Personal Finance Tips » Insurer

Insurance Fundamentals

admin — Sun, 26 Dec 2010 10:18:23 +0000

For those who are new to the world of insurance and don’t have an idea of what the term insurance means, let’s do a quick definition of the word insurance.

Simply put, insurance is a contractual agreement between two parties called the insurer and the insured, where the latter make payments known as premiums to the former in return for an insurance policy which puts an obligation on the insurance company (insurer) to pay for the financial loss of the insured arising from a specified happening or a particular event. In other words, the insurance company pay a certain amount of money for the particular kind of loss that is stated in the agreement.

An insurance agreement could be for your car, building, office equipments, motorcycle, pet, burglary, etc. It could also involve protection for some unusual types of financial losses such as we see in a situation where certain footballers like Cristiano Ronaldo, Lionel Messi, Cesc Fabregas etc. insuring their legs against injuries on the playing turf.

In a nutshell, what an insurance policy does is to give the policy holder a financial covering in the event of a particular accident happening and restoring him to his former state before the accident.

Note that when choosing an insurance company to do business with, it is pertinent you take your time to find out certain information about the firm such as; their financial stability, frequency of payments to clients, industry rating as well as their strengths compared to that of competitors, goodwill, and so on. All these are important, so as to avoid putting your money in an organization that won’t be able to give you financial covering in the long run.

How do I get an insurance policy?

You can get an insurance policy through various available means. The most popular way is to get policies through commissioned agents. Some of them are staff under the payroll of the insurance companies, while others are simply entrepreneurs who sell policies of various insurance firms for a certain amount of profit.

However, in today’s world you can get anything you want right there in your living room through the internet. So many online insurance agencies that you can talk to have a presence on the web. You can always get your desired insurance policies from them. They are always open to online support and chatting if you need help and clarification on any issue.

You will do yourself a whole lot of good by checking them out.

Cheap Los Angeles Car Insurance

admin — Thu, 23 Dec 2010 03:38:03 +0000

Cheap car insurance protects the car and takes care of all the relevant expenses in the event of a car accident. Car owners must choose a suitable car insurance that offers them desirable coverage. There are various kinds of car insurance available to car owners, and it may be a daunting experience to select the right insurance. There are policies such as comprehensive car insurance policies and liability car insurance policies that differ in the extent of coverage offered. Insurance provides financial security to car owners in the event of a fatal accident. The rules and regulations regarding auto insurance may vary from state to state. In most states, it is mandatory for all car owners to have car insurance. In Los Angeles, the premium for the insurance of a car may vary greatly depending on the insurer. It is advisable to look out for quotes from different insurance companies to obtain cheap car insurance.

The minimum coverage requirements may vary from state to state. The minimum limit of insurance for California is 15/30/5. This means California requires a minimum coverage up to $30,000 for all persons injured in an accident, subject to a limit of $15,000 for one individual, and $5,000 coverage for property damage.

Generally, the insurer examines the driving record of a car owner. If the car owner has a good driving record, he is eligible for some discounts in the premiums. Many car insurance companies offer loyalty discounts to car owners renew their insurance policies with the company repeatedly.

Many insurance companies offer free quotes over the Internet. Car owners can utilize the services of discount car insurance brokers, to find cheap and reliable car insurance. There are several insurance companies that offer extremely cheap car insurances. The car owners must however verify the credibility of such companies. Car owners must compare and contrast all the quotes before choosing an insurance company.

In Los Angeles, the cost of car insurance depends on the make and model of the car. Generally, car insurance for a sports car is costlier than other cars.

Sport Bike Insurance

admin — Wed, 22 Dec 2010 13:05:53 +0000

Many people are familiar with car insurance, and basically what affect the insurance premium of a car. However, many people forget that chasing sport bike insurance can involve the same basic rules in some ways!

So before purchasing your sports bike and searching for cheap sports bike insurance, here are a few tips:

- A more expensive sports bike will attract a higher premium, not only because they will cost more to replace, but also because they are generally of higher power and considered more dangerous.

- From this, we can safely say that the higher the ‘cc’ output your sport bike engine, the more it will cost to insure because it will be seen as posing a greater risk of an accident. Therefore if you are just a casual bike rider, you may want to consider a bike with a slightly lower power output.

- You may know that for car insurers, some customers get a discount purely because they have successfully completed a driver safety course with the insurer. This is often also the case with sport bike insurance! Find out whether the insurer has a similar ‘safe rider’ course available, teaching you to drive in a defensive manner.

- With this also comes the style of motorbike you will be riding. For example, a cheaper sports bike may still cost more to insure than a more expensive road bike, purely because it is classed as a ‘sports bike’! Therefore read up and ask insurers about average premiums for different bike categories, and the best way to find the best rates is to visit the right sites where they compare insurers, and allow you to fill out dummy quotes online to get an estimate.

I hope this information helps you find the cheapest motorbike insurance [http://www.bikeinsurance.theprovenprogram.com] possible.

Insurance Policy Exclusions

admin — Sat, 18 Dec 2010 14:43:53 +0000

Insurance can be so confusing. You get so tired and bored reading the policy that when you get to the end you tend to skim over the last parts. One of the most important parts of the insurance policy is at the end though – the endorsements section. Here is why you should pay close attention to this section.

Most policies’ basic coverage forms end with a section called endorsements. Endorsements add to, take away or change provisions contained in your basic insurance policy form. Endorsements are typically one, two, or three pages long each.

One reason insurers use endorsements is to save money. If they have new provisions or have changed provisions in their policy, using an endorsement will allow them to save on re-printing costs. The insurance company simply adds an endorsement at the end of the policy to incorporate the new or changed provisions. So be to sure to check this section when you are purchasing insurance..

Endorsements are often used to restate a policy provision after a court decision interprets the provision in question in a different way than the insurer has been interpreting it. So you can see why you need to read this section carefully after you have finished looking at the basic policy.

Most commonly, endorsements add exclusions not stated in the basic insurance policy form. For example, in home owners insurance policies these often include such things as dog bites and home daycare services performed for a profit. Also typically flood and earthquakes are excluded from most home owners polices. Separate policies can be purchased elsewhere.

Knowing what the coverage is excluded by an insurance policy is very important, especially when comparing insurance policy quotes.

How Marriage Affects Your Insurance

admin — Wed, 08 Dec 2010 04:47:54 +0000

Getting married is undoubtedly one of the busiest and most stressful times of your life. You have all sorts of arrangements to make and you have a deadline so you have to make them quickly. You probably can’t think of anything other than getting married to the person of your dreams and feel you can only afford to focus on your big day. Although this is understandable, and indeed expected, you also need to consider your insurance. Tying the knot will drastically change your insurance needs and options and you should try and sit down with your soon-to-be spouse and evaluate these carefully. Re-evaluating your homeowners, life and health insurance well before the wedding is definitely a good idea so when you come back from the honeymoon, your insurance needs are covered and you can go about “being married”.

Short-term insurance

When you get married, both your household contents will be covered under a single policy, but this is probably not the case before you say “I do”. If you are both insured by the same insurance company which is unlikely, you could simply move all your property on to one person’s policy. If not, it is wise to shop around for the best possible rate while retaining adequate cover. Getting married will change your risk profile and your monthly rate is likely to be much less, especially your vehicle insurance.

Health insurance

Similar to short-term insurance, married couples tend to pay less for health insurance than their unmarried counterparts. Most health insurance companies do not offer domestic partner cover and if they do, it is considered taxable income if you submit a claim. To that end, it is advisable for unmarried couples to have separate health insurance policies, but all that changes when you get married. Compare your policy to your partners’ and see which offers the best possible benefits for the lowest premium. It is also not a bad idea to shop around for a possible alternate insurer than either of you currently use.

Life insurance

Many consider life insurance the most important policy to consider, especially if you are starting a family. They will need to be protected in the event of either of your deaths and as such, this should be discussed well before the wedding. If you already have a policy in place, you would want to consider increasing the cover so that your loved ones are not left without a source of income after your death. If you have not already done so, you will need to change the beneficiary on your policy as well.

Ensuring that all your insurance needs are taken care of before you start your life together will not only provide you and your soon-to-be spouse with much needed peace of mind, it could also save you a few pennies on your monthly installments which is often very welcome.

Malpractice Insurance

admin — Sat, 09 Oct 2010 13:20:30 +0000

Malpractice insurance is a shield for protecting the skilled professional against lawsuits filed for committing malpractice. Malpractice insurance covers any skilled professional (such medical professionals like doctors, physicians, and nurses) for the liability claim. A skilled professional can be sued for malpractice when a client says that the professional failed to perform his or her specialized duties or neglects providing a high standard of care to the client.

Malpractice of any kind holds the skilled professional responsible for the damages caused to their patients. It is therefore very essential to award a fair compensation to the victim of malpractice for the losses. Malpractice insurance in fact shields the skilled professional from having to award the settlement out-of-pocket. The insurance company provides the compensation amount to the complainant based on the premiums bought by the skilled professional.

The amount paid for liability or malpractice insurance varies depending on area of specialization. Malpractice insurance premiums are paid by the skilled professional on the basis of geographical area and location of his or her profession, as well as on his or her responsibilities.

The insurance taken by the professional takes care of everything from attorney fees to court costs to settlement charges. For example, let’s say that a cautious dentist opts for a premium policy. The insurer provides timely, accurate, cost-effective rates to this dentist who is a specialist in dental surgery. Then, while performing a surgery, the dentist is held responsible for injury done to a patient. The patient files a dental malpractice suit accusing him or her of negligence in surgery. Even though the hospital too will come under the purview of malpractice, the dentist performing the surgery is held the most responsible. He or she becomes liable to award for the damages. At such a stage, the insurance policy acts as a buffer. The payment made for the premium serves the dentist in awarding the settlement. Thus malpractice insurance is the door to reimbursement for the loss caused.

Importance Of Insurance

admin — Sun, 26 Sep 2010 08:57:33 +0000

Insurance is a defensive measure used against future conditional losses to hedge the possible risks of the future. It is a legal contract that protects a person from contingent risk of losses through financial means and provides a means for individuals and societies to handle some of the risks faced in daily life.

These contracts of insurance are called policies and are provided by insurance companies. The Insurance companies charge a regular amount from the customers, which is paid back, either in part, or entirety, to the customers in case of a definite loss. This regular amount charged from customers is called Insurance Premium.

REASONS OF INSURANCE:

Sometimes in life it is not possible to avoid the losses. For example People may become ill. They may die of illness or accidents or their homes or other property may undergo damage or theft. So in all these cases and they have to face the loss of income or savings. So insurance is a manner of financially insuring that if such an incident comes about then the loss does not affect the present well being of the person.

DOCTRINES OF INSURANCE:

1 There should be a certain definite loss taken place at a known time, in a known place and from a known cause. Therefore the time, place and the cause of loss should be clear enough.

2 The incident that represent the cause of the claim should be accidental or beyond the control of the beneficiary.

3 The size of the loss must be significant from the perspective of the insured. Insurance premiums should cover both the estimated cost of losses, plus the cost of policy, regulating the losses, and providing the principal required to logically assure that the insurer would be able to reimburse claims.

4 The amount of premium should be affordable.

5 The possibility of loss and the cost of compensation should be calculable or estimable

TYPES OF INSURANCE:

Below are some kinds of insurances.

LIFE INSURANCE:

Life insurance policy insures the life of the insured. The insurance company is legally bound to provide a monetary benefit to a decedent’s family or the beneficiary after the death of the policyholder. The proceeds are paid to the beneficiary either in a lump sum amount or an annuity

MEDICAL INSURANCE:

Medical insurance is also called medclaim. Under this policy the insurance policy pays the amount to the insured for his health purpose. This amount covers the cost of medical treatment.

DISABILITY INSURANCE:

There are two types of disability insurance.One is simple disability insurance and the other is total disability insurance. In case of simple disability insurance,a financial support on monthly basis is provided by the insurer to the policy holder if he is unable to work due to an injury or an illness. But permanent disability insurance provides the reimbursement if a person becomes permanently disabled.

GENERAL INSURANCE:

It includes automobiles insurance, business insurance, property insurance etc.

Automobile insurance:

In UK this insurance is called motor insurance. It compensates the loss or damage occurred to the vehicle. But in United States auto insurance policy is essential to legally operate a vehicle on public roads.

Business insurance:

Business insurance protects the businesses against risks of losses and damages and compensates in case of loss

Property insurance:

This type of insurance protects the property against the risks like fire, theft etc. This category also includes fire insurance, flood insurance, earthquake insurance etc

Fire Insurance:

It is an insurance covering the damage to the property caused by fire.

Flood Insurance:

This type of insurance pays the policy holder in case of any loss or damage to the property due to flood. It protects the property against the flooding.

Earthquake Insurance:

This insurance compensates any damage to the property caused by earthquake.

IMPORTANCE OF INSURANCE:

Insurance plays an important role in sharing the risks of people in an affordable form.It helps the people to quickly recover from damages and losses.

Auto Insurance Pricing

admin — Wed, 08 Sep 2010 15:38:01 +0000

It is important to understand the structure of auto insurance pricing when you are looking to get auto insurance. Many factors, including zip code, age, gender, marital status and driving record are taken into consideration, when deciding the premium for auto insurance coverage. Driving records may include tickets and accidents history of both the owner and the family members. Other considerations include year, model and type of insurance.

The total coverage of the policy of a car owner has to be more than the minimum liability coverage limit that is required by a particular state. This is called liability coverage limits. Instead of presenting in terms of thousands of dollars, limits are presented in a series of numbers. For example, it may be given as 20/40/10, short for $ 20,000/40,000/10,000.

For people with a history of bad driving, there is a special provision called SR-22 form. SR-22 is a form that proves that one carries auto insurance. SR-22 status is given to people falling in category of high risk. Generally, SR-22 policy coverage is costlier than a regular coverage, by about 20 percent. SR-22 is required by law and has a validity of three years. On the other hand, good drivers are rewarded with lower premium. Students with good driving history are also offered some special discounts.

To protect consumers who go for auto loans when buying vehicles, many insurance companies offer gap insurance, which is a reasonable insurance mode. Here, the insurer provides the consumer, the difference between the outstanding amount owed (the higher value) and the market price (the lower value) to the consumer. Gap loan mode provides the consumer insurance against the loan ?owed? and not the ?market value? of the vehicle in question.

Several legislations in the US provide coverage to people like the ?no fault insurance,? where the victim should only prove his/her injury to claim damages from the insurers.

In some states, people can choose ?no fault insurance.? This is called ?choice system.?

Insurance – Taking Precaution Against Misfortunes

admin — Sat, 04 Sep 2010 13:39:27 +0000

Life is full of risks and sometimes when we are faced with adversities; it becomes hard to bounce back into our normal shape almost immediately. This is where insurance comes in. It refers to the ability to manage risk. Well, somebody might say that, risk cannot be managed because it is not predictable, but at a close look and through non-logical eyes, risk can be managed.

Insurance is simply taking precaution against misfortunes that may hit us at any unforeseen point in time. The process of taking this cover involves two parties, known as the insurer and the insured. The two parties get into an agreement that in case of any misfortunes, the insurer will compensate the insured with some lump sum of money. For this to happen, the insured must make payments to the insurer at given intervals of time. This agreement is referred to as a policy.

Depending on the risk factor that the insurer wishes to take cover against, the rate is calculated at which the insured will be making deposits to the insurer. The deposits are known as premiums and they earn a given percentage of interest, such that the insured is actually given more than what they have paid to the insurer by the time the loss takes place.

There are many types of risk management policies that can be bought. They include health, life, car or employment risk management policies. The employment policies are mostly taken by employers on behalf of employees in case they are injured or if they incur a misfortune in their course of duty. Insurance is guided by a number of principles, all of which are key to ensuring that the contract entered by the two parties flows smoothly and without one party being unfair to the other.

Interstate health insurance myths

admin — Mon, 14 Jun 2010 10:46:44 +0000

The game played by politicians is to take an idea from their own agenda and then frame it in a way that sells it to the other side. When the politicians meet in the middle, bipartisan solutions to problems emerge. This reflects the fact there is no monopoly on good ideas, only simple good solutions to difficult problems. In the healthcare debate, one of the solutions proposed by the GOP was to allow people to buy their insurance across state lines. This sounds a good idea. As the law stands, every state regulates the sale of insurance within its own borders. This limits the size of the market. If insurers had to compete with each other on a regional or national level, the premium rates would fall and every citizen would get a better deal. Well, let’s look a little more closely at how it would actually work.

At present, every state has a Department of Insurance to regulate the insurance companies licensed to sell policies. This is a reasonably effective system for consumer protection. But if regional or national insurers could sell policies into many states, it would break the regulatory system. It would no longer be local supervision of local companies. Insurers would decide where to establish and would, of course, choose the states which had the weakest consumer protection regulations, i.e. where they could make the most profit. Think banks and finance companies. These companies broke the US economy and produced the recession because their sales of subprime mortgages and associated derivatives were unregulated. Now apply the same thing to interstate insurance. As a final thought on this issue, remember all US states have different laws and one state cannot enforce another’s laws. That is sovereignty for you. So the state where an insurer is based cannot protect consumers under another state’s laws.

Secondly, opening the market across state lines allows insurers to cherry pick the best people to insure. Without regulations to limit the right to discriminate against people for pre-existing conditions and to increase premiums as people get older and fall ill more often, insurers will just take their profit from all the healthy people and forget about the rest. Thus, instead of increasing consumer choice, it would have the reverse effect. Most insurance companies would close their branches in individual states. Those that remained would keep all the aging and less healthy people. As their claims rise, the companies will make a loss and close. Without a law to mandate regional or national companies to offer some health coverage, it is likely the number of uninsured people would rise.

When you add all this up, it is a good thing the GOP’s proposal was rejected. Health insurance plans are complicated enough without having to change a whole mass of federal and state laws to allow interstate sales. This is not to say that consumers might benefit if there was more competition in the insurance market generally. With a real free market, properly regulated, consumers would get a better deal both in the terms of coverage and in the premium rates they pay. As it is, you must get multiple quotes to find cheap health insurance. Anticipating their profits will take a hit following this reform, insurers have been raising their premium rates. You must shop around to find the most affordable policy.