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Smoker’s Life Insurance – Smoking Can Kill Your Wallet

When life insurance brokers look out into the world they see two types of prospective customers. Every individual person fits into one of the two categories. They are either smokers or non-smokers.

Someone who occasionally smokes socially and someone who smokes everyday can end up in the same insurance category. He will pay even more if he smokes more than 20 cigarettes a day. Often life insurance premium rates for smokers can be up to three times the rate non-smokers pay. This is because insurance companies believe that smoking amplifies the risk of untimely death.

The financial penalties of smoking extend far past the price of a pack of cigarettes. In addition to the nickel-and-dime of a pack of smokes every time he runs out, the smoker endures costly consequences to lighting up.

Homes and vehicles that retain the stench of cigarette smoke lose resale value. Smokers can also be penalized when shopping for a new home because insurance companies believe smokers are more likely to burn down the house.

Smokers will also pay more for health insurance, dry cleaning and yearly teeth cleaning appointments. All of these costs add up quickly to put a hefty dent in a smoker’s wallet.

It isn’t simply what a smoker pays in extra an expense that reduces funds, but being paid less in the first place can cause his bank account to suffer as well. Studies have shown that smokers earn up to 11 percent less than non-smokers. These figures not only take into account time wasted on smoke breaks, but first impressions as well. Smokers may be perceived as less attractive and therefore passed by for jobs.

Life insurance costs aren’t the only money matters smoker’s have to worry about; however, it is a huge issue. A smoker literally burns his money away. That nicotine rush can cost thousands of dollars a year more in life insurance premiums.

While saving money on insurance premiums may not persuade him to quit smoking, a smoker may not be conscious of how much the habit is actually costing him. He may even lose his job. There have been several companies in the news recently who have fired employees who smoke simply because they pay more insurance on smokers than non-smokers.

LifeInsuranceIt begs the question, is it worth the cost?
But, the high cost of smoking doesn’t necessarily only affect the smoker himself. Documented studies have shown that Americans spend over 60 billion dollars a year treating smoking related illnesses. Women who choose to smoke during pregnancy cost the country another 3 billion dollars a year. It also causes the deaths of 2,500 unborn babies a year and results in low birth weight and life-long complications in countless others.

Fires set by smokers who fall asleep or are otherwise careless with their habit, cost the government 500 million dollars a year. The human cost is great, as fires started by cigarettes take the lives of more than 2,000 people a year.

Smokers with group life insurance push up premiums for smokers in the same pool by 4 billion dollars a year.

Smoking is by far the most prevalent cause of untimely death in the United States today. More than 400,000 people a year pay with their money and their lives to light up a cigarette.

That quick fix can not only be deadly, but greatly reduce quality of life as well. Be it human life, depreciation of property, health factors or jacked-up life insurance premiums, the decision to smoke cigarettes is costly.

Should Your Life Insurance Policy Be Written In Trust?

According to one of the largest UK life insurance companies, just 1% of life policies are written in trust. That is disgraceful and reflects poorly on the financial industry.

Let’s explain.

If your life insurance policy is “Written in Trust” then, in the event of a claim, the insurance company pays out directly to the beneficiaries you name on the policy. The significance of this is easily missed.

It means that if the policy is “Written in Trust”, the proceeds from the policy never form part of your legal estate and are not subject to Inheritance Tax. The importance of this is illustrated by the following figures:

Take Mr A. He’s a widower and wants to leave everything equally to his two sons. He owns his home which is currently worth £245,000 with a £10,000 outstanding mortgage. His investments are valued at £52,000 and his car and other chattels are worth £18,000. He also owns a life insurance policy for £100,000 which is not written in trust. We assume that the costs of administering his estate and obtaining probate would be £5,000.

If Mr A were to die now, his estate would be worth £400,000 less Inheritance Tax. Inheritance Tax is currently levied at 40% on the value of his estate over and above £275,000 – that means that the taxman will walk off with £50,000 and his sons would each receive £175,000.

Now let’s assume exactly the same figures except that in this case the life insurance policy is “Written in Trust” with Mr A’s sons as equal beneficiaries. Because the life insurance company pays out directly to his sons, they each receive £50,000 straight away and non of the money is included in Mr A’s estate. This means that his estate is now worth £300,000 and the taxman can only walk away with £10,000. Each of his sons receives £20,000 more and tax-free!

So simply by signing a few forms, Mr A saves £40,000 tax!

Is there a catch? No – all the documentation is standard and is provided totally free of charge by the life insurance company. Your broker through whom you buy the policy, should complete the documentation for you, again free of charge. All you have to do is give the details of the beneficiaries to the broker and sign the form. Solicitors are not required. In the event of a claim, the life insurance company then has to pay out directly to the beneficiaries. Job done! Poor Mr Taxman!

Even if your policy is designed to repay a mortgage, it should be “Written in Trust” for your partner. Then, rather than your estate receiving the money and using it pay off the mortgage, the money can be paid directly to your partner. This saves legal delays, solicitor’s and probate fees and loads of hassle. Your partner can then use the money to personally pay off the mortgage. Whether this also saves you Inheritance tax will depend on the value of your estate and how you have structured your will.

So we believe that a life insurance policy “Written in Trust” is a win-win situation. In addition, there aren’t many of those around these days! We can’t see any drawbacks.

By the way, no matter what you decide to do, always ensure that you have an up-to-date will.

To Lie or Not to Lie – Necessary Information to Obtain a Life Insurance

Comparison-shopping for term life insurance coverage is just a click away. However, before you go around clicking on websites, there some basic information you should be prepared to provide to get preliminary quotes:

Aside from the obvious underwriting information such as your name, age and gender, you will have to provide more detailed information such as:

Weight: If your height weight ratio is not within certain limits, (in other words you are overweight) it may affect your rate.

Do you smoke? Smokers pay a higher rate of life insurance than non-smokers do. Rates can be as much as three times higher. However if you have quit smoking for at least a year prior to submitting your application, you may save some money.

Health: Companies want to know how much you exercise and what type of lifestyle you live. Do you participate in risky activities like racing, scuba diving, sky diving, rock climbing?

Type of work: Is your job hazardous? For example, if you work in underground mining, high-rise construction or work with explosives, you’ll carry a higher rate.

Driving record – If you’ve been convicted of reckless driving or DWI in the last 5 years will increase your rate.

Your familial history – Have your parents or siblings had cancer or cardiovascular disease before the age of 60?

You may be tempted to tell the insurance company what they want to hear (even if it’s not exactly the truth), but don’t. Lying on your application may void your life insurance coverage.

Once you’ve elicited quotes from several companies, compare your rates, and make sure your insurance company will be around for the long haul. Check their AM Best rating. AM Best is a company that measures the financial stability/solvency of life insurance companies. A very low quote from a financially unstable company won’t do you a lot of good if they’re not going to be around to pay the claim.

Shop Life Insurance Rate – Getting the Best Coverage for the Lowest Rate

The purchase of life insurance is so much easier because of the availability of so much online information. The buyer learn so much by studying the magnificent amount of web content about life insurance. Life insurance rates are easier to comprehend when you get a better understanding about the different types of life insurance. Two types of life insurance come in many different forms. Term life insurance and permanent life insurance are the two types.

Term Life Insurance – is the most inexpensive form of life insurance. Term life insurance is purchased for temporary needs over a specific time. Once that time elapses then the policy terminates. The short-term benefit is what makes the premium low in comparison to permanent forms of life insurance. Mortgage term life insurance is purchased to cover a mortgage debt over a specific period. A thirty-year mortgage requires a thirty-year mortgage term policy that has the death benefit decrease as the mortgage balance decreases. The policy terminates after 30 years when the mortgage is fully paid. You can also purchase level term policies that provide level death benefits for specific periods. These times can be as short as five year and as long as twenty years with most companies.

Permanent Life Insurance – is different from term insurance because it is designed to stay in force until the death of the insured. This form of life insurance is very popular because of its inside build up of cash value. The cash value of permanent life insurance is what enables the policy to extend until the death of the insured. This cash value account is accessible to the insured. The cash can be borrowed at a very low interest rate. Universal life policies have a partial surrender feature also that requires no payback of the borrowed amount.

Do your online shopping for life insurance rates based on these two forms. Compare term rates with term rates and permanent rates with permanent rates and that will make your shopping a whole lot easier.

Guaranteed Acceptance Life Insurance – Cost-Effective Solution for Seniors

We all know that purchasing life insurance at an older age is more expensive than purchasing it while very young. In an attempt to provide affordable insurance to meet the life insurance needs of older insured’s, some companies are now offering Guaranteed Acceptance Life Insurance.

Guaranteed Acceptance Life Insurance policy rates are less expensive than the traditional term insurance policies. As the name implies, you are guaranteed to be accepted for this life insurance. There are no health questionnaires to complete and no physical exams to take. As long as you pay the premiums, the policies cannot be cancelled. Additionally, you may lock your premium rate for the policy amount you want. Your rates will not change for as long as you keep your insurance.

Where’s the catch you may be asking. Well, the policies are written for a limited period. For example, Colonial Penn’s policies are for a two-year limited benefit period. They are available for people between the ages of 50 and 85 (This age range varies depending on insurance company and state regulation).

Generally, if death occurs during the first few years, a reduced benefit is paid or the company may return the premiums paid plus interest. For instance, with a Gerber Life policy, if death occurs by natural causes within the first two years (during the limited benefits time), the beneficiary will receive all of the premiums paid plus 10%. However, if death was a result of an accident, or if death due to natural causes occurs after the two years, your beneficiary will receive the full benefit amount. In the event of suicide (with certain state exclusions), the beneficiary will receive the amount of premiums paid only.

Most life insurance companies offer a Guaranteed Acceptance Life policy for seniors. There may be variations from state to state, but the basic premise is the same. They all offer an affordable insurance option for seniors.

Please see our list of recommended insurance quote providers below to get free life insurance quotes from many providers. These sites also offer pages and pages of free insurance information.

Selling Your Life Insurance (Viaticals and Life Settlements)

Selling your life insurance is an option you might consider if you’re in a difficult financial situation for which you don’t see a close end. A terminal illness or old age could cause you to think twice about paying those hefty premiums at this stage of your life. Selling your life insurance carries with it complex implications and substantial risks, so it is important that you educate yourself regarding the big picture. If you’re interested in selling your life insurance, this is a good starting point to obtain some basic information.

Basics: Vocabulary
If you’ve already done any research on selling your life insurance, chances are good that you’ve come across two main terms: viaticals and life settlements. Both refer to the selling of your life insurance to a third party. So what’s the difference? “Viatical” is typically used to refer to the transaction involving a chronically or terminally ill insured, while a “life settlement” is a transaction involving a senior (generally over the age of 65) who is not terminally ill.

Even though you now know the difference, it does not mean that your state does. These terms might be used interchangeably, or your state might use one of them to refer to both transactions. For example, your state could use “Viatical Settlement” to refer to any type of transaction regarding selling your insurance. Be aware that this kind of ambiguity may exist in relation to the vocabulary used in the sale of your life insurance.

How it Works
The owner of the life insurance policy will sell it for a percentage of the death benefit a lump sum to a third party and, in exchange, receives an often substantial lump sum payment. The third party then becomes the new owner and/or beneficiary of the policy and pays all of the future premiums and eventually collects the death benefit when the insured passes away.

Those considering selling their life insurance may either directly approach a viatical company or settlement firm, or they may choose to work with a broker. The broker will act as an intermediary and present the information to several different companies/firms in an effort to find the highest price for the sale.

The settlement firms buy the insurance on behalf of investors. In this situation, the investors become the owners and beneficiaries, and the settlement firm pays the premium until the insured dies. The firm then collects the death benefit and either pays its investors a percentage of the annual return or repackages the policy for sale to another party.

Take comfort in know that the process of selling one’s life insurance is typically very confidential. Most viatical companies and settlement firms understand the discretion necessary to make the process run smoothly and easily. However, a company may act disrespectfully and become borderline intrusive by trying to keep track of the insured’s condition. For this reason, it is important to work with a respectful, experienced organization.

Who Considers Selling
Those with serious, life-threatening illnesses are most likely to consider selling their life insurance to provide cash for various expenses, such as mounting medical bills. For those who are not terminally ill, selling the life insurance might be a good idea for a number of reasons. If the owner’s beneficiary has died or if the owner can’t afford to keep paying the premiums, it would appear that they no longer have sufficient use for the life insurance. Seniors around retirement age may also consider selling their life insurance, even if they are free of debt, in order to receive a lump sum of money with which they may do whatever they please.

Keep in mind that different companies may have different eligibility requirements to be able to sell your life insurance policy.

Advantages to Selling Your Life Insurance
It might be easy to see some of these benefits, but others are a little less obvious.
o You’ll receive a lump sum cash payment right now. As mentioned above, this is especially useful to the terminally ill who have mounting medical bills.
o You will receive more by selling your life insurance than you would if you simply surrendered it to the insurance company. It is possible for an insured person who is 65 or older or who is terminally ill to sell a policy with little or no cash value for a $100,000.00 or much more.
o You won’t have to pay any more life insurance premiums. If your financial situation is becoming strained with no end in sight, eliminating premiums is a way to alleviate the burden.
o You don’t have to repay the money, like you do when you borrow against your insurance policy.
o Even though your life insurance benefits won’t be available once you die, you can still leave money to a certain person or organization – it will just come from the money that is leftover after using the funds from selling your policy.

So, selling your life insurance does not mean that you’re definitely robbing your beneficiaries of their gift. In some cases, the money you receive is tax-free.

There are no regulations or restrictions on how you make use of the money you receive. You may spend as much of it or as little of it as you wish, however you please.

Risks of Selling Your Life Insurance
Understanding the risks associated with selling your life insurance will help you make an informed decision. Be sure to consult a financial advisor or tax attorney to make sure you understand the implications of the sale.

o You might lose your eligibility for some public assistance benefits, especially those based on your income and assets (such as food stamps, welfare, Medicaid and some Social Security benefits).
o There could be tax issues. Selling the policy will result in a tax bill if the settlement amount exceeds your cost basis.
o With improved medical care, the ill person may live longer than expected.
o You might face unhappy heirs. This might not be a problem for you, but it could lead to a long road of (possibly legal) complications and battles. Some settlement actually companies require the beneficiaries to also sign off on any sale, which could be good or bad, depending on whether or not you’re dealing with a cooperative beneficiary.

Other Options
If you come to the conclusion that selling your life insurance policy is not for you, there are other options (though none that would provide you with such a large lump sum). An insurance agent should be able to help give you more information on some of these ideas.
Borrow against your insurance policy
o Cash out the policy if it has surrender value
o Look into accelerated benefits or living benefits
o Borrow money (from family or friends perhaps) and use the life insurance policy as collateral

If you believe that selling your life insurance policy is the right decision for you, make sure you deal with a dependable, experienced broker or settlement company to ensure that you get the best service and results from your transaction.

Second to Die Life Insurance Policies – Is it for You?

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.

Term Life Insurance No Exam – Is It Right for You?

Are you in search of term life insurance no exam required? Have you been looking for life insurance online, but maybe you’re overwhelmed with so many choices? So many websites to choose from.

Why put yourself through endless hours of searching online when you already know buying life insurance is the right choice for you and your loved ones? And, term life insurance protection provides you with the maximum amount of protection for your family at the lowest rates.

Today, with the technology available online – it’s quick, easy and affordable for almost everyone to get term life insurance with no medical exam required. There are several insurers who offer Instant Approval Life Insurance, if you qualify.

You can apply online and find out if you qualify in about 15 minutes. That’s right! No more paperwork. No more painful needles or medical exams. No more pushy insurance agents to deal with. And, no more delays of between 4 to 6 weeks to receive your life insurance policy through the mail.

Today, you can buy your life insurance policy online and print your policy immediately after you pay your first premium online, usually with a credit card. With some insurers you can actually get your life insurance coverage “In Force” today, if you qualify.

Not everyone qualifies for coverage though. You do have to be in good health, generally. But, even if you’re on medication, over weight, or a smoker – or even if you may not qualify with other life insurers – you might qualify for no exam life insurance.

You need to know that term life insurance no exam required may cost you a more money than coverage through other life insurers. However, the benefits may outweigh the cost for you. Several benefits include: Instant Approval, No invasive needles, No medical tests, No mailing delays, Coverage “In Force” today, No doctors, No pushy insurance agents to deal with… The list goes on.

As we mentioned before, there are two drawbacks – the premium may be a little higher. And, not everyone qualifies for coverage.

It’s easy to find out if you qualify for term life insurance with no exams. You just answer a few easy health questions to get your instant quotes. Then, you decide if you like the rates. If so, you can apply online in about five minutes. You usually get a response within 10-15 minutes as to whether you’re approved for life insurance coverage. Then, you can pay your first month’s premium online, and print your policy right away. It’s that simple. No time delays, no mountains of paperwork and no bothersome medical exams.

Make sure to check the financial rating of your life insurer. It’s usually provided on their web site or with your life insurance quote. Also, paying an annual premium for your life insurance coverage is usually less expensive than monthly payments. Finally, when you buy your policy online, you’re cutting out the uncomfortable, pushy sales person at your dinner table trying to talk you into the policy.

Term life insurance no exam policies can provide the protection you and your family need at affordable rates that fit your budget. It’s worth a few minutes to get an instant quote and decide if you want your coverage today. There’s no hassle, and no sales pressure. It’s your choice.

Life Insurance Settlement and Its Benefits

Why Buy Life Insurance?

Life insurance is generally offered as part of a benefits package with employment. For the most part, these policies are rather small usually in the ten thousand dollar range. People buy life insurance policies so that their families will not have to bear financial burden when a loved one passes on.

There is another reason to buy life insurance, the life insurance settlement. Your life insurance policy can be settled for a large sum before the end of your lifetime, though many people are not aware of this. Others buy life insurance specifically with this reasoning in mind.

Purchasing a Life Insurance Policy

Though it may sound strange, it’s actually a good idea to buy life insurance while the policyholder is still in good health. Rates are usually cheaper when this is the case, which makes buying a life insurance policy a whole lot easier. Rates are also less expensive if you buy life insurance while still young. If you’re young and in good health, it’s actually the best time of your life to purchase a life insurance policy – as strange as that may sound.

Don’t be afraid to do your own shopping around to find the best rates, and the best life insurance settlement. Comparison shopping is the way to make sure you get the best life insurance policy and life insurance settlement possible. Don’t rely on your employer to give you all the life insurance coverage you need. Generally, life insurance policies and life insurance settlements offered as part of a benefits package will not have good payoffs.

The Life Insurance Settlement

LifeInsuranceThere are many reasons that you may want to settle your life insurance policy. Sometimes, a life insurance settlement is the best thing you can do for your family. For instance, when the policyholder has reached the age of seventy and there is a need for a new life insurance policy or long-term care, your best option may be a life insurance settlement. A change in health status, estate tax charge, or when the policy has outlived the beneficiaries may all be reasons to consider a life insurance settlement, as well.

A large factor in the life insurance settlement is the need for liquidation of assets. This may be due to bankruptcy or other financial reasons or simply that the policy holder would like to acquire the sum of the life insurance settlement early. Your reasons for settling your life insurance policy are your own and if you feel the need for a settlement then you should pursue one.

Be sure to discuss your life insurance settlement options with your insurance company. If needed, have a new life insurance policy in place before going forward with your life insurance settlement. There is no reason you cannot have two or more life insurance policies at the same time.

A life insurance settlement can allow you to enjoy some of the benefits of your life insurance policy and be a good source of income when long-term care or extra income is needed. Be sure to discuss the exact amount that you will receive from your life insurance settlement with your insurance company, and find out the payment scale and time frame for receiving your settlement. When you agree on a life insurance settlement, the paperwork that you sign should include all of this information. Be sure to look over any paperwork very carefully before signing because you can never be too careful with insurance companies.

Life Insurance As An Investment For Peace of Mind

LifeInsuranceInvestmentWe all reach the stage in life when we wonder whether we need life insurance or not. This isn’t a great decision for any of us – nobody likes to be reminded of their own mortality after all! But it’s a decision that comes to us all at some time or other especially if we have a family to consider.

To be honest, it’s worth while looking at taking out life insurance at virtually any stage of your life especially as we reach adulthood and start to amass mortgages and other financial commitments. The fact is that it doesn’t really matter if we have a family to care for or not if we have any kind of current financial commitments then we need to think about what would happen to them if we were to die out of the blue. You also have to remember that it doesn’t matter how healthy you think you are. You could die in a car accident or get run over by a bus tomorrow!

The thing you have to consider here is what would happen to your financial commitments if you were to die unexpectedly. A lot of people don’t realise that the money they owe on stuff like loans and mortgages doesn’t necessarily pay for itself after their death. Somebody will have to take responsibility for its repayment. In the simplest of terms, you have to think about who would pay for your funeral at the end of the day.

Life insurance policy may be worth thinking about at this stage. It is essential if you have a family to add to the equation. If you have a partner and/or kids then think about how they would cope financially if you did die and your salary died with you. This isn’t just about managing stuff like the mortgage; it’s also all about working out how they would pay for life’s necessities never mind life’s luxuries. If you protect them with a life insurance policy then they could at least cope financially during what would be a very difficult time for them.

The key thing to remember with life insurance is that it doesn’t have to cost the earth. Life insurance policies nowadays can be taken out at minimal cost. You really could be paying just a couple of pounds a week to get the right levels of protection. To make things easier most industry experts recommend that you shop around for the best quote as the sector is extremely competitive at the moment. This is easily done since there are loads of web sites out there that can help you sift through competitive life insurance quotes so you can find the cheapest policies in just a matter of minutes. This is a great way of getting the life insurance cover you need without spending too much time or money in the process.