Insurance

What is Insurance?

Insurance is one of the risk management tools, which helps to take care of you or your loved ones financially during difficult times.

  • Home Insurance
  • Auto Insurance
  • Commercial Insurance
  • Life Insurance
  • Term Life Insurance
  • Permanent Life Insurance
  • Universal Life Insurance
  • Whole Life Insurance
  • Mortgage Insurance

Homeowners insurance is a form of property insurance that covers losses and damages to an individual's residence, along with furnishings and other assets in the home. Homeowners insurance also provides liability coverage against accidents in the home or on the property.

Auto insurance is a policy purchased by vehicle owners to mitigate costs associated with getting into an auto accident. Instead of paying out-of-pocket for auto accidents, people pay annual premiums to an auto insurance company; the company then pays all or most of the costs associated with an auto accident or other vehicle damage.

Plain and simply, commercial insurance is insurance that protects businesses. It covers businesses against losses, arising from things like damage to property or injury to employees, and is a term commonly used to label core business insurance covers like public liability and employers' liability.

Having life insurance means that when you have passed away, your loved ones would receive money that would allow them to pay funeral costs, medical bills, credit cards, mortgage payments, monthly bills,  and any outstanding debt, which allows them to be financially balanced and live a stress-free life.

Term insurance is like renting a policy and by definition it’s a temporary insurance and it’s designed to provide coverage for limited period of time typically 10, 20 or 30 years.

Term policies are simple and affordable in most cases but once the term is over you're going to receive premium notice and your rates are going to jump up dramatically, sometimes 10 folds or even more.

The good news is some policies have built in conversion option that allows you to trade in your term coverage for new permanent insurance policy.

Term life insurance is great for when you know for certain that no one will be depending on you financially.

For example, when your kids are all grown up and your mortgage is paid off and Term policy is also good when you are young and healthy, for example 20 years term for $100,000 can cost you two lattes a month.

Note: Term life insurance as has no cash value

Permanent insurance policy is designed to provide coverage for as long as you live. It's for long-term estate planning or final expenses or if you want to leave a bigger legacy no matter when you die.

Permanent insurance is probably the way to go. There are various types of permanent insurances, but primary categories are universal life insurance and whole life.

Both types of permanent insurances are more expensive than term insurance policy but you get more value for your money, as it is designed to last forever as long as you pay premiums on time, your family is guaranteed to receive the death benefit no matter when you pass away.

Unlike term insurance, permanent insurance policies can also build up cash surrender value and which can be accessed at any time for any reason.

You can setup your premiums to remain at a certain level for life and you don’t have to worry about insurance medical exam to re-qualify for coverage, if you like you can also arrange to pay for policy over shorter period of time, say 25 years and after that you don’t have to pay any premiums, you will be covered for rest of your life.

Universal life insurance offers certain amount of built-in flexibility. This enables you to change your premiums and death benefits to keep pace with changes in your life.

Whole-life insurance cost more than term insurance and universal insurance, but the good news is that it will develop significant cash value and can be accessed at anytime regardless of what happens in the economy. Each year the cash values are guaranteed to grow.

 

Universal life insurance offers certain amount of built-in flexibility. This enables you to change your premiums and death benefits to keep pace with changes in your life.

 

Whole-life insurance cost more than term insurance and universal insurance, but the good news is that it will develop significant cash value and can be accessed at anytime regardless of what happens in the economy. Each year the cash values are guaranteed to grow.

Mortgage insurance is an insurance policy that protects a mortgage lender or titleholder if the borrower defaults on payments, passes away, or is otherwise unable to meet the contractual obligations of the mortgage. It may pay off either the lender or the heirs, depending on the terms of the policy.