| Life And Disability Insurance (insurance)
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Life And Disability Insurance
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Bad Credit Home Loan To Get You Out Of Debt
A "bad credit home loan" can help you climb your way out of debt and get you started back on the road to upstanding, good credit. There are many lenders who are willing to make bad credit home loans to you - a loan based on your equity in your home even if your credit has slipped or isn't as perfect as it could be. By taking out a bad credit home mortgage or home equity loan, you can consolidate a... Read article
Bad Credit Home Loan To Get You Out Of Debt
A "bad credit home loan" can help you climb your way out of debt and get you started back on the road to upstanding, good credit. There are many lenders who are willing to make bad credit home loans to you - a loan based on your equity in your home even if your credit has slipped or isn't as perfect as it could be. By taking out a bad credit home mortgage or home equity loan, you can consolidate a... Read article
Life And Disability Insurance
A "Rider" is sold at the same time that you buy your insurance policy and it modifies your policy. These are occasionally called endorsements. The Rider overrides any conflict with the policy. In other words, if there is a provision in the Rider that is different than the same provision that was originally in the insurance policy, then the Rider prevails.
Riders may exclude or remove coverage, which can lower your monthly premium, however, in most cases, Riders will add more coverage to the existing policy.
These are some of the most common Riders found in life insurance policies:
Accidental Death and Dismemberment, also known as "Multiple Indemnity" - These are sometimes known as "A D & D" Riders. The insurance company will pay a multiple of the policy's Face Value, which is the amount that the policy would pay to the beneficiary in the event of the death of the insured person. This Rider may also cover loss of sight or the loss of one or more limbs within a designated amount of time from the date that the accident occurred.
Example, say that the insured person was in a car accident and damage was done to their legs that resulted in amputation a few weeks after the accident occurred. Most of the time this coverage period will depend on the state that the policy is drawn in, however, 90 days is common for this type of Rider.
Note: This type of Rider does NOT cover death by any form of illegal activities, such as committing a crime resulting in a felony, death by suicide or death by a malfunction of the body. An example of this would be someone that suffered a stroke or heart attack while driving, but the physical condition occurred before the accident and the accident was the result of that condition. This type of accident would not be covered.
A D & D will also cover dismemberment. In case of the accidental loss of one eye, one arm, one leg, etc. one half of the death benefit would be paid to the insured. In the event that the insured person suffered the loss of sight in both eyes or lost two or more limbs, then that would result in the entire principal sum (death benefit) being paid to the insured. In this event, the A D & D Rider would be terminated because the entire Face Value would be paid out.
Waiver of Premium Rider - The Insurance company will pay the policy for the person insured in the event that they happen to become permanently and completely disabled. They must also go through a waiting period called an "elimination period", which is often around 180 days (six months).
Disability Income Rider - These can be added to your life insurance policy as a Rider. This particular Rider will pay a pre-determined amount of income after the insured person has been disabled for the length of the waiting period. The waiting period or "elimination period", is the period of time immediately after the insured is determined to have a disability. There are no benefits paid during this waiting period. Your disability income may not exceed the average amount of your average income over the previous two years time. You may not buy more than this amount of coverage.
The disability benefits of the insured are combined with other potential disability income such as lost wage policies, social security disability, salary continuation plans, ect. This is to make sure that the person insured is not collecting more money by being disable than they would if they were employed. Combining or Integrating the benefits means that other forms of disability coverage will kick in to pay the insured individual first. Other forms of coverage being worker's compensation, etc. The Disability Rider will kick in to make up only enough of the difference to assure that the person receiving benefits receives an equal amount of income as the would have had they been working.
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Whole Life Insurance Services
Whole life insurance is a cornerstone of many peoples financial planning portfolio. Whole life, or "cash-value" life insurance, is an insurance policy which is purchased with the idea that a will be maintained for the duration of the insured's life. It has a level payment and accumulates a cash value over time. Whole life insurance policies are often purchased for children, the long life expectancy creates a low annual premium because the insurance company expects to amortize its risk and expenses over many years.
This is a good choice if you are planning for a certain event, death, and want to cover expenses and provide some help for the beneficiary. Also, whole life may be a good choice if you want to create a savings account, the cash value portion, which you can borrow from in the future, perhaps planning ahead when a child enters college or purchases their first house. As a savings account whole insurance offers the advantage that the savings portion grows tax-deferred allowing it to accumulate at a faster rate than a nontax-deferred account.
Whole life insurance can not be cancelled because of future health problem and the face amount is guaranteed at death less any amounts borrowed from the savings side. As you get old and your life expectancy decreases whole life insurance gets increasingly more expensive. As you get older whole life can get so expensive it no longer makes economic sense to purchase.
A small whole life policy may not provide all the coverage you actually need over your life span. You family and financial responsibilities usually start out small in life, increase through middle age and the decrease as time goes by. As you responsibilities change so must your insurance needs change. Since whole life generally has a set face value there are policies that allow you to buy more or increase the amount at certain specified times in your life, without a physical exam, at the then current rate. These can be good when buying insurance for a child who does not need much but it can be increased at perhaps 20 years of age and again at 30. This type of policies is a hedge against a health problem occurring during that time span making it harder to get increased life insurance.
Whole life's savings side, or investment account, will fluctuate just like similar investments, but the big advantage is that it grows tax-deferred. If you decide to terminate your whole life policy your cash value will be paid out to you, at which time you will be responsible for the taxes.
Before buying whole life insurance you need to think carefully about what dollar amount of coverage you need and how much you are willing to pay. Because this insurance policy is designed to last your whole life you do not want to over commit yourself where you might not be able to pay the premium at some point in the future. Although as the cash value grows you may be able to us the dividends to help reduce the premium payment.
When purchasing a whole life insurance policy find one that:
- has a guaranteed cash value starting at the very first year
- a high cash value the first year
- does not levy "surrender charges" when you cancel
- lets you use the accumulated cash value of the life insurance policy to pay the premiums if, you should ever not be able to make a premium payment, thus keeping your coverage current.
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