Life insurance isn’t something most people want to think about, but it’s incredibly important if you have a family that depends on you for financial support. Once you’re gone, that source of income is also gone. That’s why planning for your family’s future in the event of your death could be the most important thing you do.
Life insurance can cover funeral costs, replace lost income and pay for things such as your child’s college education. There are several factors that determine how much life insurance you need to carry to cover your family:
Funeral costs – Average burial costs range from $8,000 to over $10,000. In addition, there may also be unmet medical expenses that are incurred towards the end of your life, as well as probate costs or taxes on your assets upon your death. Figure out how much coverage you will need to take care of these expenses first.
How much of your income will need to be replaced – Consider how long your family would need to continue receiving your income in order to make ends meet if you were to die today. Do you want your family to receive this income until your children finish their education, until your spouse retires, gets a new job, or dies? Make a plan that includes these key events and then determine how much money will be needed to meet these goals.
How much annual income will your survivors need – Your family may not need your entire income to survive if you die. Look at your monthly expenses and create of budget of how much is needed to get by. Buy enough insurance to cover these costs or to supplement the income of your spouse.
Figure out any additional expenses you want covered – These expenses could include the cost of a college education for your children or paying for a child’s wedding, new car, home, etc. These are all big ticket items and will add greatly to the amount of coverage you will need. Take an honest look at which expenses you have for each individual child or for your spouse.
Your life insurance agent will most likely ask you all of these questions when selling you a policy. It’s important to answer them as truthfully as possible in order to get the proper coverage. The amount of time you estimate before your demise or the number of years you need coverage after your death will make the biggest difference in your costs and coverage.
To compute the return on your life insurance investment between now and the time that the money would actually be needed, most companies will assume about a 2.5 percent return for horizons of five years or less, a 4 percent return for horizons of six to 10 years, and a 6 percent return for horizons greater than 10 years. These returns are then adjusted for inflation. Actual results may differ depending upon the level of inflation and investment performance.
The entire process isn’t as complex as it may sound, and an experienced agent can guide you through everything. Once you have completed the planning stage and purchased a policy, you’ll sleep better at night with the confidence that your family’s future is well taken care of. You cannot ask for a better peace of mind than that.
It’s a day that kids look forward to for years and parents fear – the day their child picks up his first driver’s license. Parents dread this day because they worry about a myriad of dangers such as car accidents and the other assorted trouble their children can get into with their new found independence. Yet another worry is the cost. Will you buy your child a new vehicle? How much will gasoline costs add to your monthly budget? What about automobile insurance?
Insurance is a cost you cannot avoid when your child gets their license, and to add to your financial worries, young drivers are subject to much higher insurance fees than older drivers. One single factor – experience – is the largest reason teen insurance is so high. They lack it, and insurance companies like it. Rates are higher for new drivers until they get at least three years of experience under their belt, so be prepared.
Age is also a factor. Most drivers get their driver’s license at age 16 or 17, and insurance companies will charge more for insurance for drivers who are under the age of 25. Males are also generally charged more because they are perceived as being riskier drivers than females, so be prepared to pay higher for your son’s insurance than your daughter’s in some cases. There is one bit of good news associated with teen driving insurance, however. Many companies offer a discount to drivers who get good grades in school, so emphasize this point with your child to save yourself a little money on premiums.
Accidents, tickets, suspensions, or any other types of auto related mishaps can have a much more serious effect on a young driver’s insurance premiums than their more mature counterparts, sometimes doubling or even tripling rates depending on the specific offense or incident. That’s why it’s important as a parent to encourage your child to develop good driving habits:
Ask them to always drive carefully. Short trips to the store are just as dangerous as long drives on the freeway.
Tell them to drive with confidence. Help your child know the vehicle they are driving and the limits of their abilities (i.e. driving in poor weather, snow, at night). Practice with them until they are extremely comfortable driving solo.
Teach them to avoid distractions such as cell phones, especially if they are illegal to use while driving in your state.
Make certain they know that drinking and driving is never acceptable.
Your child’s initial introduction to driving is an approved driver’s training course. If you live in a state where driver’s training is not provided by the school system and you must choose your own private training firm, you have a lot more control. Don’t skimp on this important training. Pick a thorough, accredited, and highly rated course that teaches more than just the basics. Look for a driver’s education class that also teaches things such as defensive driving and specialized situational driving techniques.
Most importantly, explain to your teen the importance of maintaining a clean driving record now so they don’t pay the price for poor driving in the future such as higher insurance rates or other restrictions to their driving privileges due to points on their license, or legal problems associated with a poor driving record. If you get them started off on the right foot, you can ensure that they have a safer, more problem free driving experience as they mature into adulthood.
Home insurance policies are generally written for the broadest market possible. The basic policy is merely a boilerplate upon which more specific pieces are added. For instance, most people don’t have a home business, so this isn’t included in a normal policy. That type of coverage would have to be added. These added pieces are called “endorsements” or “riders.” There are several different types of endorsements (more than 100) that can make up a home insurance policy.
Inflation guard endorsement – If a home is not insured for at least 80% of its value, a penalty will be applied, causing the policy owner to receive less than the replacement cost under their policy if they have a loss. To prevent this, the homeowner can purchase what is called an inflation guard endorsement. With this endorsement, the amount of the insurance is increased annually by an amount that the homeowner chooses (pro-rated). This amount is generally 4% to 6%. So, if a home is insured for $100,000 plus a 4% increase, for example, the insured would be eligible for $104,000 after a year of making payments.
Personal property endorsement - A homeowner can also purchase a scheduled personal property endorsement. This endorsement covers a specified property such as an item of jewelry or other valuable. The payout for a loss such as theft is equal to an amount agreed upon by the insurer. If a $5,000 necklace is stolen, the insurance company will pay out $5,000 with no deductions made for depreciation and without requiring a deductible.
A similar endorsement is called personal property replacement cost. A standard home insurance policy pays the actual cash value for any damaged or stolen personal property. Because of depreciation, actual cash value is always significantly less than the replacement cost. With a personal property replacement cost endorsement, a homeowner can remedy this issue by receiving the actual cost to replace any item that is lost or damaged, such as furniture, electronics, etc. regardless of the item’s value at the time of the loss.
Personal injury endorsement – Another common endorsement is the personal injury endorsement. Even though a standard home insurance policy covers bodily injury and property damage, it does not cover personal injury, or injuries which don’t affect the body. These types of non physical injuries include false arrest, wrongful eviction or entry, invasion of the right of privacy in a room or dwelling, slander and defamation, or the violation of a person’s right to privacy. The personal injury endorsement also covers any liability that arises from a personal injury, such as legal fees or damages.
Earthquake endorsement – A less common endorsement (because it depends on the region in which your home resides) is an earthquake endorsement. Earthquake endorsements cover not only earthquakes, but similar events such as volcanic eruptions, landslides or any other type of earth movement. A standard earthquake endorsement has a deductible equal to 5% of the coverage for the main residence, with a minimum deductible of $250. Higher deductibles can be chosen by the policy owner to reduce the cost of the premium. In states with a relatively high frequency of earthquakes such as California, the deductible can be much higher – from 10% to 25%.
There are several other endorsements out there which apply to home insurance policies. These are merely a few of the more common ones. Speak with your insurance professional to determine which ones make the most sense for you and which endorsements will work within your budget.
It is quite amazing how many individuals do not carry any or adequate life insurance on themselves and their family, when in fact a life insurance policy is possibly the most important policy you should purchase. In today’s society, clients are most worried about covering their auto, rings, and other personal belongings than their most important prized position….themselves. This is possibly because there is a lack of education in regards to the product knowledge and reasons for having the coverage.
Here are a few of the top reasons to maintain adequate life insurance:
In the event something happened to you; could your family maintain their standard of living without your income? This would include any mortgage payments, auto payments, credit card bills, etc. Unfortunately these bills would be left for your survivors to deal with!
The best time to take out a life insurance policy is when you are young, fit, and healthy. The earlier you start a policy the better you will be in the future. If you were to develop an ailment later in life it is very possible that you will not be insurable. Once you are insured under a “fully convertible” plan (ask your agent), you can extend your coverage permanently with no additional medical exams as long as your policy is “convertible”
If you are married or have children, then it is very important to make certain your family and your partner is well protected in the event something happens to you. You hear horror stories all of the time of individuals developing fast acting disease such as cancer and leaving behind their spouse and children with a large mortgage, medical bills, and no income…..unfortunately these horror stories often come true. You want to make certain your family is well protected monetarily in the event something happens to you.
Legacy and taxes: Wouldn’t it be great to be able to leave behind some money to your estate or your kids/grandchildren as a legacy. Keep in mind that life insurance death benefits are tax-free to the beneficiaries and can be paid directly to individuals as per your policy or your will.
If you can afford health insurance, there is no reason not to have a life insurance policy in place to protect your loved ones. This will give you and your family peace of mind. Should you develop a terminal disease, your life insurance can even pay out a lump sum upon confirmation of this which can allow you to pay medical bills or possibly even fulfill any dreams such as travel, etc.
There is no better time than now to meet with your insurance agent to discuss how much coverage is enough and what time of policy can fit your needs. You wouldn’t risk not having your car or home insured….you shouldn’t risk not insuring your #1 asset…..Yourself!
If you are starting a new business or are re-evaluating your business insurance needs, it is important to make certain you have a good, solid, business insurance policy that is tailored to your needs. Many small business owners often view business insurance as a luxury, when in fact it is a necessity to protect you and your business. Several business owner’s only think of a business policy as protection against casualties and damages such as a theft, fire, or damage to equipment and products. When in fact, the most important part of a good business policy is the liability protection.
No matter what size of business you operate, big or small, it is always important to protect your business and yourself from the unpredictable. In today’s culture, even the smallest accident can result in large lawsuits. The general liability portion of a business policy is extremely important in that it defends you, your employees, and the reputation of your business from any lawsuits that may develop from bodily injury, damages, or negligence for something it did or didn’t do. General liability insurance can often be purchased separately or as part of a BOP (business owner’s policy). A “BOP” combines both property and liability insurance together into one policy.
Typically a BOP includes the following:
Property insurance to cover the building, equipment and goods
General Liability insurance to protect the business, employees and owner from lawsuits that may arise from accidents, negligence, or other damages
Casualty liability protection to protect the business and employees from harm to other people or their property
Insurance against theft of goods or money & securities
Insurance against interruption of business: This coverage can provide money to offset lost profits and income to continue paying expense
Several other options and endorsement are available to purchase
When purchasing a Business Owner’s Policy, it is very important to discuss the details with a licensed insurance agent who is familiar with commercial insurance policies. There are several options and risks that can be covered under a BOP. Some of these options can include signage, money and securities, business property, employee dishonesty, computer viruses, mechanical equipment failures, or loss of income for utility failures just a to name a few options. Not all over the options available are necessary to all business owners since not all businesses are alike. For example, a deli business that stores a large supply of refrigerated food, might find it very valuable to purchase insurance to protect them against the refrigeration equipment/breakdown or possibly even protection against a utility (electrical) failure that could possibly ruin valuable refrigerated food goods. It is also extremely important to purchase commercial auto insurance or ENOL coverage for all vehicles used within the business.
To find out more about Commercial insurance rates, please call our office or visit Knoxville Insurance for further information.
The majority of people have rented an apartment or home at least once during their lives. Renting is often an alternative to a home mortgage payment or a passing point between residences. The advantages of renting often include a lesser payment, lack of homeowner’s insurance, and property taxes. While choosing to rent an apartment or home, maintaining adequate renter’s insurance is a necessity for an abundance of reasons.
Misconceptions of Renter’s Insurance
Many individuals believe that their personal belongings are covered by the landlord or apartment’s insurance policy. This however, is generally not how it works. Typically the landlord’s policy only covers the structure, but not the renter’s property. For instance….if the property was to be destroyed by a fire, the landlord’s policy will pay for the cost of replacing the structure. The landlord’s will not pay for the tenant’s property that was inside the apartment or home such as clothing, televisions, furniture, cooking utensils, electronics, etc.
Another common misconception is that the landlord is responsible for housing the tenant in the event the apartment or the home is inhospitable due to fire or water damage. For example, if the apartment is under repair due to fire damage, the tenant must find their own housing at their own expense while the unit is being repaired.
A third misconception is that the landlord’s policy will cover theft and vandalism to the tenant’s personal property. If you are renting an apartment or home and it is burglarized, the landlord’s policy is not responsible for replacing your personal belongings.
What Renter’s Insurance Does!
Having an adequate renter’s insurance policy will provide protection for your personal property and belongings. The coverage is based upon the value of your belongings and typically clients are surprised by the amount of coverage needed once they do quick cash analysis of the property. It is often very important to check with your insurance agent and see if there are any limitations on listed coverage. Typically policies will put limitations on coverage for jewelry, guns, computers, money, and furs. If you have items valued higher than the limitations is important to let your insurance agent know so that additional coverage can be added via an endorsement or an additional Personal Articles Policy. Base coverage begins at around $10,000 and can be increased to well over $200,000. Renter’s coverage also includes liability insurance (typically $100,000) to protect the insured in the event someone is injured inside the rental property. Renter’s insurance can also provide medical payments insurance to give the insured some protection against injuries to others while inside their rental unit as well. It is a good idea to ask your insurance agent what other options/endorsements are available.
The Cost of Knoxville Renter’s Insurance
Renter’s Insurance is very reasonably priced and well worth the cost! Depending on the area, a typical $10,000 property coverage policy with $100,000 in liability coverage cost less than $10.00 a month. One of the great features with renter’s insurance is that it typically provides a Multi-Line Discount on the insured’s auto insurance, which can often offset the additional cost of the renter’s insurance! You should check with your insurance agent for details or get a free Knoxville Renters Insurance quote online.
In the state of Tennessee it is a requirement to maintain a minimum amount automobile liability insurance. These laws are to protect others in the event a driver is in an at-fault accident that causes personal injury or property damage to another. But as we all know, not everyone abides by the law. It should also be noted that the state minimum coverage for liability insurance shall be no less than $25,000.00 of coverage per individual and $50,000.00 for all individuals in the vehicle, which is often not adequate coverage. It is highly likely that $25,000.00 will not cover medical expenses for the injured individual in the event of a serious auto accident. Many people don’t realize that not carrying adequate uninsured motorist coverage can lead financial tragedy, even if they are not at fault.
Example of a situation involving an uninsured motorist:
Driver-1, which does not have any auto insurance, is driving home from a late night at work when his vehicle collides into responsible Driver-2’s vehicle. Driver-2 has state basic liability insurance, but had declined Uninsured Motorist (UM) coverage when his insurance agent offered it. The property damage to Driver-2’s vehicle is over $15,000.00, his medical bills are $25,000.00, and he is out of work for over 2-weeks. Since Driver-2 did not have any uninsured motorist coverage, he is stuck with over $25,000.00 in bills, no vehicle, and loss of 2 weeks of income. If Driver-1 was not responsible enough to have auto insurance it is very unlikely that he will help with Driver-2’s bills.
Example of a situation involving an under-insured driver:
Driver-1, who carries the state minimum $25,000/$50,000 coverage hits driver-2 and his family of four and sends all of them to the hospital with injuries. Driver-2’s family’s medical bills total over $100,000.00 and loss of earnings of over $15,000.00. This means that Driver-2’s family will only receive $50,000.00 from Driver-1’s insurance company and will be left to pay the remaining $90,000.00 himself. Of course Driver-2 can attempt to go after Driver-1 in court for the remaining expense, but what if Driver-1 does not have the money?
The cost of the coverage is much less than most realize. Typically the UM limits are set to match the normal bodily injury and property damage limits and cost only a fraction of the normal liability insurance. Luckily the state of Tennessee requires motorist to sign a rejection form when deciding not to purchase uninsured motorist coverage or purchasing UM coverage less than their BI/PD limits. However; many drivers still take make the decision to deny this coverage in order to lower their cost of insurance.
Driving without uninsured motorist (UM) coverage can be extremely risky. Statistics indicate that number of uninsured drivers is on the rise! According to the Insurance Research Council, chances are 1 in 7 that the at-fault driver is uninsured in an auto accident. Over 22% of drivers on the road in the state of Tennessee are without automobile insurance!
Be responsible and protect yourself and the ones you love! Make sure you maintain adequate uninsured motorist coverage! Click Here to obtain a free Knoxville Auto Insurance Quote today.
Life insurance isn’t something most people want to think about, but it’s incredibly important if you have a family that depends on you for financial support. Once you’re gone, that source of income is also gone. That’s why planning for your family’s future in the event of your death could be the most important thing you do.
Insurance is a cost you cannot avoid when your child gets their license, and to add to your financial worries, young drivers are subject to much higher insurance fees than older drivers. One single factor – experience – is the largest reason teen insurance is so high. They lack it, and insurance companies like it. Rates are higher for new drivers until they get at least three years of experience under their belt, so be prepared.
Home insurance policies are generally written for the broadest market possible. The basic policy is merely a boilerplate upon which more specific pieces are added. For instance, most people don’t have a home business, so this isn’t included in a normal policy. That type of coverage would have to be added. These added pieces are called “endorsements” or “riders.” There are several different types of endorsements (more than 100) that can make up a home insurance policy.
The importance of Uninsured Motorist (UM)