How to Take an Inventory of Insurance Needs

January is the perfect time to pause for a moment and reflect on the year that’s passed. It’s also a good time to prepare for the one ahead.

Taking an inventory of your insurance needs is a great way to make sure that your hard work and New Year’s resolutions are protected against fiscal uncertainty in the coming months.

Types of insurance

First, you should determine what forms of insurance are required.

The most common are auto and homeowners insurance, but don’t stop there.

Many people find that they benefit from additional forms of financial protection for small-business enterprises, as well as umbrella or supplemental policies for valuables.

Who is to be insured

Second, assess who is to be insured, the amounts of insurance and beneficiaries.

Changes to marital status, employment or other lifestyle-related concerns can have a dramatic impact on insurance coverage.

It’s important to update policies to reflect changes that have taken place over the past year. Inform your agent of any changes that have taken place to obtain the most up-to-date quotes.

How much to be insured?

Third, you should update insurance amounts.

Inflation takes a heavy toll on the cost of living, so it’s essential to update coverage amounts on a regular basis.

Changes to employment, health or even other forms of coverage can also increase or decrease the need for certain types of insurance. Ask your agent about other forms of coverage that may supplement existing policies or even replace employer-sponsored policies at a better price.

Fourth, you should document and take photographs of belongings. If you bought or sold business assets, personal belongings or other items, take photographs and record the item number. A documented inventory comes in handy during a loss or claim.

3 Things to Consider When Choosing Auto Coverage

A common mistake made by the average driver is being under-insured. Unfortunately, what might seem like a small oversight can become a costly mistake. You can make sure that you’re purchasing the right amount of liability coverage by speaking with your agent and understanding the following important considerations:

1. Understand how other assets can impact auto liability insurance. Many people make the mistake of thinking they need additional auto liability insurance only if they own an expensive vehicle; however, few things are further from the truth. Almost anyone with substantial assets such as real estate, a small business or other holdings could benefit from additional liability coverage. Your agent can advise you about your holdings in order to determine the right amount of protection for you and your family.

2. Know the rules of the road. Although the laws regarding uninsured or under-insured drivers differ from state to state, it is important to understand how it could impact your own financial situation. Ask your agent to explain what coverage is in place and what forms of supplemental protection are available in the event of an accident or claim.

3. Umbrella policies provide an additional layer of affordable protection. An umbrella policy provides a cost-effective method of obtaining additional liability protection and picks up where standard insurance leaves off, making it a superb way to protect your family.

Time for a New Year Review of Your Life Insurance

The start of a new year is the perfect time to review your life insurance needs. The following information will help ensure that you get off to a sound and secure financial start.

Why You Need Life Insurance

Plain and simple, life insurance is the ultimate form of protection for your family’s financial future. Whether you’re the primary breadwinner or the person who holds it all together at home, life insurance ensures that your family is able to sustain its standard of living should you pass away.

Why Purchase Your Own Policy

Purchasing your own policy, rather than depending solely upon an employer-sponsored policy, makes perfect sense. There are important tax advantages to consider, and your own policy provides stability in the event of a job loss. Be sure to speak to your insurance agent about your individual situation.

Types of Life Insurance Policies

There are several types of life insurance policies designed to fit nearly any budget, age or need.
A few of the more common forms include:

Term Life Insurance: Such insurance is considered one of the most affordable options. Term life insurance provides important protection for young adults and others seeking cost-effective options. It does not include an investment option. Policies range from one to 40 years duration.

Whole Life Insurance: Premiums typically include a face value portion and an investment portion, which is paid in the form of dividends. Although initial premiums are higher than they are for term life, whole life often is more affordable for long-term coverage.

Variable Life Insurance: With variable life insurance, a portion of the premium is used to pay for the cost of the insurance and fees, and any excess can be invested in such things as stocks and bonds, mutual funds, equity funds, and money market funds. It is advisable to work closely with your agent in order to determine the right level of coverage and investment diversification to meet your individual portfolio needs.

Why Disability Insurance Is Key to Your Financial Health

Most people make it a priority to purchase adequate levels of home, auto and even life insurance, but few make the same commitment for disability coverage.

Unfortunately, research shows disability insurance is one of the most urgently needed forms of coverage available. It is vital to ensuring financial stability, though, as nearly 80% of people are likely to experience at least six months of disability during their lifetime.

Disability insurance provides financial protection in the event of an accident, illness or injury. Even those with a hefty emergency fund in place may find their accounts insufficient to meet the additional demands of child care, home health services, medication or other needs during a disability.

Long-term disability is one of the leading causes of bankruptcy and poverty in the nation, affecting not just the ill or injured person, but the entire family. Even short periods of disability can have a dramatic impact on the finances of an entire family.

Unfortunately, government-sponsored forms of disability coverage often have extensive waiting periods and other limitations that may result in a devastating financial crisis, especially if a family is dependent upon a primary wage-earner for support.

Disability insurance ensures that the household is able to meet basic obligations whether the situation lasts a few months or several years. Like most forms of insurance, though, it’s most affordable when you are still healthy.

Smart Ways to Insure Your Holiday Rental Car

People who rent a car for the holidays can get the right insurance without paying too much if they follow a few simple steps.

First, renters should call their insurance agents or brokers to clarify what type of coverage they need, taking into account limitations and exclusions as well as special situations that may apply to anticipated travel plans.

For example:
•    If you drive an economy car most of the time, be sure to ask about additional coverage if you intend to rent a luxury vehicle while on vacation.
•    Make sure that you are covered when crossing state lines or renting a car in another country.
•    If you plan to share the driving, make sure everyone is equally covered before making a final determination about who will get behind the wheel of the rental car.

Renters should consider the pros and cons of all available options before making a final decision about rental car insurance.

While many credit cards claim to provide very affordable, or even free, rental car coverage, there are often major limitations and exclusions that should be fully understood.

Likewise, car rental companies provide insurance that tends to be quite costly, so read the fine print and find out how each plan supplements your own insurance to find the right balance between coverage and cost.

A Guide for Understanding Condo Insurance

Purchasing condo insurance can be complex, so it’s imperative to work closely with your broker or agent to obtain the best price and policy.

Why Are Condos Different?

Due to the use of shared space and amenities, there are special considerations to keep in mind when obtaining insurance. Most condos include special fees to cover routine maintenance and repairs, as well as specialized insurance for the entire complex or condo association.

Different Dwellings

Insurance is important for anyone residing in a condo, townhome, co-operative or other shared organization, whether you live in it year-round or use it as a vacation home.

Coverage Choices

Unit-owner policies are one of the most popular forms of individual insurance used by condo owners or occupants. This insurance picks up where the master policy leaves off by providing insurance for modifications or improvements made to the unit or for other uncompensated damages. Additional coverage may be required for personal property and even liability depending upon your individual circumstances. Ask your agent or broker about special situations, including small home business, increased personal property limits for valuables or collectibles, and enhanced loss assessment coverage. Your agent or broker will be able to provide specific insurance that complements the existing master policy to make sure you have the best policy. Loss of use is another popular form of coverage that every condo owner is likely to need. If you’re unable to use your unit due to a fire, weather-related damage or another problem, the loss of use coverage provides the protection needed to maintain a roof over your head until repairs are made.

Common Exclusions and Add-on Considerations

Every policy is different, but a few of the more common exclusions found in many policies include flood damage, earthquake- or mudslide-related expenses, pest- or pet-related problems, and business-related activities. Ask your agent about specialized coverage needs.

Things to Think About Before Cashing In Your Policy

Thinking of selling your life insurance policy to get the cash? Make sure you understand the pros and cons first.

Life settlements are increasingly popular alternatives for older Americans or others struggling with major medical bills, but there are potential pitfalls that should be carefully considered, including the potential for abuse or even outright fraud.

The first step is to understand who you are dealing with and under what terms. Many life insurance policies provide for catastrophic medical events by allowing the policyholder to take a reduced settlement offer in advance. In contrast, settlement companies actually purchase the policy, pay the remaining premiums and collect the cash value upon the death of the original owner.

While there are special instances when this may be desirable, there may also be increased risk of fraud or abuse.

Most people purchase life insurance in order to protect the financial future of their family or other loved ones. Selling the policy for cash in advance may leave dependents at risk or inadvertently expose them to financial hardship.

It’s advisable to speak with your estate planner and insurance agent to understand the full tax and financial implications for your family’s financial future should you opt to exercise the sale of a policy.

There is little federal oversight of the practice of selling life insurance policies, but there has been an increased demand for stricter regulation.

Tips to Help You Find the Right Health Insurance

Buying an individual health insurance policy can be a daunting experience.

It might seem a little overwhelming, especially if it’s the first time you’ve ever opted for anything other than an employer-sponsored plan.

With a bit of planning and preparation, though, you can find the policy that fits your lifestyle perfectly.

The following are some tips to get you started:

Understand State Regulations

If you’ve recently moved or relocated from another state, make sure you understand the rules and regulations for your new location.

Coverage requirements may vary depending on geographic location.

General Health Status and Pre-existing Conditions

Unlike employer-sponsored plans, which typically accept everyone, individual health insurance is often based upon a plethora of individual considerations, including age, weight, height, pre-existing conditions, family medical history, prior medical history and even credit score.  Answer all questions honestly when applying for health insurance and work with your agent to find a policy that meets your needs.

Compare Costs

Read the fine print to determine if you need every benefit or if the policy is missing important features you may need. For example, it is often possible to save money by excluding certain benefits such as maternity coverage, but be sure you won’t need excluded benefits anytime soon in order to avoid surprises.

Understand Caps, Limits and Exclusions

Explore more than the monthly payment before making a final decision. Ask your agent to explain lifetime caps, limits and exclusions that may impact the policy, then make adjustments to suit your needs.

Remember to take inflation into account, especially when selecting a policy with a low lifetime cap. Once you are diagnosed with a condition, it may become much more expensive to purchase additional coverage if you exhaust your existing policy limits.