Insurance World

Wouldn’t you love to know how insurance companies come up with your home insurance rates? Maybe you wouldn’t after you understand what all is involved. The whole concept of insurance started as a benevolent community partnership. Life insurance was the pioneer. When a member of the community passed away the friends and neighbors of that community would drop some money in a hat to help the deceased family give their loved one a proper burial. All insurance is based on the combined giving of local communities. The communities are bigger today and the hat has now become the insurance company. Home insurance rates are calculated by fiduciaries. These folks will add up all of the premiums remitted to the insurance company from a community and will compare it with the number of claims paid from that particular community. These geographical areas are called territories by most insurance companies. When the claims are less and the cost to recover a claim is stable then your rates will be lower. When claims are high and the cost to rebuild and recover is high then your rates will be higher. That is the simplified explanation of how home insurance rates are derived. There are investment factors and many other variables that raise and lower rates also.

Why Shop for Better Home Insurance Rates?

1. Comparing is Easy – It’s not difficult to get a homeowner’s insurance rate. Make sure that you have your declarations page so that you get the apples to apples quote.

2. Comparing is Smart – The worst thing that you can discover is that you have good rates with your present company.

3. Comparing is Leverage – If you like your present insurance company and your agent then a comparison quote from another company will make them work that much harder to keep your business.

There is no better buy in the insurance market than the home insurance policy. Shopping online for rates is one of the easiest methods for comparing rates. Take the time. You will learn a lot the first time shopping online.

Usually, the death benefit from a second-to-die life insurance policy is intended to go to the children , a charity or pay taxes owed after both spouses pass away.

In the U.S. there is a marital deduction permitting you to leave an unlimited amount of assets to your surviving spouse with no taxes payable at your death. Those assets then become part of the estate of the spouse and if it includes a second to die life insurance polciy it could help pay any taxes. In Canada, there is more lenient tax treatment.

There are also tax ramifications for small businesses, which is why business partners also purchase second-to-die policies.

THE REASON TO BUY SECOND TO DIE LIFE INSURANCE POLICIES

With a second-to-die life insurance policy your beneficiaries can pay debts with the proceeds of your policy, so they won’t be forced to sell your house or liquidate assets to pay the bill.

A second-to-die life insurance policy can help to construct a financial plan reducing the tax burden of wealthy individuals by creating trusts and using second-to-die life insurance as part of the estate-planning process.

ADVANTAGES TO SECOND TO DIE LIFE INSURANCE POLICIES

1. Less expensive. Second-to-die life insurance is usually less expensive than life insurance but depends on the blend of the ages. The premium is based upon the joint life expectancy.

2. Estate Preservation. A second-to-die policy appeals to individuals who feel strongly about preserving their estates with the life insurance paying the taxes.

3. Easier to buy. It’s easier to qualify for a second-to-die policy than for individual life insurance. Since both insureds must die before the benefit is payable, the insurance company is less concerned that one of them might not be in good health.

* Builds your estate. In some cases, second-to-die life insurance is marketed as a way to build an estate, not just insulate it from taxes. Much like individual life insurance, the death benefit of a second-to-die policy can ensure that certain people receive money, even if you spend every nickel.

4. Second-to-die life insurance might make sense for people who don’t have a lot of money but want to leave an estate for their children.