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Insurance Articles

Your Employer May Profit from Your Death

October 4, 2009 | Insurance | Videos | No Comments

Did you know your employer could take out a life insurance policy on you without you knowledge or consent?  The practice is called “Dead Peasant Insurance” where secret life insurance policies are taken out for low-level employees with the benefits paid to the company upon the employee’s death, regardless if they still work for the company.  The practice was highlighted in Michael Moore’s recent movie, “Capitalism, A Love Story”.  The video below is a report from ABC News regarding this practice.

Video: ABC News on “Dead Peasant Insurance”

Progressive “MyRate” Could Lower Your Auto Insurance

May 18, 2009 | Insurance | No Comments
progressive-myrate

Progressive has a program called “MyRate” that offers safe and/or occasional drivers to chance to lower their car insurance. MyRate is a one-of-a kind, behavior-based car insurance program that lets drivers save money based on how they drive. Drivers who choose to sign up for MyRate receive a small wireless device that plugs into a port in their car and measures how, how much and when the car is being driven.

Cars driven less often, in less risky ways and at less risky times of day could receive a lower premium.  Progressive’s MyRate Program lets drivers pay based on how, how much and when their car is driven.  The service is available in several sates that purchase policies from Progressive online, by phone, or through its more than 1,100 independent insurance agencies in the state.  The MyRate program will continue to be rolled out to more states in 2009, pending state regulatory approval.

So how does it work? When you enroll a vehicle in the MyRate, Progressive will send you a MyRate device that plugs into your car.
Drive as you normally would. The MyRate device wirelessly and securely sends information about when, how much and how you drive your car to help determine your rate at renewal. You can log into your account and see how well you’re driving.  You can also track your projected renewal rate based on your driving behavior by logging also logging into your account at progressive.com.

For more information visit Progressive.com/MyRate.

Related Article: 8 Ways to Save Money on Auto Insurance

Pfizer to Give Free Medicine to the Uninsured and Unemployed

May 14, 2009 | Insurance | No Comments

Pfizer Inc announced today that it will launch a program to help eligible unemployed Americans and their families who have lost their health insurance maintain access to their Pfizer medicines for free. The inspiration for the new program, called MAINTAIN (Medicines Assistance for Those who Are in Need), was generated by Pfizer employees who were witnessing friends, family and neighbors struggle to make ends meet after losing their jobs.

The program, which applies regardless of prior family income, will be open for enrollment through December 31, 2009 and applies to eligible Americans who have become unemployed since January 1, 2009. It is designed to help recently unemployed Americans and their families who have lost their insurance and who are taking Pfizer medicines to continue treatment for free for up to one year. Nearly 46 million Americans lack health insurance coverage, and that number is increasing as unemployment rates reach their highest levels in 25 years.

Pfizer employees proposed the idea of MAINTAIN to the company’s senior leadership team just within the last month. Pfizer employees also asked to be able to do their part by donating their own money to the program, and the Pfizer Foundation will match their donations.

Eligibility requirements of the new program include:

  • Loss of employment since January 1, 2009
  • Prescribed and taking a Pfizer medicine for at least 3 months prior to becoming unemployed and enrolling in the program
  • Lack of prescription drug coverage
  • Can attest to financial hardship


People who qualify will receive their Pfizer medicines for free for up to 12 months or until they become re-insured (whichever comes first). More than 70 Pfizer primary care medicines will be available through the program.

To make it easy for people to apply, the program will be integrated into Pfizer’s existing family of patient assistance programs called Pfizer Helpful Answers. A single point of entry makes it easy to get help:

  • All of Pfizer’s patient assistance programs, including the new program, can be reached by calling a single phone number (1-866-706-2400) or by visiting www.PfizerHelpfulAnswers.com
  • Those who contact Pfizer Helpful Answers in need of medicines made by another company will be directed to the Partnership for Prescription Assistance, a pharmaceutical industry initiative that serves to raise awareness of, and boost enrollment in, more than 475 public and private patient assistance programs.


The new program will be fully operational on July 1, 2009. However, people in need now can call 1-866-706-2400 for help. MAINTAIN is a part of Pfizer Helpful Answers, a joint program of Pfizer Inc and the Pfizer Patient Assistance Foundation.

Protect Yourself with Umbrella Insurance

April 24, 2009 | Insurance | No Comments
umbrella-insurance

With today’s litigious society where Americans love to sue each other, you may want to consider buying umbrella insurance that will give you additional liability protection above and beyond your current auto, homeowner and watercraft insurance.  

Every day we hear of lawyers being awarded large amounts of money and not to mention the numerous TV commercials by lawyers pitching their services to people injured in accidents .  Auto, homeowner and watercraft insurance policies have a limited liability (normally $100,000, $300,000, or $500,000).  What most people don’t know is if you have an accident and it’s your fault, the lawyers will come after your personal assets if your insurance don’t cover all the expenses.

For example, you have a car accident where it’s your fault and as a result a family of 4 is seriously injured.  If your auto insurance have a limited liability of $300,000 but the medical bills, lost wages, rehabilitative therapy, car repairs, legal defense, etc. end up being $500,000, you will be personally liable for $200,000.  The lawyers will seek to get this money from you.  If you have umbrella insurance then it will cover the $200,000.  Umbrella insurance is designed to kick-in when the liability on your other policies has been exhausted.

Almost every state in the U.S. hold drivers responsible for bodily injury and property damage resulting from auto accidents and the at fault driver can be sued for the damage. Personal assets from the at fault driver can be seized resulting from a lawsuit. Similar laws are also exists for home and watercraft owners.

Depending on the insurance company you can add an additional one to five million in liability protection for just a few hundred dollars per year.  The additional liability insurance is inexpensive when compared to the added coverage you will receive.

how-umbrella-insurance-works

Related: Compare Insurance Quotes

Should the Government Continue to Bailout AIG?

March 5, 2009 | Insurance | My Ramblings | No Comments
aig-bailout

It would be nice to say “No, the government should not continue to bailout AIG”; however, the US government has no choice but to bail out AIG.  This is because if AIG collapses, it will be a nightmare and would seriously damage the already fragile U.S. economy, and even the world economy. Most experts feel a collapse of General Motors would be a thunderstorm, while a collapse of AIG would be a category 5 hurricane to the U.S. economy.

AIG currently has more than 375 million policies with a face value of $19 trillion.  If the 375 million policyholders lost faith in AIG and rushed to cash in their policies at once, the entire insurance industry would tank.  Simply put, AIG is too big to fail.  There is also the fear that if AIG collapses, many people would be unable to obtain the same insurance from a competitor for the same price, which would cause many people to be shut out.

Unfortunately, no one knows when AIG will turn around and how much more money the U.S. government will have to pump into the company to keep it afloat. The government has rescued AIG four times in the last six months.

Last Monday AIG reported a $61.7 billion quarterly loss, the worst ever for a U.S. company. The US Treasury then announced the same day that it would provide A.I.G another $30 billion loan from the $700 billion financial bailout program, although the company already received more than $170 billion in taxpayer money.

Video: AIG Receives Billions More

 

How did AIG get into this mess?  Contributing factors were as follows: the company used its triple-A rating from the insurance part of its business to run a risky hedge fund, which wrote hundreds of billions of dollars of credit default swaps without hedging itself, or buying protection against the prospect that it would be forced to pay up.

What’s a credit default swap? Credit default swaps are insurance contracts sold by banks, hedge funds and others that promise to cover losses on various securities in the event of a default. They are usually purchased for mortgage securities (we all know what happened here), corporate debt, and municipal bonds. Buyers of credit default swap insurance policies pay premiums over a period of time in return for peace of mind, knowing that losses will be covered if a default happens. Credit default swaps work similarly to someone taking out home insurance to protect against losses from fire and theft.  

When AIG’s credit ratings were downgraded last September, the insurer’s trading partners demanded more collateral, but AIG didn’t have the cash. The US government, worried by the bankruptcy of brokerage firm Lehman Brothers a day earlier, gave $85 billion to keep AIG afloat which went to satisfy the trading partners’ demands for more cash.  

Video: Credit Default Swaps Explained

 

Who is AIG? American International Group, Inc., (AIG) via its subsidiaries, provides insurance and financial services in the United States and internationally and has 116,000 employees. It operates in four segments:

  1. General Insurance – underwrites various business insurance products, including large commercial or industrial property insurance, excess liability, inland marine, environmental, workers compensation, specialized forms of insurance and excess and umbrella coverages.
  2. Life Insurance and Retirement Services – offers individual and group life, payout annuities, endowment, and accident and health policies, as well as retirement savings products consisting of fixed and variable annuities.
  3.  Financial Services – provides aircraft and equipment leasing, capital market transactions, consumer finance, and insurance premium financing.
  4. Asset Management – investment-related services and investment products, including institutional and retail asset management, broker-dealer services, and spread-based investment products.

Buy Maternity Insurance before Getting Pregnant

March 1, 2009 | Healthcare | Insurance | My Ramblings | 1 Comment
expecting-couple

A couple of years ago I was unemployed, and my wife was working for herself as a personal trainer.  We purchased our own medical insurance because it was much cheaper than paying the Cobra insurance premiums offered by the company that laid me off.

A few weeks after being laid off, my wife unexpectedly got pregnant.  We were very excited!  I then assumed I could call my insurance company and tell them to add maternity insurance to my policy for an additional few hundred dollars per month.  Boy, was I in for a rude awakening!  My insurance company, Aetna, didn’t offer maternity insurance, so I shopped around and soon learned that you have to purchase maternity insurance before getting pregnant.  Also, many insurance companies require you to pay the premiums for 1 year before becoming pregnant.  If you got pregnant before the 1 year period, the policy may only cover 50% of normal charges.

Being pregnant is considered a pre-existing condition and many insurance companies will not want to cover you.  If they do offer coverage, your premium will be extremely high, possibly over $1,000 per month.  The average delivery of a baby costs about $10,000, assuming there are no complications.  The insurance companies are in business to make money. So charging you a few hundred dollars in premiums makes no sense, when they will be hit with an $8,000 bill, assuming you pay 20% of the cost.

So the advice here is to plan ahead.   Before you become pregnant, make sure you have maternity insurance or it may cause you dearly.  Unfortunately, my wife had a miscarriage very early into that pregnancy.  By the time she got pregnant again, we had maternity insurance with my new employer.  

Related Page: Compare Medical Insurance Quotes

How To Save Money Buying Auto Insurance?

December 16, 2008 | Insurance | No Comments

The price you pay for car insurance can vary by hundreds of dollars, depending the insurance company, the type of car you have, your driving record, where you live, etc.

Below are some techniques you can use to save money.

Shop Around

Get at least three quotes because prices vary from company to company.  The Internet makes it easy to easily and quickly get quotes.  You can always call the the companies directly.

Remember not to shop by price alone. You want a reputable company that you can rely on if you ever have to file a claim. You can ask friends and relatives for their recommendations of their insurance company.

Purchase a Policy with a Higher Deductible

Deductibles is the amount of money you pay before your insurance policy kicks in. By requesting higher deductibles, you will lower your insurance premium substantially. For example, increasing your deductible from $200 to $500 could reduce your collision and comprehensive coverage cost by 15 percent to 30 percent. Going to a $1,000 deductible can save you 40 percent or more.

Maintain Good Credit

Your credit rating may affect what you pay for insurance, so keep a close eye on it. Credit makes insurance rates more accurate, fair and objective. While the use of insurance scoring varies from state to state and company to company, it is a fact that drivers with long, stable credit records have fewer accidents than drivers who don’t. There are various Internet services that allow you to check your credit rating and provide tips on how to improve your score.

Seek out Safe Driver Discounts

Companies offer discounts to policyholders who have not had any accidents or moving violations for a number of years. You may also qualify for a cut if you have recently taken a defensive driving course.

Inquire about other discounts

You may get a break on your insurance if you are over 50 or in some cases 55 and retired or if there is a young driver on the policy who is a good student, has taken a drivers education course or is at a college, generally at least 100 miles away.

Reduce Coverage on Older Cars

Consider eliminating collision and/or comprehensive coverages on older cars. It may not be cost-effective to continue insuring a car worth less than 10 times the amount you would pay for coverage.

Buy your Homeowners and Auto coverage From the Same Insurer

Many insurers will give you a discount if you buy two or more types of insurance from them. Also you may get a reduction if you have more than one vehicle insured with the same company.

Take advantage of low-mileage discounts

Some companies offer discounts to motorists who drive a lower than average number of miles per year. Low mileage discounts can also apply to drivers who carpool to work.

Inquire About Group Insurance

Some companies offer reductions to drivers who get insurance through a group plan from their employers, or through professional, business and alumni groups and other associations. Ask your employer or any groups or clubs to which you belong.

When shopping for auto insurance inquire about discounts for:

  • $500 deductible
  • $1,000 deductible
  • More than 1 car
  • No accidents in 3 years
  • No moving violations in 3 years
  • Drivers over 50-55 years of age
  • Driver training course
  • Defensive driving course
  • Anti-theft device
  • Low annual mileage
  • Air bag
  • Anti-lock brakes
  • Daytime running lights
  • Student drivers with good grades
  • Auto and homeowners coverage with the same company
  • College students away from home
  • Long-time customer
  • Other discounts

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