Archive for February 19th, 2010
Is it wise to opt for the maximum deductible?
Lets start off with a simple explanation of how insurance works. In the good old days before those kind men got together in the Lloyds coffee shop, people were responsible for their own losses. If the horse pulled their cart into a ditch and this broke the wheel, the owner had to put his hands into his pock’ets (which fortunately had already been invented) and pay someone to repair the wheel. But once people could share the risks, life was suddenly better. If you gather together a big enough group of cart owners, each will only have to pay a small amount into the central fund to cover the losses of the few who have accidents. Those men at Lloyds were on to a winning business formula. Moving into modern times, the idea of spreading the risk is the same and, with thousands of people in each group, the cost of loss is divided into small premiums. But, with profits under pressure, the insurance companies came up with a new variation on the old theme. Suppose they could persuade their customers to accept the risk of some of their losses. This would then become self-insurance for part of the risk. The rest would be paid by the insurance companies. So the deductible was born. You agree to pay the first portion of any loss. In the case of traffic accidents, most of the fender benders are minor and don’t cost much to repair. That means you pay for most of the repairs yourself and the insurance companies get richer. Ironically, if no-one opted for the deductible, the increase in the premium for everyone in the group would be trivial. Read the rest of this entry »
Women should think carefully when insuring their lives
When it comes to writing an article, it’s always best to start off with good news. This sets a positive tone to the piece and keeps people reading. So, here it comes. The premiums for life insurance have been dropping! Yes, you did read that properly. It may not feel like it, but there has never been a cheaper time to buy a life policy. How come? Well, unlike other forms of insurance, the policy only pays out in the future when the life insured ends. If you go back to 1980, men lived to an average of 70 years, women to 77 years. In the latest figures released by the Center for Communicable Diseases, men now live to an average of 75.6, with women now into the 80s at 80.8 years. As an aside, the poor quality of the US healthcare service is highlighted by the life expectancy figures. The US ranks only 38th in the world. That said, since the obligation of having to pay out on a life policy is disappearing into the future, the cost of the benefits payable can be collected over more years. This brings down the premiums. Read the rest of this entry »
Affordable insurance coverage tips
Today there are many ways you can get affordable health insurance. You can contact an insurance agent by phone or browse for quotes online, and the number of offers you will get will definitely make a good comparison shopping experience. But before your set your mind on comparing the prices, first make sure you understand what coverage types your policy offers and select the one that covers your exact needs. Here are four tips on how to get the most affordable coverage and get the best of your current health insurance policy. Read the rest of this entry »