Tips to Reduce the Chances of Auto Theft

One of the key ways to keep your auto insurance rates low is to reduce the risk of theft.

Not only does a stolen car cost you dearly in terms of time and effort, but the long-term expense associated with higher auto insurance rates adds insult to injury.

Unfortunately, many people underestimate the risk of having their car stolen and fail to plan accordingly.

Recent statistics from the Federal Bureau of Investigation indicate that the odds of having your car stolen are roughly one in 207. People who live in the city are at much higher risk than those living in rural areas.

Fortunately it’s possible to fight back against auto theft and save money at the same time.

Following are some tips to help you get started:

Search the Zip: When possible, do a search on your designated zip code. Insurance underwriters routinely use zip code data for both home and work to determine a portion of your individual risk factor. Higher property crime rates are associated with higher premiums.

Install Security Devices: Installing antitheft devices, tracking and other security measures can act as a deterrent and money-saving measure. Discounts on premiums may offset a significant portion of the cost.

Watch Where You Park: Parking a car inside a garage is a great way to reduce the risk of auto theft as well as keep your vehicle secure. When away from home, search for a secure and well-lit area, preferably one with cameras as well as security personnel.

What’s the Difference Between Major Medical Insurance Plans?

Major medical insurance is a type of health insurance plan that provides coverage for most types of medical expenses that are incurred by a policyholder. They typically offer a broader, more complete range of coverage than traditional health insurance policies. This means that these plans usually provide for higher individual policy coverage limits as well as larger overall maximum policy limits.

Major medical plans can be divided into two primary categories:

Comprehensive Major Medical Insurance:

With comprehensive major medical insurance, basic health insurance coverage, along with nearly any other type of medical expense will be coordinated into one overall comprehensive plan. In these plans, benefit payments will begin after a deductible is satisfied – although some plans have a zero deductible.

Supplemental Major Medical Insurance:

With a supplemental major medical plan, coverage will begin with a basic traditional policy that will pay out benefits initially. Then, coverage for major medical expenses is added to cover the costs that are not covered by the basic plan. Typically, these types of plans will include coverage for hospitalization and surgery along with an additional policy that covers a wider range of other types of medical expenses.

Regardless of whether a major medical insurance policy is considered to be comprehensive or supplemental, most will cover a wide range of benefits, including hospital inpatient room and board, surgical services, physicians’ services, outpatient services, X-rays, and other types of tests.

Discover the ABCs of Medicare

The Medicare program came into existence 46 years ago when President Lyndon Johnson signed into law the Social Security Act of 1965.

This program is federally administered and provides healthcare coverage to Americans who are age 65 and over, as well as to those under 65 who have certain types of disabilities or illnesses.

Parts A & B

The original Medicare program consists of Medicare Part A and Medicare Part B.

Part A offers healthcare coverage for hospital stays, as well as hospital inpatient procedures.

This part of Medicare will also provide some limited coverage for skilled nursing care. There is no premium required for Medicare Part A as long as the recipient and/or his or her spouse have paid into the Social Security system for 40 quarters, or typically for 10 years.

Medicare Part B offers coverage for physicians’ services and outpatient care.

There is a premium that is required for those who wish to participate in Medicare Part B.

The amount of premium due is based on the annual income of the Medicare Part B recipient. Oftentimes, the monthly premium for Medicare Part B is simply deducted from the recipients’ Social Security income check.

Part C

Another name for Medicare Part C is Medicare Advantage.

Medicare Part C essentially includes both Medicare Parts A and B. Part C is offered by private insurers, who are approved by the Medicare program to provide this coverage.

In most cases, those enrolled in Medicare Part C are required to use specific hospitals, doctors and other providers similar to the operation of a health maintenance organization or preferred provider organization.

Medicare Part C requires a monthly premium to be paid, and oftentimes co-payments or co-insurance is required for certain services.

Do You Need E&O Coverage?

Once considered a relatively exclusive form of insurance, errors and omissions (E&O) insurance is now believed to be one of the most important forms of coverage available to many busy professionals.

Who Needs E&O Insurance?

E&O provides an additional layer of protection for lawyers, architects, financial consultants and other small-business owners who routinely provide services to others. In fact, nearly anyone who provides services or information to others may be at risk of a lawsuit. Rather than risk your financial future, E&O insurance provides the peace of mind in knowing you are protected in the event of a problem. By transferring risk to the underwriter, you have a powerful partner on your side in the event of a claim.

What’s Covered?

E&O policies typically help defray the cost of defending against litigation arising from professional liability claims due to mistakes. Legal costs and damages are usually included up to the specified limit.

What’s Not Covered?

Intentional, illegal or fraudulent activities are excluded, along with punitive damages. Specific limitations or restrictions may be included in your individual policy, so it is important to work closely with your insurance agent to select the right coverage options for your specific needs.

Is E&O Insurance Expensive?

E&O insurance rates vary by the type of services provided, annual revenue generated, type of policy and prior claim history. In general, E&O can be structured to fit nearly any type of budget, depending upon selected options.

What Coverage Does a Home Business Need?

Getting a home business off the ground entails many of the same concerns and considerations as any other startup, including the purchase of proper insurance. Unfortunately, many business owners are under the false impression that a home business doesn’t entail the same risk associated with other settings. Few things could be further from the truth.

What’s in a Name?

One of the biggest mistakes made by new, home-based business owners is failing to buy a policy naming their business as the owner of record. Remember, even if you are a sole proprietor, it is important to distinguish between you and your home-based business. Set aside a special area, use the same name and implement other standard operating procedures designed to differentiate business from personal use of the home, equipment and other assets.

Home Is Where the Hazards Are

Working from home often entails many unique hazards. Home-based business owners routinely tackle everything from the plumbing to computer-related repairs on their own. Disability insurance may be especially important, not only to counter the risk, but to help defray expenses associated with the loss of income should an injury or accident occur.

Beyond the Basics

For a home-based small-business owner, it is imperative to keep good records and insurance for all business-related equipment. Standard homeowner policies typically exclude the business use of computers, cell phones and other technology. Instead, stand-alone policies can help provide protection against everything from equipment failure to unexpected emergencies. It’s also a good idea to add a loss-of-income and enhanced liability protection to guard against unanticipated events.

Other Forms of Coverage

Following are some other important forms of coverage:

Inventory: Working from home is convenient, but don’t become complacent when it comes to storage. Protect your investment by insuring inventory and business-related equipment separate from personal belongings.

Liability: Whether you are a private consultant or full-time eBay business, running a small business often entails risk. Protect yourself and your business by purchasing additional liability coverage specified to your individual needs. If you work with client data or confidential information, be sure to ask your agent about coverage options that include data loss or theft provisions to protect you and your clients.

How to Get Started

Purchasing insurance for your home-based business is relatively simple.

Following are some things to consider:

Assets: Make a list of current coverage needs and compare against those supplied by a spouse, other employment or outside providers.

Be Realistic: It may be tempting to “self-insure” equipment or convince yourself data loss is unlikely, but it’s important to be realistic. What situations are you most likely to encounter in your type of business? What are the consequences in a “worst case” scenario? Which could you survive, and which would potentially put you out of business?

How Much Money Should You Put into Annuities?

Virtually all would-be retirees ask themselves the same question at some point: How much of my retirement savings can I afford to spend each year?

The answer depends on your income stream, but determining that isn’t always easy. Since it isn’t simple to figure out what to do with your 401(k) plan after retirement, for example, many financial products and services have been developed to allow you to convert your retirement savings into a consistent stream of lifelong income.

For example, you might work with a financial advisor to determine how to invest your retirement savings to maximize the odds of making your nest egg last. This would involve an analysis of your risk tolerance and an estimate of how much you can afford to spend annually.

You would then decide which products could best help you achieve these goals. For example, you might try to cover essential expenses like housing and food with predictable income sources, such as Social Security, pension benefits and fixed annuities. The rest you can cover with investments in other securities, such as mutual funds.

An annuity is a contract with an insurance company. You make payments in one lump sum or for a certain amount of time. In return, the insurance company provides you with payments at regular intervals either immediately or at some point down the road.

Like all investments, annuities have pros and cons and may work better for some investors than others. Your advisor can help you determine if annuities are suitable for your individual financial circumstances.

Annuities May Cushion You from Inflation

You’ve probably heard a lot about inflation lately and how you can potentially combat it.

But what’s fact and what’s fiction?

Many economists will tell you not to worry about inflation. That’s because the consumer price index (CPI), which is a widely used gauge of consumer spending, increased 3.6% year over year in May 2011.

While that’s not exactly low, so-called core inflation, which eliminates volatile food and energy costs, increased a relatively weak 1.5%.

That places core inflation below the U.S. Federal Reserve Board’s target of 2% – and the 2% to 2.5% rates prevailing before the financial crisis of 2008 and 2009.

That said, many inflation watchers believe CPI numbers may understate inflation.

Over the past 30 years, the U.S. government has changed the way it calculates inflation. For example, today’s 3.6% CPI would have been more than 10% using calculation methods in place before 1983.

How can you help cushion your portfolio from the potential effects of rising inflation?

You may want to consider an annuity, which is a contract with an insurance company. You make payments in one lump sum or for a certain amount of time.

In return, the insurance company will provide you with payments at regular intervals either immediately or at some point down the road.

While fixed-rate annuities may not seem ideal for inflationary times, it may actually be better to have a guaranteed income stream than to try to invest in asset classes you think could beat inflation. That’s because asset classes can perform differently than we expect them to.

Like all investments, annuities have pros and cons and may work better for some investors than others. Your financial advisor can help you determine if annuities are suitable for your individual financial circumstances.