), in addition to your term policy, for your specific financial needs.

4. Buying insurance for the purpose of tax planning: For many years agents have inveigled their clients into buying insurance plans to save tax under Section 80C of the Income Tax Act. Investors should realize that insurance is probably the worst tax saving investment. Return from insurance plans is in the range of 5 – 6%, whereas Public Provident Fund, another 80C investment, gives close to 9% risk free and tax free returns. Equity Linked Saving Schemes, another 80C investment, gives much higher tax free returns over the long term. Further, returns from insurance plans may not be entirely tax free. If the premiums exceed 20% of sum assured, then to that extent the maturity proceeds are taxable. As discussed earlier, the most important thing to note about life insurance is that objective is to provide life cover, not to generate the best investment return.

5. Surrendering life insurance policy or withdrawing from it before maturity: This is a serious mistake and compromises the financial security of your family in the event of an unfortunate incident. Life Insurance should not be touched until the unfortunate death of the insured occurs. Some policy holders surrender their policy to meet an urgent financial need, with the hope of buying a new policy when their financial situation improves. Such policy holders need to remember two things. First, mortality is not in anyone’s control. That is why we buy life insurance in the first place. Second, life insurance gets very expensive as the insurance buyer gets older. Your financial plan should provide for contingency funds to meet any unexpected urgent expense or provide liquidity for a period of time in the event of a financial distress.

6. Insurance is a one-time exercise: I am reminded of an old motorcycle advertisement on television, which had the punch line, “Fill it, shut it, forget it”. Some insurance buyers have the same philosophy towards life insurance. Once they buy adequate cover in a good life insurance plan from a reputed company, they assume that their life insurance needs are taken care of forever. This is a mistake. Financial situation of insurance buyers change with time. Compare your current income with your income ten years back. Hasn’t your income grown several times? Your lifestyle would also have improved significantly. If you bought a life insurance plan ten years ago based on your income back then, the sum assured will not be enough to meet your family’s current lifestyle and needs, in the unfortunate event of your untimely death. Therefore you should buy an additional term plan to cover that risk. Life Insurance needs have to be re-evaluated at a regular frequency and any additional sum assured if required, should be bought.

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Twelve Secrets and Tricks to Buying Life Insurance

Secret #1: Don’t spend too much time on a life insurance quote.

Do not be fooled by the low price quotes you get online – they don’t apply to you unless you are extremely healthy. Statistically only 10% of people who apply actually get the lowest priced policy. The premium you end up paying has nothing to do with the initial quote you get online or from an agent. It is amazing to me how often I see people getting duped by an agent who quotes company X at a lower price than another agent.

Life insurance policies are the same price no matter who you buy from! One agent or website quoting a lower premium means nothing. Prices for any given policy is based on your age and health. There are a few exceptions to this but that is beyond the breadth of this article.

Most life insurance companies have 10-20 different health/price ratings and no agent or website can assure you the quote they give you is accurate. You have to apply, do a health check, and then go through underwriting (meaning you complete a mini-exam with a nurse in your home and then the company checks you doctor records and reviews and ‘rates’ your health) to get the real price of the policy. Remember that a health rating also factors in your family history, driving record, and the type of occupation you have. Only use quotes to help narrow down your choices to the top companies. You may want to consider a no load or low policy. The more that you save on commissions the more money builds up in your policy. You can even buy term insurance no load, and save a lot on premiums. You will not get the help of an agent, which may be worth something if they are very good.

The most important factor determining price is matching your particular health history with the company best suited for that niche. For instance company X might be best for smokers, company Y for cancer survivors, Company Z for people with high blood pressure, etc.

Secret #2: Ignore the hype on term versus cash value permanent insurance.

You can go crazy reading what everyone has to say on buying term insurance versus a whole or universal life policy. Big name websites give advice that I think borders on fraudulent. Simply put there is NO simple answer on whether you should buy permanent cash value policies or term insurance.

But I do think there is a simple rule of thumb – buy term for your temporary insurance needs and cash value insurance for your permanent needs. I have read in various journals and run mathematical equations myself which basically show that if you have a need for insurance beyond 20 years that you should consider some amount of permanent insurance. This is due to the tax advantage of the growth of the cash value within in a permanent policy. I am divorced and have taken care of my children should I die. I probably no longer need as much insurance as I now have. I have earned a great return on my policies and have paid no taxes. I no longer pay the premiums, because there is so much cash in the policies. I let the policies pay themselves. I would not call most life insurance a good investment. Because I bought my policies correctly, and paid almost no sales commissions my policies are probably my best investments. I no longer own them, so when I die my beneficiaries will get the money both tax free, and estate tax free.

Since most people have short term needs like a mortgage or kids at home they should get some term. Additionally most people want some life insurance in place for their whole life to pay for burial, help with unpaid medical bills and estate taxes and so a permanent policy should be purchased along with the term policy.

Secret #3: Consider applying with two companies at once.

Life insurance companies really don’t like this “trick” because it gives them competition and increases their underwriting costs.

Secret #4: Avoid captive life insurance agents.

Look for a life insurance agent who represents at least fifty life insurance companies and ask them for a multi company quote showing the best prices side by side. Some people try to cut the agent out and just apply online. Just remember that you don’t save any money that way because the commissions normally earned by the agent are just kept by the insurance company or the website insurance company without having your premium lowered.

Plus a good agent can help you maneuver through some of the complexities of filling out the application, setting up your beneficiaries, avoiding mistakes on selecting who should be the owner, the best way to pay your premium, and also will be there to deliver the check and assist your loved ones if the life insurance is ever used.

Secret #5: Consider refinancing old life policies.

Most companies won’t tell you but the price you pay on your old policies has probably come down dramatically if you are in good health. In the last few years life insurance companies have updated their predictions on how long people will live. Since we are living longer they are reducing their rates rather dramatically. Beware the agent may be doing this to obtain a new commission, so make sure it really makes sense.

I really am amazed at how often we find that our client’s old policies are twice as expensive as a new one. If you need new life insurance consider “refinancing” your old policies and using the savings on the old policies to pay for the new policy – that way there is no extra out-of-pocket costs. We like to think of this process as “refinancing your life insurance” – just like you refinance your mortgage.

Secret #6: Realize life insurance companies have target niches that constantly change.

One day company ‘X’ is giving good rates to people who are a little overweight and the next month they are super strict. Company ‘Y’ might be lenient on people with diabetes because they don’t have many diabetics on the books – meaning they will give good rates to diabetics. At the same time company ‘W’ might be very strict on diabetics because they are insuring lots of diabetics and are afraid they have too big of a risk in that area – meaning they will give a bad rate to new diabetics who apply.

Unfortunately when you are applying a life insurance company will not tell you, “Hey, we just raised our rates in diabetics.” They will just happily take your money if you were not smart enough to shop around. This is the number one area a smart agent can come in handy. Since a good multi-company agent is constantly applying with multiple companies he or she will have a good handle on who is currently the most lenient on underwriting for you particular situation. The problem is that this is hard work and many agents are either too busy or not set up to efficiently shop around directly to different underwriters and see who would make you the best offer. This is a lot harder than just running you a quote online.

Secret #7: Don’t forget customer service.

Most people shopping for insurance focus on companies with the lowest price and the best financial rating. Unfortunately I know of some A+ rated companies with low rates who I would not touch with a ten foot pole simply because it’s easier to give birth to a porcupine backwards then it is to get customer service from them.

Before I understood this I used a life insurance company that gave a client a great rate but 2 years later the client called me and said, “I have mailed in all my payments on time but just got a notice saying my policy lapsed.” It turned out the company had been making lots of back office mistakes and had lost the premium payment!

We were able to fix it because we caught the problem so early. But if the client happened to have died during the short period the policy had lapsed, his family might have had a hard time proving that the premium had been paid on time and they might not have received the life insurance money – a loss of hundreds of thousands of dollars in that case.

Secret #8: Apply 3-6 months ahead of the time you need the insurance if possible.

Don’t be in a hurry to get a policy if you already have some coverage in force. But go ahead and apply right away knowing that you might need months to shop around if the first company does not give you a good rate. Even though the life insurance industry is getting more automated your application will still often be held up for weeks or months while the insurance company waits on your doctor’s office to mail them a copy of you medical records.

If you are in a hurry and buy a quickie ‘no-underwriting’ policy without going through the full health checks and underwriting that a mainstream life insurance company requires, you will end up paying 20%-50% more because the insurance company will automatically charge you higher rates because they don’t know whether you are healthy or about to die the next day.

Secret #9: Avoid buying extra life insurance through work if you are healthy.

I am sure there are exceptions to this “trick” but I have rarely found one. By all means keep the free life insurance your employer provides. But if you are healthy and you are paying for supplemental life insurance through payroll deduction you are almost certainly paying too much. What is happening is that your ‘overpayments’ ends up subsidizing the unhealthy people in your company who are buying life insurance through payroll deduction.

Usually the life insurance company has cut a deal with your employer and will waive the required health exam for all employees – instead they just average the price for all the employees and offer one or two rates for males or females at any given age. Life insurance companies know they will pick up lots of unhealthy clients this way so they jack up the price on everyone so that the healthy people end up overpaying so that the unhealthy employees get a cheaper policy. Also, unlike the guaranteed term policies which we recommend, most life insurance you buy through work will get more expensive as you get older.

Also group life insurance is generally not portable when you retire or change jobs meaning that when you retire or change jobs you might have to apply all over again even though you will be older and probably not as healthy and risk being turned down for a policy. If the group plan does allow portability they generally limit your conversion choices and force you to go into expensive cash value plans.

I remember helping someone evaluate his supplemental life insurance. He was sure it was a better deal than any policy I could find him. Little did he know that the price of his group plan would go up every year? By the time he retired his premium would have risen to over $10,000/year. I found him a policy for around $1000/year that would never go up. Also, unlike his old group life policy, he could take the individual policy with him when he changed jobs or retired.

Secret #10: Do a trial application on a COD payment basis.

Only send money with the application if you need the life insurance coverage right away. Sending a check with the application is a traditional practice agents used to do – I think mostly because it got them their commissions faster. If you send money with an application you usually get temporary coverage immediately but if you already have plenty of coverage and are just trying to get better rates ask your agent to do a trial application on a COD basis so you only pay once the policy is approved. If you do not send money, and you die before paying for the policy there is no coverage.

Secret #11: Wear your shoes when the nurse measures your height.

When the insurance company sends out the nurse to do your health check try to be as tall as possible if you are overweight? In most states you are allowed to wear shoes and if you are a little overweight your taller height/weight ratio will look a little better to the underwriter who is determining your health rating and policy price. Also do your exam early in the morning with no food in you – this will make your cholesterol count and various health ratios look the best.

Secret #12: Be careful with extra perks and riders.

Most policies come with options like accidental death benefit, child riders, disability riders, return of premium etc. If you do the math on most of these “extras” they usually don’t make smart financial sense. Life insurance companies are out to make money and these riders are usually profitable because they either cover something that rarely happens or they are so stringent that the benefit never gets paid out. Keep things simple and focus mainly on getting a life policy to cover your life without many strings attached. Again a good agent can help you weigh the benefits of the extra riders. But be wary of an agent who tries to tack on every possible extra rider.

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Life Insurance: Back to Basics

Life Insurance: A Slice of History

The modern insurance contracts that we have today such as life insurance, originated from the practice of merchants in the 14th century. It has also been acknowledged that different strains of security arrangements have already been in place since time immemorial and somehow, they are akin to insurance contracts in its embryonic form.

The phenomenal growth of life insurance from almost nothing a hundred years ago to its present gigantic proportion is not of the outstanding marvels of present-day business life. Essentially, life insurance became one of the felt necessities of human kind due to the unrelenting demand for economic security, the growing need for social stability, and the clamor for protection against the hazards of cruel-crippling calamities and sudden economic shocks. Insurance is no longer a rich man’s monopoly. Gone are the days when only the social elite are afforded its protection because in this modern era, insurance contracts are riddled with the assured hopes of many families of modest means. It is woven, as it were, into the very nook and cranny of national economy. It touches upon the holiest and most sacred ties in the life of man. The love of parents. The love of wives. The love of children. And even the love of business.

Life Insurance as Financial Protection

A life insurance policy pays out an agreed amount generally referred to as the sum assured under certain circumstances. The sum assured in a life insurance policy is intended to answer for your financial needs as well as your dependents in the event of your death or disability. Hence, life insurance offers financial coverage or protection against these risks.

Life Insurance: General Concepts

Insurance is a risk-spreading device. Basically, the insurer or the insurance company pools the premiums paid by all of its clients. Theoretically speaking, the pool of premiums answers for the losses of each insured.

Life insurance is a contract whereby one party insures a person against loss by the death of another. An insurance on life is a contract by which the insurer (the insurance company) for a stipulated sum, engages to pay a certain amount of money if another dies within the time limited by the policy. The payment of the insurance money hinges upon the loss of life and in its broader sense, life insurance includes accident insurance, since life is insured under either contract.

Therefore, the life insurance policy contract is between the policy holder (the assured) and the life insurance company (the insurer). In return for this protection or coverage, the policy holder pays a premium for an agreed period of time, dependent upon the type of policy purchased.

In the same vein, it is important to note that life insurance is a valued policy. This means that it is not a contract of indemnity. The interest of the person insured in hi or another person’s life is generally not susceptible of an exact pecuniary measurement. You simply cannot put a price tag on a person’s life. Thus, the measure of indemnity is whatever is fixed in the policy. However, the interest of a person insured becomes susceptible of exact pecuniary measurement if it is a case involving a creditor who insures the life of a debtor. In this particular scenario, the interest of the insured creditor is measurable because it is based on the value of the indebtedness.

Common Life Insurance Policies

Generally, life insurance policies are often marketed to cater to retirement planning, savings and investment purposes apart from the ones mentioned above. For instance, an annuity can very well provide an income during your retirement years.

Whole life and endowment participating policies or investment linked plans (ILPs) in life insurance policies bundle together a savings and investment aspect along with insurance protection. Hence, for the same amount of insurance coverage, the premiums will cost you more than purchasing a pure insurance product like term insurance.

The upside of these bundled products is that they tend to build up cash over time and they are eventually paid out once the policy matures. Thus, if your death benefit is coupled with cash values, the latter is paid out once the insured dies. With term insurance however, no cash value build up can be had.

The common practice in most countries is the marketing of bundled products as savings products. This is one unique facet of modern insurance practice whereby part of the premiums paid by the assured is invested to build up cash values. The drawback of this practice though is the premiums invested become subjected to investment risks and unlike savings deposits, the guaranteed cash value may be less than the total amount of premiums paid.

Essentially, as a future policy holder, you need to have a thorough assessment of your needs and goals. It is only after this step where you can carefully choose the life insurance product that best suits your needs and goals. If your target is to protect your family’s future, ensure that the product you have chosen meets your protection needs first.

Real World Application

It is imperative to make the most out of your money. Splitting your life insurance on multiple policies can save you more money. If you die while your kids are 3 & 5, you will need a lot more life insurance protection than if your kids are 35 & 40. Let’s say your kids are 3 & 5 now and if you die, they will need at least $2,000,000 to live, to go to college, etc. Instead of getting $2,000,000 in permanent life insurance, which will be outrageously expensive, just go for term life insurance: $100,000 for permanent life insurance, $1,000,000 for a 10-year term insurance, $500,000 for a 20-year term insurance, and $400,000 of 30 years term. Now this is very practical as it covers all that’s necessary. If you die and the kids are 13 & 15 or younger, they will get $2M; if the age is between 13-23, they get $1M; if between 23-33, they get $500,000; if after that, they still get $100,000 for final expenses and funeral costs. This is perfect for insurance needs that changes over time because as the children grow, your financial responsibility also lessens. As the 10, 20, and 30 years term expires, payment of premiums also expires thus you can choose to use that money to invest in stocks and take risks with it.

In a world run by the dictates of money, everyone wants financial freedom. Who doesn’t? But we all NEED financial SECURITY. Most people lose sight of this important facet of financial literacy. They invest everything and risk everything to make more and yet they end up losing most of it, if not all- this is a fatal formula. The best approach is to take a portion of your money and invest in financial security and then take the rest of it and invest in financial freedom.

Ultimately, your financial plan is constantly evolving because you are constantly evolving. You can’t set a plan and then forget it. You need to keep an open eye on your money to make sure it is working hard because that money needs to feed you for the next 20-30+ years that you will be in retirement. You have to know how to feed your money now so that it can feed you later.

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Chiropractor – A Health Care Invention

A chiropractor is defined as a health care device with a professional touch for the diagnosis and intensive treatment of neuromuscular disorders. Their emphasis is on neuromuscular disorders, especially spine.

Most of the chiropractors are used as a pain reliever for the patients. That is why it has been given the title of being an alternative medicine to the subjected treatment.

Chiropractors firmly and honestly believe in the kind of relationship that developed between our nervous system and spine, this does not come as a surprise as we have already mentioned that the major area of focus for the chiropractor is the spine.

Here is the listing of few of the benefits received from Chiropractic health care

1. A great boost for stress reliever

It is a well known fact that too much of stress will always result in a bad outcome. Neither is it good for health nor is it good for our well being. When our nervous system moves out a bit from the track and our skeletal system seems to have shaken off from their proper position, there are very high possibilities that your entire body will feel out of balance as well. This is what will lead to stress in your entire functioning of the body. Here is when the functioning of a Chiropractor comes into use. It helps in balancing that stress and your body is immediately made to come back to its normal balance. Once you are made to adjust to this functioning you will feel much more equipped to manage this stress if it happens to arise again.

2. Posture perfection by Chiropractor usage

By using this chiropractor over a considerable period of time, these chiropractor adjustments can help in the alignments of the spine and brings a noticeable change in your posture. This is distinctly helpful when it comes to aligning the curve on your neck. As soon as you get into your working in an office phase, you have to spend hours after hours in front of a computer. Due to this from a very young age, people are seen to be having neck issues. If you continue a regular and dutifully maintained use of the chiropractor, you can improve your body posture in no time.

3. Moods are taken care of automatically

When with time your body gets adjusted with the working procedure of the chiropractor, your entire body gets balanced. The entire chemistry of the body is brought back on track. A lot of people who have not had the best of luck in chemical balance gain a lot from the chiropractic care. Depression which is a very serious mental condition also sees an immense improvement in the moods of the sufferer. So you see how a chiropractor is creating wonders in your mood related cases as well which are in a way related to the functioning of your entire body.

Thus we provide you with a gist of all that you can mainly expect from the usage of a chiropractor. It is efficient and it is useful and it is interlinked with many a thing’s improvement.

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Calamine Lotion Benefits

Calamine lotion has been around for a long time and was always used in the medical environment. Obviously, it isn’t as strong as most antiseptic chemicals but it is a lotion that prevents itching.

Calamine lotion can be used for various treatments which include damaged and itchy skin. When skin gets damaged it will get itchy because the cells are breaking and tearing apart. It may sound painful but the itch is what really gets to you. And who can resist scratching an itch?

Coming into contact with poisonous plants is common when camping or spending the day in a garden. These are plants that use poison as a self defence mechanism to save themselves from being cut or eaten. It’s also important to know your allergies as some people may have allergic reactions to certain plants. The calamine lotion can help to soothe the burning feeling and prevents any breakouts at the same time. This will help heal the rash and infection quicker in a painless way.

Baby skin is very sensitive to most surfaces including their nappies. The calamine lotion can help to heal the nappy rash or anything of the sort without burning your child’s skin. Keeping the rash as soothed as possible will make your child more comfortable.

Insect bites are common in any area of the world. These bites could also be slightly poisonous (in certain cases) which causes itching and inflation on the skin. Applying calamine lotion to the bite will soothe the wound and assist with the process of ridding the body of the harmless poison. Please remember that certain insects can also be dangerously poisonous and you should be aware of which insects and spiders can harm you greatly. Most insects that have many bright colours are often associated with high toxic levels.

Calamine lotion also assists with stretch marks and broken skin that occurs during pregnancy. There is nothing worse than having discomfort during pregnancy especially if it could be treated or prevented. Adding calamine lotion to your broken and itchy skin relieves the surface of the discomfort.

You can also apply it to other skin problems such as acne, dryness, eczema, psoriasis and as a normal moisturiser to improve complexion and quality of skin.

Calamine lotion can be found in most stores or in bulk quantities at cash and carry wholesale stores. If skin problems continue after the use of any treatments, there is a chance that your body is unable to cure itself of the infection. In such cases you would need to consult a dermatologist to find out the cause of the problem.

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Staying Safe While Behind The Wheel

There is nothing quite like being able to hit the road and experience a level of freedom in your own vehicle. While your car can offer you a chance to escape from the monotonous routine of your daily life, it is also important to keep basic maintenance in the forefront of your mind. When something goes wrong with your ride, it can lead to some serious financial problems and general frustration. In fact, you might discover that some aspects of maintenance are less obvious than others. This is especially true of areas like windshield glare.

When you are driving on a particularly sunny day, you might not be able to see the road in front of you. The sun can be harsh and unforgiving, and this can have a huge impact on your ability to see clearly while you’re driving. Instead of chalking this up to the way that it is, you might want to take action and discover the right solutions with Crystal Fusion Technologies. Explore the different ways to improve your driving experience and learn how to stay safe while you’re behind the wheel.

A Frustrating Glare

Sunlight on the windshield can be a serious threat. A sunny day is perfect for going to the beach, having a lazy picnic in the park, or simply soaking up some rays. Unfortunately, the sun is also incredibly bright at certain times during the year. When light bounces off or gets filtered through the glass on your windshield, it creates an obstruction that cannot be easily remedied. While you might try and put on some shades, you’ll discover that this solution only gets you so far. A real remedy is in order for a lasting fix.

Companies like Crystal Fusion Technologies have put a lot of time and energy into crafting solutions that aim to improve this situation. Cutting the glare on your windshield is not an easy task and you need to make sure that you are taking the right steps to see improved results. With the assistance of the best products on the market, you can use cutting edge technology to divert the rays of the sun in a way that does not upset your driving in the slightest. Research your options to discover the perfect fit.

Driving On

Staying safe while on the road is important for many reasons. People tend to go through routine maintenance for their vehicles to ensure that no unforeseen issues arise while behind the wheel. This usually takes care of areas like oil changes, tire rotations, and other important areas. Still, maintenance neglects issues that are inherent by design. Windshield glare cannot be fixed with regular maintenance. You need to go above and beyond to protect yourself when you’re on the road so be sure to look over your options.

There are many ways to protect yourself when you’re out driving in your car. When you are paying attention to all angles of your experience, it can be a lot easier for you to spot a problem in advance. Learn about how products by Crystal Fusion Technologies might be able to improve your experience by using windshield protective coating regards to windshield glare. Explore your options and you can find the best solution for your troubles.

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Various Health Benefits of Meditation

The ancient practice of meditation is gaining popularity again in modern times. As this practice goes main stream, more and more people are enjoying its benefits. Derived from the Sanskrit word ‘Dhyana’ meditation means attention and contemplation. It is a practice to help focusing the attention away from everything to achieve a relaxed state of peace and balance. This practice is designed to promote relaxation, develop love, patience and compassion and build internal energy to overcome stressful situations.

One of the reasons for growing popularity of meditation is the scientific research proving its amazing range of benefits and healing properties. It helps a person increase his focus, eliminate negative thoughts and anxiety. Here are some of the popular health benefits of meditation:

- Reduces Stress – Stress is the most common problem of people in present times. Meditation induces a state of relaxation which is helpful in reducing stress and anxiety levels. It restores the emotional balance which will help in enhancing self-esteem, increase awareness and optimism.

- Deals with Chronic Pain – Meditation helps in reducing pain of patients suffering from chronic pain.

- Improves Sleep – It helps in improving sleep quality and cures the symptoms of amnesia.

- Improves Immunity – When the body is relaxed and stress free, the immune system is able to prepare itself to fight against various diseases.

- Provides relief from Blood Pressure and Heart Ailments – Simple daily practice of meditation can help in lowering blood pressure which will reduce the risk of hypertension. Over the time, the heart rate can also be lowered, improving the cardiovascular system. Research has proved that it has helped in managing heart diseases in many patients.

- Improves Concentration – It helps in increasing the strength and focus of your attention. It can help you think better and generate more new ideas.

- Generates Compassion – It can help to increase positive feelings and actions towards others. By practicing meditation, people learn to extend kindness and develop forgiveness.

- Helps in Fighting Addictions – The discipline developed through meditation helps in increasing self control, awareness and breaking dependencies. Research has shown that it helps people in redirecting attention, increase willpower and control impulses. It helps in developing discipline to avoid triggers for unwanted things and fight and recover from addiction.

The importance of meditation can be felt never like before in present times. With routines getting busier and more and more stressful, meditation is a good driving force that can help people cope up with the intricacies of modern lifestyle.

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Remove Unwanted Facial And Body Hair Using Laser Treatment

Removing unwanted hair is time-consuming and repetitive no matter what your preferred hair removal technique is, and whether you shave, pluck, wax, thread or use depilatory creams, the hair will always grow back. You’ll find the skin on your face is sensitive, and constantly using harsh hair removal treatments can cause a great deal of skin irritation.

All women have hair on the face, usually it’s fair and fine and is difficult to see, but those with darker hair are not so lucky. You will find that most of your female friends have the same issues when it comes to unwanted facial hair. The hair on the upper lip, chin, cheeks and sideburns can all be very embarrassing and cause you a great deal of insecurity. It seems that every time you think you’ve disposed of unwanted hair, you’ll find more of it sprouting up somewhere else, and even after you get rid of the hairs, they just grow back.

You can cover up your excess hair in areas that aren’t constantly exposed, but the hair on your face is always on display, and it can seem as though everyone is always looking at the hairs on your upper lip, chin or sideburns. A good way to get rid of unwanted hair is with laser hair removal.

Benefits of laser hair removal:

It permanently reduces hair safely
It’s a fast treatment time
The results will boost your self-confidence
Prevents razor bumps and irritation
Laser treatment causes only minimal discomfort
Laser energy gets absorbed by the pigment in the hair follicle, and this laser energy is then converted to heat, causing thermal damage to the follicle without harming the surrounding skin. This results in hair growth being stopped in the damaged follicle.
Generally for white skin you’ll need around 6 treatments, spaced 4-6 weeks apart, and this usually results in 80% of hair removal. Darker or black skin may need around 8 treatments, resulting again in 80% of hair removed.

Most clients experience minimal discomfort; some may experience a minor stinging or pinching sensation on the skin as we deliver the laser pulses, but we can offer topical anaesthetic cream to make treatments more comfortable.

Although we can perform laser hair removal treatment on white or black skin, lasers only work on hair which has pigment, because it absorbs the laser light and allows the heat to build up and diffuse throughout the follicle to destroy it. Therefore it’s not possible to treat white, grey, and blond hair by laser.

If you need help choosing a cosmetic procedure, we provide an extensive range of cosmetic procedures for the face and body: Botox, Vaser Lipo, Lip Augmentation, Dermal Fillers and many more treatments, to help create a younger, slimmer, more youthful looking you!

The Selston Cosmetic Clinic is located in Selston, Nottingham, where we offer a bespoke service with a personalised touch and deliver high client satisfaction. We have been involved in the cosmetic industry for over 10 years

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