Estimating Insurance Needs

Regardless of whether you’re single or married, you’ll need to figure out your expenses, and plan for the future.

If you have dependents, you must buy enough insurance to replace the income you currently generate for them, and also compensate for any additional expenses they might incur to replace the services you presently provide.

Although there isn’t any specific formula to estimate life insurance needs, a quick and basic way to get a rough estimate is to take your annual income and multiply it by 7.

Another key is that your plan should adequately replace the (hidden income) that would be lost at death. Hidden income is income that you receive through your employment that isn’t part of your gross wages. It includes things like your employer’s contribution towards your health insurance premium, the matching contribution to your 401(k) plan, and many other (perks).

You should also plan for expenses that arise at death. These include funeral costs, taxes and administrative costs associated with (winding up) an estate and passing the property on to heirs.

Do you have enough Health Insurance?
Many employers provide health insurance to their employees. But for others, it is up to them to provide their own health insurance. In either case, you may not have enough coverage for costly medical expenses. Ideally, you should make the effort to examine your health insurance plan to determine if you need to purchase more, change your policy, or even reduce what you have.

Health insurance policies differ from one company to another. Some require that you visit only approved doctors and medical facilities for your needs, while others allow you to decide what is right for you. An increasingly popular choice is health savings accounts that allow individuals to put money away each year into approved accounts to pay for their medical expenses. Any method that you choose is better than having no medical coverage.

Private health insurance plans are available to help you determine what your needs are, and to protect your health and that of your family. Such plans also allow you to choose the doctors you want to visit. To have medical coverage in times of need is valuable indeed, but to have complete control over your policy is an added bonus!

If you do have health insurance, invest time in knowing how it works, and what it can offer you. You should know which doctor you can visit, and if you need approval for special visits. It is also important to know how much of your medical bill is paid by the insurance policy. Some provide only 80 percent while others will not include prescription medications. Talk with your insurance agent today to determine what health insurance plan will best meet your needs.

Short-term or Long-term, which one to buy?
If you are not able to decide on the term of health insurance, you need to have a clear picture of the benefits of both in order to decide on tenure. A short-term health insurance policy is right for those who are currently living in the U.S., waiting for another plan or between jobs. It is also suitable for those without any sort of medical health coverage, and students who have just graduated. The tenure of cover of a short-term health insurance policy ranges from one month to a year.

If you feel that you need an insurance policy for more than a year, it would be useful to take a look at other individual/family health insurance policies. A long-term care health insurance policy helps cover healthcare services used by insured patients who have prolonged illness or disability. Long-term medical care services also cover routine activities like assistance in bathing, dressing, and meals. Neither Medicare nor Employer Health Insurance covers these services. While long-term care insurance policies do pay for such type of services, they are expensive. Before you buy such a policy, be sure that you can afford to pay the premium now as well as later.

Group Health Insurance – How it works

A group health insurance policy is insurance coverage applied by the employer with an insurance company. The employer usually pays a part of the premium of the group medical insurance policy. A group health insurance policy gives an employer the advantage of not paying the whole premium for the insurance policy in order to cover his employees. The best way to get group health insurance is to get a quote from different companies and find the one that best suits your company and your employees.

Can Group Insurance be categorized under tax incentives?
Group health insurance is tax deductible. Providing health insurance to employees has many advantages. Not only are employees happier, but also they are less likely to switch jobs.

Which Life Quote is right for me?
A life insurance policy protects your family financially if you or your spouse dies. Insurance companies understand that life is constantly changing, so there are a variety of life insurance policies to meet your changing needs. Because many families depend on two incomes just to make ends meet, insurance companies offer policies that can insure more than one person, protecting the total family income.

It is never too early or too late to consider your life insurance options. There are two major types of life insurance-term and whole life. Whole life is sometimes called permanent life insurance, and it encompasses several sub-categories, including traditional whole life, universal life, variable life and variable universal life. Term life insurance provides financial protection for a limited and specified period of time, at a lower cost than permanent life insurance. These policies expire without value if the insured survives the stated time period. Universal life insurance provides death benefits and income tax-deferred savings to help you meet your financial goals while you are living. It has many flexible features and benefits that can change with your changing financial needs. Whole life insurance provides the coverage amount to your beneficiary in the event of your death, as well as cash-value savings you can use during your lifetime.

Factors you must consider before purchasing Health Insurance

Prior to purchasing your health insurance coverage, you should consider these factors:

• The reliability of the insurance company. Does it treat people fairly? Does it pay claims promptly? Does it have adequate staff to answer your questions and resolve problems?
• Most insurance policies require you to cover part of your health expenses yourself (your part is called the “deductible”) before the company pays anything. Under some policies the deductible is annual, and you pay only once each year if you use the insurance. Under others, you pay the deductible each time you have an illness or injury. In choosing insurance, you should think carefully about how much you can afford to pay out of your own pocket each time you are sick or injured, and weigh the deductible against the premium before you decide.
• Usually, even after you have paid the deductible, an insurance policy pays only a percentage of your medical expenses. The policy might pay just 80 percent; the remaining 20 percent, for which you are responsible, is called the coinsurance or co-payment.
• Some policies state specific dollar limits on what they will pay for particular services. Other policies pay “usual” or “reasonable- charges, which means that they pay what is usually charged in the local area. Be very careful in evaluating policies with specific dollar limits; for serious illnesses, the limit might be far too low and you might have large medical bills not covered by your insurance.
• Some insurance policies put a time limit on illnesses and injuries. In that case, after the benefit period for a condition has expired, you must pay for continuing the treatment of the illness on actual cost basis, even if you are still insured by the company.
• Many insurance policies do not cover pre-existing conditions. If you arrive with a condition that will require medical attention, verify the pre-existing aspect of the policy that you are reviewing.