Category Archives: Insurance

Useful Tips for Homeowners

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A Homeowners Policy is vital!

Useful Tips on Homeowners Insurance

There are some things you have to know about Home insurance and that includes selecting the best insurer and getting suitable and enough coverage.

1. You are only a statistic.

In the eyes of an insurer, you’re not a person with a name; you are a set of risks. When an insurer has to decide on you as a client and your premium, they base it on your “risk factors,” which include your occupation, who you are in society, how much you own, and what kind of lifestyle you lead.

2. You have to know the value of your home.

Before you decide on a policy, call in the help of a local builder to give you an all inclusive estimate of your home’s replacement cost.

3. Be aware that Insurers differ.

Whether it’s a car or furniture that you are buying, the same product can have vastly different prices at different suppliers. The same is true when you purchase Homeowners Insurance. Get a few quotes, compare and save yourself some money.

4. Price is not the only important factor to consider.

Do your homework! Ask around! Investigate the insurer’s track record for servicing a claim. You will stop smiling at a low premium, if an insurer is in no rush to deal with your claim.

5. Consider more than the basics.

Buying a basic homeowners policy will be cheaper, but it might not offer to fully replace your home, if that is what you need some day.

6. Enquire and request discounts.

Certain behaviour on your side, that will reduce risk, will attract discounts from your Insurer.

A huge amount of money is lost by policy holders who don’t ask for discount. The insurers are quietly smiling about all the money they score.

7. Your insurer is not essentially your friend when you have a claim.

You and your insurer may have a very different opinion of fair compensation. It is your insurer’s responsibility to reinstate your financial position. It is your responsibility however to prove the full extent of your losses in order to get full refurbishment.

8. Have the correct details to file a claim.

Make sure your policy is regularly updated. Read the policy before you file a claim to prevent any nasty or disappointing surprises.

Have a look at the following interesting information:

How your Home Insurance premium is calculated

Ref.:

http://money.cnn.com/

 

Life Insurance Scams

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Scam Alert!

Common Life Insurance scams

Life Insurance scams are tempting due to is the large financial potential. The following are scams that could cost you personally:

1. Stranger-Owned Life Insurance

This is a scheme in which strangers own a policy on someone’s life normally sold to them by the insured. Scammers offer money up front for a life insurance policy, normally as a loan.

If the insured dies within the first two years, the family gets the benefit, and repays the loan. If the insured didn’t die, fraudsters hope he will transfer the policy to the lender, and not repay the loan. The lender becomes the beneficiary, receiving the big payout when the insured dies. Scammers go after the elderly, as they are likely to die sooner, with better profits.

2. Churning

Annuities promise a future regular income. However, payouts are locked out for 10 to15 years to allow growth. Scammers get older seniors to substitute their existing annuities with new annuities – for an instant cash bonus.

Seniors may never get the bonus and are trapped in a new annuity that cannot be accessed for up to 15 years, without paying a large penalty. Even if the bonus is paid, it doesn’t counteract the inaccessible source of income.

3. Twisting

Large annuities pays big commissions to agents. In order to get approval for a larger annuity, a scammer may increase your net worth, to appear that you can afford it. It will replace all other annuities. You end up with an unaffordable annuity – and no way to get your money without paying large penalties.

4. Bait and Switch

As Life insurance commissions are high compared to other types of insurance and whole life policies even more so. A scammer will sell you one type of policy and switch it with a whole life policy. You may find that you haven’t got what you thought you were and premiums may be higher than you expected.

5. Fake Death

Scammers fake a death to get a payout and even forge signatures on death certificates. Some take out policies on so-called “relatives” and fake their deaths. One scam operation involved a staged funeral and a coffin containing cow parts.

 

Ref.:en.wikipedia.org

 

 

Home Insurance Earthquake Cover

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Earthquake Cover may be expensive, but well worth it
Is Home Insurance Earthquake Cover really necessary?

For many years every time there is a major earthquake in a city, surrounding cities experience an invasion of victims relocating as a result of the damage that was done to their homes. These people say that they loved living there, but could not financially manage rebuilding the house that wasn’t covered by earthquake insurance.

Earthquake insurance will cover the homeowner or building owner against any damage that is caused by an earthquake. Some insurance covers damage to the building and provides a small amount of funds for possible relocation or to replace items that were inside. Even in the earthquake ridden California, less than 20 percent of Californians have earthquake insurance.

Many of them are beginning to consider it again as it has been too quiet for too long and the next one could be due. For many it is not a resent quake that makes them think about getting insured, it is the possibility of the next quake. Another reason to review home owner’s policies to possibly add earthquake insurance is that if a quake happens, it can destroy your financially for a very long time.

Reasons to get Home Insurance Earthquake Cover
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Structural damage by an earthquake
  1. Even if a quake doesn’t cause structural damage to your home, the coverage will replace a certain amount of items that are damaged. Earthquakes can cause a fallen chandelier or your television to drop off the wall. Sometimes it is just broken plates but you can still file a claim. The excess for damaged items is lower than for the overall property damage.
  2. If you need to vacate your home for a period while it is repaired or rebuilt, the coverage will help pay for your lodging.
  3. Structural damage will be repaired and often if you have an older home, you will have an improved frame, which is better than before.
Possible reasons against Home Insurance Earthquake Cover

The premiums of  Home Insurance Earthquake Cover can be high if you live in an earthquake area. Excess payments for structural damage is also high, but will cover you when your house is damaged by an earthquake.

If you have a small earthquake in your town and then decide to get Home Insurance Earthquake Cover, you may not be able to, as many insurance companies will halt the issuing of new policies for a certain amount of time in areas that have had movement.

It is probably a good idea to apply for coverage when conditions allow it again.

Home Insurance Flood Cover

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Flooding may cause grave damage to your house

Why you may need Home Insurance Flood Cover

Do not take for granted that a basic Home Insurance policy is enough. Often times these policies do not make provision for specified coverage. This could be a problem if you live in an area that is a high risk for certain threats that aren’t included in the cover.

Take note that your Home Insurance policy is unlikely to provide you with automatic coverage against flooding if you live in a flood endangered area. However you should acquire an add-on policy for flooding to extend the basic coverage. It should give you enough protection to cover the costs of such damages.

Home Insurance Flood Cover Explained

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Home Insurance Flood Cover is money well spent

Home Insurance Flood Cover will cover your home against repair or replacement costs of property lost due to a flood. Floods are caused by heavy rain, hurricane, tornado, snowmelt or mudflows. It is true that most home owners believe they will never need to claim from this type of coverage. Truth is that Flooding can cost any home owner huge amounts in damage. Having Home Insurance Flood Cover can be your safety net or life jacket.

Who should get Home Insurance Flood Cover?

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Water causes a great deal of damage to your house

There is no area that is totally exempted from flooding, but some areas are just more prone to flooding than others. To make these areas known to any home owner, flood maps have been created to show the locations. Flood maps are created by your national Emergency Management Agency. They are people who conduct topographic studies and collect information on storm tides, river flow, and rainfall to establish and stipulate high-risk areas.

Maps are regularly updated so the home owner can make educated decisions about protecting his property. Remember though that Flooding can happen in high-risk areas, moderate-to-low risk and almost no-risk areas.

There is a 1 in 4 chance of flooding in high risk areas. If you have purchased a home in such area, you are required to buy flood insurance. In the other areas, you are not required to buy flood insurance, but the decision is yours.

Perhaps it is better to be safe than sorry.

What does Home Insurance cover?

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Home Insurance can save you from financial ruin

Your home is your place of safety and happiness, but also possibly the biggest investment of your hard earned money you will ever make! Your safe haven requires protection against various incidents.

Home Insurance is financial protection. You pay a premium for the cover. You might never have to claim against the policy, but in the case of a destructive event it may be the only way to avoid the cost of losing a home.

Policies from different companies differ, but most home insurance policies protect against the most general risk factors such as:

  • Fires of any size that could cause structural damage of the building or the contents inside or fixtures to your house.
  • Theft of things stolen from your home.
  • Vandalism – acts by destructive people such as broken windows or doors, graffiti, or other acts from such people.
  • Storm and/or flood damage for damage to your home caused by wind, hail, water, rain and ice.
  • Falling objects – protection from falling trees or other items that may fall onto your house and cause damage to the roof or other segments of the structure.

Home Insurance is your Responsibility

It is your responsibility to seek and find the policy that suits your individual needs as well as the need to be covered against specific events that is frequent in the area and neighbourhood where your house is built.

If any of the events that you have cover for, occurs you will simply have to fail a claim with your agent or directly with the Insurance Company. The company will make the funds available to repairs damaged items or replace what was lost.

Your policy provides cover up to amount specified in the policy. Take care to be sure that your Home Insurance coverage is enough to cover the full home value as well as additional coverage that may be needed. Be aware that the value of your house should not include the land value.

 

Ref.: http://finance.alot.com

IMPORTANT Liability Insurance Facts

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Do you have enough Liability Cover?

What are the Basics of Liability Insurance?

Liability insurance covers legal claims regarding liability, or legal accountability, against the insured policy holder.

Homeowners  Liability Insurance

Liability cover in the basic Homeowners Insurance protects the insured or policyholder against rightful claims by a third party being injured on the property of the insured. It also covers damage or loss to the property of a third party. This applies to one of your guests being bitten by your pet, falling down stairs or having a tree branch break and fall on his/her car.

Vehicle Liability Insurance

Car Insurance policies include liability regarding injury to a third party in the event of an accident and also includes compensation for loss or damage to the other person’s property. If you caused an accident, this cover will pay for the injured passengers of your car, as well as the other car.

Liability Insurance Cover

Liability Insurance offers protection to the insured or policyholder regarding a legal defense, as well as indemnification regarding a settlement or court verdict. This cover applies to the negligence of the insured, but does not cover malicious or intentional destructive acts by the insured or policyholder.

 

Important Facts about Computer Insurance

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Insure laptops of a substantial value

The cost of personal computers and laptops make it necessary to have them insured.  

You can even insure computer accessories and your cover depends on individual insurance packages. 

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Insure expensive computer accessories

Computer Insurance Coverage under Homeowners Policy

The majority of Insurance Companies insure laptops and personal computers under their Home Contents Package. Your personal computer will fall under home contents, while your laptop will generally resort under the Portable Possessions section of your Homeowners Policy.

Home contents insurance covers all loose contents of your home against fire, flood, loss and damage. It is wise to find out exactly what your particular policy covers before an unforeseen event occurs.

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Home Contents Insurance covers your Personal Computer

Replacement cost vs actual cash value

Replacement cost is usually at least 10 percent more expensive as compared to actual cash value. Keep in mind that the value of these items depreciate fast. The reimbursement you get on replacement cost is the same as the current cost of your computer and not the depreciated cost you would get with an actual cash value policy. 

Rather insure your computer for replacement value. This means that you may have to specify a higher amount than the general amount allocated in a basic policy.

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Replacement Value > Cash Value

Laptop and portable computer insurance

Laptops are considered as portable possessions that can be taken with you when you step out of the house. As mentioned earlier, if the value of your laptop exceeds the amount specified in the policy, you will have to specify a more realistic amount to the insurer.

Always keep the receipt when you buy a laptop, personal computer or any valuable computer accessories.

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Many people take their laptops with them

Who needs Computer Insurance?

Students, business professionals, small business owners, schools and home users all need computer insurance. Another tip is to buy an extended warranty when you buy your new laptop or personal computer. This will cover you against mechanical breakdown, electrical failure and other eventualities specified in the warranty.

That's right ... EVERYBODY uses a computer ...
That’s right … EVERYBODY uses a computer …

Happy Computing!

7 Ultimate Rules to save money on Insurance

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Be wise and save money on insurance

Save money on insurance and avoid making serious mistakes when you shop for insurance policies with these 7 rules as a guide.

Rule 1: Financial Risks

Only buy insurance for financial risks you cannot manage on your own. Don’t handle insurance as a way to cover any or all losses no matter how small or insignificant. This is a waste of money. Insuring your home with homeowners insurance is a good choice, but taking out expensive, comprehensive insurance for a very old car is a waste of money.

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Get Third Party only insurance for old cars

Rule 2: Shop Around

Get a few insurance quotes from different Insurance Companies. Most Insurance Companies provide an online quote service, as well as a telephonic quote service via state of the art call centers. Do not immediately accept the first or cheapest quote. Make sure that the policy covers your lifestyle and individual needs.   

Companies that sell directly to the client will also save you additional money for a middleman or broker. Have a look at the benefits the different companies offer, as well as any low-cost Additional Options provided to enhance your basic policy.

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Shop around online for insurance quotes

Rule 3: Never Lie on a Policy Application

Your policy can be cancelled if it is discovered that you have given incorrect information.

Health, life, and disability insurers run severe background checks on applicants through the Medical Information Bureau, so you can get caught when providing inaccurate information.

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Do not give inaccurate information on your insurance application form

Rule 4: Don’t Buy Specific-Risk Policies

Your insurance should provide the broadest coverage you can get. Buying insurance cover against specific illnesses like cancer defeats the purpose of having an insurance policy. If you have ulcers or other medical issues, your cancer insurance will not help you. A much safer option will be to get comprehensive medical coverage instead.

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Broad Cover is safer than Specific Cover

Rule 5: Never Cancel One Policy until You Have a Replacement Policy in Place

You will be uninsured for however long it takes to get a new policy. And if disaster strikes during this period, you could be financially ruined. This rule applies to everyone, but especially for the elderly, since older folks sometimes have trouble getting health and life insurance. Please keep this important information in mind!

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Don’t be caught unawares

Rule 6: Get a High Deductible or Excess

You save money by having insurance policies with high Excess or Deductibles. The premium for high-deductible policies is always lower. Not only that, but you save yourself all the trouble of filing a claim and needing to haggle with insurance company representatives if you have a high deductible and you don’t need to make as many claims.

Lately, most Insurance Companies are offering to pay cash back to policy holders after 4 or more years remaining claim-free. This should be an additional incentive not to claim for any and every mishap.

Note: The more you claim, the more inflated your premiums will become, due toe being viewed as high-risk by your insurance company.

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Don’t claim when you don’t have to. They’re watching …

Rule 7: Rainy Day Account

While you can save money on your insurance premiums by following the rules mentioned earlier, it’s probably a big mistake to use that money for, say, a trip to Hawaii. Instead, use any savings to build a nice-sized rainy day fund that you can draw on to pay deductibles. A big enough rainy day fund can cover both periods of unemployment and your insurance deductibles.

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Save for a rainy day.

Keep these guidelines in mind and you may save more money than you expect on the long run!

 

The Concise Guide to Travel Insurance

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Is your Travel Insurance in order?

Everything you need to know about travel insurance

Why do we need travel insurance? Travel insurance protects travelers against adverse events such as cancellation and interruption of travel. It reimburses the traveler regarding medical expenses incurred, loss or damage of property and transit delays.

How can you make the most of your travel insurance?

There are four main categories of travel insurance, namely Health & Medical, Delays & Cancellation, Death and Damage or Loss of property.  

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Health Cover forms part of Travel Insurance

Emergency evacuation: Guarantees emergency transportation to either a local hospital in the event that the traveler is unable to use own form of transport. Another option is to have the traveler transported to a hospital closer to home.  If family members are covered on the same policy, they can also travel back to their home destination with the patient.     

Medical reasons: Reimburses emergency medical and dental costs incurred by travelers. The majority of holiday insurance policies reimburse the traveler after they have paid locally for treatment. Medical claims are usually paid within 7 – 10 working days. Pre-existing medical conditions are covered by most policies if the policy is purchased within a maximum period of 21 days from the date the traveler made the first payment or deposit.

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Airport Delay

Cancellation: Reimbursement comes into effect if travelers have booked and paid for a holiday, but are unable to follow through with their plans due to personal illness or injury, death of either the individual or a family member, adverse weather conditions, transport strikes, terrorism, sudden unforeseen unemployment or by sustaining serious damage to their home caused by a natural disaster. 

Delay: Travelers are reimbursed for hotel, food or clothing expenses in the event of a flight delay. 

Interruption: Insurance companies usually reimburse travelers abroad if they have to cut their trip short due to illness, death, terrorism, weather, airline strikes and other adverse conditions. These conditions refer to events outside the control of the traveler.

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Airplane medical emergency

Accidental death: Covers death or dismemberment at any time of your trip.

Air Flight accident: Covers death or dismemberment during an air flight only. 

Common carrier: Covers death or dismemberment of the traveler while traveling on public transport such as a plane, ferry, train bus or taxi.

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Tag your baggage properly

Baggage loss: Reimburses a traveler for lost, stolen or damaged personal items. This coverage is usually not confined to baggage damaged or lost by the airline, but covers the duration of the trip. 

Hire Car damage: Reimburses travelers for damage or loss to a rental vehicle. Liability coverage should still be purchased through the car rental company. 

Assistance services: Guarantees a 24-hour telephone advice and assistance service to travelers. This service can be used anytime a traveler needs advice. Be sure to keep this number in several places in your luggage or on your person when you move around.

We trust that these travel insurance guidelines will alert you to the issues you should address when taking out travel insurance for your next trip.

Bon Voyage!

Insurance terminology and definitions

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Insurance terminology and definitions for everyday use

Insurance

The impartial transfer of the possibility of a loss, from the insured to the insurer in exchange for payment. It is a form of risk management mainly used to protect against the risk of uncertain loss and to indemnify the insured.

Risk management

It is the recognition, evaluation, and prioritization of risks to apply resources to minimize and monitor the likelihood and/or effect of unfortunate events. Risks can come from uncertainty in financial markets, possible project failures, accidents, natural causes and disasters as well as unpredictable events.

The strategies to manage uncertainties with negative consequences typically include transferring the risk to another party, as in the case of purchasing insurance.

Indemnification

It is to restore or to be reinstated to the position that one was in prior to the happening of a specified event or peril.

Three types of insurance contracts that seek to indemnify an insured:

  • a “reimbursement” policy
  • a “pay on behalf” policy
  • an “indemnification” policy.

 

The Policy

The insurance policy is a contract between the insurer and the insured (policyholder). The policy determines the claims which the insurer is required to pay.

The insurance policy is a contract whereby the insurer will pay the insured if certain stipulated events transpire. Subject to the “fortuity principle”, the event must be uncertain, either the moment of the event (e.g. death of the insured) or whether the event will happen at all (e.g. flood or fire).

Insurance contracts operate by the principle of utmost good faith (uberrima fides) which requires both parties to deal in good faith. The insured has a definite duty to reveal every fact related to the risk to be covered.

Items of an insurance policy

  • Declarations – all details of the insured, the insuring company, what risks or property is covered, the amount of insurance, what deductibles apply, the policy period and premium amount.
  • Definitions – explanations of important terms used in the policy.
  • Insuring agreement – details of insured risks and the contractual agreement between insurer and insured. A summary of the major promises of the insurance company.
  • Exclusions – losses arising from specific events which are not covered by the policy.
  • Conditions – provisions and obligations required for coverage. If policy conditions are not met, the insurer can deny the claim.
  • Endorsements – modifications to the policy.
  • Policy riders – The terms of policy amendments.

 

Ref.: http://en.wikipedia.org/wiki/Insurance