Whole Life insurance

As the name implies this insurance policy is taken for the life term of an individual. This policy helps the insured to make a substantial investment. However the returns from a whole life insurance policy are not that high. But companies adopt a different strategy for these policies nowadays. The money invested by the insured earns a higher interest than commercial banks. Moreover the insured is eligible too earn tax exemptions. Another advantage of this policy is that the insured continues to be a beneficiary till the end of his life once he successfully completes paying premiums. The insured continues to be a policyholder without paying premiums thereafter.

Universal Life


The insured is required to pay a limited sum of money for a fixed period. The amount of premium you pay is constant, like that of a term life insurance policy. Similarly the benefits reaped resemble a 'whole life insurance' policy. 
Variable Life Insurance
The insurance company invests your premiums in multiple options. These policies are said to be risky as the returns are based on the performance of your stock in the market. These Policies yield great returns when the stock performs exceedingly well.


Variable Universal Life Insurance


Variable Universal Life Insurance is a combination of universal life insurance and variable life insurance. The insurer pays the premiums as in a universal life insurance. Similarly the coverage falls in line with a universal life insurance. The insurance company uses your funds for investing them in the stock market. The terms of investment in a variable universal life insurance policy are the same as variable life insurance.


Premium Life Insurance


This policy enables you to obtain insurance on payment of premium at one stroke. However the amount is quiet expensive and also decided on the basis of your age. This policy is highly recommended for people intending to invest in insurance for the purpose of wealth creation. This policy does not involve any risks because the payments are made at a stretch and the likelihood of not paying the future premiums does not arise.


Survivorship Life Insurance


This policy enables one or more persons to insure their life. The Premiums for this type of policy is less as involves a minimum of two persons. These premiums are not payable if one person dies. On the contrary the policy remains in force even after one insured dies. The second person must continue to pay the premium and it becomes payable only after his death.


Other types of term insurance policy insurance are classified on the basis of time whether short term life or long term life insurance. Group insurance is another scheme offered by employers to employees whereby the premiums are deducted from the monthly salaries of the employees and paid to the insurance company. In group insurance you have the facility of converting your policy to another which is not available with other insurance policies. So as an insurer you are given the freedom to choose the policy as per your choice. 

Term Life Insurance

Term Life Insurance is a type of insurance policy whereby the insured pays a fixed sum for a period of time. This sum remains constant. The premium charged is very nominal. The Policy holders normally survive even after its expiry unless they are affected by fatal disease or injured in an accident. This policy does not cost much. Once the policy expires the insured is also at liberty to renew the same but he will have to pay the revised rates of premium. Such a change could sometimes be too high. This is one of the drawbacks of this policy. But for this factor, it is economical and highly recommended for the salaried youth and middle men. Whole term insurance policy is another classification in term life insurance. In a whole term insurance the insured pays the fixed amount throughout his life. 


The different categories of term life insurance policy are as follows:


Group Term Life Insurance


This type of insurance is taken by the employer for his employees. The employer either pays the premiums from his kitty or by deducting the appropriate amount from the salary of individual employees. This policy provides lot of benefits but it cannot be relied solely to meet your insurance needs. This type of insurance is gaining significance in the developing countries.


Level term Life Insurance


This type of insurance requires you to select a particular period and pay premiums for the selected period. The policy automatically matures on the attainment of the selected period. Once you select the term say 5 10 or 15 years you cannot revoke it. This type of insurance is ideal for those people who are not able to make long term financial plans.


Permanent insurance

Permanent Life Insurance is an expensive Policy. This Policy cannot be stopped on any occasion as long as the premiums are paid regularly and you don't want to end the policy. In a permanent Life Insurance policy you pay premiums for an indefinite period irrespective of the fact they exceed the amount to be distributed to your dependents in case of death. 


Such surplus will be deposited by the company in a separate account. They will yield higher returns if the company performs well. A share of the profits is periodically dispatched to you. You have the option of raising loans out of those funds or accumulate them back in the account. In case you decide to end the policy you will paid back with the surrender value .If the insurer decides to retain the profits made from your investment with him then you are not required to pay income tax for that amount. There is a possibility like, when you withdraw certain amount of money within the given limit you need not pay income tax for that amount. But when you deposit money in the bank you have to pay income tax irrespective of the fact you utilize it or not.


If the insurer decides to retain the profits made from your investment with him then you are not required to pay income tax for that amount. There is a possibility like, when you withdraw certain amount of money within the given limit you need not pay income tax for that amount. But when you deposit money in the bank you have to pay income tax irrespective of the fact you utilize it or not.


It is however advised not to choose permanent insurance if your motive is solely investments and tax exemptions. In that case it is advised to invest in some form of cheap investments and make use of other financial instruments for saving tax because the basic objective of insurance is neither investment nor tax 
exemption.

MassMutual Gives Free Life Insurance

The Massachusetts Mutual Life Insurance or MassMutual company is starting a program in which they will give out one billion dollars in free life insurance coverage. The first of this program will start in the Lakewood area by giving free fifty thousand dollar ten year policies to working parents in the area. 


The philanthropic program of MassMutual is called LifeBridge and it is designed to give insurance policies, of which they have already done twenty thousand nationally, to parents who are working and eligible so that their children's education will be paid for in the event that they should die. The policies are typically given to families where the children may not be able to complete schooling as a result of a parent or guardians death. 


MassMutual, based in Springfield Massachusetts, is solely responsible for making all the annual premium payments which can be between $150 and $200. The parents who qualify for this program pay no fees whatsoever for the life insurance policy. In the past four years the company has also paid out on two claims. 


So far the company has issued out 6,200 policies to qualified parents and their children which provided families with over three hundred million in free life insurance coverage and the company plans to increase their current numbers in the near future.


Applicants to the program need to be U.S. residents between the ages of nineteen and forty-two. They need to be either full or part time employed and have a combined family income between ten thousand and forty thousand a year as proved by recent tax returns.

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Loan protection insurance guide

What is loan protection insurance?




Loan protection insurance is designed to cover your monthly loan repayments if you are unable to work due to an accident, sickness or unemployment (depending on the policy terms). Policies can vary widely between insurers with some companies offering additional benefits such as critical illness and life cover; however, typically, cover is available for a period of 6 -12 months only. Taking out loan protection can provide peace of mind that your repayments will be met in case you are unable to work through no fault of your own, but this cover is optional and is not a condition of taking out a loan. 


What cover options are available?


Policies vary widely between loan protection providers but some of the features available may include: 


Accident and sickness cover: To cover repayments if you are unable to work due to illness or incapacity.

Unemployment cover: A monthly benefit if you are unemployed for a pre-determined period, usually for more than 15 days and up to a maximum of 6 - 12 months.

Hospitalisation cover: Some policies will pay if you have to stay in hospital for a pre-determined length of time, usually more than three consecutive days and up to 365 days.

Life cover: Several loan protection insurance providers also offer a lump sum equal to the amount borrowed under your loan agreement less any arrears. 
Additional considerations when taking out loan protection insurance


When taking out loan protection insurance it's vital to examine the terms and conditions carefully and to be mindful of exclusions.


 For example,


 you may not be able to make a successful claim if you have taken voluntary unemployment or you were dismissed for misconduct. Many providers do not pay out if your circumstances change during the policy term, such as if you reach the age of 65, or if you have a pre-existing medical condition. You should also pay attention to the wait period, which is the length of time you will have to wait before you are eligible to claim and receive a payout, and could be as long as 30-90 days. 


How to choose the right loan protection insurance policy




Loan protection insurance are often sold alongside loans themselves, however, it is optional and you may be able to find more comprehensive cover at a cheaper price by shopping around. It’s often worth applying the same forethought to a loan protection policy as to a loan itself by comparing as many policies as possible before you decide which one is right for you. 


Be sure to enter all your information accurately, as omitting or providing inaccurate information may invalidate your claim. Before deciding to purchase a policy you should ensure that the terms of the policy meet your demands and needs.

Unemployment protection insurance guide

Why take out unemployment protection insurance?

With the global economic crisis leading to widespread unemployment, more and more of us are conscious of the fact that our jobs could be at risk. Unemployment insurance helps protect us against this risk by providing payouts for a pre-determined period while we are out of work. This can help us meet the repayments on our debts and could even help with the cost of other bills and outgoings.

Things to consider when choosing unemployment protection insurance
There are several factors to take into account when choosing an unemployment insurance policy:

Debt repayments: You can take out unemployment insurance to cover debt repayments only. However, you can also take out cover for a percentage of your income to potentially account for other bills and outgoings while helping you maintain a certain standard of living
Wait period: Most policies stipulate a period of time that you will need to wait after you have stopped work before you can make a claim. This can vary from 30-90 days

Length of the policy: Consider how long you want the payments to last for should a claim be necessary, and factor in how long you think it would take you to find a new job. Some policies offer cover for periods as short as three or six months, while others will cover you if you are unemployed for up to two years
What is excluded from unemployment cover?
It's important to examine the terms and conditions of an unemployment insurance policy before taking the policy out and to look for exclusions. Typically you will not be covered if your unemployment is the result of industrial action, voluntary unemployment, resignation or misconduct; and you will also not be covered if you were aware of these situations when taking the policy out. Claims may also be turned down if you are not registered as unemployed, if you are not actively seeking new work, or if your loss of employment is a seasonal occurrence.

How to choose the right unemployment insurance policy

When choosing an unemployment insurance policy consider your ability to meet debt repayments without support and the level of payout you would require, and then use a comparison website to look for a policy that's appropriate for your needs. You may also wish to consider accident, sickness and unemployment (ASU) cover for additional protection against a loss of income due to illness or incapacity.

Be sure to enter all your information accurately, as omitting or providing inaccurate information may invalidate your claim. Before deciding to purchase a policy you should ensure that the terms of the policy meet your demands and needs.

Student contents insurance guide

Starting university is exciting but it can be a daunting experience, too. With so much of your focus on meeting new friends, surviving Freshers' Week, starting your studies or simply finding your way around a new city, protecting your belongings might not be top of your list of priorities.

However, if you take just a minute or two to think about the things you own, and in many cases rely upon, such as your laptop, mobile phone, TV, clothes, iPod or camera, the value is probably greater than you think. So while buying insurance may seem dull, it's one of the most sensible investments you can make as a student, particularly since young people in the 16-24 age group are three times more likely to be victims of burglary and one in every three students becomes a victim of crime (source: Home Office Report ‘Crime in England and Wales 2007/2008’).
So what is student insurance and why do I need it?

Some students are under the impression that their belongings are covered under their parents' home insurance, but this is often not the case and even where cover is available it will usually be restricted. As a result, standalone student contents insurance policies are available to protect against loss or damage caused by risks such as theft, fire, vandalism, storm, flood and burst pipes.
With the average student now owning over £4,000 worth of belongings (Source: Endsleigh Student Possession Research 2008) student contents insurance can provide you with valuable peace of mind, regardless of whether you are in your first or final year of studies. Although insurance won’t make the loss, theft or damage of your belongings any less upsetting, it will ease the financial strain of replacing them.
Getting the right student contents insurance
The most important aspect of finding the right student insurance policy is ensuring that it provides suitable cover for your lifestyle. Always check the small print of the policies you're interested in to ensure they provide suitable cover for your needs. You may be living in shared accommodation or halls of residence but some student insurance policies will not cover ‘walk in theft’ (burglary without forced entry), and other policies may not cover pedal cycles or musical instruments as standard, for example.

Some insurance companies will offer flexible cover options so that you can pick and mix your cover depending on what you need - meaning you often have the option to insure one item, a selection of items or the contents of your whole room. To ensure you have an adequate amount of cover check the policy terms for item cover limits, any ‘total valuables’ limits (the maximum you can claim for multiple items), the excess (the amount you have to contribute in the event of a claim) and any exclusions (items or risks that are not covered).

Remember to check the period of insurance too, as your policy may cover your possessions during term time only and should you need cover to continue during holiday periods then you will need to speak to your insurer to arrange this.

Depending on the insurance company, other policy benefits may include a 24 hour student helpline, legal expenses cover, cover for course fees should you be deregistered due to death, illness or accident and accidental damage cover.