Consider Deductibles on Your Workers' Compensation

An Excerpt From My Book, Simmonds on Workers' Compensation Insurance:

A deductible is the part of a claim you pay before the insurance company steps in. Put another way, a deductible is a way for you to retain a portion of the loss. The larger the deductible, the larger the premium savings.

Workers' compensation deductibles are usually expressed separately for the two parts of a workers' compensation claim: indemnity (lost wages) and medical.

Get the facts before increasing the deductible on your policy. How much will you save in premium? Are the deductibles on a per claim or per year basis? Run the numbers to see what the deductible would have cost you in the past three years based on your claims experience. Are the savings worth the risk?

Deductibles can also affect the losses that show up on your experience modification sheet. In many states a loss under the deductible is not included as an experience mod loss. This can have a positive impact on your premium down the road.

Employee Theft Blog

An employee theft insurance claim is a huge hit to most business people. Not only is there the financial consequences, there is the emotional toll of the violation of trust.

I've started collecting stories of employee theft in my new blog, www.employeetheft.blogspot.com.

Check it out for stories of the crimes and hints to prevent a loss.

Has Overtime Been Excluded From Your Workers' Compensation Payroll?

An Excerpt From My Book, Simmonds on Workers' Compensation Insurance:

When a worker receives overtime, the extra amount paid is not part of workers' compensation payroll. For example, if a worker makes $8.00 per hour normally and $12 for overtime (time-and-a-half) the only payroll that is counted is the $8.00.

Make sure the extra for overtime has not been included in your payroll audit. Check past audits too. They can be corrected. Contact your agent for help.

Be Aware of Out-of-State Work Comp Exposures

An Excerpt From My Book, Simmonds on Workers' Compensation Insurance:

Your employees are eligible for workers' compensation benefits in the state where they are injured. If your employees travel to other states, be aware that you may need to purchase coverage for those states. Many insurers provide coverage for other states right on your basic policy - designed for only incidental exposures.

Check with your agent.

Family Waves (sic)

Consider Excluding Family Members From WC

Several states allow family members of owners to be excluded from workers' compensation coverage. Family includes parents, siblings, children and spouse. Excluded family members must voluntarily waive coverage in advance of any claim. Such a waiver must not be a condition of employment.

Check with your agent to determine the law in your state.

Genetic Tests Banned For Life Insurance Customers

Life Insurance companies have been told that they must not determine the amount of cover a person is eligible for using data from genetic tests. The ban came into effect in 2001 but will be applicable to all life insurance sales until it is reviewed in 2011 and will officially last until 2014.

Regardless of a customer’s genetic make-up and their family’s history of hereditary conditions such as cancer, insurers are banned from using this information to effect the price of people’s insurance policies. “The moratorium on the use of predictive genetic test results works well for consumers.” The Director General at the Association of British Insurers told the UK press.

“It means people can insure themselves and their families, even if they have had an adverse result from a predictive genetic test. The moratorium has proved effective since its introduction in 2001 and can now continue.” The only tests which the insurance industry can use to determine policy fees are those sanctioned by the British Government.

Insurance scam tactic isolated

The Insurance Association of Jamaica (IAJ) says it is not alarmed by reports that a body was dug up on Saturday as part of an alleged attempted life-insurance scam.

The Manchester police have reported that the body of 70-year-old retiree, Irvin Sinclair was exhumed from a grave in Pratville, south Manchester, to be burnt and passed off as that of a policyholder in order to make an insurance claim.

Yesterday, the executive director of the IAJ, Orville Johnson, told The Gleaner that insurance companies have adequate systems in place to deal with fraud.

He also said life-insurance fraud was not prevalent.

"We don't have any recent record of insurance fraud on the life side," he said, adding that the verification process for life insurance claims was very stringent.

Isolated incident

Assistant Commissioner of Police Denver Frater also said there was no intelligence to suggest that the incident was part of a trend.

But he said people have been using innovative ways to try to defraud insurance companies.

The five men implicated in the weekend desecration remained in police custody up to late last night.

They were to have been questioned yesterday, but the interview did not materialise. The police did not provide a reason for the delay in questioning the men but indicated that it would be undertaken today.

The police said about 3:45 a.m. on Saturday, three vehicles were signalled to stop on the Greenvale road in Mandeville. Two of the cars reportedly sped off, leaving the other vehicle, a white Toyota Corolla.

According to the police during a search of the car, the body of the retiree was found in the trunk. Condolence phrases for this tragedy has been sent to the relatives

Tips to fill a life insurance form

In an age when shares can be purchased at the click of a mouse, filling a life insurance proposal continues to be a major chore. More often that not it is the insurance agent who, in his eagerness to sell, fills in the details on behalf of the insured.

What the proposer doesn’t realise is that such a casual approach can make a crucial difference when it comes to pricing, and in ensuring that claims are not prejudiced. Unlike other transactions, insurance is based on faith. Since the insurance company cannot verify every bit of information, it accepts in good faith whatever details the proposer provides. The flip side is that this gives the company the right to reject claims if there is non-disclosure of a fact that is material to the pricing of premium.

If there is a vague or incomplete entry in the proposal, the underwriter may play it safe and bracket the insured in a higher risk category. This is more applicable in case of policies where there is a high sum insured.
Taking a little more trouble in filling the proposal form can, however, help the insured save premium money. Here are some disclosures that make a difference in price:

Age proof
Proposers may be tempted to give a self-declaration, in the absence of certificates. take this route when their age certificates are not readily available. However, it makes more sense to make available photocopies of birth certificates, passports or school leaving certificates, especially if you are above 40 years of age. The underwriter may raise the premium to accommodate the possibility of the applicant being older than the declared age. Sometimes, the increase can lead to a premium payable for a life five years older than that for the declared age.
Income

Indians often fight shy of disclosing their full income. But there is a legitimate reason for an insurance company to seek the proposers’ income, particularly if the proposer is seeking a high sum insured. Insurance companies usually accept the sum insured as a multiple of present income. Under-declaring income could result in the company declining the proposal for a high sum insured.

Occupation
It’s best if the occupation is not left vague. For instance, when you mention your occupation as ‘engineer’ with ABC Construction, the underwriter wants to know if you are a design engineer or a site engineer or an IT engineer maintaining the company’s systems. Do mention if you toil in an environment with high safety norms. This reduces premium hike on the grounds of “occupational extra.”

Medical history
Here again, most applicants are reluctant to share information, and agents misguide proposers by asking them not to declare some medical procedures.

The information, however, need not increase your premium. If a claim has arisen out of any pre-existing condition not disclosed in the proposal form, the insurer has a ground not to pay it.

Family history
Being clear on this front works in your favour if the family is seen enjoying higher life expectancy with good health. It makes a stronger case for cover at a higher age.

Other details
List all the life insurance policies you have. Give details of the cover you enjoy under those policies along with the policy numbers, name of the insurer, sum assured and the date on which the policy started. If you have bought a policy from the same insurer at a standard rate in the recent past, you may get a favourable underwriting treatment.

A lethargic attitude here can deprive you of better underwriting treatment. Mention the reasons behind the purchase of life insurance. If you don’t have any insurance and are going in for a large sum assured due to a fresh home loan, mention it. Employment, wedding and child birth and are some valid grounds. Because accidents could happen, like when you are travelling to Central America to examine statue on Gods of Aztec.


If the proposer does not mention the surgery details in the proposal form and this is detected subsequently, the underwriter will turn cautious about the life to be insured. Even if an additional test is called for, you stand to benefit from it, as you come to know about hidden problems, if any.

Give Yourself Some Work Comp Credit

An Excerpt From My Book, Simmonds on Workers' Compensation Insurance:

Most workers' compensation insurers allow underwriters pricing discretion of up to 25% above and 25% below the published rates Credits are used as competitive tools by insurers. They are often loosely tied to loss control and claims management programs. Find out what your credits are. Ask your agent how to get more. You will rarely get credits if you don't ask for them.

Work Comp Tip - Know Your Perfect Mod

An Excerpt From My Book, Simmonds on Workers' Compensation Insurance:

Know Your Perfect Mod

If you spend more than $4,500 on your workers’ compensation premium you probably have, as part of your premium calculation, a factor known as the experience modification. It’s a calculation that compares your actual losses to the average losses of companies like yours.

The modification is expressed as a factor - you multiply your premium by the mod and that determines your final premium. A mod of .85 gives you a credit. A mod of 1.20 increases your premium.

Many consider a mod of 1.00 to be OK. After all, there is no surcharge.

I’m not satisfied with that. An experience modification of 1.00 means the employer is average. It’s the workers’ compensation equivalent of a “C” on a high school report
card.

Your objective is the perfect mod, meaning the modification you would have if you had no losses. Measure your performance on that basis. How low your mod goes is a function of your industry and payrolls. Learn what an A+ is before you go patting ourself on the back.

I developed a tool to help insurance buyers understand the idea of the perfect mod. The software performs the calculation so you can see what an A+ would look like. The tool also provides information on the impact loss severity and frequency have on your experience modification.

Go to www.Modmanager.com for access to the tool.

Prevent Employee Theft

Every day, it seems, there is another story in the news about an employee stealing.

Three simple steps can prevent employee theft incidents:

--Immediately mark all customer payment checks "for-deposit only"

--A person not authorized to sign checks reconciles all bank accounts

--Conduct criminal background checks on all new employees

More employee theft prevention tips can be found here.

Reading an insurance policy: schedule of forms and endorsements

In my last post I began discussing how to read an insurance policy, beginning with the coverage selection page. The next thing you should understand is the order in which you should read a policy. (Hint: it's not necessarily front to back.)


The coverage selection page of many policies includes a section called "Schedule of forms and endorsements" or some variation of that. That section will contain a list of names of forms referred to by a combination of numbers and letters that make no sense to anyone who is not an underwriter (a person who puts together insurance policies). An example from a malpractice policy I had a few years ago:


U-PL-871-A CW (4/98)


The schedule identifies the forms and endorsements (which, for practical purposes are the same thing) that make up your policy. Some policies, such as a motor vehicle policy, may contain only a coverage selection page and the main policy form. Others, such as commercial general liability policy, will contain a coverage selection page and up to a couple of dozen forms, some as short as one page and others quite lengthy.


Generally the form identification, corresponding to the entries in the schedule of forms and endorsements, is at the bottom of each form. Each listing on the schedule of forms and endorsements should correspond to a matching form, and vice versa. If you have a form that is not listed on the schedule, or an entry on the schedule without a corresponding form, you should follow up with your insurer to see if the mistake is on the schedule or (more likely) in the insurer putting together the forms.

1,000 Insurance Items

I have just finished implementing a site search feature for my websites and blog. I figured now that I have more than 1,000 articles, definitions, posts, newsletters, white papers, and ebooks I had to make it easier for visitors to find what they are looking for on my website.

Search from the blog entry (look right) or from my website - the search box appears on every page.

Comments welcome.

Terrorism Insurance

When you buy business insurance you are offered terrorism coverage for a separate premium. Here is some info on the federal terrorism insurance program.

On December 26, 2007, the President signed into law the Terrorism Risk Insurance Program Reauthorization Act of 2007, extending the Terrorism Risk Insurance Act (TRIA) through 2014. The United States Treasury Department implements the Program.

Here are some key points to TRIA:

--Federal program with mandatory participation by insurance companies.

--Covers foreign and domestic terrorism (as if 2007).

--Covers attacks on U.S. property that cause at least $100 million in damages.

--Annual losses covered by the program are capped at $100 billion.

Your life insurance policy is for you as well as your family

Q: I am 35, running my own company in Dubai, and raising a family of four. I have decided to buy life insurance, but am unsure who I should approach, how much cover I need and what kind of policy best suits me. Please help.

A: Life insurance is a cornerstone of any financial plan, and - since you have dependents to consider - you should try to have the right policy in place as quickly as possible.

The key role of life insurance is to ensure that your financial obligations are covered in the event of your death, so securing a policy should provide you with valuable peace of mind.

Although it is a question everybody asks, there is no quick and easy formula for determining how much insurance you need. Everybody's circumstances are different, and your needs are likely to be determined by a range of factors including your income, the specific needs of your family, debts and your family's lifestyle.

Try to determine the overall scope of the policy by calculating the two needs that your family will need to cover. You can break these into two areas: immediate cash needs and income needs.

Your family's immediate cash needs are likely to include expenses like funeral costs, any repatriation costs, hospital fees and so forth. You might also want to make sure there is an emergency fund to cover rent, school fees and the costs of covering any debts or liabilities.

Planning
The income needs will be determined by how much income your family will need to sustain their lifestyle, and how long the income will be required. You might look to cover the period until all your children reach 18 - and begin to become financially independent - or until your spouse retires.

Deciding the period will help determine the type of policy you require. Given your relatively young age, you might consider term insurance, which - as the name suggests - covers you for a specific period of time in the case of premature death. After that period, you can drop the policy or pay annually increasing premiums to continue the coverage.

The advantage of these policies is that they tend to be the less expensive than other alternatives, although they only pay a death benefit rather than accumulating a cash reserve.

Another alternative is whole life insurance, which is the more traditional approach. With whole life, the premiums stay the same over the life of the policy, which stays in effect until your death, even after you've paid all the premiums. Whole life premiums build up a cash reserve over the life of the policy.

You could also look into other types of permanent life insurance, such as universal life insurance and variable life insurance.

Deciding on a policy is generally easier with the assistance of a professional financial adviser. If possible, try to work with an independent adviser who isn't tied to a specific provider, since they will be able to offer unbiased advice and suggest the right policy to suit the needs of your family and your current budget.

Safeguarding Your Family’s Financial Future

(NAPSI)-Building a family nest egg that won’t crack could require having something known as term life insurance.

A term life insurance policy offers insurance protection for a specified term, or period of time-typically 10, 15, 20 or 30 years.

People often use term insurance to help secure mortgage payments, wedding expenses, college loans, car loans and similar types of debt. Because the policies pay a predetermined amount should something happen to you within a specific time frame, they can be a good way to help prevent long-term-but not lifetime-payments from being passed on to surviving family.

Choosing Term Insurance

Fortunately, term insurance can be a simple insurance product to research and purchase.

Start by going online and getting quotes for similar policies from different companies. Be sure to have your basic personal and health information handy, and answer all questions truthfully. Then compare the quotes against your needs. Here are a few facts that will be helpful to know:

• Term premiums may increase each year (known as an annually renewable term) or remain level for a set period (called a level term).

• Term insurance is generally less expensive than permanent (cash value) life insurance.

• At the end of the term period, the policy may contain a provision permitting it to be renewed without a medical exam, although the premium rate will probably be higher.

• Some term life insurance policies include an option to convert to a permanent life insurance policy.

• Traditional term life insurance provides a death benefit only; the policies do not offer an opportunity to build cash value.

Some policies may include terms that are more customizable and that can be linked to specific life events, including retirement, the payoff of a mortgage or a child’s graduation from college. But they might also provide more affordable coverage for people in a variety of situations.

For instance, if an individual wants to purchase term insurance but has high cholesterol, a 30-year policy may be too expensive. However, the individual could be covered on a 26- or 27-year policy that might be a better fit for his or her monthly budget.

Coverage into Retirement

Traditionally, term insurance was seen as a vehicle to insure yourself until you had enough financial security to self-insure. However, with these new, more customized term options, insurance can be affordable well into retirement.

Coverage may also include expanded ages, meaning consumers in their mid 50s, 60s and even people who are 70 years old can purchase term insurance, providing coverage into their 80s-considerably longer than most term plans currently allow.

With people living longer, and working well past 65, the added coverage can be a smart way to help safeguard a second mortgage, medical or other expenses people tend to encounter later in life.

It's not difficult to manage life's financial risks

Life is full of financial risks. Even the most conservative financial strategies can be sidetracked by unexpected developments.

For example, an illness or disability could prevent you or your spouse from working, putting your family in a precarious financial situation. Someone in your family could become seriously ill, resulting in considerable health care expenses. Or your death could create a huge financial burden for your loved ones. Fortunately, it's not difficult to manage these risks. Proper insurance coverages and a few other simple steps will prevent unwelcome events from turning into financial disasters. Here's what you should consider:

Life insurance: You and your spouse should have adequate life insurance coverage. The payout from a life policy can replace lost income that results from the death of a breadwinner. It can also offset funeral and estate expenses, and liabilities such as capital gains taxes on assets that might arise as a result of your death. Money received from a life insurance policy is tax free, so the full amount goes toward providing your loved ones with a secure future.

Disability insurance: If an illness or injury prevents you from working, you and your family could be left with little or no income. Disability insurance can replace all or part of that missing income through a series of monthly payments while you're unable to work.

Critical illness insurance: Even if you can work while sick, you could face increased expenses. Critical illness insurance provides a one-time payment if you're diagnosed with any of the illnesses covered in the policy. These include heart attack, cancer, stroke or other major life-altering illnesses.

Long-term care insurance: An extended illness could require expensive health care or personal care services. Long-term care insurance helps offset expenses such as nursing home services, assisted living care, and home health care.

Health care insurance: Understanding how important supplemental coverage is these days, especially with the constant changes to provincial health insurance, it's wise to consider purchasing your own healthcare insurance when leaving a Group Plan. A previous column dealt specifically with health care insurance, and in particular two unique products that are now available to retiring group plan holders. If you have any questions on these, please let me know.

There are more steps you can take to reduce financial risk. For example, if you do not already have ready access to a line of credit, be sure you have emergency funds in a bank account or in other safe, cashable investments. The equivalent of six to nine months' living expenses will help you through temporary financial emergencies.

Even if you have enough wealth to weather severe financial problems, insurance is a necessity. Without it, your savings and investments can disappear quickly in the event of an illness, disability, or death. And don't count on Registered Retirement Savings Plan investments in an emergency; a withdrawal from an RRSP can trigger a huge tax liability and rob you of a comfortable retirement.

When it comes to insuring your financial security, it's essential to know how much coverage you need. Work with your financial advisor to assess your family finances and determine what you would require to replace lost income.

When selecting individual insurance, be aware that terms and conditions offered by insurers vary, even among similar policies. Your financial advisor will help you select the right solutions for your needs.

Reading an insurance policy: The first step

An insurance policy consists of several sections, and to understand what coverage you have purchased you need to understand what each section means.


The "coverage selection page," also called the "declarations page" or "dec page" is created for you personally when you purchase or renew your insurance. It indicates how much insurance you have bought ("the limits," discussed in a previous post) and any other information unique to the policy your policy. For example, the dec page of an auto policy will indicate what cars are included in the policy. A Commercial General Liability policy will indicate what premises are covered in the premises liability portion of the policy. A dec page may also indicate the names of the people or businesses that are covered under the policy.


Each and every time that you purchase or renew insurance, you should review the dec page to make sure that the insurer has issued to you the policy that you meant to purchase. In an auto policy it is not unknown for an insurance agent to raise your insurance limits (and your premiums) without discussing that with you. If your policy renews automatically, it is a good time to consider if the limits you chose still meet your needs.


In future posts I will discuss other parts of an insurance policy, beginning with the "insuring agreement."

Cure For the Disappearing Laptop

For $50 a year you can add LoJack to your laptop.



The same people who provide a way to get your car back when its stolen have put together a similar system for your laptop. We all have heard the horror stories of the data breaches and shear turmoil that's caused by a lost computer.



http://www.absolute.com



Combine LoJack with passwords, data encryption, and diligence at protecting your computer and you have the complete package.

Can You Afford Not To Get A Term Life Insurance Quote?

Term life insurance provides death protection for a stated time period. Term life insurance is perhaps the simplest form of life insurance. It was developed to provide temporary life insurance protection on a limited budget. Since term insurance can be purchased in large amounts for a relatively small initial premium, it is well suited for short-range goals such as life insurance coverage to pay off a loan, or providing extra life insurance protection during the child-raising years.

In most states term insurance policies are offered providing level premiums for 5, 10, 20, and 30 year periods. These policies can be renewed or continued at higher premiums in most states to age 85 or 95 as stated in the policy.

With a policy in place today, you can:

• provide security for your family
• protect your home mortgage
• look at your estate planning needs
• look at other retirement saving & income vehicles

Adjustable premiums:Term life insurance policies have adjustable premiums. This means that State Farm may raise or lower premiums at some point specified in the policy based on projected changes of investment earnings, mortality experience, persistency, and expenses. However, premiums may never be raised above the maximum premiums stated in the policy.
Renewability:State Farm's level term policies allow the policyholder to continue coverage past the original coverage period of the policy. Each time the policy is renewed the premium increases to the amount for the then attained age of the insured. This right is usually offered for a specific period, which varies depending on the type of policy.
Conversion: Term policies are convertible to age 75 in most states. Conversion allows the policyholder to exchange a term life insurance policy for any permanent life insurance policy offered by the Company at any time while the policy is in force (subject to established policy minimums).
Life insurance sites often do not sell life insurance policies at all; rather they sell your information to one or many local agents. Make No Mistake! Recognize the difference! Sites that are valid should display the life insurance broker's name and included a listing of the states, the term life insurance broker is "legally licensed" and "legally appointed" to conduct business.
Term Life Insurance Quote is a FREE SERVICE dedicated to helping you with all of your life insurance quotes and term life insurance quotes needs. We offer access to a Nationwide network of life insurance and term life insurance experts.
People buy life insurance - term life insurance because too often most of their other plans fail. They buy it because they realize the need of protection for their families after their death; or for a reserve for emergencies and additional income for later years.

Life insurance can:

• Provide cash and income needs on and immediately following death such as unpaid bills and taxes and other obligations.
• Prevent a family's suddenly dropping from its accustomed standard of living after the death of the breadwinner.
• Provide continuous flow of funds for the living spouse.
• Allocate income funds for the children's education.
• Provide a retirement income throughout old age.
• Provide a reliable savings plan for the future.
• Supplement income when earning power is destroyed by illness of accidents, such as covering medical expenses.
• Furnish surplus earnings for the investors should disaster strike.
• The bottom line is this: While Life Insurance is not always the insurance product at the forefront of your thoughts, Life insurance is always a friend in time of need.

How To Use Life Insurance To Protect Your Family Finances

Life insurance is one of the most effective ways to protect your dependents against the financial loss that can occur on the death of the main family breadwinner.

Like most insurance plans, price tends to drive life insurance buying decisions before product quality and ultimate suitability are considered. In reality, focusing solely on the monthly cost is not always an accurate indicator of the best value cover. Unfortunately, any shortfalls in cover are usually discovered when it’s too late after a claim is made.

An example of this is term life insurance plans which usually offer two premium options, guaranteed or reviewable. Guaranteed premiums are just that, fixed at outset and guaranteed by the insurer not to be increased if they experience a higher than expected level of claims. This is opposed to reviewable premiums which are subject to review, usually every five years and, can be increased at the insurer’s discretion.

Although guaranteed premiums are more expensive than reviewable rates they should be considered, particularly for policy terms in excess of ten years. This is because the level of each potential premium review increase is likely to rise the older you get.

Is a Lump Sum or Income Benefit Best?

A more accurate measure for getting the best value cover is to match the right policy type to need for protection. A good example is the fact that most policyholders choose lump sum cover when applying for a life insurance plan intended for family protection. Lump sum cover is fine if you need to provide large sums to settle debts such as mortgages and loans. True family protection cover is more about ensuring an income is provided to replace that lost on the death of the life assured and main earner. The potential problem with a lump sum used for family protection is where do you invest the lump sum to generate the required income? And will the income generated be subject to tax and sufficient to meet the needs of the surviving dependants?

A more suitable solution is cover that’s designed to provide an income to the end of the required term rather than a lump sum. This is known as Family Income Benefit and has many advantages over lump sum alternatives. The first of these is that it’s usually cheaper than a comparative lump sum plan because the risk to the insurer decreases over the policy term. For example, a 20 year level term assurance plan with a sum assured of £100,000 will cost the insurance company £100,000 if a claim is paid up to the end of the cover.

Compare this to a Family Income Benefit policy providing an annual income benefit of £10,000 over the same 20 year term which could potentially cost the insurer £200,000 if a claim was made shortly after inception. In practice this is unlikely so the risk to the insurer decreases throughout the term. So if a claim was paid during year 10 the insurer would pay the annual income benefit for the next 10 years.

An additional feature of Family Income Benefit is that the income benefit can be paid on an increasing basis if selected from the outset. This option is usually available as a flat rate percentage increase or as a link to certain indices such as Retail Prices or Average Earnings.

So overall, Family Income Benefit can provide an almost perfect solution to providing an income for your dependents on the premature death of a family breadwinner. Not only is often the cheapest form of family protection life insurance but it also currently provides the income benefit totally free of tax.

Adequate life insurance for hard-working Dads?

Adequate life insurance for hard-working Dads A dad's workload is worth far more than his monthly wage packet – a fact which is often overlooked when taking out life insurance, ASDA Financial Services has said.

The salary from the main job is just one of many contributions a dad makes to the family finances. From DIY around the house to helping with homework – if dads were paid for these jobs, they would earn £16,484 a year on top of their main salary, ASDA experts have found.

Their calculation includes an average 156 hours of DIY a year, which makes up for nearly half of the amount, but also includes activities such as helping with homework, giving the kids a lift to friends' houses or activities, washing the car, tending to the garden, mowing the lawn, and driving lessons.

Therefore, should the worst happen, a family would not only lose their main provider and his salary, but would also have to spend considerably more money to have these unpaid jobs done by somebody else.

Life insurance policies pay out a capital lump sum to the beneficiaries should the policyholder die or be diagnosed with a terminal illness during the term of the cover. They provide peace of mind and help the survivors to cover expenses such as mortgage payments, outstanding debt, or funeral costs.

On the occasion of Father's Day, ASDA therefore urges families to check if their head of household has adequate life insurance, including provision for their unpaid activities.

With lots of policies starting from less than £10 a month, life insurance is far more affordable than most people think, ASDA's Head of Insurance, Gideon Ingham, said.

He commented: "Dad's financial contribution to the household via his salary is just the tip of the iceberg. Considering how inexpensive cover is, it's astounding how many families overlook life insurance for the person who is often the main bread winner in the family."

"Life insurance should be accounted for as part of the family budget in the same way that birthdays and holidays are," he recommended. "It really is best to be prepared for every eventuality."

Slip Prevention Strategy

Thousands of employees are injured each year in slip and fall accidents. All are preventable.

Clear halls and walkways, remove snow and ice, use non-slip floor coverings. The most important thing may be the shoes your employees wear.

Shoes For Crews is a company that specializes in safe shoes that are fashionable and slip-resistant. They have an extensive web catalog with styles for almost any workplace. Ordering is easy. Returns are encouraged and free if you order a replacement pair. They even have a payroll deduction plan that employers can put in place to help employees pay for the shoes. www.ShoesForCrews.com.

Save Premium - Check Your Class

An Excerpt From My Book, Simmonds on Workers' Compensation Insurance:

Your workers' compensation rates are based on the business and industry in which you work. There are over 600 employment classifications in workers' compensation for different industries; from "Abrasive Wheel Manufacturing" to "Zoo."

Important point: your company receives a classification – not your employees. You may run a hotel and employ someone to do nothing but paint. That person will not be classified as a painter. He will be part of the mass of employees included in the hotel classification, along with your other maintenance people, sales staff, and housekeepers.

Each class has a specific definition that prescribes who gets classified in that "code." The definitions for some classifications are several pages long.

Get a copy of the definition for each of the classifications you have on your policy. Are the descriptions correct for your company? Work with your insurance advisor to find a classification that is a better match (at a lower rate).

Home and Office Inventory

When I first entered the insurance business, insurers offered neat (I thought) little books of blank pages ready for insureds to fill in with lists of their belongings. The idea was that after a fire, the books would provide a record of their possessions, making loss adjustment easier.

Nobody ever filled out those books.

A better way to document your furniture, electronics, and other property is with a digital camera. Walk around your home or business and snap pictures of each room. Drop the photos onto your computer hard drive. Should you ever need them, they are there.

You do have off-site backup of your hard drive, right? (If not, check out www.Carbonite.com. $50 for a year to backup one computer. It's what I use. They have a free 15 day trial.)

Understanding risk life insurance

Q: What is risk life insurance?

A: Risk life insurance is a way of creating an “instant estate” for your loved ones in the event of your death. The best way to understand this “instant estate” is to think of it as the amount of money needed to replace you as a breadwinner.

Risk life insurance thus means that when you die, your loved ones will be correctly compensated and able to continue to live as if you were still generating your income, as opposed to them being forced out into the workplace to support and fend for themselves.

Where there is a two income family then both partners need to consider risk life assurance.

Q: Who needs it?

A: Generally, the people who need risk life insurance most are, in my mind, typically younger to middle-aged salary earners with dependents. This is because they’re still creating their estates.

They have yet to save the money and build up the assets which may one day reduce the need for life assurance. Their dependents who are usually young children, but could be aged parents or other family, cannot yet depend on the accumulated assets for their day to day living.

In contrast to this, young people without dependents and family obligations don’t typically need risk life insurance. A young, single person with well off parents, who is just starting out in their first job for example, has no need for life assurance.

They should, however, secure themselves with income protection. This is a different type of risk insurance that protects your income should you become disabled or be involved in an accident.

It will provide you with 75% of your monthly salary until such time as you can return to work.

Q: How much life insurance do you need?

A: To avoid being over or under insured you should use a financial planner to do a proper financial analysis of your needs. As a general rule of thumb however, you should have life cover of at least ten times your annual salary to replace your income.

People’s needs are different though – hence the need for a financial planner. Previous marriage obligations, commitments to extended family and so forth will all impact on the amount of life cover you require.

You should establish how much cover is provided by your employer as this will form part of the calculation.

Q: Do critical illness benefits, disability benefits and impairment benefits fall under your life insurance?

A: In addition to life insurance, these other types of insurance can be considered for specific needs. These are often for the same amounts as your life insurance but can be implemented separately.

Their main purpose is to replace income lost and preserve your lifestyle should you not be able to work, either temporarily or permanently.

Q: What is the difference between accelerator rider benefits versus stand-alone benefits?

A: You can have trauma insurance and disability among others, added to your policy as an accelerated or a stand-alone benefit. By way of example: you can apply for R1 million of life insurance and R1 million of disability, and will be given two choices.

The less expensive option – the accelerated benefit – will involve your disability paying out should you become disabled and the life cover simultaneously falling by the same amount. You thus be paid out for death or disability, whichever comes first.

With the stand-alone option the disability and death benefits would be paid separately; functioning independently of each other. This solution will, however, involve a higher premium.

When choosing between these then, you have in part to look at affordability. However the decision as to how best secure your family’s future should be discussed with a professional.

Q: How can you save on your life insurance premiums?

A: You should look at your investments and insurance policies with your financial advisor at least annually. This is important for two reasons. The first of these is that your lifestyle circumstances may have changed: you may have had a child or been promoted.

The second reason is that alternative, sometimes more competitive, products and services become available over time. These might suit you better.

That being said, if you do choose to replace one product with another, you must be absolutely sure that the new product is definitely much better than the old one.

Q: What is group life assurance?

A: Group life is the life insurance normally provided to you by your company as a member of your company’s retirement fund. It’s thus life insurance offered by an insurance company to a group of people.

It’s typically structured around more favourable rates as opposed to individual – the insurance equivalent of a “bulk discount”.

Group life assurance also usually provides a “free cover limit”. This means that up to a certain level your cover is provided free of underwriting: you don’t have to have any medical tests.

Regardless of your state of health then, you can get automatic access to this free cover limit.

The disadvantage of group life assurance is that it’s provided by your employer and thus not specifically tailored to your personal circumstances.

You would probably need to “top-up” your life insurance, as the group cover generally provided is equivalent to just three times your annual salary – well short of the “rule of thumb” amount.

This is why you should discuss life insurance cover with your financial advisor, to ensure that your loved ones will be adequately provided for should the need arise.

Cash For Your Life Insurance: New Spam Attack

There appears to be a new type of spam attack, the focusing of an email blitz for a limited period of time - with a potentially high return for the spammer.

An example of this occurred this Saturday where we received over ten emails encouraging the cashing in of Life Insurance over a few hours, indeed, in less than one hour, we received seven into our various email accounts.

Life Insurance?
Life Insurance isn’t an area we know lots about, but we’d imagine that selling it is something you do when you pretty desperate for cash, and it probably isn’t a great idea.

Back in 2001 there were reports that “consumer advocates urge policyholders to be cautious, because a number of the companies operating in the industry have murky histories, possibly involving fraud.”

Spam messages like the ones this weekend aim to prey on people in their weaker moments, hoping to catch and exploit them.

New spam approach
This approach — focusing the attack to a specific time and particularly a weekend — has the advantages of getting lots of the emails past spam filter, before people can mark them as spam.

By getting these mails through, there’s a high chance of getting them in front of people who might be tempted to take up the offer - no matter how bad it might be for them.

Contractors Can Split Workers Comp Payrolls

An Excerpt From My Book, Simmonds on Workers' Compensation Insurance:

The workers' compensation insurance rules for most employers do not allow an individual employee to be divided up into different categories. For example, a restaurant employee who also delivers orders cannot have part of his payroll assigned to the restaurant code and the rest to the drivers code.

Contractors, however can split an employee's payroll into separate employment codes. So, an employee who works as a carpenter and also does painting can be placed in two different classes, and therefore, you pay two different rates.

Contracting companies must keep detailed records to allocate payrolls.

Talk with your insurance advisor.

How much insurance should you have?

The amount of insurance coverage you purchase is called the "limit" of the insurance--the maximum amount the insurance will pay. Most policies have two limits, the per person limit and the aggregate limit. The per person limit is the most that will be paid to any single person. The aggregate limit is the total amount the insurance policy will pay. If you have an auto policy with limits of $20,000/$40,000, and you injure three people in a car accident, the most any single person can recover from your insurer is $20,000. The total all three people can recover from your insurer is $40,000.


Of course, if you have severely injured someone, they can seek amounts in excess of your policy limits. If they win at trial, that excess amount will come from you.

In deciding the amount of insurance you should have, you should consider:


* The amount of damages you may cause if you are negligent. For example, in attorney malpractice insurance, the common advice is to have enough insurance to cover the full value of the largest cases you work on.


* What your own assets are. In a typical case, the plaintiff's attorney will not encourage the plaintiff to seek amounts in excess of the policy limits if you have limits that are reasonable in light of your personal situation. If you are rich, or even comfortably middle class, and you have the minimum auto policy coverage of $20,000, and you severely injure someone in an accident, it is likely that the injured person will seek to go after your personal assets. If you have very little income, savings, or assets, the injured person may seek a small contribution from you as a matter of principle, but the plaintiff's attorney will understand there is little to gain by forcing you into bankruptcy.


* The moral issues. How would you feel if, for example, you severely injured a person so that he is disabled, unable to work, and unable to take care of his kids, and the most he could get from your insurer is $20,000? A large financial settlement from your insurer obviously won't give him his health back, but it will help make his post-accident life easier. Such a settlement is only possible if you have higher coverage.

* The cost of the premiums. Until this year all personal auto policies in Massachusetts cost the same for whatever level of coverage you were purchasing, no matter which insurer you used. With deregulation you will need to shop around for the best price. While you're at it, compare prices for different levels of coverage.

Employers' Liability Coverage

An Excerpt From My Book, Simmonds on Workers' Compensation Insurance



When the topic of workers' compensation is discussed, the conversation usually concerns state mandated benefits for medical expenses and lost wages. There is a second, less well known, part of the policy – employers' liability.



When a worker is injured, workers' compensation pays the medical bills and lost wages. How about the affect the injury has on the employee's family?



Examples:



--A wife watches her husband fall from a roof to his death. She is emotionally devastated and sues the employer for the horrific scene she witnessed due to the employer's negligence.



 --The family of a vibrant man who is now a quadriplegic after a workplace accident sues for loss of support and companionship.



 --A worker in a boat yard comes home each day with clothing covered in dust and chemicals. The family's clothing is contaminated, causing the children to become sick.



The above are all real claims made against employers. Each is excluded from coverage under the general liability policy's provisions removing coverage for incidents arising out of the employment relationship.

Employers' liability is the answer. It's included in part two of the workers' compensation policy.



Claims are rare (though growing less so). Workers' compensation policies usually include limits for each accident, disease total limit, and disease for each employee.

Typical Limits for Employers' Liability:

Each Accident $100,000
Disease – Policy Limit $500,000
Disease – Each Employee $100,000.



Some umbrella insurers require higher limits of coverage:

Each Accident $500,000
Disease – Policy Limit $500,000
Disease – Each Employee $500,000

Insurance Agent's Commissions

Most insurance agents receive a commission on the sale of policies. No secret there.

If your agent doesn't get paid a commission (some are on salary), certainly your agency (the employer of your agent) gets a commission. Workers' compensation pays among the lowest commission rate of any insurance policy. It isn't uncommon for agents to get 2%. Average commission on business auto, property and liability insurance policies are closer to 15%. Many professional liability policies pay the agent 8% or 10%.

How Your Workers' Comp Premium is Calculated

An Excerpt From My Book, Simmonds on Workers' Compensation Insurance:

The workers' compensation insurance premium calculation is pretty straightforward. In short, the insurance company takes your payroll in the various classifications and multiplies it by a rate per $100 of remuneration.

If you have several different employment classifications on your policy, the above calculation will be done for each class.

Insurers may add surcharges or credits to the total before coming up with your final premium. Find out what credits your insurer has available. Ask what needs to be done so that you can qualify for maximum credits.

You may also have an experience modification, a ratio of expected losses to actual losses (more info on the experience mod can be found at www.ModManager.com

Most insurers have multiple rating plans – substandard, standard, and preferred. Ask your agent to identify your policy plan. Find out what needs to happen so you can qualify for a lower rate.