Types of Insurance

Insurance can be termed as a form of risk management which is mainly used to protect an individual against the risk of prospective financial loss, if any. Insurance can be used as a tool to shield an individual against potential risks like travel accidents, death, unemployment, theft, property destruction by natural calamities, fire mishaps etc
Different types of insurance is used to cover different properties and assets such as vehicles, home, health care etc. Basically, an insurance policy can also be known as a protection net which secures you from any financial losses in future. All you have to do is pay the insurance agencies a specified amount every month, known as premium, so that they can take care of you by providing you financial back up in case of a sudden health emergency or a fatal incident.
There are two ways for getting an insurance done.
One way is to visit an agent and consult him for the best option you can avail for your situation. And then, trust him/her for their suggestion on the type of insurance they feel is right for you.
The other way is to research and choose on your own, the type of insurance which will be best suited for your situation. You should research the market as well as the net, to look for the best insurance companies, and further more, the most suitable type of insurance that they offer.
Also explore the various types of policies which are available to you in the market, and then compare to decide which one to choose finally.

APPLIANCE PROTECTION

HOMEOWNERS' INSURANCE

The purpose of homeowners' insurance is to protect you against damage to your home and property from natural disasters.
Insurance companies offer different ratings of insurance and assign these ratings with codes starting with the letters "HO". While these ratings are fairly standard, they do vary a little with companies, so check with the company to see what policies cover.
When comparing policies, consider differences among deductible, coverage of property other than the house (sheds, garages, etc.), and percent of loss covered. Consider also whether the policy covers resale cost or rebuilding cost. Rebuilding usually provides better coverage, but is more expensive.
Basic homeowner's insurance does not cover the contents, though you can often add it for an additional fee or buy it separately. When buying contents insurance, consider whether it covers replacement value or fair market value. Replacement value is a better buy because it pays to buy a new piece of furniture or appliance, not what your old one is worth.
Consider also buying liability insurance which covers you if someone sustains an injury or other loss on your property.
Renters and condominium owners need only contents and possibly liability insurance. Many companies have policies tailored to these purposes.

AUTO INSURANCE

In most states you are required to have auto insurance and you don't want to be without it.
Basically, you buy auto insurance for two purposes: to insure against liability you have to others and to insure against damage that others do to you or your car.
You need to have liability insurance. How much you need depends on how much you have in assets.
Whether you need insurance to protect your own car depends on your car and how detesting it would be to replace it.
If your car is expensive and if buying another one would wipe you out financially, consider buying comprehensive and collision. If you have an older car and wouldn't get much from the insurance company if it were totaled, don't bother. Instead, put the money you would have paid for comprehensive and collision toward saving for your next car.

LIFE INSURANCE

For most people, the purpose of life insurance should be to replace the financial contribution made by a family member.
Life insurance can be pure insurance, which pays only on the death of the insured, or cash value insurance, which also has a savings vehicle. Most people who need life insurance are better off with pure insurance and saving for retirement through other vehicles.
Proceeds from life insurance cover three types of expenses: replacement of the policyholder's income or work, estate taxes, and burial costs. When you consider the amount of insurance to buy, consider the following:

1. Most of the life insurance should be on a family member whose salary is important to the family budget.

2. Consider a relatively small life insurance policy on a stay-at-home parent to cover child care and other expenses.

3. Don't buy life insurance on children. Instead, buy life insurance on other family members for the benefit of children.

4. Consider reducing the amount of life insurance you have as you build more financial assets.

5. Pass on credit life insurance and mortgage life insurance if you can. These plans are restrictive and expensive. Buy more general life insurance instead if you feel a need.


6. Pass on life insurance altogether if you are single and don't have anyone depending on you. At most, get a small policy to spare your family burial expenses.

You should buy about 12 times the amount of money you would need annually to replace what the family member is contributing. For example, if you would need $40,000 a year to replace the death of an employed member, you would need a $480,000 (rounded to $500,000) policy.

HEALTH INSURANCE

Don't go without this. Most people have it at work, but if you don't you will really save big by going for a group policy. When comparing policies, consider deductibles and what is or isn't covered. When given a choice, choose one that covers the huge, debilitating conditions over one that is good about routine immunization, but that balks at the larger, more expensive claims.
Health insurance comes in three types, though many policies mix and match traits of the three.
Fee for service, the most expensive, allows you to go to almost any provider and covers almost anything that is medically necessary. You don't have a primary care physician who has to approve visits to specialists.
Preferred provider options (PPO's) allow you to self-refer to any provider in the PPO's list and generally cover a wide variety of services recommenced by those providers. Some PPO's cover other providers, but with a larger co-payment.
Health maintenance organizations (HMO's) are the least costly, but the most restrictive. They assign you (or let you select) a primary care physician. That physician acts as a gatekeeper in that (s)he decides what is medically necessary and when you may see a specialist. Often the HMO itself has to permit certain treatment and can rule against your doctor if it thinks the treatment is too costly.

What to do after an accident?

The world we live in is full of unpredictable surprises - surprises that commonly destroy the lives of individuals, families and dependents. For example, in our country alone, over the last 12 months, more than 5000 people died in road accidents whereas more than 12000 people got injured as a result.
A good majority of these people had more than 4 dependents. Those of them who are not anymore have left behind a financially crippled family, those of them who are disabled, have become an additional burden of being a liability instead of a breadwinner. They, like us, thought that it would never happen to them. The fact of life is that it did..
Any body cannot prevent an accidental death nor cure a disability but it can help a victim’s family survive through their journey on life’s troubled waters. Family Guard is the solution to life’s unpredictabilities. It covers every aspect imaginable at an economical cost – structured by the product specialist from world’s renowned organization.What’s more, you are covered for 24 hours a day, year round –any where in the world! Take a look through its benefits, which can turn into income for yourself and your family when luck deals a band hand.

At any time, can I cancel my policy?

Yes. You can do this and we will return premium as per policy terms for the unexpiredPortion of the coverage period if there is no claim

Can I transfer any No Claim Bonus earned from any other Insurance Company?

Yes. No Claim Bonus earned from any other Insurance Company is honoured byNew Hampshire Insurance, if it is in your name.

How can my Premium Amount be reduced further?

Premium Amount can be further reduced through No Claim Bonus. If thereare no claims during the year, your premium will be reduced by 10% upon renewal.You can get the reduction upto 50% in 5 years.

What is the basis of premium rates to be charged for my car?

Premium rates that apply will be different based on makes, models and year of Manufacture of your car. The city in which you reside plays a role on the premium to be charged.

What is Automatic Non-Forfeiture Options?

If the policy has acquired a surrender value and a premium has remained unpaid beyond the grace period, the policyholder will entitled to benefits under one of the following two options given hereinafter, depending on the option exercised (if any) in his Proposal for this policy:
Option A : Automatic Paid-up
Option B : Automatic Premium Loan
Provided the surrender value of the policy exceeds the total of due premiums(s) remaining unpaid and any other amount owed to State Life. The option can be exercised at the time of taking the policy or at any time thereafter while the policy is in force. The option can be changed subsequently by written intimation to and endorsement in the policy by State Life, so long as no premiums remain unpaid beyond the grace period. If no option has been exercised by the policyholder, benefits under "automatic paid-up" option will apply.
A – Automatic paid-up Option
This policy will be converted into a paid-up policy. The paid-up Sum Insured will be specially calculated to allow for the clearance of all outstanding dues of State Life against the policy. No further premium(s) will be payable but the sum insured will be reduced. Any bonuses attached to the policy will be taken into consideration while determining the paid-up sum insured. A policy once paid-up will not be entitled to any further bonuses. If the specially calculated paid-up sum insured works out to be less than Rs.100/ the policy will not be converted into paid-up but will be treated as having been forfeited losing all its benefits. A policy thus made paid-up may be revived for full sum insured as per provision of condition No-4 above.
B – Automatic Premium Loan Option
So long as the net surrender value of the policy equals or exceeds any due premium remaining unpaid beyond its grace period, State Life will continue to keep this policy in full force, and treat the said premium as paid by creating an automatic premium loan against the net surrender value of the policy. When the net surrender value of the policy becomes less than a due premium remaining unpaid beyond its grace period, the policy will be kept in full force for a further broken period. This broken period will bear the same proportion to the full period of the unpaid premium as the net surrender value bears to the unpaid premium. The policy; will automatically be forfeited and lose all benefits at the expiry of the said broken period. Profit or return (however called or described) will be charged on automatic premium loan at rates determined by State Life from time to time, so long as any automatic premium loan along with profit or return (However called or described) is outstanding against this policy, any; payment received by State Life will first be applied to reduce this debt
carrer in insurance company

What is underwriting?

Underwriting of a risk involves consideration of material facts on the basis of which a decision will be taken whether to accept the risk and if so at what rate of premium.

What is reinsurance?

The very fundamental principle of spreading of the risk is actually practiced by the insurance companies by reinsuring the risks that they have insured.

What happens if the loan is not repaid?

If loan is not repaid during the term of the policy or early claim, the amount of loan plus profit or return, if any, will be deducted from the claim money and the balance amount will be paid to the person making the claim.

How to repay the loan amount?

A policyholder can repay the loan amount either in part or in full anytime during the term of the policy.

What is the rate of interest for the policy loan?

Currently State Life is charging 10% interest on policy loans. Interest is payable half-yearly.

What is the procedure to get a Loan?

The policyholder has to apply for loan in a prescribed form and submit the policy document with the form duly completed.

Who is eligible for Policy Loan?

Policyholders are eligible to take loan on their policies subject to certain rules and regulations.

What loans are available against life insurance policies?

At present loans are granted up to 80% of the Surrender Value for policies, where the premium due is fully paid-up. The rate of profit or return charged is 10% per annum compounded semiannually.

How is a life insurance policy useful?

Planning for the financial consequences of a premature death is an essential part of every financial plan. Generally, the consequences are simply too large to ignore and cannot be totally covered with your own resources.
Life insurance is nothing but a contract with an insurance company under which the insured (purchaser) pays a premium in exchange for coverage of specified losses. Life insurance protects your family against the risk of the premature death of you (or your spouse). Life insurance planning should consider your family's short-term needs (for example, medical expenses) and long-term needs (for example, replacing your income).
In the course of our life we are accosted by risk-that of failing health, financial losses, accidents and so on. Insurance is a means by which life's uncertainties are addressed in financial terms. It offers a monetary compensation against those losses. Insurance is considered more as a hedging mechanism rather than a true investment avenue. Life insurance, in particular is essentially acknowledged as a mechanism which eliminates risk substituting certainty for uncertainty primarily by transferring risk from the insured to the insurer.

Is life insurance a saving instrument?

Life insurance is mainly considered as a saving instrument rather than an investment avenue as it promotes compulsory savings besides protecting the family of the policyholder in the event of unforeseen happening. It is the only saving instrument, which covers the life risk. A loan can also be availed against the State Life insurance policies.

How are premiums on life policies calculated?

The calculation of life insurance premiums is primarily based on four factors – age of the person to be insured insured, type of policy, sum insured and term of the policy.

Can a lapsed policy be revived?

A lapsed policy can be revived within five years from the date of the first unpaid premium.

What happens if the policy document is lost?

The loss or destruction of a policy document does not in any way absolve the Corporation of the liability of payment of policy monies when the claim arises. If the policy is lost or destroyed, claim or sum insured will be paid to the claimant or policyholder after he or she furnishes an indemnity bond jointly with two sureties. Similarly, a policy can be surrendered even if the original policy document is lost. However, for the purpose of loan or survival benefit one has to obtain a duplicate policy. The policy being a legal document, the issue of duplicate policy involves the normal procedures like issuing a newspaper advertisement.

Can a policy be altered?

No alteration is permissible in the policy document - the evidence of contract, unless both the parties to the contract agree. After the policy is issued, a policyholder in a number of cases finds the terms not suitable to him or her and desires to change them to suit his or her convenience. State Life also realizes that insurance being a long-term contract, certain changes under given circumstances might necessitate an alteration of the contract. Keeping in view the basic principles of insurance and administrative convenience, State Life permits some alterations. As a rule, State Life will not permit alterations within the 1st year from the commencement of the policy.

How can a lapsed policy be revived?

A lapsed policy may be revived during the lifetime of the life insured, but within a period of 5 years from the due date of the first unpaid premium and before the date of maturity. Revival of a lapsed policy is considered either on non-medical or medical basis depending upon the age of the life insured at the time of revival and the sum to be revived.

When does a policy lapse?

When the premium is not paid within the days of grace provided after the due date, the policy lapses. The grace period in case of yearly, half-yearly and quarterly modes of payment is one month and in case of the monthly mode of payment, it is 15 days.

How do you effect a change of address and transfer of policy records?

When a policyholder wants to change his address in State Life’s records, notice of such change should be given to the zonal office servicing his policy. Policy records can be transferred from the zonal office that services the policy to any other zonal office nearest to the policyholder's place of residence. The correct address facilitates better services and quicker settlement of claims.

What is Nomination/ Assignment of a Policy?

When the policy money becomes due for payment on the death of the policyholder, it can be paid only to that person who is legally entitled to give a valid and effective discharge to the Corporation. If the policy bears nomination, the claim is settled in favour of the nominee. Similarly, if the policy is assigned, the assignee receives the claim amount. It should be noted that an assignment of a policy automatically cancels the existing nomination. Hence, when such a policy is reassigned in favour of the policyholder, it is necessary to make fresh nomination.

Whom is a death claim payable?

Death claim is usually payable to the nominee/ assignee or the legal successor, as the case may be. However, if the deceased policyholder has not nominated/ assigned the policy or not made a will, the claim is payable to the holder of a succession certificate or such evidence of title from a Court of Law.

What are the various modes of payment for premium?

Premiums other than single premiums can be paid by the policyholders to State Life in yearly, half-yearly, quarterly or monthly installments.

What are Survival Benefits?

In some policies, a part of the sum insured is paid to the policyholder in the form of Survival Benefits, at fixed intervals before the maturity date. The risk cover for life continues for the full sum insured even after payment of survival benefits and bonus is also calculated on the full sum insured. If the policyholder survives till the end of the term, the survival benefits will be deducted from maturity value.

What is Bonus?

State Life distributes its profits among it policyholders every year in the form of bonuses. Bonuses are credited to the account of the policyholders and paid at the time of maturity. Bonus is declared as a certain amount per thousand of sum assured.

Is there any policy where the insured gets no money at the time of maturity?

Yes, there are two policies on which you will not get any money on Maturity. These are Term Insurance by Annual Premium and Term Insurance by Single Premium.

What are the policies available for kids below the age of one year?

There are only two policies available for the newborn. These are Child Education and Marriage Assurance and Child Protection Assurance. Child Education and Marriage Assurance provides a lump sum benefit for the child at the completion of the policy term and also has a family income benefit in case of death of policyholder (Allah forbid). Child Protection Assurance is a joint life assurance and covers the lives of child and either of the parents. For these plans, age of the child should be above six months.

What are Medical and Non-Medical Schemes?

Life insurance is normally offered after a medical examination of the life to be insured. However, to facilitate greater spread of insurance and also as a measure of relaxation, State Life has been extending insurance cover without any medical examination, subject to certain conditions. This facility is called Non-medical Scheme.

What is an Annuity Scheme?

Annuity schemes are those wherein policyholders regular contributions over a period of time (or a one-time contribution) accumulate to form a pool with the insurance company. This pool is used to yield a regular income that is paid to policyholders until death starting from your desired age. Some annuity schemes have the option to pay your survivors a lump sum amount upon your death in addition to the regular income you receive while you are alive.

What is a Three Payment Plan?

It is an endowment policy for which a part of the sum insured is paid to the policyholder in the form of survival benefits, at fixed intervals, before the maturity date. The risk cover on the life continues for the full sum insured even after payment of survival benefits and bonus is also calculated on the full sum insured. If the policyholder survives till the end of the policy term, the survival benefits are deducted from the maturity value.

What is an Endowment policy?

An endowment life insurance policy is designed primarily to provide a living benefit. Therefore, it is more of an investment plan. Endowment life insurance pays the face value of the policy either at the time of death of the policyholder or at the time of maturity of the policy. The policy is a method of accumulating capital for a specific purpose and protecting this savings program against the saver's premature death. Many investors use endowment life insurance to fund anticipated financial needs, such as college education or retirement. Premium for an endowment life policy is higher than that of a whole life policy.

What is a Whole Life Policy?

These are the simplest policies to understand. You pay a fixed premium every year based on your age and other factors; you earn increases in the policy's surrender value as the years roll by and your beneficiaries get a fixed benefit after you die. The policy takes you into old age for the same premium you started out with. Whole life insurance policies are valuable because they provide permanent protection and accumulate surrender values that can be used for emergencies or to meet specific objectives. The surrender value gives you an extra source of retirement money if you need it.

Who can buy a life insurance policy?

Any person above 18 years of age, who is eligible to enter into a valid contract, can go for an insurance policy. Subject to certain conditions, a policy can be taken on the life of a spouse or children

Career Paths/Success Stories of few Marketing Executives

A Sales Representative having two years’ association and having fulfilled the laid down promotion criteria is elevated as Sales Officer. He has to pass in-house courses.
The Sales Officers completing the laid down promotion criteria of Sales Manager are upgraded as Sales Managers.
The field channel is paid basic commission and additional bonuses for quality and consistency. All the three channels are provided group insurance facility and the Sales Officers and Sales managers are allowed limited medical facility and on completion of pre-determined parameters, seating & allied facilities which include the office, office furniture etc.

How to become a Life Insurance Agent?

Dynamic young men and women of minimum 20 years of age holding National Identity Cards, having Matriculation certificate and capable to accept the challenges, can be appointed as Sales Representatives. They have to complete pre-determined performance standards. The candidates can approach the Zonal Offices or the Area Offices/Agency Offices spread over the nooks and corner of the country for selection.

Foundation Course (FC)

The Foundation Course is basic requirement in Insurance. Every field workers should be fully trained about the insurance products and should be able to assess needs of customers. According to the Ordinance, Agents operating in Life Insurance shall be required to complete a ‘Foundation Course’ of three months duration. The Foundation course contains following phases:

1)Classroom Training 10 days

2)On Job Training 80 days (Practical Field training under the supervision of Area Manager or Sector Head)

3)Total No. of days 90 days

Management Orientation Study Course (MOSC)

This course contains 17 units: Its duration now in 2006 is changed from 15 to 10 days. Following topics are covered under this course:

1)Planning and Management

2)Recruiting

3)Selection

4)Training

5)Supervision

Marketing Management Series (MMS)

This course comprises of 5 Modules, each module contains 5 units and total 25 units are included in this course. The normal duration of this course now changed from 25 to15 days, This course is conducted continuously for 15 days. Following Subjects are included in this course:


1) Recruiting for result

2) Selection for Success

3) Penetrating your Market

4) Improving Performance

5) Planning for Productivity

Professional Qualification

Actuarial Science

Actuarial science deals with risk management. A qualified professional in Actuarial science is called an Actuary. The Actuary is a business professional who uses mathematical skills to define, analyze and solve financial and social problems. In dealing with such problems, actuaries create and manage programs which reduce the adverse financial impact of the expected and unexpected events like illnesses, accidents, unemployment, loss of property or premature death.

Actuarial Training Scheme

Program for recruiting freshly qualified intermediate (pre-engineering) and A-level candidates as ‘Actuarial Trainees’. Based upon its requirements and vacancies available, State Life invites applications by advertising in all the leading daily news papers of the country. The criteria and procedure for selection is mentioned in the advertisement, which is strictly followed. Based upon the progress of the actuarial students, they are promoted to higher grades.

The Society of Actuaries USA and Institute of Actuaries, UK, both conduct examinations in Pakistan through their representatives. For examinations of both the professional bodies, the student has to put in personal efforts to pass the examinations through self-study.

Process of registration for the examinations of both the professional bodies is simple and every student has to register on his own. Admission to the UK Institute as a Student member is not automatic and the candidate needs to apply for the membership of the institute. Both these bodies offer discounts to the students of developing countries. You may write to these bodies in order to obtain discounts.

Chartered Insurance

Different qualifications offered by the Chartered Insurance Institute (CII), London, UK are valuable and accepted globally in insurance market. State Life also recognizes these qualifications and encourages its employees to pursue them. The CII offers following qualifications on earning prescribed number of credits:

• Certificate CII

• Diploma CII

• Associate CII

• Fellow CII

Life Management

Life Office Management Association (LOMA), USA offers different qualifications for management of life and health insurance. Most cardinal of these is Fellow, Life Management Institute (FLMI). State Life encourages its employees for pursuing these qualifications. For further details about different qualifications offered by LOMA, please log on to their website: www.loma.org

Is it necessary to have previous selling experienc...

Quite simply, the answer is "NO". Looking at the background of most successful persons, we find that they came from many walks of life and they had varied experience. What they do have in common, is an ambition to succeed and a determination to work hard for this success. With our training and guidance their natural talents have blossomed and they now lead a busy business life, enjoy high earnings and have more creative and fulfilling lifestyles. Previous experience is not necessary, but what is necessary is:

1) Graduation in any faculty.

2) A willingness to accept training and follow a proven, successful method of running your business.

3) The desire to succeed and the willingness to work hard to attain your ambition.

4) Complete honestly in your dealings with the public and with all colleagues within the Company.

5) A positive mental attitude.

Carrier Opportunities

1) Insurance companies is committed to a policy of equal employment opportunities and welcomes people irrespective of their race or gender. All appointments are made on the basis of merit and candidates are placed in jobs for which they are best suited.

2) They provide their employees with life-long employment and career growth. Their employee development and qualification enhancement program provides opportunity to talented people to grow and rise to the highest levels of management through a policy of promotion from within and continuous development. In return they ask for dedication, hard work and professionalism

3) They hold their employees in the highest esteem and they do all they can to increase their self-worth so that the employee can achieve fulfillment and full potential. Pay and performance are linked and rewards and recognition go to those who consistently outperform.

4) Work of all employees is directed through a comprehensive performance management system which interlocks business objective with individual goals, targets and work plans; evaluates results and achievements; provides feedback and counseling; and forms the basis for performance and potential review, merit, increases, salary position, career plans, training and development.

Car Insurance Quote Site Reviews

Online Car Insurance Quotes are a great demonstration of how the internet is changing the way we all do business. Gone are the days of visiting your local insurance agent and accepting whatever price you are quoted on auto insurance from the only company he maintains an agency relationship with. Today, competitive car insurance comparisons online allow consumers to quickly compare rates among various car insurance carriers with no obligation. You submit some basic information about your automobiles, driving history etc., and generally quotes from competing companies will be displayed instantly. If you wish to follow-up on a particular insurance rate quote, simply click on the link for that quote to make further inquiry. Car insurance has essentially become a commodity with states heavily regulating coverage options. Thus, there is no reason not to explore the savings you can get by comparing auto insurance quotes online.
We will be continuing to update the results of our quote requests throughout the remainder of the month. In our May update, we should have a complete report on which providers are currently offering the best service for getting car insurance quotes online. Stay Tuned.