Being Accurate Can Protect Your Insurance Coverage

Rescission – meaning your insurance carrier “rescinds” your insurance contract or terminates it as if it never existed – is serious for any business owner. While rare, a rescission means an insurance carrier is not obligated to pay your claim, even if it would normally be covered under your policy.

Insurance companies have the right to terminate a policy if the insured conceals, misrepresents or deceives the carrier during the application process. This can occur in many types of coverage, from health coverage to fidelity protection.

To prevent rescission, your coverage application must be accurate. Your ethical duty when applying for coverage is to disclose to your insurer all “material facts”, that is any circumstances that might make an underwriter hesitate or refuse to write your business.

For example, if an employee steals from petty cash but subsequently repays you, you may be satisfied to let the matter drop. However, when you later apply for fidelity coverage, you must disclose this; failure to do so may invalidate your coverage for any future theft committed by this employee. In rescission cases, the court will look at what you as the policyholder knew when you applied and whether you acted in good faith.

Rescissions are not a common occurrence, but what business owner can afford an uncovered loss? As you complete your policy applications, bear in mind that honesty is always the best policy. Armed with all the facts, your insurance advisor will be able to find the policy that’s right for you.


Choose Long-Term Care Benefits That Work for You

Today’s long-term care insurance policies are more flexible than the plans of several years ago. In the past, most long-term care plans only paid for services received in a skilled nursing facility, and benefit triggers were much more stringent.

The long-term care insurance plans of today cover a wider range of services. For example, many policyholders are now covered for care received in assisted living facilities and their own homes as well as in skilled nursing facilities.

In putting together the long-term care insurance policy that is best suited to your needs, you have a number of options to choose from, including:

Length of Coverage

You can choose the duration of coverage – the number of years you wish to be covered under the policy – including a lifetime option covering you for the remainder of your life, providing you continue to meet the criteria necessary to qualify.

Amount of Coverage

Typically you can choose the actual dollar amounts of daily or monthly benefits you wish to receive.

Elimination Period

A long-term care policy’s elimination period works like a deductible in other types of insurance; you can choose the number of days that you pay out of pocket for your care until the policy benefits start. Depending on the policy, this can range from a low of 0 days to a high of 365 days.

Inflation Protection

You can also choose to add inflation coverage. With this option, the benefit amount will increase by a certain percentage each year in order to help keep up with inflation.

The flexibility of today’s long-term care insurance policies means that you now are able to pick and choose from options that weren’t available in the past. It’s important to work with your insurance professional in order to tailor those options to most closely meet your care expectations when the need arises.

Protect Your Income With Disability Insurance

The definition of an asset is “a useful or valuable quality, person or thing.” Many people, when asked what they consider their most important asset, cite their homes or their savings. However, while these are certainly high priorities, the fact is that everyone’s key asset is the ability to earn an income. Without it, you likely wouldn’t have a home or savings.

It is essential to protect that asset with disability insurance. Disability insurance is designed to replace some or all of your income if you become disabled and unable to work due to illness or injury, as covered by the policy. A disability insurance policy usually provides benefits in monthly increments, so you are able to pay your regular living expenses and maintain your standard of living.

There are many variables involved in a disability insurance plan, but the key components consist of the following: the amount of income to be paid when a triggering event occurs, how long those payments will continue and how long you must wait for the benefits to start after the triggering event happens.

When you purchase an individual disability insurance policy, the premiums are typically paid out of pocket with after-tax dollars. Discuss with your insurance professional the tax ramifications of this; it is likely your benefits will be tax free.

Unquestionably, your ability to earn an income is of vital importance. Ensure that you protect this vital asset with disability insurance but also be careful to select the plan that will work for you. Insurance professionals can help.

Vacant Property Owners May Need to Update Their Policies

Many people who formerly owned or rented are moving in with relatives to save costs in this troubled economy. This means many rental properties and single-family homes are sitting vacant and awaiting sale or foreclosure.

If you own a property that is vacant, is your insurance coverage adequate? Vacant houses have higher risks of vandalism, arson and other losses; if a property is unoccupied for a certain length of time, usually 30 to 60 days, your insurance coverage may cease or offer only limited coverage in the event of a loss.

To determine if you should update your insurance information with your agent, ask yourself these questions:

  • Do you own a rental property that you can’t keep occupied?
  • Have you moved out of your home while you try to sell it or await foreclosure?
  • Do you travel extensively or perhaps live part of the year in another residence?If you answered “yes” to any of these questions and haven’t updated your status recently, it may be time to do so. Should you suffer a loss, the status of your property when you completed your insurance application greatly affects your coverage. For example, if your home was occupied when you purchased your coverage, your insurance carrier will assume that it is still occupied. If, after a loss, an adjuster determines the house was unoccupied, your claim may be denied or significant portions of coverage may be declined.

    Why run the risk? Contact your insurance professional and correct outdated information.

Is Your Homeowner’s Coverage Working for You?

Is your homeowner’s insurance still working for you?

Here are some things to consider before you purchase or renew your homeowner’s coverage.

If your home is a total loss, do you have enough coverage to rebuild? The majority of property claims result from partial damage to a home. If your home is completely destroyed, you want to have enough coverage to totally rebuild it.

Homeowner’s policies limit personal property coverage. Homeowner’s policies place limits on many types of personal property. If you have valuable guns, jewelry, watercraft and trailers, or computers, consider purchasing additional coverage.

Does your policy provide replacement cost coverage? Personal property is valued at replacement cost or at actual cash value. Replacement cost replaces your old damaged or stolen items with new at no extra cost to you. Actual cash value considers the age and condition of the item. Replacement cost coverage doesn’t increase your premiums by much but provides better coverage.

Are my children’s possessions covered while they are away at college? Your homeowner’s policy may provide limited coverage for your college student while he or she is living on campus; however, once your child rents an apartment in his or her own name, consider purchasing a tenant homeowner’s policy.

Do you work at home? Your policy may only provide limited coverage for equipment provided by your employer so you can work at home. Additionally, if customers or business associates come to your home on business, you may want additional coverage for this.

Is my boat covered? It depends. A small boat like a kayak should be covered under your policy, but for a larger boat you may need extra property and liability coverage through a boat policy.

Each company’s coverage differs slightly so it’s important you consult an insurance professional to be sure you get just the right policy for your own circumstances.

Home-Based Companies Need Business Coverage

Many people start home-based businesses to earn extra income, and these businesses can come in all types, ranging from beauty salons to bookkeepers and everything in between.

During the start-up phase, there are many factors to consider: Will you provide a product or service? If you’re providing a product, will you make it at home? How will you market yourself? Where will you look for funding, and what financing programs are available?

Carving out your own niche is the fun part of starting a business, but several other areas need decisions as well: Will you operate as a sole proprietor or form a corporation? What accounting rules will you need to know? What relevant government agencies should you be aware of? And what kind of insurance will you need to protect your new venture?

Whatever your business, if you operate out of your home, you will need liability insurance for the products you make as well as for the customers you do business with.

Be aware that your homeowners’ insurance policy does not provide this coverage. Insurance companies want you to insure a business on a business policy.

In addition to liability concerns, you may have bought materials and equipment that are specific to your business rather than part of your household belongings. These also need to be covered by a business insurance policy.

If you use your own car to make deliveries or go to appointments, your personal auto policy will not cover this and you will need business auto coverage.

Fortunately, there is an inexpensive type of policy that can give you an adequate liability limit and coverage for your business property and auto. It’s called a business owners policy, and it’s offered by nearly every major insurance carrier.

Costs can run between $500 and $1,000 per year, depending on what you need to insure.

Health Savings Accounts Can Save You Money

Health savings accounts (HSAs) can help individuals save money by paying for a number of health care expenses that are not covered under their current health insurance policy. These plans may also help in providing funds for individuals with a limited amount of health insurance coverage, especially on services that may be related to uncovered preexisting conditions.

As HSAs are set up in conjunction with high-deductible health insurance policies, someone considering purchasing one should first determine if the plan’s deductible will be manageable should a medical need arise.

However, in many cases – primarily for those who are young and in good health – a high deductible health insurance policy does make sense; typically the higher the deductible, the lower the premium will be for the policy.

In addition to building up a health-related savings fund, owners of an HSA may even obtain tax advantages, as they may be able to deduct the deposits that go into their HSA account when preparing their annual tax returns.

When withdrawn for qualifying health-care related costs, the money in an HSA often can come out tax-free. In addition, funds within the HSA account will typically grow on a tax-deferred basis, allowing the money to compound faster.

If this sounds like something that could be of benefit, before you open an account you should discuss your options with your advisor. Be sure to compare different plans and deductibles for the combination that will work best for you.

Between Jobs? Fill the Health Insurance Gap

For many people who are between jobs, it is about more than just trying to manage without a regular paycheck; it also can mean living without that all-important health insurance coverage.

While most individuals may be eligible to continue their coverage under their former employer’s health insurance plan through the Consolidated Omnibus Budget Reconciliation Act (COBRA), this can be an expensive option, especially if the coverage is not just for the unemployed individual but also for a spouse and/or children.

Some people who are between jobs may be willing to take a chance and go without coverage until they have a new position and can participate in their new employer’s plan.

However, this could be very risky, because an accident or illness could occur during this coverage gap.

The Temporary Health Insurance Coverage Solution

One of the best ways to avoid the financial risk of a costly medical problem that develops between jobs is to purchase a temporary – or short-term – health insurance policy. If the individual will probably require coverage for only a year or less, temporary health insurance could be a viable alternative.

Temporary plans can offer comprehensive benefits, often at a very affordable price, even when compared to a stand-alone plan or COBRA. In addition, if the applicant is in good overall health, a temporary health insurance policy can be approved quickly, often in as little as two days after applying.

Many top-rated insurance companies offer temporary health insurance coverage, making it easy to compare different benefit options as well as premium amounts.

With today’s cost of medical care – even for minor issues – it’s wise to have continuous health insurance coverage. Temporary policies can fill the bill and represent a great way to help bridge the gap between a former employer’s benefits and eligibility for a new group insurance policy.

Thinking About Life Insurance? Read This First

Life insurance may seem complicated, but basically all policies fall into one of two categories. It’s fairly easy to determine which category and how much coverage you’ll need.

Applying also isn’t difficult. Apply for insurance when you’re young and healthy. And tell the truth when you apply for coverage.

To simplify matters further, we’ve compiled these tips for individuals who are in the market for life insurance (or just want to know if their existing policies are sufficient):

  • There are two types of policies. Pure term policies consist of insurance only, meaning you pay a premium and the policy pays out a certain amount when you die. Whole life policies combine term policies with an investment product. They also build cash value.
  • Consider your options. Whole life insurance may be just right for some people; you can keep whole life policies throughout your life and also build up tax-free cash, which then can be borrowed. However, these policies usually cost more. Pure term policies are for those who prefer to keep their investing and insurance separate.
  • Always buy enough life insurance to meet your needs. Life insurance is no place to skimp. Because whole life insurance is often more expensive than term life insurance, many people who buy whole life often buy too little, leaving themselves underinsured.
  • Be sure the term of the policy meets your needs. Life insurance is all about protecting the people you leave behind. Don’t buy it unless you have dependents, and ensure the policy will last as long as your dependents do.

If you need assistance researching your life-insurance options and applying for the appropriate policy, your advisor can help. He or she knows your financial circumstances and goals and can help you select the best policy for you.

Vigilance Pays Off in Preventing Insurance Fraud

As a business owner, you may not think that insurance fraud affects your business.

While you may not experience fraud directly, you certainly experience it indirectly through increased insurance premiums. As the Federal Bureau of Investigations says on its website: “The total cost of insurance fraud (non-health insurance) is estimated to be more than $40 billion per year. That means insurance fraud costs the average U.S. family between $400 and $700 per year in the form of increased premiums.”

Who is committing $40 billion in fraud? It’s true: organized crime rings do commit fraud. However, it’s the high number of ordinary people who commit fraud that may be the most telling. Particularly during tough economic times, many individuals look for ways to raise money by defrauding their insurance companies.

Some of the most common scenarios target auto insurance and worker’s compensation insurance. In these scams, people generally claim larger benefits than they are due. In car accidents, for example, requests for repairs or reimbursements are padded to cover deductibles. Similarly, in workers compensation claims, injuries are exaggerated, so the insured workers are off the job for a longer period of time and collect more than is warranted for the type of on-the-job accident they suffered.

Your best defense is a great offense. Know your executive team and your staff personally. Train them well, and put into place a good system of controls and cross-checks. You’ll feel a lot more confident that you have reduced your risk of experiencing a fraudulent claim.

Protect Against Larceny With Crime Coverage

Businesses handling money need to consider crime coverage as part of their commercial insurance portfolio. This provides protection in eight key areas:

Employee Theft covers any kind of theft by an employee and isn’t limited to theft of cash.

Forgery and Alteration applies to third parties, including contractors who are in your workplace for cleaning, construction or repairs and who steal your checks. Coverage is provided for checks drawn on your account or the account of any party who acts as your agent. Checks include drafts, promissory notes, and orders or directions to pay money.

Inside the Premises – Theft of Money and Securities includes money (defined as currency, coin or bank notes in current use with a face value) as well as traveler’s checks, register checks and money orders held for sale. Cashier’s checks are not considered money.

Securities are defined as negotiable and non-negotiable instruments that represent money or property, including commodities such as grain and tokens and stamps (even stamps in a postage meter). Securities can also be evidence of debt related to credit or charge cards, but only if the evidence of debt is against a card not issued to the insured.

“Inside the premises” encompasses your place of business and your banking institutions. If your bookkeeper is taking checks to the bank and they’re stolen, you are covered.

You are also covered for an attempted or actual theft from locked safes, vaults, cash registers, cash boxes and cash drawers inside the premises as well as for the disappearance or destruction of money or securities.

Inside the Premises – Robbery or Safe Burglary of Other Property covers you against robbery (the unlawful taking of covered property from someone having custody of it, where actual bodily harm or threat of bodily harm is involved). It can also be an obviously unlawful act witnessed by the person having custody of the covered property. Safe burglary requires evidence of forcible entry into or the removal of the entire safe or vault from the premises.

Outside the Premises is literally anywhere outside your business. Coverage is provided for theft, disappearance and destruction while outside the premises and in the custody of a messenger or armored car company. Coverage includes theft, robbery or other instances of accidental loss.

Computer Fraud provides world-wide coverage of money, securities and other property fraudulently transferred by computer from the insured premises or banking premises to a location other than the insured premises or the banking premises. It does not include transfer to a messenger.

Funds Transfer Fraud provides coverage for loss of funds resulting directly from a fraudulent instruction directing a financial institution to transfer, pay or deliver funds from the insured’s transfer account.

Money Orders and Counterfeit Money provides coverage for counterfeit money accepted in good faith in exchange for purchases. It also covers money orders accepted by the named insured in good faith but not accepted when presented by the named insured for payment. The coverage territory is limited to the U.S., its territories and possessions, and Canada.


Protect Your Baby With Classic Car Insurance

Summer is the perfect time to take your baby out for a ride. We’re not talking about your four-month-old baby; we’re talking about your other baby – your classic car. In the season of warm breezes, nothing beats the feeling of burning up the open road in your classic.

Classic cars come in all shapes and sizes, but they have one thing in common: the love and passion of their owners.

So it’s important that you have the right insurance protection for your car. Classic car (or collector car) insurance offers specialized coverage not available in standard auto policies, including:

  • Agreed value. Car insurance is typically based on actual cash value, which means you get the depreciated value of your vehicle in a loss. Collector vehicle insurance, however, provides agreed value, which means that you and the insurance company agree on the value you would need to replace your classic. If you are offered this option, take it.
  • Mileage plans that take into consideration the lower mileage on collector vehicles.
  • Coverage for modifications to the car.
  • Coverage for spare parts. This is usually a fixed amount, but it can come in handy if you need to make a last-minute repair.

In addition to providing the all-important coverage, these insurance carriers are very knowledgeable and can “speak your language” when it comes to insuring your hot rod, your exotic car, your classic motorcycle or your muscle car.

Now get out and burn up the road!

What to Consider When Insuring Your College Student

With all the responsibilities that come with becoming a college student, such as studying, writing papers and adjusting to the freedom of being on one’s own, it’s likely the last thing on your student’s mind is health insurance.

Yet because accidents and illnesses occur – even to young and healthy individuals – having the appropriate amount of coverage is essential.

One option is to add your student to your own health insurance policy; however, this type of coverage may have limitations if he or she attends college out of state.

Another option would be to obtain health insurance through his or her college or university, something some schools offer to their students. This coverage is often very affordable, which is particularly beneficial to students on a limited budget.

However, these policies may cover  only those health-related services that are provided at the on-campus medical facility.

As well, if the student leaves school, the coverage will be terminated. It’s important to have a thorough understanding of what is and isn’t covered, and you and your student should read the fine print carefully.

Stand-Alone Plans Are Portable

As alternatives to the options above, a college student in search of health insurance may opt for a stand-alone health insurance plan.

By going this route, your student can select benefits that more closely match his or her needs.

These types of policies are also portable, meaning that the coverage will stay with the student regardless of whether he or she is still attending school.

Another solution is a temporary or short-term health insurance policy. These plans typically provide coverage for up to 12 months, and the benefits can be very thorough. This can be an ideal option for students who will be graduating soon and expect to be covered under an employer’s health insurance plan in the near future.

Do You Really Need Life Insurance? It Depends

Life insurance is designed to protect those who depend on you for financial support.

Here are some tips that may help you decide if life insurance is the right choice for you.


Children do not need life insurance, since no one depends on their income.

Young single adults:

If you’re newly independent, the only reason you would need life insurance is to pay your funeral costs or support an elderly parent.

New families:

Do you really need life insurance if you’re newly married? If you are both earning incomes and one spouse could manage financially if the other dies, then you may need life insurance only to cover funeral costs. However, if you’re thinking of starting a family, you should seriously consider getting life insurance now; the rates will likely be cheaper now than when you are older.

Established families:

If you have a family that depends on your income – whether it’s a spouse, children or aging parents – you do need to provide for them. Be aware that life insurance isn’t just for the partner who works outside the home; not insuring the person who handles the household chores and child care could result in severe financial hardship for the remaining spouse.


Life insurance at this stage may not be necessary. If you don’t have anyone who depends on your income for support, and if you are able to cover your funeral expenses, you likely can avoid life insurance.

If you decide you do need life insurance, note that it costs more the older you get.

You may want to purchase life insurance when you’re younger; however this depends on your individual circumstances.

So before buying, discuss your needs with an advisor who is familiar with your situation.

How Your Credit Score Affects Your Auto Insurance

Did you know your credit score can be used for more than just getting a bank loan?

These days many types of organizations use your credit score to determine how much they will charge you to do business with them.

If you live in a state other than California, Hawaii, Massachusetts or Michigan, your insurance carrier has the right to use your credit score as one of the factors that determine your auto insurance premium.

Why are insurance carriers using your credit score? Insurance is all about assessing risk or exposure to loss.

In the past, auto insurance has always been rated on the vehicle itself. These days, given the many technological improvements to vehicles, insurance companies have decided to assess the risk of the vehicle and the driver.

Research shows people’s financial traits cross over into other parts of their lives.

People with higher credit scores pay their bills on time and use good judgment with credit card limits.

They also carry over their good judgment to driving and tend to get into fewer accidents.

People with lower credit scores don’t pay bills on time, have a high debt-to-credit ratio, and are more likely to have accidents and file claims.

Therefore, insurance companies base your premium on your credit score.  And those with lower scores should start working on improving them.

Here’s how: pay bills on time and reduce credit card debt. Thirty-five percent of your credit score is weighted on paying your bills on time, and credit card debt represents 30%.  You also can boost your score an additional 15% by keeping longtime accounts open.

Best of all, be in control of your financial picture. The better your credit score, the better you are handling your finances. Banks, insurance companies and others will take notice and you will reap the benefits.

Enjoy a Stress-Free Boating Season With Watercraft Coverage

wning and enjoying a boat are among life’s great pleasures.

Boating can be a real stress-buster, but only if you have the right insurance in place.

A personal watercraft policy is similar to auto insurance in that both cover moving motor vehicles.

With personal watercraft policy coverage (PWC), you can insure any size of craft from an angler boat to a yacht, giving you total peace of mind.

Here’s how it works:

Liability Coverage will pay for accidents if you are deemed to be legally liable. This will also be your limit of coverage if you are sued for an at-fault accident. Medical payments will help pay for medical or death expenses.

Agreed Value means you and your insurance carrier agree on the value of your boat. In a total loss, you will get that amount to replace it. If this option is offered, take it!

Property Coverage is similar to Comp and Collision on your auto policy and will pay to repair or replace your boat in case of damage. You also may be able to get Contents coverage for trailers, sporting equipment or belongings kept in the boat.

Pollution Coverage is helpful if you have a fuel leak that contaminates the water. Some carriers offer up to $500,000 in limits.

There are many insurance carriers that offer PWC, and your local insurance agent will have the resources to shop around for the best policy at the best price for your needs.

How EPL Insurance Can Help You Sleep at Night

There are some issues that keep business owners up at night. And right at the top of the list is a discrimination or harassment suit.

While you hope this won’t ever happen in your own company, chances are it could. Employment practices liability insurance (EPLI) is there to cover a variety of situations that, unfortunately, have become all too prevalent in today’s work world.

For example:

  • A male employee feels discriminated against because of his sexual orientation.
  • A female employee may have been harassed by her manager because she is pregnant.
  • An employee with a disability is berated by co-workers and feels that he has suffered emotional distress.
  • An employee sues over what she believes is a wrongful termination because she is retiring within a year.
  • A delivery person files a suit because he feels sexually harassed while at your place of business.
  • A long-term employee sues because she believes she was unfairly passed over for a high-level job

These are some of the areas where business owners may find themselves vulnerable. This is particularly so for small to medium-sized businesses, where rules and procedures can be more lax than in a more formally organized larger corporation.

If you’re faced with a claim like those described above, EPLI offers coverage that will pay for the investigation and defense of the claim as well as provide a limit of insurance in the case of a judgment against you.

Minimize the Possibility of a Claim

While having EPLI is important, you’ll also want to be sure to take steps to prevent or minimize the likelihood of claims; a commitment to good employment practices is one of the more important tools in your executive liability toolkit.

Good employment practices start with a commitment by all levels of management to zero tolerance for any behavior that makes an employee feel uncomfortable.

The employee manual should include a clear, strong and consistent statement to this effect, and there should be annual mandatory seminars on harassment in the workplace.

Implement and communicate a procedure that will make employees feel safe reporting a situation that makes them feel uncomfortable. Make sure you have an open door policy to keep lines of communication open.

If there is a claim, immediately communicate with the person making the claim to assure him or her that these concerns are being taken seriously. Create an action plan to investigate all complaints. Be prepared to discipline and possibly terminate the offender if you find the claim is justified.

Find the Right Policy for You

Not all insurance carriers offer the same coverage and deductibles for EPLI. You’ll want to do some research and talk to your local, independent agent to find the right coverage for your company’s needs.

One million dollars in coverage can be included on your business owners policy for a minimum premium. If you want more coverage, you can ask for a quote through your general liability policy or purchase a separate EPLI policy.

Going Green Makes Environmental and Insurance Sense

Going green. Environmental  consciousness. Reducing your carbon footprint. Breathable structures. These construction industry buzzwords are all about being aware of the impact of new construction on our environment.

Insurance carriers are learning about this trend and formulating coverages that benefit and reward both residential and commercial customers for using environmentally friendly practices. Here are a few examples:

Discounts are available for homes and businesses that are LEED certified. Leadership in Energy and Environmental Design (LEED) was created by the U.S. Green Building Council and is the gold standard of certification in environmental circles.

If you make green upgrades to your building, insurance carriers now provide an endorsement – not covered in traditional property insurance – that will cover replacement of those upgrades. The increased cost to construct as well as potentially re-engineer and re-certify may also be covered.

Green roofing is of particular interest because it is constructed differently from roofs on traditional buildings. Coverage can be offered as part of a total limit or a separate limit.

Other possible coverages that could be included are debris removal/recycling, business income coverage and air flushing.

Because the area is still relatively new, each carrier has its own definition of what the term “going green” means, and one may cover something another doesn’t. Let a professional agent research the green coverage that’s best for you.

Supplemental Insurance Fills Coverage Gaps

Even the best health insurance policies may leave you with gaps in coverage.

In some cases, these additional out-of-pocket expenses can be substantial, often leaving you in a financial bind.

Coverage gaps can include policy deductibles and co-insurance requirements as well as lab tests and alternative medical procedures.

In addition, there may be the additional burden of lost wages if your health condition keeps you from working, even temporarily.

Cash benefits

The purchase of a supplemental health insurance policy – designed to cover many of the additional costs that come with illness or injury – is one way to fill the gaps and cover unanticipated expenses.

Supplemental insurance pays a preset cash benefit to the policyholder once a triggering event occurs, including specific types of accidents, injuries or illnesses as defined in your policy.

Some policies offer coverage based on a daily, weekly or monthly payment, while others may simply pay out a lump sum.

Unlike most regular health insurance plans, supplemental plans often pay benefits directly to you, allowing you to make the very individual decision on how these dollars will be used.

Medigap plans

One of the most well known types of supplemental health insurance for seniors is Medicare Supplement. These policies are often referred to as “Medigap” plans because they are purchased for the purpose of filling in the coverage gaps left by Medicare.

Depending on the plan you choose, Medigap insurance policies may also cover costs not covered through Medicare, such as dental and vision care as well as benefits for hearing loss.

As a senior or as someone who has suffered a serious accident or illness, the last thing you want to think about is whether you will be hit with extra costs. Depending on your own situation, purchasing supplemental health insurance may give you peace of mind and save you money.

Thinking of Selling Your Life Insurance Policy?

Unemployment remains high and the housing market is still in the doldrums. Although the stock market improved in late 2011 and early 2012, it remains volatile.

So it’s no wonder some investors are considering selling their life insurance policies for cash.

But is it a good idea?

Selling your policy

First, let’s review how one sells a life insurance policy.

Selling a life insurance policy is referred to as a life settlement transaction. Under such a transaction, someone buys your life insurance policy for a lump sum. The new owner of the policy continues paying your premiums until you die, at which point the new owner collects your death benefit.

This can provide immediate income, which may be beneficial in difficult times. But taking cash in exchange for your life insurance policy may not make as much sense as it used to, thanks to two factors.

First, there has been a steep decline in the price life settlement investors are prepared to pay for life insurance policies, so you might not get as much cash as you had hoped for your policy.

Second, thanks to a 2009 Internal Revenue Service  ruling that raised the tax bill for many individuals who sell their life insurance policies, you may end up being heavily taxed.

These two factors point to the fact that the current life settlement market favors buyers.

If you’re interested in selling your life-insurance policy and are concerned about whether it’s the right approach for you, why not consult a financial advisor? He or she can help you determine if there are better options than selling your policy.


For example, if it’s cash you need, you may be able to withdraw or borrow funds from your life insurance policy. You also may be able to make premiums more manageable by restructuring the coverage.