Examining Three Common Types of Insurance

Posted on June 26, 2007 @ 4:16 am

I was looking for information regarding insuring myself as well as my property.  I came across some valuable tips that I wanted to share with you all regarding three common types of insurance.

Return of Premium Term Life Insurance

Return of Premium Life Insurance refunds your premiums if you don’t die. A big objection to buying term life insurance is that people see themselves outliving the specified term and often think of the premiums as wasted money. As a result, the insurance industry has answered that objection with the recent introduction of Return of Premium term life insurance.

Return of Premium (ROP) term life insurance combines the benefits of traditional with a return of premium feature. Your family receives a lump sum death benefit if you die, otherwise the insurer returns all your premiums. For those in good health and those who feel that they are not at risk at dying during the term of the policy, this is definitely a good option.

Mortgage Insurance

Mortgage Insurance is sometimes required by lenders on lower down payment loans. This type of insurance protects the mortgage lender from defaults on your mortgage.  Borrowers are able to purchase homes that they wouldn’t otherwise be able to afford, due to high 20 percent down payment requirements by insuring their mortgage.

Private Mortgage Insurance (PMI) is insurance on your mortgage designed to protect your mortgage company should you not make your loan payments. This minimizes the lenders risk and may allow them to give you a better borrowing rate. Private mortgage insurance is frequently called for by mortgage companies because of the larger number of defaults that come with minimal down payment mortgages.

Vehicle Insurance

If your car is written off due to an accident, it’s your insurance company’s responsibility to provide you with an amount of money that would purchase an equivalent car. Truth be told, you may not receive what your vehicle is truly worth. They can use formulas and will often consider quotes from various dealers that aren’t always that attainable to determing your vehicles replacement cost. Every car is different, with things like condition, mileage, and repairs a factor in determining a vehicles replacement value. If the quote from your insurance company don’t seem reasonable, you may want to present them with some local quotes of your own. Be sure to keep a documented vehicle history as well, so you can present repair and maintenance receipts if there’s a dispute. Don’t forget to agree on the sales tax value on your replacement vehicle with your insurer – it is one of the most overlooked expenses in replacing your car.

The Money Alert is a well-known financial site covering insurance matters. Their popular Pet Insurance articles have been published by several publications throughout the United States. Please visit The Money Alert dot com to learn about insurance topics.

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