November2016

Mortgage Life Insurance – The Best Approach

Insurance is risk management. So, for each type, you need to identify the risk to cover and the best way to do it. Mortgage life insurance, like other insurance types, could be expensive, so you need to understand that the inherent risk is the same as for normal life insurance. Besides, there are different ways to get it.

Financial institutions sell mortgage life insurance to protect them from potential loss on the death of mortgagees. Financial institutions, instead of family members or others you choose, benefit from these policies.

Let’s look more closely at how mortgage life insurance might arise. If you borrowed $100,000 from a bank to buy a house, the bank would write its name on the property’s title, and so, become a co-owner up to the loan’s value. This is the typical mortgage.

If you died before you repaid the mortgage, the bank would have two choices. It might sell the house and give your beneficiary the difference between the amount they got on sale and the outstanding loan. Alternatively, it could allow your beneficiary to take over the mortgage loan and repay it. To do the second, the bank would need to be comfortable with the beneficiary’s finances after your death. The bank might accept the alternative if your life insurance and other assets provided enough income to pay the mortgage and give your dependents an acceptable income to live on.

Another way to deal with mortgage insurance when you get a mortgage is for you to insure your life for the mortgage’s full value. This would supplement existing regular life insurance coverage. However, this does not look holistically at your finances, so I do not think it is the way to go. You might not need more insurance.

Mortgage life insurance sold by a financial institution can be expensive and has disadvantages. First, the insured amount falls as the mortgage balance drops over the mortgage’s life, but the premium does not fall. Second, unlike a term life policy, the bank has the right to hike premiums. Third, it is not portable. So, if you switch your mortgage, you need to reapply for life insurance with your new bank.

You would be better off to review your financial affairs and if needed, buy extra term insurance from an insurance company. You would own the policy. The financial institution wouldn’t. Your spouse or others you choose, would be the beneficiary, not the bank. And your spouse or dependent would have the choice to take over the mortgage, if that alternative was best for them.

Like all financial decisions, listen, hear, and understand your alternatives, and let the Lord guide your decision.

(C) 2011, Michel A. Bell.

Term Life Insurance – How To Get The Best From It

There are merits in getting a term life insurance policy. There are also demerits. A deeper knowledge of term life insurance (Its merits and demerits) will help you ascertain if it’s right for you or not. Let us go over the merits of term life insurance before we go further…

It is a less expensive option and a great alternative at a time in your life when you can’t risk being without a life insurance policy but are financially burdened.

Disadvantages…

1. You would have to pass on within the policy’s duration for any death benefit to be given to your loved ones. There’s no form of benefit to be paid out should you stay alive through the policy’s duration and/or pass on even a minute afterwards.

2. Policy holders could finally become uninsurable at the termination of their present term life policy.

The following two features will ensure that you get the best out of your term life insurance policy. Although they will make your premium slightly higher, they’re well worth it.

Guaranteed renewal…

A term life insurance policy with guaranteed renewal means you can’t be rejected if you want another term at the end of a current term.

Convertibility…

If you get a term life policy that’s convertible, you can change over to another life insurance policy thus having the best of both worlds. If you are less than forty, you can get it when you need substantial coverage but have few dollars and later switch to whole life insurance as your finance improves.

Get Your Term Life Policy For The Least Price Possible…

You can bring down your term life insurance rates by asking for quotes from reputable insurance quotes sites. I advise that you use not less than three quotes sites since that will ensure you do not miss out better quotes not presented by the other sites. This provides you a broader basis for doing better comparisons thereby increasing your chances of getting better quotes.

What Are Life Insurance Benefits and How Could They Be Used?

At the present time most of the people desire to know about the benefits of life insurance. Life insurance benefits are payments paid by the benefactor to the beneficiary in accordance with the written agreement between the two parties. This insurance unlike all other kinds of insurances are usually released by the insurance company to the family members on behalf of the beneficiary’s death.

Life insurance benefits are highly important and people are usually urged to sign up for them. The uses of the insurance are particularly many including the ability to pay for the burial and funeral arrangements of the deceased. Other uses may include; expenses extended to memorials of the deceased as well as past bills which were probably unpaid before the beneficiary died.

The benefits of Life insurance can also be used to for other factors like continue paying bills for the family needs. For example, if one had a child in school, these funds could be used to cover the costs of school fees, college fees and any other requirements that the child may need. All in all insurance benefits could also act as sources of inheritance! It comes as a common ground of understanding to be driven to particular attentions that one can actually refuse his or her life insurance benefits. This is usually conducted under specific contracts which are usually signed by filing a disclaimer report which may state that the benefits could be awarded to the next person on the list. This is however not very common since people have families that they actually care for.

One may be asking this question; what are the benefits of life insurance and could they actually be part of a will? The answer to this question can be based upon the need to understand the general importance of these benefits. Well, on the signing of this policy, the rightful person to receive the funds is usually mentioned and thus this directs that particular person to a couple of instructions that describe on what he or she could do with the funds. If neither, then the decision is usually left to the current holder of the funds to make. Insurance benefits are generally important and the reason for their creation was to make sure that people don’t spend money without investing on particular needs that could actually call upon the attention of the individual like in the case of medical insurances or life insurances among others.

MetLife Will Repatriate an Offshore Reinsurance Unit

MetLife, the nation’s largest life insurer, said Tuesday that it would make its business more transparent by moving some deals for hedging risk back to the United States from offshore, pleasing regulators but underwhelming the stock market.

For a number of years, MetLife has been using a Bermuda subsidiary, Exeter Reassurance, to reinsure several billion dollars’ worth of variable annuity contracts, in which customers pay in advance to receive guaranteed payments in retirement. By buying the reinsurance, MetLife was able to remove the obligations to these policyholders from its balance sheet.

Such transactions have become extremely popular in the life-insurance business in recent years, and regulators at the New York State Department of Financial Services have been investigating the deals since last July. The department’s superintendent, Benjamin M. Lawsky, recently called them “financial alchemy.”

“Let’s call it shadow insurance,” Mr. Lawsky said in a speech in April, recalling the so-called shadow banking system that appeared in the run-up to the financial crisis.

MetLife and other insurers have been trying to cope with the Federal Reserve’s long-running policy of keeping interest rates very low to help revive economic growth. Many life insurers are having trouble because they normally buy bonds to make good on annuities they sold in the past, and they cannot get the yields they need in the current low-rate environment. They can reduce the obligations on their balance sheets, however, by shifting them to reinsurers.

But buying reinsurance from an off-balance-sheet subsidiary “does not actually transfer the risk for those insurance policies off the parent company’s books,” Mr. Lawsky said in his speech. By law, reinsurance must involve a real transfer of risk; otherwise insurers are not supposed to use it to improve their balance sheets.

Mr. Lawsky said questionable reinsurance deals throughout the industry were increasing the likelihood that policyholders would not receive their payments at some point. He also expressed concern that they were causing systemic risk within the broader economy, the way the booming growth of mortgage-backed securities had done in the years before 2008.

MetLife’s chief executive, Steven A. Kandarian, said in an annual presentation to investors on Tuesday that repatriating MetLife’s policy obligations from Exeter “proactively addresses recent regulatory concerns” about such deals, adding that Mr. Lawsky’s inquiry had been an important factor. He also said the change would put MetLife in a better position to comply with new collateral requirements put in place by Congress after the financial crisis.

Mr. Lawsky issued a statement on Tuesday praising MetLife’s decision, saying the company had “acted wisely in bringing this subsidiary back to the United States, where it will be subject to stronger rules and oversight.”

MetLife said the transaction, which it expects to complete next year, was also part of an effort to lower the risk of its variable annuities business. It also said it was ratcheting back on sales of the annuities, aiming for $10 billion to $11 billion worth this year, compared with $28.4 billion in 2011.

MetLife’s shares closed down 1 percent, or 48 cents, to $42.82.

When MetLife’s transaction is complete, it will have returned Exeter to the United States and merged it with three state-regulated MetLife units: the MetLife Insurance Company of Connecticut; the MetLife Investors U.S.A. Insurance Company, now based in Delaware; and the MetLife Investors Insurance Company, based in Missouri. A spokesman said it was not yet clear where the merged company would be based.

Go Online For The Cheapest Life Insurance Quotes

When it comes to life insurance it can be very confusing, there are many different terms which describes life insurance and unless you are an expert in such matters they can sound like a foreign language. When it comes to getting the cheapest life insurance quotes then going with a specialist broker is your best option.

The basics of life insurance are relatively simple; you take out cover in case you should die and this will ensure your loved ones are financially secure and can carry on paying the monthly commitments and you leave enough to take care of your family. However there is so much more to life insurance than just this, so it is imperative that you fully understand all the different life insurance policies on offer. The main types are term life and whole life insurance.

The cheapest and simplest of all life insurance is the term life policy. If you take out term life insurance then you take it just to cover the fact that if you die your dependants get paid out, as opposed to taking insurance that will pay if you should die or pay out after a set period of time. This type of policy will only pay out an agreed lump sum of money if you die which means that those you leave behind wouldn’t be left struggling and having financial difficulties to deal with.

One big factor that you have to take into account when taking out life insurance is how much to insure yourself for. As a general rule of thumb you should aim to cover your life for around 4 to 6 times the amount of your annual salary, or enough to pay off your mortgage. So the easiest way to decide this is to take the amount you have coming in each year and multiply it by 6, or see how much you have left on your mortgage. This will give your family enough to deal with financial commitments for some time. Of course you need to take into consideration the rate of inflation and if you have children make sure they would be covered if they are thinking about going into higher education.

A broker will be able to get you the cheapest life insurance quotes while giving you excellent advice on the different types of cover available and what might be the best for your circumstances.

Types of Term Life Insurance

The most simple and basic form of term life insurance is for a term period of one year. In this case the death benefit is paid by the company issuing the policy if the individual who is insured died during that particular one-year term. This policy is so stringent that no benefit is paid even if the insured dies just a single day after the final day of the specified one-year term. The premium that is paid is then simply the expected probability of the policy holder dying in that particular one year term along with a component of cost and profit for the insuring company. Due to the fact that the possibility of dying in the next year is extremely slim for anyone whom the insuring company accepts for providing coverage to, this is not very cost effective. Also, due to this very reason it is also not very commonly done.

The most simple and basic form of term life insurance is for a term period of one year. In this case the death benefit is paid by the company issuing the policy if the individual who is insured died during that particular one-year term. This policy is so stringent that no benefit is paid even if the insured dies just a single day after the final day of the specified one-year term. The premium that is paid is then simply the expected probability of the policy holder dying in that particular one year term along with a component of cost and profit for the insuring company. Due to the fact that the possibility of dying in the next year is extremely slim for anyone whom the insuring company accepts for providing coverage to, this is not very cost effective. Also, due to this very reason it is also not very commonly done.

Finding the Best Whole Life Insurance

Now that you have finally decided to sit down and make sure that you have all of your final arrangements set in place, there is a lot that you need to consider when it comes to the best whole life insurance. The whole life insurance policy is one that is generally the best for people when it comes to the long-term outcome but it is something that people generally avoid because of the upfront money. Generally speaking, even the best whole life insurance plan will have you paying a pretty high premium.

This is to make sure that the best whole life insurance company has gained enough money from you upfront in order to pay out down line. Also, the best of the best whole life insurance companies will only have you pay a premium for about twenty years or so which means your monthly premiums will be on the higher side. It is better to pay the high monthly or yearly premiums now instead of later when you are retirement. Taking care of getting the best whole life insurance plan in place now is something that is extremely important to take care of.

Shopping Around

When it comes to trying to shop for the best whole life insurance it is extremely important to make sure that you are not taking the first policy that you come across. The reason is that you may very well come across truly the best whole life insurance policy and find that you are over paying. Now you can always stop the policy that you paid for and begin a new one with the better company but all of the money that you put into what you thought was the best whole life insurance plan is wasted and that is money that you are not going to see again.

Make sure that you are keeping good notes of all of the various companies that you come across and what the details are for the policies that they are offering. By taking notes and taking the right amount of time to compare it all, you will be able to truly find the best whole life insurance plan out there. Once you have found the best whole life insurance plan you will want to go ahead and take care of it and get it all started The sooner you sign up for the best whole life insurance plan then quicker you will be done paying for it all.

How to Find the Best Rates On Life Insurance in Nevada

At some point in each person’s life, often not long after they’ve married or, especially, right after having a child, the realization begins to dawn that none of us are immortal. That is often the time that we first decide that we need life insurance – and then the race is on the find the best rates on life insurance in Nevada.

When shopping for life insurance the first decision one needs to make is which kind of life insurance to buy: whole life or term insurance.

Whole life, as the name implies, is insurance that is good for your whole life. You buy it once and unless you want to upgrade or make alterations in your policy at some point, that’s it for life. Whatever premium rate is in effect for the amount of the policy and your age at the time you take out the policy is the rate you will pay for the rest of your life.

Term insurance, on the other hand, is a life insurance policy that is good for only a certain number of years – called the term. It is generally possible to buy term life policies for 5 years, 10 years, 20 years and 25 years; sometimes for longer terms. Your premiums will be based on your age at the time you take out the policy, the amount of the policy, and the number of years (the term) that the policy will be good for.

The premiums you will initially pay for term life insurance are almost always lower than the premiums you will pay for whole life insurance. The difference is that when it comes time for you to renew your term insurance policy you will be forced to pay a higher premium than you did before due to the fact that you are now older than when you took out the first policy.

In other words, the premium for whole life insurance is level for the life of the policy, whereas the premiums for term insurance keep going up – sometimes substantially – each time you must renew your policy.

But regardless of which type of insurance you choose, the problem of finding the best rates on life insurance in Nevada remains the same.

What can you do? Don’t smoke or use tobacco products, and if you already do, stop. Smokers pay considerably higher rates than non smokers. If you are overweight, do whatever is necessary to lose weight. Join a gym or a professional weight-loss program. The healthier you are the lower your life insurance premium.

If you drive a flashy sports car or muscle car, trade it in. If you have a dangerous job, let this be your reason to change careers. Anything that puts your life at risk will raise your life insurance rates.

Keep your credit rating healthy. Believe it or not, people with better credit ratings get better rates on their life insurance.

And, of course, go online and compare policies and rates. But don’t stop at comparing rates at just one website – compare rates at 3 or even 4 different websites; each website will have its own set of companies that it will use for comparisons, and you need to see the rates of as many different companies as possible in order to find the best rates on life insurance in Nevada.

What is Term Life Insurance

Term life insurance is in fact the original form of life insurance. It is commonly considered to be a pure form of insurance protection. This is due to the fact that it builds no cash value whatsoever. This is as opposed to the case of permanent life insurance like whole life, universal life and variable universal life. Term life insurance is not permanent. This is because it covers you only for a specific period of time that is the relevant term. If the insured individual dies during that particular term, the death benefit is paid to the specified beneficiary. Since the term expires, many a time the insurer does not have to pay out. This makes term insurance perhaps the most inexpensive way to purchase a considerable death benefit on terms that are on coverage per premium dollar basis.

As term insurance is not of a permanent nature its primary use is usually to provide coverage for the temporary financial responsibilities of the insured. Such responsibilities may include college education for dependants of the insured, dependent care, consumer debt and mortgages. However the responsibilities are not limited to just these listed items. There is however a main disadvantage of term life insurance. This is that the coverage provided by such term insurance such that at the end of the term, the coverage ceases. Now after this ceased coverage any new policy has to be underwritten newly and that too this time according to the current age and health of the policyholder at the time of underwriting.

On the flip side when a complete or whole life policy is taken out, the individual insured has a guaranteed insurability for the rest of his or her life and this coverage is regardless of any alteration in the health of the individual.

This does however mean that the initial premiums of the whole life coverage are likely to be higher than that of term insurance coverage. Therefore it depends on your personal needs and situation in order to decide which plan is ideal for you.

Mobile Phone Insurance More Important To Britons Than Life Insurance

A study by Legal and General has found that Britons think it is more important to protect their mobile phone from loss or theft than it is to insure themselves against critical illness, accident or death.

The most surprising result from the survey highlights the fact that possessions are more likely to be insured than the person owning them. Most people surveyed, over 54%, had no protection policies whatsoever, while 22% had their phone insured compared to 17% who had critical illness and life assurance. Income protection was considered important by only 14% of those questioned.

Furthermore the survey finds that significantly more people have insured their home contents than their life, with over two-thirds of those questioned saying they have insured their home against 41% who say they have insured their life. Time and again the insurance industry reports that there is a huge gap between the amount of cover that UK citizens have taken out and estimates how much should actually be taken out to cover everyone, and this survey suggests that gap is in no danger of closing.

Legal and General’s protection sector Marketing Director Bonnie Burn’s thinks it is a worrying trend. She said:

“The priorities of the nation seem mis-guided, with people more concerned about the loss of their mobile phone than how they would cope financially if they could not work, through illness or serious accident. We all hate facing up to our mortality, but when insuring our life is considered less important than insuring our possessions, then perhaps it’s time for something to be done.”

The fact that people are willing to pay for relatively expensive phone insurance, but not for life or critical illness cover is particularly depressing news for the UK life insurance industry. When you compare life insurance cover pound for pound against mobile phone insurance the figures make sobering reading. For example paying an average premium of £4.99 a month would result in paying almost £60 a year for a phone worth around £150 – over a third of its value in one year. Many people take out this insurance unaware that they may also be covered for mobile phone loss or theft on their home contents policy. On the other hand a 30 year-old man wanting £200,000 life cover would pay on average only £13 per month; a lot more cover for your money! It appears that even through the majority of us have it ahead of any other protection cover mobile phone insurance most definitely works to the benefit of the insurer.

This news comes on top of the news issued by government that estimates that almost seven million working Britons are not making enough provision for their pension. That combination of inadequate income, critical illness and life cover, and pension provision suggests that many Britons are financially ill-equipped to face the future, and could face real hardship if the worst should happen.