Archive for August 18th, 2011
by Phyllis Foster – The Turner Agency
The most frequently asked question about life insurance is: Do I need it? The answer depends greatly on your situation. So, let’s determine if you need it. Review these statements and check all that apply:
□ I am married.
□ I have children.
□ Our family recently welcomed a new baby.
□ I am single, but I have dependents (a child or an elderly relative) who I support.
□ I am the sole breadwinner in my household.
□ I recently changed jobs.
□ My income has changed.
□ I recently bought a house.
□ I will pay for my children’s college education.
□ I own a business.
□ I am in debt.
□ My family has a history of illness, such as diabetes or heart disease.
□ I have trouble saving/investing money.
If you checked any of these statements, you need life insurance to protect the loved ones who rely on you for their financial support.
Imagine if you died unexpectedly. What would happen to your spouse, your children and other dependents? Would their standard of living or care slip significantly? Who would pay your children’s college tuition? Who would pay your mortgage and other debts? Would your business survive?
With life insurance, these concerns go away. If for no other reason, get life insurance for those most important to you—your family.
Life Insurance Tips
Now that you’ve determined that you need life protection, here are 10 suggestions to help you look for the best life policy for your family’s needs:
1. Get the right amount. Remember that the amount of life insurance you need is directly related to the dependency of your family. An eight-year-old child is more dependent than a 20-year-old already is in college. Plus, knowing how much coverage you need prevents you from paying for unnecessary insurance.
2. Start young. Get your life insurance while you’re young. Generally, premiums are cheaper for younger people because they are healthier than the rest of the population. Also, buying young will enable a cash-value policy to grow in value.
3. Live healthy. Don’t smoke. Tobacco users pay more than twice the premium as non-smokers. Also, don’t cheat because benefits can be denied if someone who claims to be a non-smoker dies of a smoking-related illness. Also, you can improve your insurability and get a better rate by routinely visiting your doctor and improving medical conditions, like high blood pressure.
4. Know what life policy you need. Learn the difference between term life and whole life policies, as well as that of a cash-value policy versus an annuity. There are products that serve several purposes and those that serve a single purpose. Know what your needs are first. Then you’ll know which coverage you should purchase.
5. Dual incomes? If you and your spouse are breadwinners, get life insurance for both of you. That way, if either of you passes away, the family’s standard of living will not suffer.
6. Prepay the premium. Ask the insurance company if you can pay your premium in advance, instead of monthly. This approach will save money on administrative or handling fees. Not all companies do this, but it never hurts to check.
7. Want to save money, too? Some life insurance products—known as “cash-value policies”—are both a savings tool and a death benefit. These policies are ideal if you cannot save money. The cash value accumulates and can be borrowed or used for other purposes.
8. Buy ‘bulk.’ Some insurance companies charge less for buying more. For example, it may be cheaper to purchase a $250,000 policy rather than the $230,000 you need.
9. Don’t rely on employer-provided coverage. Many group plans limit the amount of coverage offered, which may not be enough for your needs. Additionally, you likely cannot take the life insurance with you if leave your job.
10. Keep your coverage current. Major life events will impact the amount of coverage you need. Many events—such as having a child, getting married or buying a big house—will increase the amount of coverage you need. Others—such as children leaving the roost—may decrease the coverage you need.
Losing you would be painful enough for your family. The right life insurance can at least alleviate concerns about the financial implications of your death. Call Phyllis Foster at 400-3515 to discuss your options.
by Ross Turner – The Turner Agency
Millions of Americans (our staff included) donate time—their most valuable asset—to serve as a volunteer board member on non-profits, booster clubs, churches, PTAs and civic organizations, just to name a few. The decisions we make can have a dramatic impact on our respective organizations—and not always for the better. If a volunteer endeavor goes bad, would a volunteer board member have coverage against a lawsuit under his or her homeowner’s policy?
The last thing volunteers want to consider is what would happen if their favored organization file suit against them as a result of their efforts. But it happens, and not infrequently. This does happen, especially when volunteers make decisions that directly influence the finances of an organization. Often, the only insurance these volunteers have to back their efforts is a homeowner’s policy. Unfortunately, this policy may be of little assistance.
The reason homeowners’ policies do not usually cover liability stemming from actions as a volunteer is the nature of the claim. The policy is designed to cover claims of “bodily injury,” such as someone slipping on cracked pavement in your driveway; and/or “property damage,” such as accidentally setting your neighbor’s house ablaze when burning some brush on a windy day.
Claims against board members do not usually involve bodily injury or property damage. Rather, they involve bad decision-making that results in financial loss to the organization, such as the decision to invest in an IT system that turns out to be a debacle, costing the organization tremendous time and money.
There is another problem. Homeowners policies do not cover “professional services.” This is important to note, because board members are often asked to serve in a capacity consistent with their profession. For example, a church member who is a CPA may be asked to serve on the church’s board as finance chairman. Even though he is not paid for his services, the “professional services” exclusion under his homeowner’s policy would still apply.
In addition to the above, homeowners policies do not cover claims of personal injury unless this coverage is specifically added. Personal injury insurance is added to the homeowner’s policy to cover claims such as libel, slander, wrongful eviction, and false advertising.
What to Do
Events causing claims are unpredictable. While the reasons shown above prove it’s unlikely, not all claims against volunteer board members are excluded by a homeowners policy. Decisions to purchase personal injury coverage and a personal umbrella policy will increase your ability to find coverage for a suit against you.
The best method for insuring the actions of board members is for the organization to purchase a directors and officers (D&O) liability policy. These policies are relatively inexpensive for most non-profits. Before volunteering, request information on the organization’s D&O policy. The absence of this insurance leaves you at risk of having no personal insurance to defend a suit brought against you by the organization and should influence your decision to serve.
Please call us at 288-9513 to learn more about D&O insurance.