Economic times are especially tough for seniors today. Many have worked for years expecting a nice pension, just to have the rug pulled out from under them when the company folded or they just cut back on benefits. Others are forced to continue working well into their 70's and 80's. Some will never enjoy retirement. This is a sad situation. The good news is there is now a solution for those who own a home.
The reverse mortgage for seniors is a government regulated program that allows seniors who are 62 and older to draw upon the equity in their home to supplement their social security and pensions. The beauty of the reverse mortgage is that it does not have to be paid back until the senior dies, moves or sells the home. Credit is not an issue as the reverse mortgage is determined by the equity in the home and the age of the applicant. The money can be used for whatever you choose, including home repairs, college for grandchildren, vacation and travel, long-term care or anything else you may need it for.
In most cases, if it sound too good to be true, it is; however, read on to learn about this wonderful program designed for those who really deserve a break in today's tough economic times!
How does a Reverse Mortgage Work?
A reverse mortgage, AKA (HECM), Home-Equity Conversion Mortgage is a loan based on the equity in your home. You trade the equity for tax-free income from a lender. The lender pays you in monthly payments, a lump sum or an equity line of credit you can draw on as needed, or a combination of these options. You still own your home and you are required to maintain homeowner's insurance, pay the property taxes and keep the home in good repair.
The loan doesn't have to be repaid until the senior dies, moves out of the home, or sells the home. At this time, the lender is to be paid in full, including any interest that has accrued. Any proceeds go to you or your heirs. In the event your proceeds do not cover the amount owed or your total withdrawals exceed the value of your home, your lender will be protected from loss by the Federal Housing Authority (FHA) insurance.
Most people who is 62 or over can get a reverse mortgage if they have equity in their home. Most states require counseling to be sure you understand what you are doing and no one is taking advantage of you.
As stated earlier, credit is no issue; the amount you can borrow is based on the value of your home, current interest rates and your age. The limit you can borrow is about 80% of the equity in your home. The amount you can draw increases if the value of your home increases over time. The government sets a total limit on what you can borrow based on where you live. In 2007, the limit was between $200,160 and $362,790, per year, even if your home is worth considerably more.
Reverse mortgages are a great solution if your income is low and your home is valuable. To determine if this is a good idea for you, consider how long you will live in your home. Closing costs tend to be high with fees based on the value of your home and the limit on federally insured reverse mortgages in your area. If you plan to move within the next few years, a reverse mortgage would not be a good idea. Talk to your local mortgage specialist to see if you qualify for a reverse mortgage and if it is the right option for you.
Ted Lewicki, president of Pillar Mortgage Corporation, specializes in reverse mortgages and financial planning for seniors. Ted offers a unique plan called the senior care package which includes financial planning for long-term care. http://www.pillarmortgage.com/ services Oakland County, Michigan with many clients in Waterford, Pontiac, Rochester, Auburn Hills, West Bloomfield, Keego Harbor, Milford, White Lake, Walled Lake, Wixom and neighboring cities and communities.
Economic times are especially tough for seniors today. Many have worked for years expecting a nice pension, just to have the rug pulled out from under them when the company folded or they just cut back on benefits. Others are forced to continue working well into their 70's and 80's. Some will never enjoy retirement. This is a sad situation. The good news is there is now a solution for those who own a home.
The reverse mortgage for seniors is a government regulated program that allows seniors who are 62 and older to draw upon the equity in their home to supplement their social security and pensions. The beauty of the reverse mortgage is that it does not have to be paid back until the senior dies, moves or sells the home. Credit is not an issue as the reverse mortgage is determined by the equity in the home and the age of the applicant. The money can be used for whatever you choose, including home repairs, college for grandchildren, vacation and travel, long-term care or anything else you may need it for.
In most cases, if it sound too good to be true, it is; however, read on to learn about this wonderful program designed for those who really deserve a break in today's tough economic times!
How does a Reverse Mortgage Work?
A reverse mortgage, AKA (HECM), Home-Equity Conversion Mortgage is a loan based on the equity in your home. You trade the equity for tax-free income from a lender. The lender pays you in monthly payments, a lump sum or an equity line of credit you can draw on as needed, or a combination of these options. You still own your home and you are required to maintain homeowner's insurance, pay the property taxes and keep the home in good repair.
The loan doesn't have to be repaid until the senior dies, moves out of the home, or sells the home. At this time, the lender is to be paid in full, including any interest that has accrued. Any proceeds go to you or your heirs. In the event your proceeds do not cover the amount owed or your total withdrawals exceed the value of your home, your lender will be protected from loss by the Federal Housing Authority (FHA) insurance.
Most people who is 62 or over can get a reverse mortgage if they have equity in their home. Most states require counseling to be sure you understand what you are doing and no one is taking advantage of you.
As stated earlier, credit is no issue; the amount you can borrow is based on the value of your home, current interest rates and your age. The limit you can borrow is about 80% of the equity in your home. The amount you can draw increases if the value of your home increases over time. The government sets a total limit on what you can borrow based on where you live. In 2007, the limit was between $200,160 and $362,790, per year, even if your home is worth considerably more.
Reverse mortgages are a great solution if your income is low and your home is valuable. To determine if this is a good idea for you, consider how long you will live in your home. Closing costs tend to be high with fees based on the value of your home and the limit on federally insured reverse mortgages in your area. If you plan to move within the next few years, a reverse mortgage would not be a good idea. Talk to your local mortgage specialist to see if you qualify for a reverse mortgage and if it is the right option for you.
Ted Lewicki, president of Pillar Mortgage Corporation, specializes in reverse mortgages and financial planning for seniors. Ted offers a unique plan called the senior care package which includes financial planning for long-term care. http://www.pillarmortgage.com/ services Oakland County, Michigan with many clients in Waterford, Pontiac, Rochester, Auburn Hills, West Bloomfield, Keego Harbor, Milford, White Lake, Walled Lake, Wixom and neighboring cities and communities.
Life insurance is essential if you have a family that depends on you for financial support. Life insurance protects your loved ones if you die. You should consider purchasing a life insurance policy if you are married and your spouse depends on your income, you have children or an aging parent or disabled relative who depends on your financial support or if your savings and other assets are not sufficient for their support. Other good reasons to have life insurance are if you own a large estate and expect to owe estate taxes or if you own a business. Your surviving spouse will need legal council to handle the estate and an accountant to handle the business. Life insurance will provide the money to pay for the necessary professional services needed in this case.
Some jobs are riskier than others; below is a list of the 10 most dangerous jobs according to the Bureau of Labor Statistics:
Timber cutters
Airline pilots
Construction workers
Truck drivers
Farmers
Groundskeepers
Other Laborers
Police
Carpenters
Sales occupations
Contact your insurance agent to help determine the type and amount of life insurance coverage you need. They have worksheets and calculator tools, which are also available online to crunch the numbers and figure out how much is enough.
Shop around and compare various policies and benefits offered. Premium costs vary so get several quotes before choosing a package that fits your individual needs and your budget. Buying life insurance is the best way to protect your family if you die. The amount of coverage you need increases as your family grows. Life insurance provides the financial support your loved ones will need to replace your income, pay off debts and cover the expenses of settling your estate.
There are two basic types of life insurance. Term life insurance provides coverage for a specified period of time and is more affordable if your need for life insurance is temporary. Maybe you only need the coverage until your children are grown. Cash value life insurance provides a death benefit with a cash value and offers life time protection.
Term life insurance is usually offered for a period of time ranging from 1 to 30 years. For example, if you have young children and you need insurance to provide for them until they have grown and completed college, you will need about 15 - 20 years coverage.
The amount of coverage you need depends on how much income your family needs and how much debt you owe. Your insurance agent will use a life insurance needs calculator to determine this amount. The amount of the premiums will be determined by several factors including your age, health, life style, family medical history and the risk involved with your occupation.
Once you have decided which type of coverage you need, the next step is to submit an application. The application will contain questions about your current and past health history and lifestyle. You may be required to have a physical which is arranged and paid for by the insurance company. Your completed application and the results of your physical will help the insurance company determine whether or not to offer you life insurance and how much the premiums will be.
When you are issued a policy, it is important that you read it over and understand it. The reading can be tedious and the lingo can be confusing, but do not put this off. Read it and make a list of questions to ask your insurance agent. If necessary, meet with your agent and go over the policy to be sure it is what you intended to buy and that it covers your needs. Most states have laws requiring your insurance company to offer a period of at least 10 days to review your policy and to cancel it without penalty.
The most important thing to consider is how much coverage you need. This is also the most difficult part. Some advisors say to multiply your annual income by seven or to buy enough insurance to replace the income you expect to make between now and retirement. Others say to buy enough to cover your debt. Neither of these methods are the right answer. You need to take a complete inventory of all your finances and think about the amount your beneficiaries will need to maintain their lifestyle, also considering children, their college educations and inflation.
Your needs will continue to change as you have children or accumulate assets. If you own a home, your needs will change as you pay down the principal balance. It is important to review your coverage every 3 to 5 years to be sure you have enough coverage. You may even find that as time goes by and debts are paid that you will need less coverage at a lower premium cost.
Figuring out how much coverage you need is a very lengthy and very complicated process including short-term needs, long-term debts, family maintenance expenses, your existing resources, your total expenses and the future value of money.
Short-term needs include final expenses, outstanding debts and emergency expenses, including medical, hospital, funeral expenses, attorney fees, probate costs and outstanding taxes that will need to be paid. Outstanding debts include credit card balances, auto loans, college loans and other bills. Emergency expenses should be included in a cash reserve amount to cover unforeseen medical emergencies or major home repairs.
Long-term debts include your mortgage and college tuition for your children. This one can be difficult to calculate because you have no way of knowing where your children are going to attend college or what course of study they will be going into. The US Department of Education reports college costs to have risen about 5% annually.
Family maintenance expenses include child care, food, clothing, utility bills and transportation costs. These expenses change as your children grow. Child care will decrease as the amount needed for food and clothing increases. Also consider extra curricular school activities that they may be interested in, requiring the purchase of musical instruments, sports equipment and uniforms and field trip costs to name a few.
Add up the total short-term, long-term and maintenance expenses and keep this number handy for the next steps in determining life insurance needs.
Resources you have to meet these needs include savings, stocks, mutual funds, other investments, social security and any life insurance that may be offered by your employer. Only include liquid assets as selling the home or vehicles would mean altering your family's lifestyle, which is one of the things you want to avoid doing by having life insurance.
Subtract the amount of resources from the total you came up with earlier to determine the amount of life insurance you need. If the figure is very high and the premium is not within your budget, see where you can make adjustments. Remember, you will be reviewing this data every few years and making changes accordingly. You will also be calculating in the future value of money based on your investments, your returns and inflation.
Even if you are an expert in finance, accounting and economics, the amount of life insurance you need is a very complex number to calculate. Your insurance agent has tools and worksheets to help you come up with a program that suits your needs and fits your budget. Do some research, ask questions and educate yourself before purchasing life insurance. A competent insurance agent will have plenty of questions to ask you as well to help determine your individual needs. He will also be available to answer questions and concerns you may have in the future and to review your coverage needs as your life changes.
This article was written by Ted Lewicki, a Farmers Insurance agent located in Waterford, Michigan. Ted has been an insurance agent for nearly 50 years. He has been a member of the Better Business Bureau with no reported complaints. Ted interviews his clients to learn just what type of policy they need so that they are adequately covered in the event of an unfortunate accident where they may be sued. http://www.a-oneinsurance.com/ services Oakland County, Michigan with many clients in Waterford, Pontiac, Rochester, Auburn Hills, West Bloomfield, Keego Harbor, Milford, White Lake, Walled Lake, Wixom and neighboring cities and communities.
Congratulations on the purchase of your new home! Now that you're unpacked and settled in, you should think about evaluating your insurance needs. You probably already have homeowner's insurance as this was a requirement of your mortgage company, but is it enough to protect you? Get this business out of the way now and enjoy life in your new home.
Homeowner's Insurance:
You most likely have a mortgage on your home, so your lender required a certain amount of insurance coverage in the event of a loss. If your home were to burn to the ground, would you be able to write a check to cover the balance due on the mortgage or to rebuild? Of course not! This is just one reason you carry homeowner's insurance. The minimum coverage you must have to satisfy your lender is a policy in the amount of the appraised value or the purchase price of the home. But have you thought about your furniture, appliances, clothing and other belongings? How do you replace everything you own should there be a fire or theft? These are things to consider when purchasing homeowner's insurance. An experienced insurance agent will ask you about your assets and calculate how much additional coverage you need to be completely covered in the event of a total loss.
Flood Insurance:
Flood insurance is not covered under a standard homeowner's policy. Some people live in an area where lenders will require flood insurance. Even if it is not required, but you live in a low-lying area or near a lake or other large body of water, you may want to purchase additional flood insurance. Flood insurance is for weather or nature related flooding. Your standard policy should cover flood damage if, for example, you're on vacation, your furnace fails and your pipes freeze and burst. But you may not be covered if your finished basement is flooded due to excessive rain. Be sure to ask your insurance agent about this.
Auto Insurance:
The law requires everyone to carry a minimum amount of auto insurance to cover damages and injuries caused to others in the event of an accident. If your car is financed, the financial institution will recover full coverage so that the loan paid if the car is wrecked beyond repair. But, if you are in a very serious accident causing major damage, injury or death and it is determined to be caused by your negligence, you may not be adequately covered. If you are sued, you stand a chance to lose everything, including your home, business and other valuables you may own. Now that you have purchased a new home, it is a good idea to evaluate all your insurance coverage to be sure you are protected. You may need to purchase an additional umbrella policy to protect your assets should damages exceed the coverage limits of your current auto and homeowner's policy.
Disability Insurance:
What if you become ill or are injured and unable to work? How would you pay your mortgage payment? Disability insurance will pay you a monthly benefit to replace a portion of your income until you are able to work again. Many employers provide disability insurance to their employees. If you are self-employed or do not have this benefit where you work, you may want to purchase additional coverage.
Life Insurance:
If you are the head of the household and the primary wage earner you should consider purchasing life insurance to protect your family and home if you should die. Life insurance can help provide for your family, paying off debts and replacing a portion of your income to take care of their needs. Some employers provide life insurance, but it might not be enough to provide financial security to your family.
A lot of the above insurance categories are optional; many are nice to have if it fits into your budget. A couple of newlyweds may not think about all these needs, but as your family grows, so do your financial needs. Be sure to consult your insurance agent to discuss your insurance needs now and in the future as you accumulate additional assets or have children. If you should get a large pay raise or a promotion at your job, consider using some of the extra money to purchase additional insurance coverage.
This article was written by Ted Lewicki, a Farmers Insurance agent located in Waterford, Michigan. Ted has been an insurance agent for nearly 50 years. He has been a member of the Better Business Bureau with no reported complaints. Ted interviews his clients to learn just what type of policy they need so that they are adequately covered in the event of an unfortunate accident where they may be sued. http://www.a-oneinsurance.com/ services Oakland County, Michigan with many clients in Waterford, Pontiac, Rochester, Auburn Hills, West Bloomfield, Keego Harbor, Milford, White Lake, Walled Lake, Wixom and neighboring cities and communities.
Insurance, home Insurance, auto Insurance, life Insurance, health insurance, annuities, liability insurance, motor cycle insurance, boat insurance
Congratulations on the purchase of your new home! Now that you're unpacked and settled in, you should think about evaluating your insurance needs. You probably already have homeowner's insurance as this was a requirement of your mortgage company, but is it enough to protect you? Get this business out of the way now and enjoy life in your new home.
Homeowner's Insurance:
You most likely have a mortgage on your home, so your lender required a certain amount of insurance coverage in the event of a loss. If your home were to burn to the ground, would you be able to write a check to cover the balance due on the mortgage or to rebuild? Of course not! This is just one reason you carry homeowner's insurance. The minimum coverage you must have to satisfy your lender is a policy in the amount of the appraised value or the purchase price of the home. But have you thought about your furniture, appliances, clothing and other belongings? How do you replace everything you own should there be a fire or theft? These are things to consider when purchasing homeowner's insurance. An experienced insurance agent will ask you about your assets and calculate how much additional coverage you need to be completely covered in the event of a total loss.
Flood Insurance:
Flood insurance is not covered under a standard homeowner's policy. Some people live in an area where lenders will require flood insurance. Even if it is not required, but you live in a low-lying area or near a lake or other large body of water, you may want to purchase additional flood insurance. Flood insurance is for weather or nature related flooding. Your standard policy should cover flood damage if, for example, you're on vacation, your furnace fails and your pipes freeze and burst. But you may not be covered if your finished basement is flooded due to excessive rain. Be sure to ask your insurance agent about this.
Auto Insurance:
The law requires everyone to carry a minimum amount of auto insurance to cover damages and injuries caused to others in the event of an accident. If your car is financed, the financial institution will recover full coverage so that the loan paid if the car is wrecked beyond repair. But, if you are in a very serious accident causing major damage, injury or death and it is determined to be caused by your negligence, you may not be adequately covered. If you are sued, you stand a chance to lose everything, including your home, business and other valuables you may own. Now that you have purchased a new home, it is a good idea to evaluate all your insurance coverage to be sure you are protected. You may need to purchase an additional umbrella policy to protect your assets should damages exceed the coverage limits of your current auto and homeowner's policy.
Disability Insurance:
What if you become ill or are injured and unable to work? How would you pay your mortgage payment? Disability insurance will pay you a monthly benefit to replace a portion of your income until you are able to work again. Many employers provide disability insurance to their employees. If you are self-employed or do not have this benefit where you work, you may want to purchase additional coverage.
Life Insurance:
If you are the head of the household and the primary wage earner you should consider purchasing life insurance to protect your family and home if you should die. Life insurance can help provide for your family, paying off debts and replacing a portion of your income to take care of their needs. Some employers provide life insurance, but it might not be enough to provide financial security to your family.
A lot of the above insurance categories are optional; many are nice to have if it fits into your budget. A couple of newlyweds may not think about all these needs, but as your family grows, so do your financial needs. Be sure to consult your insurance agent to discuss your insurance needs now and in the future as you accumulate additional assets or have children. If you should get a large pay raise or a promotion at your job, consider using some of the extra money to purchase additional insurance coverage.
This article was written by Ted Lewicki, a Farmers Insurance agent located in Waterford, Michigan. Ted has been an insurance agent for nearly 50 years. He has been a member of the Better Business Bureau with no reported complaints. Ted interviews his clients to learn just what type of policy they need so that they are adequately covered in the event of an unfortunate accident where they may be sued. http://www.a-oneinsurance.com/ services Oakland County, Michigan with many clients in Waterford, Pontiac, Rochester, Auburn Hills, West Bloomfield, Keego Harbor, Milford, White Lake, Walled Lake, Wixom and neighboring cities and communities.
Insurance, home Insurance, auto Insurance, life Insurance, health insurance, annuities, liability insurance, motor cycle insurance, boat insurance
Your home is one of the largest investments you will ever make. Homeowner's Insurance is essential for protecting your investment. It is also important that you have adequate liability coverage to protect all of your other assets as well.
Basic Coverage:
A standard homeowner's policy will cover damage to your home and contents caused by fire and smoke, ice and snow, lightening, theft and frozen pipes. Your policy will also cover you in the event of liability claims if someone is hurt on your property, medical payments to third parties, and legal costs should you be sued. Most people have $100,000 - $300,000 in liability coverage on their homes; however, the very wealthy sometimes carry more as they have more to lose in the event of a lawsuit.
Additional Coverage:
You should read your policy carefully to find out exactly what is covered so you're not caught by surprise when you file a claim and it is denied. Most standard insurance policies do not cover damages caused by floods, earthquakes, war & terrorism and nuclear accidents. You may be able to purchase additional coverage for these items.
Other Valuables:
If you own a lot of valuable jewelry, such as an engagement ring or other valuables like antiques or furs, you will need to have these items appraised and itemized on your insurance policy in order for them to be covered in the event of a fire or theft.
How Much Coverage is Necessary?
Mortgage lenders require a minimum amount of coverage equal to the appraised value or the purchase price of the home; however, this is just for their protection. You may need additional coverage for your home and its contents. You should ask for replacement cost coverage to adequately protect your assets. Otherwise, you may just receive the actual cash value less depreciation for the years you owned the item. Replacement cost coverage provides the amount needed to replace the lost item today, regardless of how long you've owned it.
Discounts on Coverage:
There are several types of discounts you can get on homeowner's insurance premiums. One common discount is if you carry multiple policies with the same company, such as auto insurance, investment property insurance, life and health insurance. Many insurance companies give a discount for having good credit or if you have a home security system. A discount could also be offered if the occupants of your home are non-smokers, or if you live close to a fire department or fire hydrant. Some insurance providers offer discounts if you own a newer home or one that is built out of fire-resistant materials.
Shop Around:
If you are a first time home buyer, you probably have a lot to learn about homeowner's insurance. It's a good idea to shop around and get several quotes so you will have an idea of how much you should be spending. Annual insurance premiums vary from company to company and also from one neighborhood to another. A home located in a high-crime, urban area may cost more to insure than one in a more rural area where there is less crime. Don't necessarily go with the cheapest price; be sure you are getting the coverage you need. Also, check with your state's department of insurance to make sure the company you're dealing with has a good reputation in the industry.
A good insurance agent will interview you, the client, to determine just how much coverage you need. Many will come to your home to evaluate your needs and take photos. Be sure to ask the appropriate questions about coverage and read your policy carefully to be sure you are adequately covered. Do not simply take the word of your agent as mistakes could be made in processing your policy. Your agent should continue to be available to answer any concerns you may have once your policy is written. It is not difficult to upgrade when necessary. Also, be sure to review your coverage from time to time as you accumulate more assets or your home increases in value.
This article was written by Ted Lewicki, a Farmers Insurance agent located in Waterford, Michigan. Ted has been an insurance agent for nearly 50 years. He has been a member of the Better Business Bureau with no reported complaints. Ted interviews his clients to learn just what type of policy they need so that they are adequately covered in the event of an unfortunate accident where they may be sued. http://www.a-oneinsurance.com/ services Oakland County, Michigan with many clients in Waterford, Pontiac, Rochester, Auburn Hills, West Bloomfield, Keego Harbor, Milford, White Lake, Walled Lake, Wixom and neighboring cities and communities.
The cost of health insurance has gone up significantly over the last decade, making it difficult if not impossible for smaller businesses to provide health care plans for employees. There are several types of health plans available, including HMO's, PPO's and POS plans. Some larger companies are able to offer their employees a choice of health plans or insurers where smaller companies are only able to offer one.
Here is an overview of the common types of health care plans:
HMO - Health Maintenance Organization
HMO's are generally the least expensive health care plan, but they are also the least flexible, requiring you to visit only those doctors who are in your HMO network. With these plans, you elect a primary care physician who is a part of the network. The primary care physician is your main health care provider and he has to give you a referral in order for you to see a specialist when necessary. This type of coverage requires a monthly premium and a co-pay of $5 - $10 for each doctor visit.
Prescription coverage varies and the percentage of prescription cost covered by the HMO is decided upon by the employer. The amount paid by the employee can be anywhere from a $5 co-pay on some drugs to a larger co-pay of almost the entire amount for others. It all depends on the plan that is worked out by the employer.
An HMO cannot require referrals for emergency care. They are required by law to cover emergency room visits; this is the only care they will cover without a referral from your primary care physician.
PPO - Preferred Provider Organization
A PPO is a more flexible plan than an HMO, allowing you to choose the doctor your visit. They do not require a referral from your primary care physician to visit a specialist, but the premium is generally higher for this type of plan. If you should visit a physician outside your network, you might have to pay for the treatment and file a claim with the PPO insurance provider for a partial reimbursement, generally up to 80%.
POS - Point of Service Plan
The characteristics of this type of plan are a blend of the HMO and PPO plans. You will be required to choose a primary care provider from the associated network. If you should visit a doctor outside of the network, you may be required to pay for the treatment yourself, unless you are referred by your primary care physician. In this case, the health plan will pay.
The insurance plan offered by an employer depends on the size of the company and the number of employees they have. The cost and flexibility of the plans vary. Usually the most flexible plan comes with a higher premium. If you have recently changed jobs and have new insurance coverage, you may end up having to change doctors if your doctor is not within the network of physicians who can accept your insurance.
This article was written by Ted Lewicki, a Farmers Insurance Agent who represents several insurance companies. Ted has been in the insurance business for nearly 50 years; he has been a member of the Better Business Bureau with no reported complaints. He is always available when his customers have questions or concerns or they need to review their insurance coverage. http://www.a-oneinsurance.com/ services Oakland County, Michigan with many clients in Waterford, Pontiac, Rochester, Auburn Hills, West Bloomfield, Keego Harbor, Milford, White Lake, Walled Lake, Wixom and neighboring cities and communities.
Long-term care, Senior Care Package, Family care package, Financial Planning, home Insurance, auto Insurance, life Insurance, health insurance, Insurance, annuities, liability insurance, motor cycle insurance, boat insurance
The cost of health insurance has gone up significantly over the last decade, making it difficult if not impossible for smaller businesses to provide health care plans for employees. There are several types of health plans available, including HMO's, PPO's and POS plans. Some larger companies are able to offer their employees a choice of health plans or insurers where smaller companies are only able to offer one.
Here is an overview of the common types of health care plans:
HMO - Health Maintenance Organization
HMO's are generally the least expensive health care plan, but they are also the least flexible, requiring you to visit only those doctors who are in your HMO network. With these plans, you elect a primary care physician who is a part of the network. The primary care physician is your main health care provider and he has to give you a referral in order for you to see a specialist when necessary. This type of coverage requires a monthly premium and a co-pay of $5 - $10 for each doctor visit.
Prescription coverage varies and the percentage of prescription cost covered by the HMO is decided upon by the employer. The amount paid by the employee can be anywhere from a $5 co-pay on some drugs to a larger co-pay of almost the entire amount for others. It all depends on the plan that is worked out by the employer.
An HMO cannot require referrals for emergency care. They are required by law to cover emergency room visits; this is the only care they will cover without a referral from your primary care physician.
PPO - Preferred Provider Organization
A PPO is a more flexible plan than an HMO, allowing you to choose the doctor your visit. They do not require a referral from your primary care physician to visit a specialist, but the premium is generally higher for this type of plan. If you should visit a physician outside your network, you might have to pay for the treatment and file a claim with the PPO insurance provider for a partial reimbursement, generally up to 80%.
POS - Point of Service Plan
The characteristics of this type of plan are a blend of the HMO and PPO plans. You will be required to choose a primary care provider from the associated network. If you should visit a doctor outside of the network, you may be required to pay for the treatment yourself, unless you are referred by your primary care physician. In this case, the health plan will pay.
The insurance plan offered by an employer depends on the size of the company and the number of employees they have. The cost and flexibility of the plans vary. Usually the most flexible plan comes with a higher premium. If you have recently changed jobs and have new insurance coverage, you may end up having to change doctors if your doctor is not within the network of physicians who can accept your insurance.
This article was written by Ted Lewicki, a Farmers Insurance Agent who represents several insurance companies. Ted has been in the insurance business for nearly 50 years; he has been a member of the Better Business Bureau with no reported complaints. He is always available when his customers have questions or concerns or they need to review their insurance coverage. http://www.a-oneinsurance.com/ services Oakland County, Michigan with many clients in Waterford, Pontiac, Rochester, Auburn Hills, West Bloomfield, Keego Harbor, Milford, White Lake, Walled Lake, Wixom and neighboring cities and communities.
Long-term care, Senior Care Package, Family care package, Financial Planning, home Insurance, auto Insurance, life Insurance, health insurance, Insurance, annuities, liability insurance, motor cycle insurance, boat insurance
The cost of health insurance has gone up significantly over the last decade, making it difficult if not impossible for smaller businesses to provide health care plans for employees. There are several types of health plans available, including HMO's, PPO's and POS plans. Some larger companies are able to offer their employees a choice of health plans or insurers where smaller companies are only able to offer one.
Here is an overview of the common types of health care plans:
HMO - Health Maintenance Organization
HMO's are generally the least expensive health care plan, but they are also the least flexible, requiring you to visit only those doctors who are in your HMO network. With these plans, you elect a primary care physician who is a part of the network. The primary care physician is your main health care provider and he has to give you a referral in order for you to see a specialist when necessary. This type of coverage requires a monthly premium and a co-pay of $5 - $10 for each doctor visit.
Prescription coverage varies and the percentage of prescription cost covered by the HMO is decided upon by the employer. The amount paid by the employee can be anywhere from a $5 co-pay on some drugs to a larger co-pay of almost the entire amount for others. It all depends on the plan that is worked out by the employer.
An HMO cannot require referrals for emergency care. They are required by law to cover emergency room visits; this is the only care they will cover without a referral from your primary care physician.
PPO - Preferred Provider Organization
A PPO is a more flexible plan than an HMO, allowing you to choose the doctor your visit. They do not require a referral from your primary care physician to visit a specialist, but the premium is generally higher for this type of plan. If you should visit a physician outside your network, you might have to pay for the treatment and file a claim with the PPO insurance provider for a partial reimbursement, generally up to 80%.
POS - Point of Service Plan
The characteristics of this type of plan are a blend of the HMO and PPO plans. You will be required to choose a primary care provider from the associated network. If you should visit a doctor outside of the network, you may be required to pay for the treatment yourself, unless you are referred by your primary care physician. In this case, the health plan will pay.
The insurance plan offered by an employer depends on the size of the company and the number of employees they have. The cost and flexibility of the plans vary. Usually the most flexible plan comes with a higher premium. If you have recently changed jobs and have new insurance coverage, you may end up having to change doctors if your doctor is not within the network of physicians who can accept your insurance.
This article was written by Ted Lewicki, a Farmers Insurance Agent who represents several insurance companies. Ted has been in the insurance business for nearly 50 years; he has been a member of the Better Business Bureau with no reported complaints. He is always available when his customers have questions or concerns or they need to review their insurance coverage. http://www.a-oneinsurance.com/ services Oakland County, Michigan with many clients in Waterford, Pontiac, Rochester, Auburn Hills, West Bloomfield, Keego Harbor, Milford, White Lake, Walled Lake, Wixom and neighboring cities and communities.
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With the price of health care, insurance is a necessity. The cost of medical care is rising rapidly and few people are able to afford this luxury without insurance.
Types of Health Insurance Coverage:
Two common categories of health plans are indemnity plans and managed care plans such as health maintenance organizations (HMO's) and preferred provider organizations (PPO's) and point of service (POS) plans.
An indemnity plan offers the option of choosing your own doctors. They pay for your medical expenses, in full, in part, or up to a specified amount per day for a certain number of days.
Managed care plan provide broader coverage, but involve an arrangement between the insurer and a selected network of health-care providers. An HMO will require that a primary care physician coordinate all of your care, referring you to other specialists within their network, when necessary.
Whichever type of plan you choose to buy depends on your individual health care needs and your budget.
What costs are covered?
Health insurance plans vary, so you will want to ask questions and discuss your health care needs with your insurance agent. When comparing insurance plans, be sure to find out if they provide additional benefits that you may need, including prescription drugs, preventative care, mental health, maternity care and vision to name a few.
Out-of-Pocket costs:
In addition to the monthly premiums, you may have other associated costs like co-payments, coinsurance and deductibles. A co-payment is the amount you pay each time you visit the doctor or have a prescription filled. This is generally an amount much smaller than what it would be without insurance coverage. The deductible is the amount you pay toward your medical expenses during a one-year time before the insurance company picks up any costs. Coinsurance is the percentage of your medical costs that you pay after you have paid any deductibles.
Obtaining Health Insurance:
Some employers offer a group plan or you may belong to another affiliation such as a school or club. When these options are not available, you must purchase private health care. You can talk to your insurance agent about customizing an individual plan that meets your needs and fits your budget.
You want to look for a plan that offers the flexibility and benefits you need at the lowest cost. Like any major purchase, it is a good idea to shop around and get several quotes. Here are some questions you will want to ask:
What are the cost of co-pays, deductibles and coinsurance?
Does the plan offer the freedom to choose your own doctor?
Does the plan cover the medical and health services you need?
Is the insurance accepted by your current health care provider?
Is family coverage available?
Will the policy cover pre-existing conditions?
Is there a waiting period? How long is the waiting period?
Is it a requirement to have a complete physical first?
If you're a smoker, will this have an effect the cost of premiums?
Also check with your state's department of insurance for information about the reputation of the insurance company. Regardless of which company or plan you choose, it's no good if your insurance provider is constantly refusing claims.
Cutting the cost of medical bills is a sure way to cut the cost of insurance. A healthy lifestyle is obviously the most effective way of cutting down on medical expenses. Take advantage of programs that offer free or reduced health screenings. Exercise regularly, eat right, have regular check-ups and avoid bad habits like excessive drinking and smoking.
If you take prescription drugs regularly, see if a three-month supply will save you money. Check online resources for ordering prescriptions through the mail instead of going to the pharmacy. Request a generic equivalence of your prescription when possible. Some pharmacists provide generic drugs automatically unless you or your doctor specifies different.
Carefully read your medical statements to be sure you are only paying for the services received. This is important even if your insurance covers the cost. You can help keep your premiums down by making sure your insurance company is not billed for a procedure you did not receive. Call your medical provider if you have any questions about your statement. If you don't get satisfactory answers, have your insurance company review your claim.
Married couples can save by being on the same plan rather than maintaining separate insurance. Most plans allow you to add your spouse within 30 days of getting married. Some will make you wait until the annual open enrollment period to make this change.
Keep track of your medical expenses; many of them are tax deductible if you itemize. Allowable medical expenses include doctor bills, eye care, prescriptions, lab fees, dental costs, hearing aids and other medical supplies.
If your insurance plan is limited or you don't have insurance, check with your medical provider, local clinics and hospitals to see about free health screenings such as cholesterol tests, eye exams, mammograms and cholesterol testing. Many of these are only offered once a year but it can't hurt to ask.
Some insurance companies cover preventative care such as annual check ups to help you stay healthy, therefore, requiring less in expensive procedures and treatments. Ask if they provide for discounts on vitamins or health club memberships. It also doesn't hurt to negotiate with doctors on their fees, especially if you have no insurance. Many doctors offer a courtesy adjustment to people who do not have insurance.
Insurance can be very expensive; so can medical care. Shop around, ask questions and live a healthy lifestyle to prevent health problems and save money on medical costs. Even if you have the best health coverage available, it's a good idea to stay healthy and avoid medical procedures that can be just as miserable physically as they are financially.
This article was written by Ted Lewicki, a Farmers Insurance Agent who represents several insurance companies. Ted has been in the insurance business for nearly 50 years; he has been a member of the Better Business Bureau with no reported complaints. He is always available when his customers have questions or concerns or they need to review their insurance coverage. http://www.a-oneinsurance.com/ services Oakland County, Michigan with many clients in Waterford, Pontiac, Rochester, Auburn Hills, West Bloomfield, Keego Harbor, Milford, White Lake, Walled Lake, Wixom and neighboring cities and communities.
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Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
Life insurance is essential if you have a family that depends on you for financial support. Life insurance protects your loved ones if you die. You should consider purchasing a life insurance policy if you are married and your spouse depends on your income, you have children or an aging parent or disabled relative who depends on your financial support or if your savings and other assets are not sufficient for their support. Other good reasons to have life insurance are if you own a large estate and expect to owe estate taxes or if you own a business. Your surviving spouse will need legal council to handle the estate and an accountant to handle the business. Life insurance will provide the money to pay for the necessary professional services needed in this case.
Congratulations on the purchase of your new home! Now that you're unpacked and settled in, you should think about evaluating your insurance needs. You probably already have homeowner's insurance as this was a requirement of your mortgage company, but is it enough to protect you? Get this business out of the way now and enjoy life in your new home. 
With the price of health care, insurance is a necessity. The cost of medical care is rising rapidly and few people are able to afford this luxury without insurance. 
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