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Wednesday, 6 April 2016


The most terrible disease of our age is of course cancer. Tons of research and millions of dollars are being spent in an effort to find a cure for this illness. And as far as we know, no progress is yet being made. On the other hand, statistics shows that cancer is one of the largest money driving diseases for the pharmaceutical industries. And in the age of the internet, we can see a lot of people sharing their stories on how they treated and cured cancer all naturally, without any use of chemotherapy or radiation. It makes us wonder how much do we really know on cancer and what we’re not being told. I bet Big Pharma would hate to lose all of that money coming in.

In that context, a research was done by the University of Kentucky on the effects grape seed has on curing cancer. And they came up with some promising results. The medical experts found that grape seeds can kill almost 80% of the cancer cells. This study was published in the American Association for Cancer Research magazine, and it’s available for all people. There are many different studies and they’ve all found that many natural ingredients can help in the fight against cancer, but still, there is no 100% effective cure for cancer and millions of people are dying every day from this terrible disease. We really hope you find this article helpful and don’t forget to share it with your friends and family. Thank You.

Saturday, 25 April 2015

Complete Guide of Purchasing Life Insurance

Purchasing life insurance coverage can be one of the most important and enduring financial decisions the head of a household makes for his or her family. A life policy can ensure that a family’s most pressing financial obligations are met even if a primary caregiver is suddenly absent. These include commitments to mortgage and car payments, medical bills, and student tuition expenses.

Since policy options vary as widely as the policyholder needs they cover, shopping for life insurance can also be very difficult. Before committing to one policy over another, consumers must carefully consider their coverage needs and options. Let’s get started with the basics: 

Who Needs Life Insurance, and How Much?

People primarily purchase life insurance to provide for their beneficiaries in case of an unexpected death. And while policy sales and life insurance coverage rates are at their lowest levels in fifty years, most Americans admit that they could use more coverage:
  1. According to a 2013 report by the Insurance Information Institute (III), 33% of Americans believe they are underinsured. 
  2. The Life Insurance Marketing and Research Association,or LIMRA, reports that 43% of consumers buy policies after specific life events like getting married, having a baby, or buying a house. 
  3. In one J.D. Power survey of individuals who were widowed between the ages of 25 and 55, only 25% believed that their deceased spouse had adequate life insurance. 
How Much Life Insurance Is Enough?

All life insurance provides a death benefit. This is the amount of money an insurer pays if the insured person passes away while the policy is in force. Sometimes the amount of the death benefit is also called the face value of the policy.

Purchasing a policy to cover dependents is not the only reason people or companies purchase life insurance, but it is the primary motivation for most consumers. With this in mind, the ideal amount of life insurance is enough to help your family live comfortably without the benefit of your income. The California Department of insurance provides some good tips to help people figure out how much life insurance to purchase.
  • Figure out how much money your dependents would need to continue with their current standard of living if they lost your support. You might consider outstanding loan balances, monthly bills, and plans for the education of your children. 
  • Balance an ideal death benefit against the cost. No insurance policy will do your family any good if you end up dropping it because it costs too much. 
  • Shop around to compare prices and benefits offered for policies from a variety of different insurers. 
Types of Life Insurance Policies

Many financial advisors and insurance agents have strong opinions about which kind of life insurance is best. Before you consult with an agent or an insurance representative, familiarize yourself with the basics so you can get an idea of your policy options and which may be best suited for you and your family. Start with the two basic types: cash value and term policies.

Term Life Policies

Term life policies are the most popular and common coverage plans available. They are active for a specific length of time. The term could be a few months or a few decades, but the contract always comes with a definite end date; and these policies have no cash value if you survive beyond the end of the contract. Since term policies are temporary and usually have no cash value, they are best suited for individuals who want to provide a financial safety net for their families in the event of a premature death. Since they are temporary contracts, insurers can guarantee higher benefit payouts for lower premiums.

To give you an idea, consider that a term life policy that guarantees a death benefit sum of $500,000 may cost a policyholder between 25-55 well under $500 a year while the policy is active. Alternately, annual premiums on cash value policies or term policy renewals can cost well into the thousands once you reach a certain age or if the status of your health changes.

Cash Value Policies

Whereas term life policies guarantee a set death benefit sum for a certain time, cash value policies work more like investment vehicles. They are more expensive, but they offer a cash accumulation feature and are typically permanent policies. In other words, your coverage will remain active as long as you continue making payments, or choose to cash out the policy.

This is the best policy for those who want to guarantee that their beneficiaries will receive the full cash value of the policy at the time of their death. Because cash value policies are permanent and can grow a cash value, they are more expensive than term policies. The most common kinds of cash value policies are whole life and universal life coverage.

Whole Life Coverage

This type of permanent cash value life insurance typically provides coverage for an entire life for a constant, agreed-upon premium. Whole life offers more consistency than other permanent cash value policies because the death benefit, its premiums and even the interest rate of your cash investment can be frozen at the time you buy the policy.

Universal Life Coverage

Also a permanent and cash value type of life insurance, this kind of policy provides more flexibility than whole life. Within limits, premiums and the face value can be changed over the course of the policy’s life and policyholders can renegotiate terms and adjust coverage to meet their current needs. That said, unlike with a whole life policy, the death benefit can vary based upon the performance of the money market the policy is invested in. If the investment value increases, the face value will rise. If the investment value decreases, the death benefit could decline. If you want a cash value policy, but you’re younger or you think that your coverage needs may change, a universal life policy is ideal. Because while your rate of return can vary, you will have more options to lower, raise or even borrow against your cash value throughout your life.

Variable Universal Life Coverage

This policy hybrid offers the investment security of variable life with the flexibility of universal life. The details of these policies must be worked out with your provider to determine what a balanced policy for your needs might be, but keep in mind that premiums for tailored policies will typically be higher and subject to change as your health and financial circumstances change.

This graph outlines the typical features of each of these common policy types:

Which Kind Of Life Insurance Is Best For You?

People and companies purchase life insurance policies for different reasons. All policies provide a death benefit, but that might be used to help families cope with the loss of a breadwinner, cover funeral expenses, accumulate an asset, transfer wealth to the next generation, or even protect a business. Ultimately, the most important thing to consider when you’re shopping life policies is your coverage needs in terms of your age, health, and financial obligations.

The truth is that younger and healthier people pay less for life insurance coverage, because insurers will expect you to survive the term of your policy or to renegotiate terms as you convert a term policy into a permanent policy later in life. Some younger people choose to purchase a larger term policy to cover a home, growing family, and other obligations. Then they lock in lower rates with a smaller permanent policy for lifetime coverage.

That’s why it’s important for younger clients who need less coverage or are unsure of their coverage needs to realize that term policies costs less. A lower premium means families can afford to purchase more coverage or save money for other uses. Savings could be used to pay bills, reduce debt, or fund investment accounts. And ultimately, less debt and more savings will lower your need for comprehensive life insurance coverage.

Term policies also expire, and they usually have no cash value after the policy ends. If a family’s breadwinner buys a 20 year term policy at 35, he may find himself without coverage at 55. The problem is that rates will be higher for any particular type of coverage at 55 than they were at 35. You should also consider the risk of developing medical issues that make the family breadwinner harder to insure.

On the other hand, many insurers court the over 50 crowd, and some insurers offer 10 year term policies to reasonably healthy people in their 70′s. You can also find term policies that offer an option to convert them to permanent coverage before the expiration date, and this might be a good way to hedge bets. 

Consider Your Employer Coverage Options First

If your employer offers group life insurance, it can be a simple and convenient choice. That said, some employees opt to purchase individual policies because coverage does not depend upon employment with a particular company. Others buy their own policies because their employer does not offer enough coverage for their needs.

Group and Employer-Sponsored Coverage

Since many Americans rely on employee-sponsored life insurance, make sure you understand your choices. An employer-sponsored group policy is not exactly the same as voluntary benefits that might be offered at your place of work. This might be confusing because premiums for both types of employer-based policies get taken out of paychecks. Here’s how to tell the difference:
  • Employers do not pay any of the premiums for voluntary worksite plans. They might offer to take premiums out of paychecks, and in some cases this might be done out of pre-tax earnings. 
  • Insurers underwrite an entire company when they offer group life insurance policies. In other words, employees usually just sign up without answering health questions. 
  • Insurers can underwrite each applicant when they offer voluntary worksite benefits. Employees might answer health questions, and some employees could be declined or charged more based upon their answers. 
  • Most of the time, group coverage gets terminated when employment ends. Some voluntary benefit companies allow ex-employees to keep their coverage if they keep paying the premium. 

Buying Individual Life Insurance Plans

Today’s consumers can purchase life insurance online, through the mail, or over the phone. They also have the option of sitting down with a local life insurance agent or other financial professional. Some applications only require answers to a couple of basic questions, while other applications can take an hour to complete. The right choice really depends upon your needs and situation. This should be clearer as you read about different types of policy applications and situations, but before you begin, there is one major term you need to know before you get started: underwriting.

Underwriting refers to the process that an insurer goes through to determine if an applicant is eligible for a particular policy, death benefit amount, or even rate class. The insurance company employee who handles this process is called an underwriter. Their job is to determine your risk level and coverage qualifications. There are three different types of underwriting processes:

Fully-Underwritten vs. Simplified Issue vs. Guaranteed Issue

You probably expect to answer some health questions on your application. When it comes to determining your life insurance benefits, there are three basic types of underwriting levels: Fully underwritten, simplified issue, and guaranteed issue.

Fully-Underwritten Policies

Expect to answer several questions about your current health, personal history, and even your family’s health. You might even need to submit to a medical exam, get a physician’s statement, or supply a blood or urine sample. The advantage for people in good health is that this is usually the only way to get approved for preferred rates. A little inconvenience can save you a lot of money, and it might be the only way to qualify for really large death benefits.

People with a healthy lifestyle and no serious health issues might save money by taking out a fully underwritten policy. The insurer picks up the bill if they request any exams. If you do not smoke, watch your weight, and have no prior medical conditions, you have a good chance to qualify for better rates. This might be the only way to qualify for large face value policies even if you cannot qualify for the cheapest rates.

Simplified Issue Policies

Compared to fully-underwritten policy applications, providers will only ask a few health questions before granting you a simplified issue policy. The questions have been designed to only weed out applicants who have serious illnesses. If you could have qualified for a preferred rate, the convenience might be costing you money. Since life insurance companies have to base their decisions on less information, they will assume the average customer falls into a riskier rate class. Maximum policy death benefits limits might be modest too.

Keep in mind, people with less healthy habits or a prior medical issue might never qualify for the very best rates anyway. It might not be worth it to go through the trouble to answer several questions, have a medical exam, and then wait several days for an answer. The application process for simplified issue policies may be very quick, and some insurers will answer within a day or two.

Guaranteed Issue Policies

Generally, guaranteed issue policy applications will ask little to no health questions. Insurers use a graduated death benefit instead of underwriting. The full death benefit might not be payable for 24 to 36 months. Some of these policies will pay a percentage of the death benefit or refund premiums if the insured person dies before the waiting period is over. Maximum policy death benefits are usually fairly small.

Of course, guaranteed issue policies will typically cost more than fully-underwritten or simplified issue policies. The increased risk gets built into the rates. They also usually do not offer an immediate death benefit. Guaranteed issue policies are often advertised to seniors as a way to get life insurance without answering any health questions. Lots of relatively healthy older people might quality for cheaper policies, so frugal people might shop around.

If you want millions of dollars in coverage, you may need to submit to a more complete underwriting process. If you want a policy worth a few hundred thousand dollars, say to cover a home mortgage, you might be able to use a simplified issue application. Guaranteed issue policy limits usually stop at a few thousand dollars. 

What You Need to Know Before You Buy

Life insurance is a billion dollar industry, so it is a good idea to find an agent you trust before committing to a policy contract. A good agent should be able to review your state’s insurance underwriting guidelines and advise you on your risk levels and options ahead of time. You can choose between an independent insurance agent or an agent that works directly for a single provider.

Generally, more consumers choose to buy policies through independent agents because they can compare more providers this way, but there is no indication that policyholders who buy directly from a provider or one of their agents receive less coverage or pay more overall:

Regardless of if you choose an independent or an affiliated agent, it’s important to go into your consultation knowing what to ask and what the possibilities are. Here are a few questions and reminders to bring up with your agent or insurance representative.

What information does this application require?

These days, most insurers want to find out a lot about their applicants before they become customers. This means that a company might request your drivers license number and ask for permission to pull credit reports and medical records.

Overseas travel habits, risky hobbies, poor credit, too many traffic tickets, or a criminal record could impact an underwriter’s decision. This does not mean you cannot purchase life insurance, but it may mean that you will never get the most favorable rates. If you think something about your history might raise a red flag, find a good agent to help you.

The Medical Information Bureau, MIB, keeps records of serious medical treatment. These are usually reported by various insurance companies. You have the right to visit MIB.com to pull your medical history so you can see what they know about you. You can bet that most insurers will look at this information, so why don’t you review it first?

You also have the right to get free credit reports from the major credit bureaus. Visit the U.S. Federal Trade Commission (FTC) for more information about obtaining your free credit report.

What if I am declined for a certain type of coverage?

People might be declined for life insurance. Each company and type of policy will have its own underwriting guidelines.
Try to avoid declines because they will be inconvenient and might even make it harder to qualify for other policies.
Some insurers do ask if you have ever been declined before on their applications.
Get information from a good agent or your own research before you apply to avoid declines.
Despite the best efforts of qualified agents and informed consumers, declines do happen occasionally.
Getting a decline from one insurer does not mean you should stop looking for coverage.

You want insurance, and your agent certainly wants to sell you a policy, but insurance company underwriters have other priorities. They have to follow guidelines that protect the insurer against assuming too much risk.

Most people can find coverage. If something on your health or personal history raises a red flag, that means you should do more homework or get assistance from a life insurance professional. Insurers have to tell you exactly why they declined your application, and you can use this knowledge to avoid the problem in the future. In some cases, the information they based their information on could be in error, and you have the right to get errors corrected.

Can I omit information on my application?

You might as well assume that insurers will find out if you try to lie or cover up anything. You do not have to complete an application if you would rather not answer questions, but you should never sign an application when you know the information is misleading or incomplete. This could be fraud, and it can also get your policy terminated before it ever pays out any benefits. If an application asks uncomfortable questions, you could search for a policy that has fewer requirements.

How can I avoid insurance scams or overpaying for a policy?

Shop wisely
Comparing a variety of policies from a handful of different insurers should help you find the right coverage at the right price. Be sure to begin with a clear idea of the reasons why you want to purchase coverage, an estimate of how much coverage you need, and what type of policy would be best for you. You’ll also want to make sure that the provider you choose is financially viable, this guide from the Insurance Information Institute calls out the largest life insurance providers by revenue and offers a few tips for assessing smaller companies.

Protect yourself
Occasionally, people do get scammed by unlicensed fraudsters. Licensed agents and insurers must follow very strict regulations. Visit your state’s insurance commission website to verify the license of any agent or insurer that you plan to do business with. Most states provide residents with a simple online search and a toll-free number. These state insurance departments exist to regulate the insurance business and protect consumers.

How can I learn more about my coverage options?
There is a lot to know about life insurance, but most insurers make the process of applying for a policy very simple. Depending upon your needs, you might be able to click a few buttons, call a toll-free number, or sit down for a short appointment with a local agent. Most of the information in this guide applies to exceptions, and not the rules. If you feel like you've been violated by an insurer or you aren't getting the information you need, contact your state’s insurance commission or the NAIC to further explore your rights and options as a policyholder.

Compleate Guide Home Insurance

Unless you work in the insurance industry, you probably have a lot of questions about buying your first home policy. Understanding more about your options and how insurance companies operate should help you get the best possible deal.

Home insurance is a complex issue, but you can make decisions easier by breaking them down into smaller questions, gathering pertinent information, and reviewing your options. While some of the following points might not apply to you, they offer a generalized approach to reviewing and selecting a homeowner’s policy that meets the needs of most people. 

Why You Need Home Insurance

Homeowners insurance is a type of multi-line policy that covers residential buildings and items kept at residences while protecting the owners from liability. Homeowners need this type of policy because they:
  • Satisfy insurance requirements set by mortgage lenders 
  • Protect owners from liability 
  • Pay to replace damaged or destroyed property 
Without home insurance, owners could face steep repair costs. Replacing a roof often costs between $2000 and $8000 according to Angie’s List. Imagine spending that much money out of pocket after a storm. With home insurance, you only have to pay a deductible (usually around $500) for your new roof.

Letting home insurance coverage lapse does more than just expose you to high repair costs. It also makes you look like a bigger risk to other insurance companies. When your policy lapses, other insurance will conclude that you either cannot make your payments on time or that you are unreliable at making timely payments. Either way, it can prevent you from getting a good policy at an affordable rate. Some companies won’t approve you for a policy at any price because they see you as a risk that they do not want.

The recent rise in weather-related property losses due to catastrophes affects both providers and policyholders. Homeowners are particularly affected by unforeseen property damages that are frequently not covered under standard home policies.

What Your Policy Should Cover

Whether you’re a first-time homebuyer or a seasoned homeowner, assessing your coverage needs can be a difficult process.

Chances are that your mortgage company will require you to purchase homeowner’s insurance, so you don’t have a choice. That’s okay because every homeowner needs insurance protection. You just have to know how to compare policies to choose an option that covers your needs at an affordable price.

Before you start comparing policies, though, consider what levels of coverage you need. Most first-time homeowners get the best protection by choosing a policy that:
  • Covers the cost of rebuilding the home 
  • Covers their personal belongings 
  • Protects them from liability 
If a policy falls short, then you probably need to look for a better option. Insurance policies that fall short of these protections leave you open to risk and probably won’t meet your mortgage company’s standards.

Home insurance should cover number events that would otherwise leave you with a large repair bill. A Consumer’s Guide to Home Insurance lists numerous perils covered by home insurance. These include:
  • Fire, smoke, wind, hail, explosions, lightning, and civil unrest 
  • Theft and vandalism 
  • Falling objects, such as trees 
  • Weight of snow, sleet, freezing rain, or ice 
  • Ruptured or overflowing heating, air-conditioning, plumbing, and sprinkler systems 
Know How to Read Your Policy

According to the National Association of Insurance Commissioners, most home policies have at least six sections that define types of coverage. In most cases, insurance companies will assume that your personal property is worth about 75 percent of your home’s value. That means that if your home is valued at $200,000, a standard coverage plan will generally cover up to $150,000 in personal property coverage. But while it represents the bulk of your policy, personal property coverage represents just one piece of your overall policy. Familiarize yourself with the terms set in all six sections to better understand your coverage levels:

Section A: Physical Damage to Your House

Section A explains how much you will get paid when your house is seriously damaged. If you want to cover the replacement cost of your home, then make sure this section gives you that option. After you agree to the policy, the insurance company will not pay you more than the amount specified in this section. 

Section B: Physical Damage to Other Structures

This section covers other structures on your property. This can include sheds, detached garages, and fencing. 

Section C: Personal Property Damage

Section C covers the items that you keep in your home. This can include everything from high-end stereo equipment to your children’s clothing. Like Section A, you have some flexibility here, so you want to choose a coverage amount that makes you feel comfortable. Ideally, your policy can replace everything you own after a burglary or extensive damage to the house. 

Section D: Additional Living Expenses

Section D tells you how much money you can get from the insurance company when you have to live away from your home.

Let’s say that a storm damages your roof so badly that you cannot live in the house anymore, so your family has to move into a hotel during home repairs. This section specifies how much money you can get for those extra expenses.

This might seem unnecessary, especially to young people who don’t have children, but Section D could potentially save you a lot of money. According to Travel and Leisure, the average daily rate of a hotel room in San Francisco is about $160. Even in smaller cities, such as Denver, you can expect to spend about $100 per night. It doesn’t take long before lodging and food becomes more expensive than your mortgage payment.

Section D protects you from those extra expenses. Remember, though, that the insurance company will only pay up to the amount specified in this section. Anything over that amount is your responsibility. 

Section E: Comprehensive Personal Liability
Section E offers comprehensive liability insurance that protects you from lawsuits when you accidentally cause damage to someone else’s property. It also protects you when you get injured on or off your property. 

Section F: Medical Expenses

If someone gets injured on your property, Section F of your insurance policy protects you from medical bills and lawsuits. According to the Washington Post the average emergency room visit costs $1,233 (with the possibility of paying as much as $24,000 for something as simple as a sprained ankle), so this is an important part of your coverage.
Identify Coverage Gaps

Unfortunately, standard home insurance policies don’t cover everything that could damage your property. Without extra policies that cover these gaps in coverage, you don’t have any protection against some common disasters.

In September 2013, large areas of Colorado experienced floods that ruined homes and businesses. According to CBS News, more than 7,200 homes and businesses in Larimer and Boulder counties were damaged by the floods. About 1,200 of those affected did not have flood insurance. That mean they will have to pay for repairs on their own.

The good news is that additional coverage helps protect you from disasters not included in your policy.

The bad news is that storm-related coverage gets more expensive every year. Homeowners living in flood prone areas usually rely on the National Flood Insurance Program for affordable coverage. Unfortunately, the Time Magazine reports that costs will rise 25 percent per year until they equal the actual risk of covering homes in flood-prone areas. In other words, someone who paid $500 for a government-subsidized flood policy in 2012 can expect to pay over $1200 by 2016. Some of the most common gaps in standard insurance policies include:
  • Pollution damage 
  • Earthquakes, landslides, mudflows, and other land movements 
  • Acts of war or overthrow of the government 
  • Damage caused by animals, birds, or insects, such as termites 
  • Damage deliberately caused to the home 
  • Normal wear and tear 
How to Shop for Your Best-Fit Policy 

1. Consider Coverage Needs in Terms of Your Lifestyle
Your phase of life should heavily inform which level of insurance you opt for.

Young, Single Buyers
A young person who doesn’t have any children might not need as much coverage as a family. When you don’t need to worry about protecting children and other family members, then you can often raise your deductible, save more money, and accept higher risk.

Young Families
If you start a family, then you should consider how your homeowner’s policy affects them. Suddenly, you might not have an extra $500 to spend on home repairs (learn more about this below under Controlling the Cost of Home Insurance).
You might also need more protection from Section D of your policy, which covers additional living expenses if you cannot live in your home . A single young man or woman might not mind spending a week sleeping on someone’s couch, but your children will need a more stable environment, especially after a catastrophe that causes significant damage to their home.

Established Families and Retirees
As your children get older and you near retirement, you can adjust your insurance needs again. Depending on your financial situation, you might want to raise your deductible again so that you can save money on your monthly premiums. With fewer people relying on you for financial and emotional support, you might find that you can take a little more risk.

2. Find Insurance Professionals You Can Trust

If you want a good policy, but you don’t want to do a lot of work to get one at a low price, then you should consider using an independent insurance agent. Independent agents can browse policies from several companies. That lets them give you succinct information about your options so that you can choose a policy without doing much research on your own.

You can check a company’s credentials by contacting consumer agencies in your state. Agencies like Standard & Poor’s can also give you company ratings that will help you decide which ones you can trust. 

3. Assess Your Add-on Policy Needs

Many homeowners find that they need additional coverage to protect themselves, their homes, and their personal belongings. Additional and unique policies fill those gaps in coverage. The price of these add-ons can differ greatly depending on where you live, your home’s value, and what you want to cover. 

Additional Policy Options
  • Flood Insurance: essential for anyone living in flood-prone areas. The average policy costs about $650 per year. 
  • Earthquake Insurance: earthquakes can happen anywhere, but they’re most likely along fault lines. The average earthquake insurance policy costs about $700 a year. 
Unique Policy Types
  • Modified Coverage Forms: great for people who own older homes with replacement costs that exceed market value. 
  • Condominium Unit Owners Form: insurance specifically designed for people living in condominiums. 
  • Dwelling Fire Form: pays for repairing fire damage, but does not pay for liability, personal property, or medical expenses 
Other Weather Hazard Protections
  • Guaranteed Replacement Cost Coverage: extends your home insurance coverage by up to 20 percent. 
  • Inflation Guard: increases your insurance coverage limit over time. 
  • Personal Umbrella Liability Insurance: additional liability protection that exceeds that offered by your standard home insurance policy. 
  • Scheduled Personal Property: additional coverage for expensive belongings such as art, jewelry, and furs that exceed the typical personal property coverage of a home policy. 
4. Find a Quality Provider

Now that you know what level of coverage you need, you can start comparing companies and policies. Start by using the National Association of Insurance Commissioners website to weed out companies that have received a lot of complaints. The NAIC will tell you whether an insurance company has received complaints about things like:
  • Claim handling delays 
  • Claim denials 
  • Unsatisfactory settlement offers 
  • Canceling policies 
  • Poor customer service 
You can also contact your state’s Insurance Commission to learn more about the insurance companies that serve your area and a listing of all licensed insurance agents and brokers. You can find contact information for your state on this NAIC map. 

5. Know the Right Price

Insurance companies look at several factors when determining how much to charge for home policies. Standard questions include:
  • How old is your roof and plumbing? 
  • What is the value of your home? 
  • What is your home’s rebuild cost? 
  • How old is your home? 
  • Does the home have a swimming pool? 
  • Does the home have a security system? 
The insurance company will also look at your address to determine things like:
  • Whether you live in a high-crime area 
  • How close the nearest fire station is to your home 
  • Whether you live in an area prone to wildfires, flooding, storms, or earthquakes 
All of this impacts the price of your policy.

Once you have several quotes, you should know the fair value of insuring your home. You might have a few outliers (companies that charge extremely high or low prices), but most of them will cluster in a price range.

Beware of companies that offer extremely low prices. They’re attractive to buyers, but they usually have low prices for a reason. Remember that customer service matters, too. If a company doesn’t give you prompt responses now, then they certainly won’t after you’ve already paid for a policy. Always double check the NAIC database before you purchase insurance from a company that seems exceptionally cheap.

Homeowners should be aware that average premiums are going up due to higher rates of property losses nationwide. 

How to Lower Your Risk Level and Your Rates

Homeowner coverage premiums might feel outside of your control, but you can do some things to reduce your risk level in the eyes of insurers. If you feel like prices are too high, consider using the following tips to make policies more affordable. Each one can have an impact on how much you pay every year. 

Raise Your Deductible

Your deductible is the amount of money that you have to spend out-of-pocket before the insurance company starts picking up the tab. Raising the deductible makes you more responsible and reduces the insurance company’s risk. That usually means you pay a lower rate.

Keep in mind that you do have to accept additional risk when you raise your deductible. Only raise your deductible if you can afford it. If you don’t have enough money to pay for $1000 of repairs, then you shouldn’t have a $1000 deductible.

Assuming that you can afford a little more risk, you can save quite a bit of money. According to a booklet published by the Insurance Information Institute, most insurers recommend a $500 deductible. Raising the deductible to $1000 could lower your bill by as much as 25 percent.

Improve Your Credit Score

Insurance companies assume that people with good credit scores are more responsible than those with poor scores. Maintaining a good credit score makes you look less risky to insurance companies, so they’re more likely to give you lower prices.According to myFICO, you can keep your credit score healthy by:
  • Paying your bills on time 
  • Reducing the amount of money that you owe creditors 
  • Keeping credit card balances low 
  • Checking your credit score annually to find mistakes 
Install Extra Security 

You could qualify for discounts by installing deadbolt locks, smoke detectors, and a security system in your home. Those willing to spend money on an in-door sprinkler system that puts out fires and contacts the police automatically can save as much as 20 percent. 

Get Serious About Home Improvement Projects

You can make your home safer and more appealing with some simple improvements. Putting a fence around a pool, for instance, could lower your insurance premium. Other noteworthy improvements include:
  • Updating your electrical and heating systems 
  • Replacing old water pipes 
  • Installing a new roof 
  • Replacing damaged patios and decks 
  • Repairing wood, tile, and linoleum floors 
  • Bundle Your Insurance 
Many insurance companies offer discounted prices to customers who purchase multiple policies. Buying your car and home insurance from the same company, for instance, could give you a five to 15 percent discount.

Bundling discounts vary from company to company, so explore your options by asking for quotes that include multiple policies. 

Ask About Discounts

You could qualify for insurance discounts for any number of reasons. Members of the military often get discounted rates. Geico, for instance, gives a 15 percent discount to military personnel. You might also get a discount for belonging to an alumni, professional, or travel association. (Some associations have deals with insurance companies that lower costs for their members. Other memberships show insurance companies that you are the kind of client they want.)

Ask companies to give you information about discounts so you can explore all of your options. You don’t want to miss any way to lower your insurance costs. Even if you only save a small amount each year, those discounts add up to big savings. 

Don’t Switch Providers Too Often

Insurance companies want to keep their customers, so they often reward loyalty with discounted rates. Switching erratically from company to company can make you look risky. Insurance companies often share information with each other, so they know that you jump from policy to policy.

Never Stop Shopping

Staying with the same home insurance company for many years could lead to cheaper rates. Still, this doesn’t mean you should necessarily stay with the same company for life. If you can get comparable coverage from another provider at a better rate, go for it. By comparing insurance companies every few years, you can make sure that you never pay more for the coverage that you need. Just don’t make a habit of switching providers every year.

The Takeaway: Remember the Basics

You don’t have to be an insurance expert to get a good deal on a home policy. Just remember the basics:
  • Your homeowner’s policy has at least six areas of coverage that you can adjust to match your unique needs 
  • Floods, earthquakes, and wildfires are rarely covered, so you might need an additional policy if you live in an area prone to these and other disasters 
  • The price of your insurance policy depends on many factors, including where you live and how much coverage you need 
  • You can control the price of your policy by making certain decisions about where you live, how you protect your home, and how much risk you are willing to accept 
  • Always ask about discounts 
  • Bundling your home policy with other types of insurance often gives you cheaper prices 
  • Your policy needs will likely change throughout your life, so it’s up to you to decide how much coverage you need during each of life’s phases 
  • Always research insurance companies before buying their policies. Fraud does exist in the insurance world. You do not want to fall victim to unscrupulous companies 
  • Some licensed insurance companies offer better services than others. Use the NAIC database to make sure you choose a company with few complaints 
As long as you keep these basic points in mind, you should be able to navigate the insurance world without too many problems. Whenever you feel overwhelmed, take a step back, review the above information, and approach your options confidently.

Buying home insurance for the first time can feel stressful (as does buying it for the second, third, or fourth times), but you probably have more control over the situation than you realize. Informed, savvy buyers can make better decisions than those who don’t know how to compare options or even get the information that they need to compare policies. That means you’re prepared to make a decision that will protect your home and family without spending more money than necessary.

Complete guide Auto Insurance

Modern automobile insurance coverage has been around for more than 100 years and first became mandatory in Connecticut in 1925. However, most states did not require car owners to insure their vehicles until the mid-1950′s. Currently 48 states and the District of Columbia require proof of valid insurance to register and operate an automobile.

According to the business intelligence services company SNL Financial, U.S. insurers paid out more than $65 million in liability claims in 2012 and $41 million in property damage claims for private passenger auto claims alone. AAA estimates that U.S. accidents involving cars are responsible for roughly $164 billion in damages a year. Without the resources of insurance company lawyers and adjusters, uninsured individuals would no doubt have incurred much higher costs. While most Americans understand that car insurance is important, most people are shaky on how their insurance actually works. This guide is here to teach you the fundamentals.

What is Auto Insurance?

The phrase auto insurance is a general term that refers to various types of insurance protection for cars. The Insurance Information Institute explains that an auto insurance policy can include up to six different types of coverage:
  • Liability 
  • Collision 
  • Comprehensive 
  • Uninsured Motorist 
  • Underinsured Motorist 
  • Personal Injury Protection 

The simplest explanation of auto insurance is that it agrees to pay all or part of the costs associated with an accident, theft or other cause of damage to your car. In exchange for this coverage, you need to pay an insurance premium to your provider.

The Primary Types of Auto Insurance – What’s Covered

The six different types of auto insurance all cover different problems. In order to become a savvy auto insurance consumer you need to understand exactly how each type of coverage works.
Automobile Liability Insurance Coverage

Liability insurance pays for damage and injuries that result from accidents where you are deemed at fault. This means you were responsible in some way for causing the accident. In most accidents, both drivers are considered to be partially at fault because of a rule known as “comparative negligence.” There are a few situations when you won’t be considered at fault, such as if you were hit directly from behind, but otherwise you will be considered at least partly responsible.

As most states have comparable negligence laws, even if you are an incredibly cautious driver, a portion of the blame will be yours. According to the Centers for Disease Control and Prevention, the cost of injuries (medical and loss of productivity) from car accidents was $99 billion in 2010. Without liability coverage, you could be in charge of paying these bills yourself. There is an accident where an injury occurs every 14 seconds; in the time it took you to read this paragraph, at least one person was injured in a car accident.
What’s Covered?
Bodily injury includes medical costs, pain and suffering, lost income from wages and other special damages.
Property damage covers damage to other vehicles and their contents, as well as structures and other types of physical property. This also includes costs associated with the inability to use damaged property. 

Auto Collision Insurance

This coverage pays for damage to your vehicle caused by other cars. Collision insurance is always optional and may only be required by a lender on more expensive vehicles. Collision insurance is generally more expensive than liability insurance and often includes a deductible (an amount you pay out of pocket before insurance kicks in). According to the research firm Mitchell International Inc., the average deductible for collision insurance is $110.25.
What’s Covered?

The benefit of collision insurance is that it pays for damage to your vehicle even when the accident was your fault. Collision coverage will only pay for the damage not covered by another driver’s policy when the accident is their fault. Simply put you can only get paid once.
Comprehensive Coverage

The best way to describe comprehensive coverage is as “everything else” insurance. This covers damage to your car from anything other than a car accident. It is an optional coverage that protects your investment. In 2010 buyer trends indicated that 76% of drivers purchasing liability coverage purchased comprehensive. In fact, many lenders require you have comprehensive for any vehicle that has a lien against it in order to pay off the note in the event the car is stolen. According to the research firm Mitchell International Inc., the average deductible for comprehensive coverage is $126.40.

What’s Covered? 

  • Theft and vandalism 
  • Windows and windshield 
  • Animal damage 
  • Falling objects (like trees) 
  • Storms and natural disasters 
  • Uninsured and Underinsured Motorist Coverage

Uninsured motorist protects you in the event of an accident where the driver of the other vehicle does not have insurance. In this case your uninsured motorist coverage steps in and covers your damages. This is an important gap in coverage because the Insurance Research Council found that roughly one out of every seven drivers doesn’t have car insurance. Here’s a map identified the percentage of drivers without insurance in each state:

Underinsured motorist coverage protects you from shortfalls in the coverage of the other driver in the case of an accident. Let’s say, for example, your brand new Mercedes S class was totaled in an accident with a driver who only has state minimum liability coverage of $25,000. While no-one was hurt, the value of your car is four times more than the other driver’s insurance. In this example, your underinsured coverage would make up the difference (up to your coverage limit) on the cost of repair or replacement. Sometimes insurance companies sell both uninsured and underinsured coverage under the same policy, while others sell them as two separate types of coverage.
What’s Covered? 

  • Both uninsured and underinsured coverage function as supplemental liability insurance for another driver who causes an accident with your vehicle. 
  • Just like liability coverage, uninsured or underinsured coverage has separate coverage amounts for property damage and injury. 
  • Most insurers limit the amount of uninsured/underinsured motorist coverage to the same limits as your policy’s liability coverage. 
  • Limits can run from $20,000 to $1 million or more. 
Personal Injury Protection

PIP or Personal Injury Protection goes above and beyond paying for medical and hospital expenses. Some states refer to this type of coverage as no-fault because it pays its benefits regardless of which driver was responsible for the accident.

What’s Covered?

Coverage may vary from state to state but will contain some or all of the following coverage benefits:
  • Lost wages 
  • Service replacement for someone injured in an accident, meaning they’ll receive assistance with things like household chores or child care 
  • Rehabilitation costs 
  • Funeral costs 

Unlike other auto coverage, PIP/no-fault payments are not dependent on who was to blame; they also begin making payments much faster. Currently a dozen states (and Washington D.C.) have mandatory no-fault personal injury protection requirements:
  • Washington D.C. 
  • Hawaii 
  • Kentucky 
  • Michigan 
  • New Jersey 
  • North Dakota 
  • Utah 
  • Florida 
  • Kansas 
  • Massachusetts 
  • Minnesota 
  • New York 
  • New York 
  • Pennsylvania 

Other states, like Arkansas, require that PIP be offered as an option to all policyholders. Check with your state’s insurance department to determine how they handle personal injury protection insurance.

Who’s Required to Have Auto Insurance, and How Much?
48 States have mandatory insurance requirements for motor vehicle registration. If you don’t have at least a minimum level of coverage in these states, you are breaking the law. This can lead to large fines, a loss of your driver’s license, and possibly jail time. These penalties apply even if you never get in an accident. For example, if your car is registered in Washington and you get caught driving without insurance, it’s a traffic violation that leads to an immediate fine of at least $450.

The only two states that don’t require all drivers to have car insurance are New Hampshire and Virginia. New Hampshire “strongly recommends and urges” owners to carry at least standard liability and property damage insurance. The Granite State may not have mandatory insurance requirements for everyone but it is required if any of the following apply:
  • DWI conviction in the last 3 years for first offenses, longer for subsequent convictions 
  • Habitual offenders 
  • Individuals found at fault for an uninsured accident 
  • Individuals returning from a suspended license 

Conviction of one or more of the following:
  • Leaving the scene of an accident 
  • Conduct after an accident 
  • Underage DWI 
  • Subsequent (2nd) reckless driving offense 

The other state that does not have a mandatory requirement is Virginia, which allows car owners to forego even basic coverage if they pay an “uninsured motor vehicle fee” of $500 per year in addition to the regular cost of registration. Virginia’s fee does not release owners of liability for damages.

In the event of an accident, the driver and or vehicle owner will be personally responsible for the cost of all damages and injuries. People who had insurance at the time of registration who are cancelled or cease having coverage for any reason are required to pay the pro-rated portion of the uninsured motor vehicle fee immediately or face a substantial penalty.

How Much Insurance is Enough Insurance?

At the very least you will need to carry your state minimum coverage. If you don’t have at least this much coverage, you are breaking the law. The basic required coverage in most states is automobile liability insurance coverage, which protects you from financial loss for accidents that are all or partly your fault.

Liability coverage is presented as two or three numbers; Pennsylvania for example is 15/30/5 – all of which represent thousands of dollars.
  • The first number is the maximum amount that the insurance company will pay out for injuries to one person in a car you hit ($15,000). 
  • The second number is the maximum they will pay if multiple people in the other car are injured (the total is divided among all the injured) ($30,000). 
  • The third number is the maximum they will pay for property damage ($5,000). 

However, many people will find that minimum coverage is insufficient. Let’s say you cause a serious accident that destroys multiple cars and you only have the Pennsylvania minimum amount of coverage for property damage, $5,000 total. This wouldn’t even begin to cover damages. Not only would you have to replace your own car out-of-pocket, the other driver could also sue you for damages, which would then come out of your other assets.

The more you have in coverage, the less likely it is you’ll ever pay for damages out-of-pocket. On the other hand, more coverage costs more money. This is the sort of tradeoff you need to learn to manage in order to really get the coverage that best suits you.

You should also consider what risks you want to insure and what risks you don’t. If you’re driving an old, broken down car, you may not need collision coverage. Since your car is worth so little, it may not be worth the money to insure it. On the other hand, liability is almost always worth having because it protects you from a lawsuit.

Shop Around and Save Money on Car Insurance

The California-based Foundation for Taxpayer and Consumer Rights advises you to determine how much insurance you want before you start shopping around for rates. This way it will be easier for you to compare companies and you’ll be less likely to buy coverage you don’t want or need.

The insurance departments in every state do a great job of regulating insurance companies to make sure they provide the right kinds of coverage and comply with state-specific laws. This overhead means you need not worry about paying your premium and the company disappearing into the night.

However, not all insurance companies provide the same level of service. Differences can especially occur in the time it takes a company to process claims – the difference between getting a check in a week versus a month can be enormous. While insurance departments only make sure insurers fulfill their obligations, consumer rating organizations like J.D. Power and Consumer Reports will tell you how they treat their customers.

  1. Before reinsurance transactions, includes state funds 
  2. Based on U.S. total, includes territories 
  3. Data for Farmers Insurance Group of Companies and Zurich Financial Group (which owns Farmers’ management company) are reported separately by SNL Financial LC 
Source: SNL Financial LC

How to Save Money on Car Insurance

Controlling the cost of auto insurance is a proactive process, which means you can’t count on your insurer to do it for you; you have to do it yourself. The best advice is to shop your auto insurance around on a regular basis. Jim Whittle, the Chief Claims Council of the American Insurance Association, recommends that drivers review their policies once a year to make sure coverage is appropriate and that drivers aren’t missing on any discounts.

Evaluate your coverage

Consider what you are insuring by answering some simple questions. Is your new car loan paid off? If so, do you really need to continue comprehensive coverage? This is an especially important question if you live in an area with a very low incidence of car theft. You’ll want to consider increasing deductibles.


Ask your insurer about discounts for bundling your auto insurance with your homeowner’s or renter’s policy, life insurance and your other forms of coverage in order to receive a volume discount.
Safe driver discounts

Ask your insurer about safe driver discounts and if you qualify. Many insurance companies offer discounts for each year you go without an accident or violation. Ask about taking a safe driver or defensive driving course and how this will affect your rates.

Beware of Scams

The most costly form of insurance is bad insurance. Bad insurance is insurance that does not provide the protection you want or need and often lulls you into a false sense of security by tricking you into thinking you are properly covered. If you want to avoid being scammed into buying bad insurance following this list of dos and don’ts will help protect you: 

Don’t buy insurance from a door to door salesman, unsolicited callers or pop-up internet ads. Do check prospective insurers and brokers rating with the Better Business Bureau. 
Don’t give your current policy number out indiscriminately. Do check with your state insurance department to make sure the agent/company are licensed in your state. 
Don’t fall victim to the promise of “Free Services” that only conceal hidden costs. Do use your common sense. If a deal sounds too good to be true, it likely is! 

What If I Have a Terrible Driving Record?

Insurance companies are in the business of making money, plain and simple. They try to limit their risk by avoiding riskier drivers since they are more likely to have an accident. If you have a poor driving record or are a brand-new driver with no history, it might be hard to find a company willing to cover you.

One solution is to try to find coverage through an assigned risk pool. All states have a system of assigned risk where high risk drivers are given to an insurance company at a prescribed rate. Insurers are required to accept a certain number of these assigned risk drivers in order to continue selling insurance in the state.

Buying insurance through the assigned risk pool is not a permanent condition. As violations fall off your record and accidents fade into the past without new incidents, you can move out of the pool and buy regular car insurance lower rates.

The Parts of an Auto Insurance Policy

When your auto policy arrives, it will come with your insurance ID card. You may have received a temporary ID by fax, email or directly from your agent, but the one that comes with your policy is the permanent one and should be immediately placed in your car so you don’t lose it.

Read through your policy when it arrives to make sure you have the coverage you want. While mistakes aren’t common, they do occur. It’s best not to discover that your limits or coverage is wrong when it comes time to make a claim. Car insurance policies have a set design and will include the following:

Declarations Page

This is usually the first page of your policy and includes who and what are insured. The declarations page has the make/model of your car and the VIN (vehicle identification number). It’s important to compare the VIN on the policy with the way the number appears on your registration or title. If they don’t match, you’ll be sure to have some trouble when making a claim.

The declarations page will also include your premium amount and the policy term, either six months or a year. It will also mention any deductibles. If any of this information appears incorrect, advise your agent or insurer as soon as possible and request a corrected policy be issued.

Insuring Agreement or Base Policy

This section spells out the provisions of your policy, the extent of your coverage and the insurer’s responsibilities. It also stipulates certain requirements, like when and how to pay your premium on time and how to report accidents to the insurance company in a timely fashion.

Policy Exclusions

This section spells out what isn’t covered; it’s especially important to read and understand these exclusions in their entirety. If you find exclusions you wish to have covered, you should speak with your agent or the company about having them added to the policy. Be aware that having exclusions removed will most likely result in a higher premium.

Policy Conditions

This section spells out your legal responsibilities and your insurance company’s legal responsibilities.

Policy Definitions

Also known as the fine print, this is where the terms of the policy are explained. Reading and understanding this section ensures you do not have any misunderstandings about your coverage and obligations.

What to Do in the Event of an Accident

Accidents happen. The Property Casualty Insurers of Association of America recently reported that drivers file a collision claim roughly once every 18 years. Given the likelihood that you will face multiple accidents during your time as a driver, there are a few basics to keep in mind in the immediate aftermath of any car accident:
  1. First and foremost, when you get into an accident, don’t panic. 
  2. Make sure you and any passengers are physically okay. 
  3. Put on your hazard lights and, if possible, relocate the car to the side of the road to avoid any further collisions. 
  4. If you have a cell phone notify the police, even for a minor fender bender. 
  5. If someone in either vehicle is injured, immediately request medical assistance. 

Once the vehicles have been moved and injuries have been addressed, it is time to exchange information with the other driver(s):
  1. Collect as much information as possible, including name, address, phone number and driver’s license number. 
  2. You will also want to gather information about the other vehicle, particularly the license plate number, make and model. 
  3. There is no need to discuss who is at fault with the other driver; that’s the job of the insurers and/or the police. 
Reporting the Accident

After an accident, be sure to contact your insurance provider as soon as possible. They will need your name and contact information and ideally your policy number. They also need to know the day, time and location of the accident, as well as a general description of the injuries and damage. A more detailed report will come in the following weeks. Don’t take your car in for repairs until after you’ve spoken with your insurance company because they may have rules you need to follow to handle the repairs, such as what garages you are permitted to go go to.

Filing a Claim

When you talk to your insurer’s claim department they will provide you with instructions regarding their procedures for filing a claim. Follow the instructions you are given, and if you are unclear or uncertain about what is being requested, always ask questions. Claims representatives are trained to walk you through the process and explain the whys and wherefores of the process.
The Driver’s Seat

Don’t wait until you get into a car accident to figure out your car insurance. By then, it may already be too late. If you master the basics presented in this guide, you’ll become a more informed auto insurance consumer and, in turn, a safer, smarter road warrior!