The first use of insurance was to insure property for over sea voyages. Soon after there was insurance for property that didn’t move, buildings, inventory, raw materials, and the like. It wasn’t until recently that life insurance has come into its prime. In the beginning of the 20th century limited life insurance policies were written to cover the cost of funerals but that was as far as they went. Then in the 1950’s people began to realize the need for health and life insurance as a means to offset unexpected occurrences.
The reason that health and life insurance started to become commonplace is that for all of the time that people were insuring their property they weren’t insuring their greatest asset. Unless someone is independently wealthy the greatest asset they have is their ability to earn money. This ability to secure a paycheck far outweighs any current asset that someone may have.
What is Economic Death
Any unforeseen event that limits the ability of an individual to secure a paycheck is considered an economic death. Even if the event is not substantial enough to force a person completely out of work, if it significantly lowers the income attainable, it can be construed as a partial economic death.
For example, Joe Smith works at a factory where he makes $50,000 a year. If he works for 40 years he can safely assume he’ll make $2,000,000. With a little financial planning this should be enough to assure him a nice retirement.
However, there are several circumstances that could limit this potential income. There are potential accidents, illnesses, or economic situations that may cause him to either not be able to perform his job or cause his company to go out of business. These situations, these risk factors, are considered his exposure.
Three Types of Economic Death
How Can an Individual Respond to Risk
There are four universal responses to risk. These responses, and the actions they produce, define the probability of an individual succeeding or failing in the avoidance of serious risk repercussions
Risks that are Often Insured Against
There are an almost unlimited number of risks that can be insured against. Lloyd’s of London has become infamous for insuring celebrity body parts from Keith Richards two million dollar hands to Mariah Carey’s one billion dollar legs (CalgarySun.com 9). These are far from the norm but anything can be insured for a price. For those of us without such outlandish salaries the most common risks that are covered are accident and sickness.
These risks are monetarily offset in a legal contract that sets a premium (payable at a set interval) for an individual to obtain a lump sum disbursement upon either the completion of a set term or upon the occurrence of the risk that was being contracted to offset.
Health insurance coverage is important because one never knows when one will become ill. Granted, health insurance can be costly. Also, there are life circumstances which can make it seem impossible to get adequate health insurance coverage or payment of costs. For instance, denial of claims, reduced retirement benefits, job layoffs, and pre-existing conditions can be burdensome. Fortunately, there are ways to deal with these challenges.
Health Insurance Enrollment Choices and Subsidies
If working for an employer who offers health insurance coverage, during the open enrollment period, sign up to get a flexible spending account. The benefit of this is that one can use up to $5000 tax free to pay for out-of-pocket medical expenses. Also, participate in a mail-order prescription opportunity which enables payment of half of what one normally might pay for prescriptions at a drug store. In addition, purchase generic prescriptions when possible.
Until 2014, purchasing low cost group health insurance coverage via a professional association is one option to reduce health insurance costs if one is self employed or if an employer has suddenly cut health insurance benefits. However, in 2014, individuals with low income or middle income will be able to get subsidies that will enable them to purchase health insurance.
Stick With Medicare for Health Insurance as a Senior Citizen
If one has an illness and wants to be able to see any physician of choice, it is better to stick with traditional Medicare coverage. Also, most likely, getting Part D coverage for prescriptions along with Medigap can be a helpful choice to cover deductible costs and co-insurance costs.
Of note, some senior citizens have been signing up for private Medicare Advantage plans rather than the typical Medicare coverage. However, the fees to the plan administrators are going to be cut and there are concerns that some of these administrators will cut benefits or leave the health coverage market totally. That is why staying with Medicare coverage could be the best bet.
If Health Insurance Claims are Denied Keep Trying
If a claim is submitted and it gets denied, try again. In fact, chances are strong that the claim could get paid if one is very exact in going through the process described in the denial note. Always appeal in writing and send it via certified mail. In a formal letter, include documentation and be specific in the response to the reason that was given for the rejection of payment of the claim.
Also, include discussion of what the illness was, previous treatments that failed, consequences of not being able to receive care, medical records, and also put into the packet a note from the doctor. If the medical procedure was experimental, attach a copy of a medical journal article which says that the treatment can be an effective treatment. Or, if all else fails, go to the state insurance department and ask to get a patient advocate.
If things go far enough, the case will likely be reviewed by an independent review board. The review board may get involved through an employer’s health insurance plan or through the state insurance regulatory board. In the meantime, also negotiate with the physician and work out a payment plan which stretches payments out over time and makes treatment more financially affordable.
Health Insurance Options If Laid Off Work or If You Have A Pre-Existing Condition
Joining a health insurance group plan that one’s employed spouse is already a member of is an option for health insurance coverage if one has no job. Or, thanks to Consolidation Omnibus Budget Reconciliation Act (COBRA) requirements, one could remain in the group health insurance policy provided by one’s employer for 18 months after the job was ended although companies with fewer than 20 workers might be exempt from having to provide this.
Having a pre-existing condition or having a condition which is not included in coverage means that it might be necessary to be a part of the state high risk health insurance pool. In addition to the state high risk pools, there is also now a national high risk coverage pool that one can join as a result of health reform law.
Also, healthcare such as medical tests and medical exams are available at Walgreens or other drug stores these days. Medical evaluation may be done by a nurse practitioner instead of a physician. However, the medical care is available. Also, going to a community health care center is an option because community healthcare centers in many urban areas provide free medical care for those without health insurance or those who have low income.
Loan protection insurance is sold to borrowers as security against unforeseen circumstances such as injury or redundancy. However, according to a BBC’s news report, “Crackdown on Misselling of PPI” (BBC News) customers are being sold PPIs inappropriately. In one case, a debt was written off due to the misselling of a loan with a PPI. This would indicate that customers must be especially wary when purchasing loans.
Guide to Getting a Cheap Loan
Finding cheap cover from compare sites and playing one against the other is a great way of obtaining cheap cover. However, loan insurance annexed to a loan with low APR can make it expensive. In fact, according to Money Saving Expert’s report, “Reclaim PPI Loan Insurance,” the cover may work out to be twice as costly as the cost of the loan itself. Furthermore, the Financial Services Authority (FSA) has issued heavy fines to loan companies for attaching PPIs to loans without customers’ notification.
With this in mind, the following has important relevance:
The Cheapest Unsecured Loans
The consumer may consider dispensing with payment protection if the following does not apply:
Before taking out payment protection, address the following:
Cheap Loans and Cover
Customers may save thousands by taking vigilance over the cost of payment protection on loans. Finding a cheaper quote from an independent insurer is a shrewd move, but the necessity of a PPI may be questioned if the risk factor of not having one is low.
Should a pet owner purchase pet health insurance? This is a question that should be considered carefully. Vets are now able to treat many more conditions in companion animals successfully, including feline cancer, and canine diabetes. However, these treatments come with a high price tag.
Statistics show that one out of every three pets will need some type of emergency pet care every year. Two out of every three companion animals will face a serious health problem sometime in their lives. Many pet owners believe that purchasing a pet health insurance policy is the best way to be prepared for unexpected veterinary emergencies. But is this really true?
Here are questions that should be answered before buying any kind of health insurance for pets.
Is Lifelong Pet Insurance a Good Idea?
Many people wonder if they should get pet insurance for a new puppy or kitten or wait until the animal is older. This is a good question.
Just like people, pets face many more health issues as they get older. This can make it very difficult to find pet health insurance for an older animal. Most companies won’t cover a companion animal who is older than nine years. If they do, the premiums will be very high.
Is the answer to buy pet insurance when the companion animal is younger? Maybe not. That $10-a-month premium for a kitten may increase as she gets older. How much will premiums increase? Can a certain premium be locked in until the pet is ten or twelve years old?
If she is treated for a certain condition, like feline diabetes, will this condition be considered a “pre-existing condition” when it comes time to renew the policy? If so, the company may refuse to insure her any longer, or may increase the premium substantially.
Also consider the cost of premiums over the pet’s lifetime. $15 a month comes to $180 a year. If the premium remains the same for ten years, the cost would be $1800, just for premiums. The premiums will probably increase if any claims are filed. Don’t forget about the co-pays and deductibles, too.
How Much is the Deductible? How Much Co-Pay is Required?
Every pet insurance plan has a deductible, which is the amount that the owner has to pay himself. Depending on the pet’s age, the deductible may be $50 or more for each procedure (not each visit). This can add up quickly if the animal requires several procedures.
The insurance company may also require that the pet owner co-pays ten to twenty percent of the vet bill.
Ask About Caps
The maximum amount an insurance company will pay per animal per year is called a cap. There may be a cap for each covered condition, plus an annual cap and a lifetime cap for each animal. Avoid nasty surprises by learning which caps apply to the pet, or its condition.
How Long Does It Take to be Reimbursed?
Be aware that the pet owner is expected to pay the vet at the time service is rendered. The pet owner fills out the insurance form and mails it in. It can take two to four weeks, or longer, to receive reimbursement.
Before buying a policy, ask how the reimbursement is calculated. The owner may be reimbursed for a certain percentage of the vet’s bill. Or the company may have a benefit schedule that lists what it will pay for each procedure. The company may only pay a certain percentage of this amount, not a percentage of what the bill actually was.
Always Read the Fine Print
Know ahead of time which conditions are covered, and which are excluded. Is there a waiting period before the insurance goes into effect? Does the owner get to choose which vet to use? Are prescriptions covered? What about emergency care?
Every insurance company is different, and each company offers many different plans. If a pet owner decides to invest in pet health insurance, it’s important to compare plans carefully, and to read the find print to find the best value for pet insurance.
Every day is a good day to start learning new ways to save money from that ever–loving saving money expert, Granny Ruby. She was always looking for new and better ways to save money on just about everything. Taking care of one’s family, especially their health care, is perhaps the most noble of all pursuits, and finding ways to do it cheaper was a life–long goal of Granny Ruby.
According to Hewitt Associates, a human resources consulting firm, the average worker’s out–of–pocket medical expenses fro 2017 will increase 10.1 percent to an average of $1,880. That means that in order to keep current levels of health care and health insurance, folks are going to have to increase overall income by 10 percent, or start cutting costs from an already strained budget. Here’s a few of Granny’s helpful tips for cutting medical and health care costs.
Save Money by Using Retail Clinics, not the ER
Prevention is always the best medicine, but there are times when a visit to the doctor or clinic is a necessity. For minor problems like a sore throat, flu shot, muscle sprain, or ear infection, try going to the local drug store or grocery store pharmacy. These days, most of these retail stores in–house care facilities are staffed with a nurse practitioner or physician’s assistant. There are several insurance companies that offer coverage for these retail care facilities.
These professional care givers are able to treat and diagnose most problems and they can offer treatment for a lot less than going to a doctor’s office. According to the Rand Corporation, a non–profit think tank, a visit to a local retail clinic can cost about a third less than going to an urgent care clinic or the family physician. Compare that with $570 for the average ER visit, according to the Rand study. Check with an the HR department at work, or with an agent or insurance representative for more details on specific insurance coverage.
Health Insurance Savings
It may be a good time to check all health insurance coverage limits and benefits. Getting the right amount of coverage and the right type of coverage is one of the best ways to save money. Some health insurance policies are made to appear like a great deal and may offer a low premium or deductible. Be careful and make sure all the details of the policy are adequate to cover any emergency or long–term health care issues.
Some health insurance policies that offer super low premiums or deductibles may only provide for less than $100,000 per accident or illness. If a person were to encounter a serious illness for which care might be months or even years, that small amount of coverage isn’t going to go very far. Someone’s going to get stuck with a lot of hospital, doctor, and medical bills and it won’t be the insurance company.
Granny would say that the best way to save money is to spend money wisely and get the most bang for a buck. In this case, buy a high–deductible health insurance policy with a minimum of $1 million coverage for each accident or illness. Also, make sure that all the policy coverage rules are understood clearly before signing anything. Different insurance companies have different rules for what is covered. Be sure to check with an agent or representative.
Check Medical Bills and Save Money
According to Medical Billing Advocates of America, as many as 80% of doctor and hospital bills contain some sort of error. Something as simple as a wrong billing code, wrong account number, or even incomplete information can cost the unwary consumer a great deal of money. These mistakes are so costly, a billing error discovery industry has sprung up in this country to find and recover these overcharges and errors in medical bills. Consumers can also get help with reviewing medical bills for free at the Patient Advocate Foundation at patientadvocate.org.
Mark Twain once said that the holy passion of friendship is so sweet and steady and loyal and enduring in nature that it will last through a whole lifetime, if not asked to lend money. Make a commitment today to start changing attitudes and misconceptions about money. Money is indeed a good thing if one learns to use it wisely.
According to Bloomberg News, the national unemployment rate rose to 8.9 percent in April. Because most U.S. residents get their insurance through their employers, this means that a large number of individuals must now pay for their own health coverage.
Individuals can sign up for COBRA, which allows them to stay on their employer’s health plans for up to 18 months after they lose their jobs. COBRA, though, can be costly. According to the North Carolina Institute for Medicine, the number of uninsured residents in the United States hit 52 million in January of 2016. That’s up from 46 million individuals who did not have health insurance coverage in 2014. A big reason for this is cost: Paying for health insurance is expensive.
Fortunately, there are ways that individuals can cut the costs of health insurance.
Shop Around for Health Insurance
Individuals can save on health insurance by shopping for different health plans. Individuals can research these plans at the Web home of the National Committee for Quality Assurance. Consumers can also work with independent insurance agents or brokers to find the best plan for them. These agents don’t work with a specific insurance company, and will instead search for the most affordable plans for their clients. Working with an agent can be especially important for individuals who have preexisting medical conditions.
Stay Healthy for the Best Prices
Consumers should refrain from smoking, taking drugs or abusing alcohol if they want to pay the lowest premiums. Policyholders who smoke, for instance, are viewed by insurance companies as bigger risks than those who don’t. That’s because smokers are far more likely to need intensive medical care during their lifetimes than are non-smokers.
This doesn’t mean, though, that consumers should try to hide any existing medical conditions or health problems from their potential insurers. Insurance companies will certainly discover when individuals try to hide health issues. Instead of trying to sneak these conditions past insurers, individuals should instead give out as much information about their medical conditions as possible. For instance, individuals with a history of high blood pressure should make sure to inform potential insurers that they have changed their diet and are now taking medication to keep their condition under control.
Don’t Forget to Look at Other Options
Consumers don’t always have to obtain their health insurance through a private insurer. Trade associations or alumni clubs often offer their own group insurance plans that may boast far lower rates. Labor unions might offer the same. Paying for health insurance is never going to be cheap. But with a little research, consumers can cut a significant amount of dollars from their insurance premiums.
As companies around the world look to save as much money as possible on their operations, employers are carefully evaluating employee benefit plan costs.
Group insurance benefits are typically subject to an annual renewal process.
At renewal, benefit plan managers have an opportunity to ensure that their insurance carrier is effectively providing essential employee benefits as economically as possible.
A popular option for saving clients money at renewal is the Administrative Services Only (ASO) plan.
Group ASO Plan Defined
ASO is now one of the fastest growing types of employee benefit arrangements. Under an ASO plan, employers are responsible for directly funding all claims that their employees incur. Plus, employers pay a fixed fee for administrative services like claim payment and management reporting. An insurance company or other financial institution usually provides those administrative services, but doesn’t collect any premiums where no insurance risk has been underwritten.
Health and dental benefits are most commonly covered under ASO plans. Self-insuring short-term and long-term disability benefits requires that employers set aside reserves to ensure that future claim payments are made even if coverage terminates. Larger employers fund ASO disability plans.
Fast-Growing ASO Plans
For the year ending December 31, 2008, Canada’s Great West Life Assurance Company garnered US$1.9 billion in self-funded premium equivalents under ASO contracts, up 8% from $1.8 billion in 2007. In contrast, Manulife Financial reported a 25% decrease from more traditional group insurance products in 2008. Competitor Sun Life Financial had a 7% slide in premiums for its more conservative portfolio of group insurance clients.
Costs That ASO Benefits Save
Under traditional experience-rated group insurance, employers pay a group premium that includes charges for claims, reserves, inflation factors, administrative fees, risk management and profit. Also included are sales commissions. The insurance company calculates group renewal premiums, looking at each group’s claims experience history but also adding rate adjustments and assumptions to improve profitability for the block of business to which the employer belongs.
In contrast, an Administrative Services Only plan limits client funding to actual paid claims plus a fixed fee for administrative charges. An ASO client saves the following group insurance charges:
ASO Advantages Over Group Insurance Premium Renewals
The annual renewal negotiation for insured health and dental benefits is often painful, with the insurance company trying to win maximum rate gains at the expense of their clients. Tactics used include waiting until the last minute to force through excessive premium renewals before the client has a chance to respond intelligently.
Employers do have the option of taking their insured plans out to market for competitive bids, either directly or through a group benefits broker. But if repeated annually, employee benefits re-marketing can become expensive both in terms of time and money.
An ASO plan eliminates the need for the premium renewal process. With an ASO plan, the administrative services fee is fixed and charges are more directly linked to the actual claims that employees incur.
Claims Advantages Of ASO Benefits
Administrators provide their clients with detailed reports of claim payments, then help their clients focus on claims’ cost control strategies without having to worry about other insurance charges.
For example, an ASO plan enables the client to take away overused benefit components like anti-depression medication that might be standard coverage under an insurer’s package plan for companies of a certain size.
US Health Plans Involve Major Risks
Here’s an important note for American group policyholders contemplating a switch of their Major Medical plans to ASO.
Canadian provinces offer medical care. Thus, a major portion of the costs for highly expensive treatment like cancer chemotherapy is provided for under government plans. Therefore, Canadian companies are insulated from major medical costs should their employees require extensive surgery, transplants or other expensive treatment.
In contrast, an American company that self-insures the Major Medical benefit may have to pay millions of dollars for medical complications from a pregnancy especially if there are no limits on coverage.
Therefore, ASO plans in the U.S. usually are sold with stop-loss policies that require an insurance company to assume the risk when claims exceed a contractually specified dollar amount or percentage.
There are many different types of travel insurance policies. They cover the traveler for different lengths of time, for different areas of the world, and insure a bewildering a variety of different things. How can one sort out this maze?
Single Trip or Annual Policy?
Annual travel policies cover the traveler for every trip he or she takes in a year. Single trip policies are simply for one trip or holiday. For those who go away more than once a year, annual policies usually work out cheaper. When working this out, one needs to consider the possibility of weekends away as well as the main vacations. These all add up, and often the annual policy is worth having.
Europe or Worldwide Cover?
For those who are only taking a vacation in Europe it is cheaper not to get worldwide cover, and Europe-only insurance cover is significantly cheaper. However, if the traveler is going further afield, it is essential to be covered despite the cost, as in places like the USA medical expenses can be extremely high.
Specialist Policies or Activities
For those going away for long periods, such as a ‘gap year’ trip, it is probably essential to look for a specialist policy, since most annual insurance policies have a limit on the length of each trip, usually around 30 days
For travellers who plan to do ‘adventurous’ activities, such as skiing or hang gliding, a specialist insurance policy may be required. Some ordinary insurance companies do offer winter sports cover, but one may have to pay extra. For more extreme activities, it is worth checking if one can pay an extra premium to cover them, particularly if it is only for a short period of time. This is sometimes cheaper than an annual insurance policy with a specialist company.
Only Get the Cover Needed
Sometimes policies offer different amounts of cover. It is not worth paying for cover one does not need; for example, large amounts of baggage cover if the traveler is not taking away anything valuable. Sometimes it is cheaper to insure valuables along with one’s household insurance, so it is worth checking. Experts recommend £1 million of medical cover in Europe, or £2 million in the rest of the world. They also suggest personal liability cover of at least £1 million, £1,500 baggage cover, and £3,000 cancellation insurance. But a good rule of thumb is not to buy what is not required.
Checking to See if One is Already Covered
Some banks offer free travel insurance with certain accounts, so for those who have one of these, there is no point in paying twice so long as what one needs is actually covered. However, the travel accident insurance offered by some credit card companies only covers the individual in certain very specific circumstances, so one should not rely on it.
Finally, the individual should be upfront about any medical conditions or similar things, as otherwise the policy could be invalidated.
Once the traveler has adequate insurance cover, he or she can go on that planned holiday safely, knowing that if anything goes wrong at least there should not be an expensive bill to be paid. And this peace of mind is at least as important as the good feeling one gets after a restful and relaxing holiday.
The following is a guest post from Nigerian real estate developer Michael Chudi Ejekam.
A lot of people make the mistake of assuming that, because they are a tenant, it isn’t necessary to pay for renters home insurance. However, the coverage they are thinking of is taken out by the landlord purely to protect the building and its structure. It doesn’t cover the tenant’s household items or personal liability in the event of someone getting injured. It represents yet another expense that a family can do without.
Why Cheap Renters Insurance Coverage is Important
Although not the most expensive policy, many families are forced to work on a limited budget. This means that reducing the cost of renters insurance is fundamentally important if affordability is to be established. The most effective ways to reduce premiums are performing a more comprehensive search, increasing the deductible and selecting ‘actual cash value’ for claims on household goods. Polices are also cheaper for over-55’s and for those who pay annually.
Trawl the Market for Renters Home Insurance
A common mistake that tenants make is accepting the first offer that they receive. However, this is a very inefficient way of identifying a cheap renters insurance policy. Websites, such as moneysupermarket.com, allow the customer to search through hundreds of different providers. It is then relatively easy to look at the most competitive deals and compare the policy features – cheap doesn’t necessarily mean good.
Increase the Deductible on Insurance for Renters
The deductible is the amount an individual is prepared to pay before making a claim. This means that if a $500 deductible has been chosen and $1,500 of personal possessions are stolen, the policy will pay out $1,000. Selecting a higher deductible on renters contents insurance can significantly reduce the monthly premium. This is because insurers don’t need to waste time on small claims. However, it is necessary to put away a sum of money that can cover the deductible that is selected.
Actual Cash Value (ACV) vs. Replacement Cost Value
A policy that only agrees to pay out the ‘actual cash value’ offers a less expensive alternative for a family. This is because it doesn’t cover the cost of replacing the item, it pays out a sum of money equivalent to its current cash value. Whilst this is an excellent way of achieving cheap renters insurance, it also means that any payment is unlikely to be sufficient to purchase a replacement.
Other Ways to Get Cheap Renters Insurance
Insurers may be prepared to reduce the cost of renters property insurance for those who pay annually. Whether this is possible depends upon a number of personal and financial factors. Others will be able to secure discounts on their home renters insurance policy by purchasing several forms of coverage (car, home etc) from the same provider. Over-55’s may also be eligible for age-related discounts.
Do you use vans or other vehicles as part of your business?
You do not have to run a huge multi-million pound business for fleet van insurance to be appropriate for you. Many insurers classify as few as two vans or trucks as a ‘fleet.’ Others will offer preferential rates and terms for anything over five to ten vans covered under one fleet van insurance policy.
Commercial vehicles are important company assets
Vans and trucks are vital components of many firms and are probably some of your most valuable company assets. This is why it is crucially important that they are fully protected. Many companies find that a fleet van or truck insurance policy is the best way to achieve this.
In the same way that your business can suffer if your workforce is absent through sickness, having your commercial vehicles off the road through theft or an accident can negatively affect your business. Can your business afford for its vans or other commercial vehicles to be off the road?
Fleet truck insurance is the perfect solution answer if you are a company with a number of vans or trucks. One fleet van insurance policy can cover your whole range of commercial vehicles, saving you both time and money. You only have to deal with one insurance company rather than having to correspond with dozens of different insurers for your various commercial vehicles.
Discounts and fleet van insurance cover
Fleet truck insurance policies will also save you money. Many companies offer discounts if you cover several vans, trucks or other commercial vehicles under one fleet van insurance policy. Discounts of 10% or more are not uncommon.
Whilst the cost of insurance is important, it is also vital that you consider what the various fleet van insurance policies cover. Many will include fire and theft, legal expenses and goods in transit. You may also benefit from a policy that offers a replacement vehicle if you rely on your vans being on the road at all times.
As anyone with a fleet of trucks will know, insuring your vehicles separately can be both costly and complicated. There is no guarantee that each of the policies provides the same cover as the others and it can take a huge amount of the time to review and renew each individual policy. With a fleet van or truck insurance policy, all your commercial vehicles are covered under one comprehensive policy, saving you both time and money.