More People Get Life Insurance After Terror

Author: Michael Challiner
Source: isnare.com

When the London bombings occurred on July 7th in 2005, many people felt a sense of unease and concern about living in Great Britain?s capital. There were reports that people were too frightened to use the underground train network and then of course there were many of those who knew the victims of the tragedy.

So it is no surprise that after the event has occurred, more people have chosen to take out life insurance policies. While insurance firms say that the number of people taking out Payment Protection Policies has been on the general decline over the years, the Association of British Insurers recently reported that the number buying life insurance products rose slightly last year.

In fact, life insurance was worth ?1 billion for the insurance industry in 2005. When asked the question whether the rise is due to an anxiety about terror threats, the ABI says that it could be the case.

Afterall, when the US terror attacks happened on 9/11/2001, the number of people taking out life insurance rose slightly the following year, reflecting the mood of the nation.

Unlike travel insurance policies, life insurance does not contain terrorism exclusions and so if you die as a result of a terror attack, the insurance firm will pay out on the claim. This would have most certainly been the case with respect to the victims of 7/7 in London.

However, the ABI says that group life insurance policies may contain these types of exclusions because of the accumulated risks that are possible in one location. What this means is that you need to read the terms and conditions of your policy because they can vary.

Even if more people do not take out life insurance as a direct result of terrorism, perhaps the threat makes them value their life more or think about what would happen to their family should they do become a victim of another sort of tragedy.

What Life Insurance does, is offer financial protection in the event of an early death if you have a family dependent on your earnings. But as well as this, it can also be a means of saving.

You can get endowment policies which you can pay premiums for an agreed number of years, say 15, then at the end of this time you can receive a lump sum. This is the sum insured together with bonuses. That is, if you take out a ?with-profits? policy. If you take out a policy called a Unit-Linked Endowment, the lump sum is the return of all money invested together with the investment growth. Even if you die before the maturity date, the insurance company will pay the sum insured or the value of the policy at the time, if it is greater.

Most policies have optional extras, such as the waiver of premiums if you are unable to pay them at such stage, or critical illness insurance. But what you need to remember is that a life insurance policy is a long term commitment so if an incident, such as a terror attack, does occur, your family is protected. It is not designed for you to cash in early. Brokers and financial advisers can off help deciding what policy you should take out. But never surrender a life insurance policy without taking out expert advice.

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Advantages and Disadvantages of Guaranteed Acceptance Life Insurance for Seniors

Author: Chris Simons
Source: articleage.com

Buying life insurance when you are a senior used to be a hard thing to do, but now there are many companies that offer Guaranteed Acceptance Life Insurance to people who would not otherwise be able to buy life insurance due to their age, health or financial situation. With Guaranteed Acceptance Life Insurance there is no physical exam requirements or questions about the applicants health. These plans usually have a limited benefit period. If the death of the policyholder occurs in the first few years a reduced benefit is paid, or the insurance company returns the premiums already paid with the accumulated interest. This is how insurance companies are able to guarantee acceptance.
There are a few disadvantages to guaranteed life insurance. Most of these types of policies are designed to provide only funeral expenses, so most do not sell policies with a benefit value of more than $15,000 to $20,000. The cost of guaranteed life insurance policies are also high, because the company has no other information but age and gender on which to base the premiums. These two disadvantages can make guaranteed life insurance very undesirable, especially since you can end up paying the insurance company more in premiums than the death benefit of the plan. That means that the insurance policy has a worse performance than a savings account. The National Association of Insurance Commissioners is actually looking into this problem to find out if anything should be done.
Guaranteed life insurance policies also have a feature called “Graded benefit period.” This protects the company from people signing up for insurance while on their deathbeds. This is done by writing into the policy that if the policyholder dies within a certain amount of time after the policy is taken out, the company only has to pay the premiums, plus the interest that that has accrued to the policyholder.
With all of these disadvantages in mind it is usually best to look for traditional insurance first, and take the physical exam and answer medical questions to find out if you can get insurance. If you can get traditional insurance you will most like pay much less for a greater amount of benefit than if you had bought guaranteed issue life insurance. If you have been turned away from every other policy because of health or age, guaranteed life insurance is a good option, but it should not be your first. Talk to a financial advisor and see if a savings or investment plan would be a better option.
Chris Simons is a prolific freelance writer. You are welcomed to visit http://life-insurance.cyberinformer.com, for more information on Life Insurance.