Life Insurance

Final Expense Insurance

If you’re getting older or if you suffer from a terminal illness, you may be thinking of how you can help your family cover expenses in the event of your death. With all the new procedures and good medical techniques that are common now, people are living to be much older than they did just a few decades ago. This does not mean that it is not important for those who are over sixty to have good insurance coverage; it means that it is time to get serious about it if there is not a policy yet in place.

The following are some reasons why final expense insurance for the elderly is so important:

· Covers Final Expenses – As the title of the insurance describes, this insurance covers all final expenses so that families are not left to scramble to get the funds together. The policy pays the person who is listed as a beneficiary who then takes care of the final arrangements. There is no need to put your loved ones in financial straits when it is so easy to apply for and be approved for final expense insurance.

· Pay for What You Want – The elderly may have very distinct wishes as to their final resting place and what they want for their arrangements. When final expense insurance is purchased, the final arrangements can be set at that time and the insured can have their funeral home set as the beneficiary so that the loved ones do not have to do anything. This allows the deceased wished to be carried out in the way that they want and they have the security of knowing that they are taken care of even in death. The amount of the policy can be set to cover these costs including any expenses that may have increased during the life of the policy holder.

· Convenient and Easy to Pay Off – Those elderly people who opt for this type of insurance can pay a small monthly fee to make sure that their policy stays in place. Even those on a fixed income can afford this type of insurance. Most insurance companies can automatically deduct the cost of it from the insured’s bank account so that they do not even have to remember to make the payments each month.

It is just sound planning to have final expense insurance. Those who are elderly should consider this insurance but it is not limited to those over sixty. Anyone who wants to make sure that their arrangements are carried out the way that they want them to, should have this insurance in place.

Life Insurance

Term Life Insurance

Term life insurance is most commonly referred to as pure insurance and for an agreed premium, based on age, health and other risk factors; it provides you with a stated dollar amount of death benefit protection for a defined period of time. Unlike the cash value policies, such as whole life, universal life, indexed universal life and variable life, which in addition to the lifetime death benefit, provide for cash value accumulation, policy loans and many other valuable benefits within the policy.

With a term life insurance policy, you may choose terms of one, five, ten years or even longer and many may be renewed at the end of each stated policy term, with a new premium based on your current age. Some may also offer opportunities within the contract for conversion to a permanent life insurance policy offered by the issuing company. This not only stops the premium increases but also now provides a savings element to enjoy a buildup of cash value within the policy. These guaranteed renewable provisions do not require medical underwriting or proof of the current medical condition, protecting the insured from a potential un-insurability issue due to a decline in health, although most term policies will not be renewable or convertible beyond age of 85.

Term life insurance is generally less costly than permanent life insurance in the early years, but in the latter years of the policy the premiums often far surpass those of permanent policies and can become quite prohibitive due to increased age bands, whereas permanent life policies offer a set level premium throughout the entire stated premium payment period within the life insurance policy contract.

I would say the simplest analogy to use here would be; you are simply renting a term life insurance policy for a set period time, as opposed to purchasing permanent life insurance protection for a lifetime. And, the big take-a-way would be; no matter what type of policy you are considering, be sure to always keep in mind, the younger you purchase any life insurance policy the lower the premium will be.

Level term policies are best used to protect against the premature death of the policy-holder. This type of protection can be used to meet many very important needs such as, income replacement, college funding for children and grandchildren as well as many business purposes. This keeps the amount of insurance protection level throughout the chosen term.

With a decreasing term policy, the death benefit reduces gradually throughout the term and may be used to protect a declining need such as a home mortgage, consumer and/or business loans or just about any financial commitment that shrinks over a period of time.

In order to keep the level of protection up to date with inflation an increasing death benefit term policy may be just the thing, but remember there may be additional underwriting required within this type of policy.

Combination policies are becoming quite common today. With a combination of term and permanent insurance, more immediate protection can be acquired at a considerable savings in premium. In order to accomplish this goal, term insurance is added to the permanent insurance policy as a rider.

Hopefully, you can now see a term insurance policy can be and is the right insurance policy to purchase today to address a number of specific insurance protection needs. While also understanding, it is surely not the best insurance purchase to make, in at least as many if not more life event protection needs, throughout one’s lifetime.

My best advice I can offer to my readers is and will always be… Before purchasing any life insurance product, be sure to speak with a qualified, licensed professional in your state. It is imperative and always wise to investigate your options before you buy!

Nate Akers
Licensed Insurance Expert

Health Insurance

Changing Healthcare 2014

Starting January 1, 2014, four of the biggest changes in the reform legislation are set to be implemented. This is when the “rubber will meet the road” and it all goes from theory into practice. Whether or not this is a big success or another financial burden on our national debt, only time will tell. But, what’s important now is to understand what is expected of you and/or your business and which decisions are best for you.

The 4 biggest changes are:

• Individual Mandate- The PPACA requires all American citizens and legal residents to purchase qualified health insurance coverage. If not, then you will pay a minimum fine of $95 up to 1% of your household income. The fines increase in 2016 to $695 per person or 2.5% of income up to $2085.

• Guaranteed Coverage- Coverage cannot be declined due to pre-existing conditions. For persons who have been unable to get coverage on the individual market due to pre-existing health conditions, they will now be able to get the same coverage and price as a healthy person the same age (smokers are charged additional).

• Health Insurance Marketplace (Exchange)- For individuals and small businesses, the Federal government and some states will provide an Exchange to access health insurance in addition to the traditional method of an insurance agent/broker. In fact, some insurance agents/brokers will provide plans both inside and outside the Federal or State Exchange. The two important points are 1.) an individual can only qualify for a subsidy and 2.) a small business can only qualify for the small business tax credit through a Federal or State Exchange. The Enrollment for the Exchanges opens October 1st this year.

• Pay or Play Rule- For businesses with 50 (FTE/Full-Time Equivalent) employees or more, an affordable “minimum essential coverage” health plan must be provided to their employees or pay a fine. If a business does not provide qualified coverage, the penalty will be the lesser of ($2000 times the # of F/T employees minus 30) or ($3000 times the # of F/T employees that obtain a subsidy for coverage through the Exchange). This penalty is determined on a monthly basis so will pay 1/12 those amounts times the # of months they are not in compliance.

These are the biggest, but far from the only, changes that are coming in 2014. How will you be affected? Do you know the best approach to take? For some, you may not see much difference. For those individual and businesses who want answers to your questions, my suggestion is to speak with an agent/broker that will be providing coverage both inside and outside the Exchange to compare your options and help you make the best decision.

Nate Akers
Insurance Expert
Licensed Insurance Agent