Are You Over-Investing in Your Insurance?

There are some people who are looking for the cheapest life insurance policy to fulfil their protection need. However, at the same time, there are people who like to invest the maximum fund in the insurance schemes.

When posed with the question why, they simply reply more investment means more returns. The question here is- is it prudent enough to invest out-of-the-limit in insurance schemes, even if these schemes belong to unit-linked category? The simple answer is no.

Insurance is not an investment tool exactly

The core purpose of having any insurance is to have protection against contingencies. To offer the financial protection, insurance companies are charging some amount out of the premium as fee and the rest of the amount is utilized for creating the pool of funds to protect those in need. To do this, insurers have various kinds of propositions so that every person interested in insuring himself is able to find a plan that suits his financial state.

Initially, plans were largely traditional in nature that offered guaranteed minimum returns over a period. Many people did not find this idea of insurance lucrative enough and preferred other investment tools to earn comparatively higher profit. So the insurers came up with ULIPs that is unit-linked insurance plans, to be able to give better returns or market-linked returns to customers. The basic fundamental of providing protection remained the same.

Take inflation into consideration to understand whether it is right to over-spend

To better understand the concept, take inflation into consideration and calculate the financial returns you would get over the period. Would the returns received be considerable enough to fulfil at least some of your needs? No. You find that you would basically be using your own funds that get added to the small percentage of profit your investments are able to accumulate over a period of time. Saying that does not imply that insurance is of no use. It is just that the system of insurance works to provide you much-needed, timely protection that you would not be able to avail by yourself. So, it always makes sense to have insurance, but one should not over-spend on it to have huge returns.

How should you decide whether you are over-spending?

There are many general rules that insurance dealers follow to make buyers understand the estimate of their needs. The basic question is- how much life insurance you really need? To check what you are spending is enough or more than what you are required to spend, read and calculate the recommended sum insured.

Insurance equal to ten times your annual income. For instance, you earn Rs. 10, 00,000 annually you should buy coverage of Rs. 100, 00,000.

Insurance equal to 5 times your annual income plus total liabilities. If total liabilities are Rs. 70, 00,000 and annual income is Rs. 10, 00, 000. Estimate comes to Rs. 1, 20, 00, 000, that is Rs. 50, 00,000 (510, 00,000) plus Rs. 70, 00,000.

Insurance equal to 300 times your monthly expenditure. Say you spend Rs. 50,000 per month, your coverage should be equal to Rs. 1, 50,00, 000 (50,000300).

Insurance equal to the amount your family needs. Family needs do not remain constant for a long time. The expenditure today can increase tomorrow if kids pursue higher studies. If your children are in their earning phase of life, expenditure may not increase, rather decrease. Like this, take an estimate of various needs on a yearly basis that are not in a scene in the present but need could crop up after some years. Add up the immediate liabilities surfacing at the event of demise and what your family will need for ongoing needs for the number of years you would like to protect them financially.
By using the above methods you get rough estimates about how much sum insured you should have. If one of these estimates matches with the collective sum insured of all your life insurance policies with a difference of even a few thousands of rupees, you are on the right track. However, if the collective amount of the sum insured of your policies is much more than these estimates, you need to look into the matter.

Neither it pays to be underinsured nor does it pay to be over-insured. Assuming an insurance plan as an investment plan is fine to a certain extent as it offers tax benefits and keeps your financial goals in place but allocating maximum funds there is not a wise decision.

By investing more than what is required you are converting your investment into expenditure. To extract maximum value out of your money, invest in insurance only what is required and the difference can be used somewhere else to maximize the returns.

Why You Need To Compare Health Insurance Plans Before Making A Decision?

They say it's better to be safe than sorry. Since you can't really guarantee your safety or even your good health, you should take it to another level and say it's better to be insured than to be unprepared for life's eventualities.

There are different types of insurance to cover different aspects of life. Some of these are car insurance, home insurance, health insurance, life insurance, crime insurance, travel insurance, and even alien abduction insurance. You don't have to get covered for every little thing, but it is certainly worth your money to invest in insurance for things that truly matter, such as your health.

Health insurance gives you the chance to prepare for the onset of illness and other health issues. You may be the most health-conscious person on the planet and still be stricken with disease. Living in this toxic world with the added strain of modern living, you are exposed to all sorts of health hazards, so having your health covered by insurance is definitely a prudent choice.

To get the best coverage possible, you need to compare health insurance plans. There is a veritable sea of options when it comes to health insurance policies, so it's important to do your due diligence and conduct all the necessary research and analysis. Fortunately, there are insurance comparison websites that have made the task easier for those in the middle of shopping.

To astutely compare health insurance plans is to look beyond the rates. Of course, it's important to look for the most competitive ones, but there is usually a reason why some plans are much cheaper than others. For this reason, it's really important to compare and contrast different plans.

There's also the perspective to consider. Are you employed? There's a possibility that your company has given you some coverage. If this is the case, then you may opt for something else that covers whatever is not included in your existing one.

When reviewing a plan, the important points to consider are the terms pertaining to home health care, paperwork, time period for providing doctor attention, location of affiliated hospitals, deductibles, monthly premium, pay out limits, etc.

Health insurance is as basic as it gets. The protection benefits not only yourself, but your loved ones as well. You can just imagine the double whammy they would receive if you got sick without the means to address your condition. Make no mistake about it; your health is definitely worth the investment

Insurance - One of Life's Neccessity

While it's nice to enjoy the many comforts of life, those comforts come with risks. This is where insurance comes in. To get the most out of your car, home, and ultimately health, you will likely need to invest in protection. This provides individuals and families with peace of mind and protects you and your loved ones from unforeseen events or accidents.

Keep Your Car Covered

Most states have laws that require insurance in order for an individual to operate a vehicle. If you're pulled over without proof of coverage or you're involved in an accident, you can be fined or even have your licensed suspended. Not only is it beneficial for the individual to have car insurance, but it is also beneficial to other parties if an accident occurs. The insured party may have more costs or delays in car repairs or medical bill payments and the uninsured party may incur fines and out of pocket costs. This also helps in cases of accidents caused by your surroundings. For example, if your car is covered and the windshield is shattered by a rock, you can call the company and they will supplement the price of the new windshield.

Safeguard Your Home

Whether you have purchased a home or simply rent, gaining insurance is a top priority. There are many unpredictable events that put the valuables inside and outside your home at risk. First and foremost, homeowners should be aware of the potential risks. Whether it's a natural disaster or a fire, your home is an investment you surely don't want to watch go away with rain or fire. Keep in mind the valuables you've collected over the years and the feelings you have attached to them. Mitigate your stress by having a separate entity directly responsible for the financial repercussions. Accidents happen. For example, a leaky roof caused by the weather, a tree falling on the house from a storm, or the neighbor's kid breaking a window with their rogue baseball can all wreak havoc. There are also additional special features that can be tacked on to renters and home owners insurance. If you live in a flood prone area, flood insurance can be included in the policy. Hurricane and tornado insurance can also be added for those who live in at risk areas.

Whether young or old, insurance is a necessity of life. Paying monthly bills over the course of the year will protect you and your family from unthinkable incidents. While some see this as a waste of money, ask anyone who has faced a disaster without coverage and you will soon change your mind. Explore your options and don't be afraid to be picky with your provider. They're top priority should be getting you what you need.

Signs of a Quality Insurance Company

The insurance company you choose to protect you from loss in the event of an accident or situation needs to be a trustworthy one. Know what to look for as you analyze and examine different companies and policies to ensure that you choose the right coverage.

Positive Ratings

Rely on the assessments of the rating companies, whose purpose is to analyze the quality and financial wellbeing of insurance companies. Check the rating of any insurance company you are considering. As you check ratings, compare them to learn which business has the highest rating. Higher ratings have a direct correlation with the solidity of the business and the services provided. Higher ratings also indicate entities with more solid financial standings for paying out claims.

Business Longevity

Examine the length of time a business has been operating to get an indication of the quality and reliability of its services. A newly formed entity may not be able to offer customers the same reliability and performance as businesses that have been around for many years. A recent purchase and transfer between insurers could indicate that the new owner is undertaking positive growth.

Customer Service

The services provided to customers by an insurance company will be an important indicator of quality. Optimally, customers should be able to reach representatives in a variety of ways, such as by phone, online chat, and email. The response times to customer queries should be relatively short to ensure that all questions and concerns receive a speedy resolution. Customers should also be able to reach a representative around the clock and on weekends and holidays for emergencies.

Coverage Policies

The policies provided should meet your needs, with cost effective premiums, affordable deductibles, and terms that meet your coverage needs. Compare policy terms between different corporations to ensure that you choose the policy that fits your budget and needs. Explore the claim-paying process to find out how the business investigates claims and the typical time period for payment on a claim. Find out the rate of claim refusal, also, so you know the average pay out statistics for the insurance company.

Reviews and Complaints

Learn about reviews and complaints recorded by other customers to find out potentially positive and negative information about the insurer. Find positive and negative reviews on websites that allow consumers to record their experiences for other consumers to read. These reviews may provide surprising information about an entity that could lead you to decide not to choose them as your insurer. You might also learn positive information about the way a business takes care of its customers. Optimally, the corporation you choose should have very few or even no complaints lodged against it from other customers.

Once you gather extensive information about a company, you will have the data you need to choose a quality business for your coverage needs. This will enable you to put your trust and confidence in this corporation, knowing that it will assist you financially if you need it.

Know the Several Types of Insurance

All of us are well accustomed to the term "insurance". The term stands for insuring or giving cover to an individual or a group for a specific purpose. On the basis of the function, an insurance policy can be classified into several types. Let us study the types to get a detailed knowledge of the policies.

Home Insurance- our home protects us round the year, but it also needs protection against the rude side of nature. Home insurance can protect your residence from both natural disasters and man-made accidents. They offer a compensatory price for damage to property and life in the home.

Health Insurance- If you are taking a health insurance then that is going to give cover to you and your family. This can be on the basis of the type the health insurance is. This gives one the ability to fight sudden medical emergencies owing to hospital bills, medical expenses, specialist charges, etc.

Personal Accident Insurance- This kind of cover is recommended to one to cope with accidental deaths. Life insurance already covers this part. But when a person gets disabled and losses his or her earning capacity either partially or totally, then the personal accident insurance can be helpful.

Motor Insurance- This protects one against vehicle damage and third party cases of accidents. You would have a mutual contract with the insuring company that on payment of a certain amount as premium, the company will pay you a certain amount if any accidents occur. This type of insurance offers medical coverage, liability and property damages. The property damage covers the theft or damage of the car and the liability coverage maintains the legal aspects in terms of property damage and bodily injuries.

Travel Insurance- As the name suggests the policies gives cover while one is on a trip. So, when you are on the trip all your worries will be taken care of by the insurance from sudden medical expenses to loss of passport, baggage, delay of flight, etc. You can have a safe and trouble-free journey with them.

Commercial Insurance- In a company there are several needs of insurance policies. Most companies have several policies that are specifically designed to protect the assets, vehicles, machines, business, employees and other unseen losses. These policies help them to fulfill the immediate requirements.

These are some of the most common types of insurance that one can find in the market. If you are in need, choose the one that best suits your requirements.

Essential Things to Change in Insurance Training

Insurance services use knowledge related to finance, regulations, analytics in general and everything else in specific. For example, take project insurance. The insurer needs to evaluate various risks associated with the project. He should be able to make use of project management documents to understand the measures being taken by managers to manage the risks identified by them. He should be able to assess loss in case of claim. He need to use the knowledge of project management techniques in project insurance.

Again, if it is agriculture insurance, an insurer has to get idea about the crop yield, soil quality, farming practices etc. to do a meaningful insurance. So, knowledge of agriculture science need to be applied. Since insurance extends its services to every possible activities in the world or even in space, it has the potential to use every kind of knowledge.

Knowledge gained by insurance professionals during training are to be used. They are not for answering few questions in examination and then forgetting them. There is no end of values that insurance service can add in risk management in any kind of activities. And that is through the use of knowledge related to risk management techniques and also the knowledge related to activities. It may not be expected that every insurance professional will gain knowledge of every activity. But, he will do better if he is able to identify what knowledge to be used from where. This where can be external too.

There can be such training courses that are related to existing practices. But these are at the most basic level. It makes sense if there is a need of organized training on existing practices. There are regular changes in standards, regulations etc. that may create need of organized training to make them known to insurance professionals in formal way.

However, since Insurance service by nature is futuristic, there has to be emphasis on such topics that empowers the professionals to understand the future in scientific way with greater nuance. Such training prepares insurance professionals to go much deep in their profession and make the profession richer.

So, one thing that definitely need to be in the insurance related training is something about the future, something latest, something new, something that make the participants come out from the routine thinking and dive deep into topics related to finance, regulations and analytics or related to the special area of insurance.

The Basics of Tradesman Insurance

You may have hired the services of many workers, but you have to believe that gardeners, carpenters and builders are on the list of the most diligent workers. However, the problem for these workers is that they are prone to several risks. For instance, they may lose their tools or they may get involved in an accident while working at a site. Let's know more about the tradesman insurance.

Tradesman Insurance

As said earlier, tradesmen's job involves the risk of accidents. An average office worker may not be prone to as many risks as a tradesman. Actually, tradesmen make use of dangerous tools. That is the reason they are more likely to get injured than other people. The majority of tradesmen is usually self-employed. So, replacing a damaged or lost equipment is very hard for them. They may lose a lot of potential income if they don't get a replacement for their lost or damaged tool. Fortunately, they have a ray of hope in the form of the tradesman insurance. This type of insurance is provided especially for these people.

If you have no idea what this insurance is, you can go ahead and read through this article. Tradesman insurance offers the following coverage:

Public liability coverage

This type of coverage offers coverage against legal expenses that may incur because of the claims of a property damage or injury to a worker.

Personal accident coverage

Personal accident coverage will provide coverage in case of an injured staff member at the workplace.

Damage to someone else's property

This type of coverage helps you to pay for the expenses that occur when the workers cause damage to the property of a client.

Contractual works

This type of cover insures the construction works of the tradesman, including materials, especially if they get damaged or stolen. Aside from this, it can reimburse the heavy expenses related to extra costs of labor needed in order to rebuild the things that were completed earlier. For instance, this can offer coverage if a storm causes a damage to a building that is being built by a contractor.

Tools and equipment

The tools and equipment insurance offers coverage to the policyholder in case of the costs that occur in case of a repair or theft of a tool or piece of equipment.

Commercial Vehicle Coverage

This type of coverage protects you against the cost of upkeep of a vehicle of van that you use for business. Aside from this, it can cover for the rental cost of a vehicle. You can also buy other optional features or covers. For instance, with efficacy coverage, you can reimburse the litigation expenses if you are held liable for the installation of a faulty security alarm.

You can also buy tax investigation coverage if your business is being investigated for reasons related to tax. It will provide coverage against the loss of income during the investigation.

The Takeaway

So, if you are a tradesman, we suggest that you give a go to the tradesman coverage. Hope this helps