Group Term Life Insurance

Employee benefit plans help retain your skilled employees and recruit people who can make significant contribution to your company’s profitability. Life insurance benefits form a key element of any employee benefit plan. This is the most sought-after benefit as it ensures the financial stability of the dependents in the event of the employee’s death. A group term life insurance offers the employer an affordable way to provide financial security to the employees’ dependents in the unfortunate event of their death.

Group term insurance may include disability coverage and/or accelerated death benefit and the employee can make his/her choice. Insurance companies across the nation will offer flexible plans to suit company culture, employment policy and the financial obligations. The plans are tailored to the company’s requirements with a variety of consumer-friendly features and options designed to meet the needs of the employees. A multitude of flexible plan options exist to meet the needs of diverse group employers in various industries. Features such as living care benefit, liberal benefit amounts, dependent coverage and portability are often included in a majority of these plans. Moreover, a group term-life insurance plan ensures low-cost benefits for the employees without significantly increasing the expenses. Discuss with a licensed insurance specialists from the companies to determine the optimal group policy for your organization.

In today’s world of globalization and cut-throat competition to retain the best talents, group term life insurance is an invaluable employee benefit to provide financial security to the employees’ dependents.

Partnership Life Insurance

A partnership is fairly simple to set up. Two or more people get together with the intent of going into business; they get the appropriate licenses and file the necessary papers with the State and you are in business. When the areas of expertise of these people compliment each other the situation is ideal. Although each partner is taxed on an individual basis they all are liable for the debts of the business.

The partnership is treated like a separate entity in some ways as it can own property and execute documents, however, when it comes to payment of taxes or debt liability the owners are responsible. When a partner dies the company must be dissolved. If the survivors want to continue the business they must form a new company.

At the time of the formation of the partnership an agreement should be drawn up stating the percentage of shares each partner owns and under what conditions and in what manner shares can be disposed of. The agreement can be modified later upon the approval of a majority. If there are problems between partners the agreement is the legal document that they should be able to fall back on.

Advantages

  • Fairly simple and inexpensive to set up.
  • Makes going into business with family members easy and unlimited.
  • Capitalizing a business is simpler and stronger when many people put their resources together.
  • Because many people are putting their assets together the borrowing power is greater.
  • Each partner has the unique opportunity of specializing in their own area of expertise.

Disadvantages

  • Unless otherwise stated in an agreement the partnership must be dissolved upon the death of a partner.
  • The remaining partners must purchase or inherit the shares of the deceased partner unless otherwise stated in an agreement pertaining to succession.
  • A partner can require that the business be dissolved at any time.
  • Cannot take advantage of tax write offs like group life insurance, disability and health.
  • All partners are at risk for liabilities. All assets of the partnership are at risk in a limited partnership.
  • If a partner wants to leave the partnership he may suffer financial loss.

Life Insurance

Now let us look at how life insurance applies to this type of business. Let us suppose a partner died or had to leave the partnership because of disability. This situation could destroy the business, however, if the business had a properly drawn up buy-sell agreement funded by life insurance and disability insurance much of the problems would be averted. Each partner would have a life insurance policy and a disability buy-out policy on his life paid for by the other partners. Upon the death or disability of a partner the insurance company pays an amount equivalent to the value of the shares owned by the deceased. This money is used to purchase the deceased shares from his heirs.

Term Life Insurance Quotes

Term life insurance has allowed millions of Americans to secure the financial future for their dependents at affordable prices. As healthcare costs increase, getting an affordable term life insurance quote is now an absolute necessity. With thousands of products to choose from, it is often a daunting task to research for the one which will give you the best value for your money.

Internet based research seems to be the best solution before you decide to meet an insurance agent at an office. There are various online quote processing companies nowadays, who can give you a premium rate quote absolutely free of charge and with no obligations based on your personal requirements. These online intermediaries help do an extensive comparison shopping utilizing the latest technologies. This will facilitate the bench-marking process before you can make a conscientious decision for the term life insurance. Based on this information, you can have a knowledgeable discussion with your insurance agent to make your final choice. Companies offer one-year, five-year, 10 / 20 year polices along with adjustable policies to suit the customer’s priorities. This helps in getting insurance coverage within affordable expenditure levels.

Over the last couple of years, term life insurance has become a commodity due to tough competition among the companies. Moreover, online instantaneous comparison shopping has also transferred the market control to the buyer resulting in lower premiums and better services. If you are not interested in building cash value from your life insurance through investments, term life insurance seems to be the cheapest and the most intelligent decision for just pure life insurance.

Life Insurance Providing Little Protection from Terrorism

Recent statements by the City of London Police Commissioner James Hart that future terrorist attacks in London’s financial centre are, “a matter of when, rather than if”, will increase already serious concerns over issues of personal and business financial protection.

Mr Hart’s statement pointed out that, “if you want to hurt the government, hurt people at the same time, and you want to cause maximum disruption…where better to hit than at the financial centre?”

Mr Hart also echoed a report by the insurer Axa which warned that just under 50% of small firms do not have a plan in place to ensure that their business could survive should they be hit by an emergency or disaster. Axa highlighted that many businesses, especially in the South East danger zone, are not even covered against general risks such as fire and flood, which have a much greater chance of hitting a business than the now high profile terrorism threats.

The research carried out by Axa found that almost one in five small to medium-sized firms had been hit by some form of disaster and about 5% of them took more than a year to get their businesses back on track. Any company that does not have cover against potential future disasters could stand to lose large sums of money, or even go out of business, if the Commissioners warnings go unheeded.

Emergency services workers are also experiencing additional worries about their financial protection in light of the terrorist attacks. Somerset fire-fighters have recently temporarily called off threatened industrial action amid claims they may not be insured for dealing with terrorism. In a postal ballot, Union members had previously overwhelmingly voted in favour of taking some form of industrial action short of a strike, such as refusing to train on specialist equipment which can be used in response to terrorist incidents. The actions have been called off pending a report due next month from a working party which has been set up with the Somerset Fire and Rescue Service to study the fire-fighters’ personal insurance.

Adrian Woollaston, of the Somerset branch of the Fire Brigade Union said: “Somerset fire crews want our employers to address our very real concerns and this gives an opportunity for them to do so.”

The fears experienced by the fire-fighters revolve around exclusions which added to many group life insurance policies that prevent pay-outs being made should the policy holder be injured or killed as a result of a terrorist attack.

The Association of British Insurers has sought to reassure emergency workers who may die as an indirect consequence of terrorist events by stating, “exclusions do not generally apply on stand-alone life assurance policies, regardless of the occupation of the policyholder”, however, they also indicate that “other personal insurance cover” such as personal accident, mortgage protection, income protection and critical illness cover are usually subject to exclusions.

This would mean that many existing insurance policies held by emergency workers to protect their future and that of their family, such as mortgage payment protection, may not provide any cover in the event of a terrorist attack.

Searching through all the available insurance policies using information sites like Moneyfacts or Moneynet can go some way to helping by providing guide information and price comparisons, but more needs to be done.

Sam Oestreicher of Unison said, “We are asking all insurance companies to look at their policies and if they have such exclusion clauses to drop them”.

Carefully checking through the various complicated clauses inherent in financial policies is something many consumers prefer to ignore, but as the fire-fighters are currently finding out, it is vitally important in order to ensure the protection is there.

Life Insurance 101

All types of Life Insurance fall into one of the four groups explained below, which type you use depends on the type of risk you wish to protect and the funds you have available.

Term Assurance

Cash lump sum paid out in the event of death

Straight term assurance is still a very cost-effective way of providing financial protection for the family or business. A lump sum is normally provided when a claim is made which is paid into the estate of the policyholder.

In order to avoid complications with delays in probate or inheritance tax, an appropriate trust can be used so that any payment is made direct to the beneficiaries.

It is also possible to have the cover indexed according to inflation, so that the level of cover remains the same in real terms. Since there is no element of saving, the plans do not acquire a surrender value. If you wish to include this option, you could opt for convertible term assurance.

Family Income Benefit

A regular income paid following death during the term of the plan

This type of plan provides for a regular income to be paid out in the event of the death of the life assured during the term of the policy. With each month that passes, the liability which the insurance companies is taking on decreases by a set amount. This enables the costs to be kept down to a minimum and is often the least expensive plan available.

The benefits can be written in trust to avoid legal delays and any possible

liability to inheritance tax.

Mortgage Protection.

This type of plan is also a term policy which covers the declining balance of a repayment mortgage. This enables the cost to be kept to a minimum but make sure that the interest rate figure is high enough for any possible increases in the mortgage rate.

Whole of Life Cover

Provides cover for the rest of your life

The main disadvantage of term cover is that at the end of the term, cover ceases and any new policy has to be underwritten according to the age and health of the policyholder at that time. When a whole of life policy is taken out, the policyholder has guaranteed insurability for the rest of their lives, regardless of any change in their health.

This means that initial premiums are likely to be higher than term assurance cover, but the plan has far more flexibility. It therefore depends on your personal circumstances as to which plan is likely to best suit your requirements.

Critical Illness Cover

Cash lump sum for those who die or have a critical illness

In recent years, the need for protection for those who actually survive serious illness or accident has become more apparent. It has been described as ‘life cover for the living’.

Most plans cover the common conditions such as heart attack, stroke and most forms of cancer, but there is variation on more rare conditions. In addition to specific illnesses, it is quite common to have permanent disability cover. If you become permanently disabled and unable to return to work, the plan pays out. There is however, a wide variation in the definition of ‘return to work. Some plans would only cover you if you were totally unable to work. Others have an own occupation? clause so that if you were unable to return to your normal occupation, a claim could be made. This is an extremely important fact to bear in mind when selecting your insurer.

Finding Fast Life Insurance

Since the widespread growth of internet usage and database building it’s never been easier or quicker to find fast life insurance. There was a time not long ago that the project could drag out forever. The process began with phone colds and lots of dialog between you and agents about various policies, options and underwriting requirements. Today fast life insurance is possible.

You simply kick off your shoes, grab your favorite drink, boot up the computer and log in to the internet. Then you type in what you’re looking for and bang the results pop up on the screen for your review. That alone saved you a lot of time and talk.

Then you review the sites for quotes and results. Most of these services provide you data on the most aggressive carriers available. They aren’t biased generally speaking as they make their money regardless of which program and so forth that you buy.

This entire shopping process can be done in less than an hour and finding the best offers as well. If you have questions there’s normally a phone number or email address for you to use.

You simply fill out and online application and you;’re almost done. If your age and amount of insurance require a medical examine you’ll be contacted immediately and schedule for someone to stop by for probably a half hour to take your blood pressure, obtain a urine sample and ask you a few questions.

This whole process is very simple and as you can see that’s pretty fast life insurance.

Advantages Of Whole Life Insurance Policies

When you consider the advantages of whole life insurance policies I hope you will conclude that this is life insurance worth owning. I have no objection to term life insurance and even owned some when I was much younger. Each type of policy has it’s place and it’s own function. I cannot, for the life of me, understand why some people never have appreciated this. I refer to the term advocates who seem to hate the thought of buying a whole life policy.

The First Of The Advantages Of Whole Life Insurance Is The Death Benefit

The whole life insurance policy assures you a guaranteed death benefit that never decreases and upon death is usually free of federal income taxes. If you choose you may take the death benefit in the form of a monthly income instead of a lump sum.

The Premiums Remain Level; Another Of The Advantages Of Whole Life Insurance Policies

When you buy a whole life policy the premium you start out with is the premium you will always pay. It never increases. If you, however, decide to use your dividends to reduce premiums you will pay a much lower premium than you contracted for.

Whole Life Insurance Policies Have Cash Values

Another of the advantages of whole life insurance are the cash values. They can be borrowed by the policy owner for whatever reason he or she should choose. If you should decide to surrender your policy at any time you receive your cash values. These cash values accumulate tax deferred.

Participating Whole life Insurance Policies Earn Dividends

If you own a participating whole life insurance policy you automatically become eligible to earn dividends on your cash values if the company performs well, which they usually do.

These dividends can be paid to you in cash, can be used to purchase paid up additions, to reduce premiums or they can be left to accumulate at interest.

Certainly these are worthwhile advantages of whole life insurance. There are many, many more.

How to Lower Your Life Insurance Premiums

In the world today when human health and life are extremely precarious, getting health insurance becomes mandatory for every individual. Health insurance can be of immense benefit in the hours of need. It brings requisite money at your doorstep when you are impotent to earn and meet your medical and other expenses. On the same hand it is also a great help to the person’s family.

But despite of being aware of the value of an individual’s life on and also of the countless advantages fetched by a health insurance policy, people hesitate in taking it. According to surveys the primary reason behind it is the cost of the policy. However, if a person is little vigilant he can always gain the pleasure of a health insurance policy at affordable rates.

The cost of a health insurance policy varies greatly with the region in which an individual is located. All the health insurance plans are not available everywhere. For instance citizens of places like Washington State and Kentucky do not have many options to explore. People residing in the rural areas such as Texas and the like do not get to save enough on HMO policies due to lack of people that make it economical. Similarly some states do not have the option for an association health plan. However these things should not obstruct you from buying a health insurance policy. For there are quite a few ways in which you can acquire a reasonably priced life insurance policy.

o In order to have an affordable policy, the foremost thing to be done is to opt for a health insurance broker who is well acquainted with the insurance market and business. Internet is the perfect means to hunt for an agent. A broker will not just present different market rates to you but will also negotiate with the company for the rates. Moreover he will also tell you what are the different ways in which you can lower your premiums like by joining a group etc.

o Another good way to procure an affordable policy is to obtain online quotes. There are quite a few sites that will assist you with the requisite details after you give them some general information about yourself.

o You should also visit to your state insurance department’s website. Here you will see the complete list of companies that sell individual coverage as well as those that sell without brokers in your state.

o You can also look up the state’s insurance pool. At many places such as Texas, those individuals who do not get coverage anywhere else are covered under the high-risk pool.

o For those who have debilitating physical conditions, COBRA legislation is good option.

o You can also form your own small group. For small groups the employer group policies are quite often subject to different rules. These are offered at relatively low prices and turn out to be more spirited.

o Finally you can even become a part of an association or group that has group coverage.

Life Insurance and Life Assurance are Not the Same!

The average man in the street assumes that Life Insurance and Life Assurance are names for the same form of insurance. How wrong they are! But don’t hang your head in shame, many financial commentators get it wrong too! Life Insurance and Life Assurance perform different financial roles and are poles apart in cost – so it helps to surf for the correct product.

Life Insurance provides you with insurance cover for a specific period of time (known as the policy’s “term”). Then, if you were to die whilst the policy is in force, the insurance company pays out a tax-free sum. If you survive to the end of the term, the policy is finished and has no residual value whatsoever. It only has a value if there is a claim – in that context it’s just like your car insurance!

Life Assurance is different. It is a hybrid mix of investment and insurance. A Life Assurance policy pays out a sum equal to the higher of either a guaranteed minimum underwritten by the policy’s insurance provisions or its investment valuation. The value of the investment element is then a reliant on the Insurance Company’s investment performance and length of time you have been paying the premiums.

Each year the insurance company adds an annual bonus to the guaranteed value of your life assurance policy and there is normally an extra “terminal bonus” at the end. Therefore, as the years go by your life assurance policy increases in value as the investment bonuses accumulate. The value of these bonuses are then determined by the insurance company’s investment performance. Once investment value has been assigned to the policy, you can cash it in with the insurance company. However, most people get a far better price for their life assurance policy by selling it to a specialist investment broker rather than cashing it in with the insurance company.

If you were to die during a Life Assurance policy’s term, the policy pays out the higher of either the guaranteed minimum sum or the accumulated value of the annual investment bonuses. However, if you are still living when the policy terminates, you usually get a bigger payout. This is because with most insurance companies, an additional terminal bonus is awarded.

There is a also a specialised form of life assurance called “Whole of Life”. These policies remain in force for as long as you live and as such, have no preset term.

There is also a practical difference for the internet user. Whereas you can buy life insurance online, the Financial Services Authority view life assurance as fundamentally an investment product. As such they believe it is best suited to being sold by a Financial Adviser with advice based on the Advisors full understanding of your personal details. Therefore, you will be unable to buy life assurance online. However, you can use the internet to find a suitable financial adviser with whom you can meet and discuss your requirements.

What are Life Insurance polices and Life Assurance policies used for?

Life Insurance is usually a focal point of the family’s financial protection. It is ideally suited to ensure that known debts such as a mortgage, are repaid in full in the event of the policyholders death.

When it comes to providing a lump sum for general use in the event that the policyholder were to die whilst the policy was in force, either life insurance or life assurance can be used. The differences are that with life insurance the size of payout would be preset whereas with life assurance it would depend on the guaranteed minimum and the insurance company’s investment performance. But remember, at the end of the policy’s term life insurance is worthless, whereas life assurance should payout a sizeable investment sum. In this context Life Assurance seems far more worthwhile but in practice more people elect for life insurance. Why? It’s a matter of cost. Life Insurance is considerably cheaper than Life Assurance. Furthermore, in recent years, investment returns on Life Assurance policies have fallen significantly and many insurance companies have placed penalties for cashing in policies early. This has adversely affected the resale value of Life Assurance policies.

Finally, if you want a product to provide a lump sum on your death whenever that is with a minimum payout guaranteed, you’ll probably elect for Whole of Life insurance. It’s really a form of lifetime investment with the benefit of a guaranteed minimum. They’re particularly useful for Inheritance Tax Planning.

Life Insurance – Top Money Saving Tips

More and more people are buying life insurance online and the numbers seem to be doubling every two years. The reasons are clear. Prices are lower on the Internet and life insurance is fundamentally a simple insurance product.

Despite the underlying simplicity of life insurance, most web sites channel their online clients through a telephone based help and advice service manned by experienced personnel. They represent your safety net so if a little technical knowledge is called for, help is at hand.

But it’s always a good idea to have a few Top Tips in your back pocket when you’re shopping online for life insurance. They’ll help you ask the right questions and find the best policy.

1. Always have your Life Insurance policy “Written in Trust”.

This means that in the event of a claim, the money goes directly and immediately to the person(s) you nominate when you first take the policy out. It also avoids all possibility of your estate having to pay Inheritance Tax on the proceeds of your policy and that could represent a 40% tax saving !

All you have to do is tell the online brokerage organising your policy that you want your policy “Written in Trust” and the names of the people who the life insurance company pay in the event of a claim. They will then sort it all out for you. The extra good news is that this service is invariably free of charge. So it’s a win win situation and there aren’t many of those around these days !

2. In the early years a Reviewable Life Insurance Policy will be cheaper but a Guaranteed Policy will work out a better buy in the longer term.

With a “Guaranteed Policy” the insurance company guarantees never to increase your policy’s premium.

With a “Reviewable Policy” you agree that your insurance company can review the cost of your policy at regular intervals. But don’t be kidded – in our experience a “review” is just another word for a price increase. After all, who’s ever heard of an insurance company passing up a chance to charge you more! The review intervals are usually between 2 to 5 years but this does vary between insurance companies. You will find the details of the review intervals on the documents sent to you before you accept the insurance – these are called The Key Features Documents.

So, comparing otherwise like for like policies, in the early years the premiums for a “Reviewable Policy” will undoubtedly be lower than the premiums for a “Guaranteed Policy”. Thereafter, the premiums for a Reviewable Policy increase eventually catching up with and overtaking, the premium for a “Guaranteed Policy”.

In our experience, you can expect the monthly premiums for a Reviewable Policy to exceed those of a Guaranteed policy in about 7 to 10 years and then within the following 10 years, more than double again. If your budget is currently tight then by all means choose a Reviewable Policy – after all your salary may increase in coming years and ease the strain. On the other hand, if the premiums for a Guaranteed Policy are affordable, we think they represent your best buy.

A footnote. Many insurance companies have stopped offering “Guaranteed” rates for standalone critical illness insurance policies. This because they have experienced much higher claim rates than they initially expected. However, you may still find a Guaranteed life insurance policy that also provides critical illness cover. As we have explained, “Guaranteed” rates are especially good value and if you can get a quote for a Guaranteed life policy that includes critical illness cover, you may have a real bargain.

3. Thinking about a Joint Life Insurance Policy?

A Joint Life Insurance policy is usually written on a first death basis. This means that the policy will pay out on the death of the first policyholder, subject to the policy being in force at the time. This leaves the second person uninsured and older. Older people can struggle to get life insurance at an affordable premium, so rather than a Joint Policy consider taking out separate policies now. Overall it will work out a little dearer – but you get twice the cover and double the peace of mind.

4. Taking out a Life Insurance Policy? Now would be an ideal time to include Critical Illness cover.

Are you likely to need Critical Illness Insurance in the future? Yes? Then consider adding it now to the life insurance policy you’re arranging. Why? There are three reasons.

Firstly, a Life Insurance policy combined with Critical Illness cover will work out significantly cheaper than buying two separate policies. Secondly, as we have already explained in the footnote to Tip 2, you may be able to buy a combined Life and Critical Illness policy with a guaranteed premium. That could be a real bargain. Finally, premiums for critical illness cover increase rapidly as you get older – so the sooner you take it out, the cheaper it will be.

5. Don’t confuse Terminal Illness cover with Critical Illness cover.

There’s world of difference between Terminal Illness and Critical Illness cover so it’s important to understand the difference.

Terminal Illness cover pays out the insured lump sum if a Medical Doctor diagnoses you with an illness from which the Doctor expects you to die within 12 months. Most good life policies automatically include Terminal Illness cover at no extra cost. It’s basically an early, and welcome policy payout.

A Critical Illness policy pays out the insured lump sum if you are diagnosed with one of a wide range chronic illness and there is no life expectancy criteria. Indeed, with many of the insured illnesses you could expect to survive for many years. For example: certain cancers, heart disease, stroke, multiple sclerosis, loss of speech, sight or hearing, onset of Parkinsons or Alzheimers disease, third degree burns etc. Say you were an engineer aged 40 and you lost your sight. A Critical Illness policy would pay out immediately and that money could well be vital in helping you and your family through many difficult financial years ahead. If you just had Terminal Illness cover there’d be no chance of a payout.

So as you can see, Critical Illness cover is far more comprehensive than simple Terminal Illness cover and for that reason critical illness cover always costs you extra.

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