Buying insurance of any type can be a very stressful experience. With all the different companies advertising lower rates and better coverage it can be extremely difficult to find the best policy for you. While buying any kind of insurance can be a difficult decision, when you want to buy health, life or pet insurance the process can be even trickier because you are dealing with the life and health of your family and pets.
1. DECIDE WHAT TYPE OF INSURANCE YOU NEED
Nobody wants to think about insurance. It's boring, it's expensive and finding the right policy for your particular situation is time-consuming. It's also one of the most important decisions you'll have to make. Isn't being an adult fun?
Health insuranceDo I need health insurance? The short answer is yes. It's no secret that medical bills are outrageous. A single trip to the doctor's office can cost you upwards of a thousand dollars. If that isn't enough, the average cost of medical care for a broken leg is near 20 grand. So, unless your last name is Rockefeller, health insurance is probably a good investment.
Coverage options:
• Employer: The best way to get health insurance is to find a job that offers it as one of the employee benefits. Employers are able to get cheaper insurance, through group plans and then offer those discounted rates to their employees. Sometimes, and employee will have to pay a percentage of their monthly premium, but in rare cases, and employer will cover the entire premium for an employee. Chances are, you will have to fork over some money for any dependents, however.
• Self-Employed and Individual Coverage: Those that are self-employed are sometimes the hardest hit by rising healthcare costs, because they have to pay for individual coverage. Most major health insurance companies will not give you group status until you have at least two full-time employees. And the more employees you have, the cheaper your rates. For the self-employed, there are sites on the Internet promising coverage, based on "National group" plans. They say they will combine all individuals across the nation into one group. However, these sites often have very high premiums, offer little coverage, and you end up paying more in the long run. Your best bet is to meet with a reputable insurance agent in your area to explore your options.
• Government: For low-income individuals Medicaid and Medicare are popular federal programs, but there are options in some states for free coverage. For example, Illinois offers free health insurance to all children, if their parents are below poverty-level. Adults must cover their own insurance, however. To see if your state offers free health insurance coverage, visit these sites:
2. State Health Agency list
For information on Medicare and Medicaid, visit:
• Medicare Prescription Drug Coverage
• Medicaid Program - General Information
Some major health insurance companies include:
• Aetna
• Humana
• Compare quotes from all major carriers
Life insuranceDeciding if you need life insurance is a completely different story. There are many questions you will need to ask before you decide if life insurance is a good investment and how much life insurance you need.
• Do you have any dependants?
If you live alone or do not have anyone that relies on you for support you probably don't need life insurance. However, if you have a spouse or minor children, you will want to make sure they are taken care of.
• How long until your dependants become self-sufficient?
If your spouse is capable of working or your children are nearing adulthood you will not need as much life insurance as you would if your spouse is disabled or your children were very young.
• How much debt will you be leaving behind?
You will want enough life insurance to cover any outstanding debts so your loved ones will be taken care of. If you have a mortgage on your home or large amounts of credit card debt you will want enough life insurance to cover the expenses.
• How long will your estate be tied up in probate?
Probate is the court process of determining how your estate will be managed and distributed according to a will or state law if a will is not available. Your estate will be tied up in probate if you do not name a beneficiary in your will. The best way to avoid probate is to name a beneficiary. However, if your estate will be tied up in probate, you will want enough life insurance to cover your dependants' expenses until the estate is settled.
Once you've answered these questions you will be better suited to make a decision on whether you need life insurance and how much coverage is right for your situation.
Life insurance is broken up into two main categories.
Term Life Insurance - Life insurance policy that covers the insured for a specified period of time. The length of time varies, though most policies use five year increments for coverage periods.
• Term Life America searches major insurance companies around the country to get you the best rate.
• Budget Life is another website that will search top insurance companies for great term life rates.
Whole Life Insurance – Life insurance policy that is kept for the entire life of the insured and pays death benefits upon the insured’s death.
• Most Choice is a great website that will find whole life insurance rates that will work for you.
• Insure.com offers rates on whole life and many other insurance needs.
Pet Insurance:The cost of taking Fido to the vet has skyrocketed in recent years. Deciding to buy pet insurance is a tough decision to make. Pet insurance can cost thousands of dollars over the life of your pet, depending on the type of pet you have. The chances you will spend that much money in vet bills is low, but if you are willing to do whatever it takes to save your pet, pet insurance may be a better option than having to take out a loan to cover an expensive procedure.
• VPI Pet Insurance offers pet insurance policies online that are accepted by most vets across the country.
• Pets Best Insurance is another nationally recognized pet insurance company that offers complete health care coverage for your pet.
2. KNOW THE LINGO
When researching the different types of insurance policies you may come across some unfamiliar vocabulary. Learning some key insurance terms will help you understand what you are reading when you are shopping for an insurance policy.
• Agent – person who sells and services insurance policies.
• Broker – insurance salesperson that works for clients and not insurance companies.
• Benefit Period – the length of time that benefits are paid to the insured and their dependants.
• Claim – demand to the insurance company by the insured or their dependants for payment as stated in the insurance policy.
• Coverage – protection provided by the insurance policy.
• Co-payment – required payment made by the insured party for a given service before the insurance company will consider paying for health care services. Usually a flat-rate.
• Deductible – amount insured must pay before the insurance kicks in. Typically an annual amount.
• Living Benefits – way to receive death benefits from an insurance policy before the death of the insured. Usually because of terminal or catastrophic illness.
• Policy – the written insurance contract between the insurance company and the policy holder. (The policy holder is not necessarily the insured.)
• Premium – Cost of insurance for a specified risk for a certain period of time.
• Renewal – automatic continuance of the insurance policy by payment of another premium.
This list is not complete. There are many more terms you will come across while researching the different insurance policies available. If you are unsure what a term in a policy means, be sure to ask before you commit to an insurance policy.
3. LOWER THE AMOUNT OF RISK FOR BETTER RATES
The cost of any insurance policy depends on the amount of risk involved with the policy. Nobody likes to give away money, especially insurance companies. The more risk an insured person is for the insurance company, the more expensive the insurance policy is going to be. There are a few things you can do to lower your risk classification.
• Stop smoking
No, not your pet. Smoking is the leading contributor to high health and life insurance costs. If you don't smoke you are ahead in the game, but living in a household with a smoker is considered just as high a risk to insurance companies. The same goes for pet owners. If you smoke, it puts your pet at higher risk for certain diseases and illness and will raise pet insurance premiums.
• Maintain a healthy weight
Insurance premiums for overweight individuals, including pets, are much higher than insured parties that maintain a healthy weight. Overweight individuals are at a greater risk for certain illnesses and diseases and are considered a higher risk for insurance companies. If you have health, life or pet insurance, the insurance company usually requires a periodic physical. Maintaining a healthy weight will help to keep your insurance premiums as low as possible.
• Avoid hazardous activity
Hazardous activity is any activity that puts the insured party at risk beyond the risk involved in normal activity. Most life insurance companies will not even cover such activities as bungee jumping and rock climbing. If they do cover these activities, it will raise your insurance premiums astronomically.
4. SHOP AROUND FOR THE BEST INSURANCE RATES.
Once you've decided what policies you need you will want to find the best possible rates. Just because an insurance company has low rates doesn't mean their policy is the best deal.
• Check with local insurance agents and online for rate quotes
Insurance companies will give you free rate quotes so you can see what their policies offer. Call or visit the local insurance agents in your area to get a quote. You can also get quotes on the Internet at any of the insurance quote websites. Don't get pressured into signing any documents until you've checked out the available options.
• Allstate Insurance offers many different types of insurance including home, auto and life.
• MetLife offers life, disability and other types of insurance and is nationally recognized.
• Blue Cross/Blue Shield is a nationally recognized health insurance company offering health insurance to companies and individuals.
• State Farm offers health and life insurance as well as home and auto.
Get more information on the insurance companies you're researchingCheck with people you know who have health, life and pet insurance to see which companies they use or recommend. See if the insurance company is registered with the Better Business Bureau and if any complaints have been filed against them in the past.
• The Rip-Off Report has information by consumers on different insurance fraud and scams they have come across.
• Visit Bad Faith Insurers to get a list of the top bad faith insurance companies around today.
• Decide which policy fits you the best and go with it
After doing your research you should have a good idea what insurance policy is the best one. You will want to get the best service at the lowest rate. Don't get sucked in to a low price if the service is not as good.
