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What is life insurance?
Life insurance is a contract, often called a “policy”,
between you and an insurance company to provide money to a person
you designate, in the event that you die during the time the contract
is in force. In essence, during your lifetime you pay money, known
as the insurance “premium”, to the insurance company.
It promises to pay money to the persons you name, the “beneficiaries”,
at your death. Some types of life insurance also give the policy
owner the right to “borrow” a portion of the “cash
value” within a policy, or to receive an “accelerated
death benefit” if you become terminally ill or require confinement
in a long term care facility.
What is term insurance?
Term life insurance is insurance that lasts for a specific time,
such as 5 years or 10 years. The policy pays a death benefit in
the event the insured dies during the specified period. Since term
insurance is for a limited period and accumulates no cash value,
the rates tend to be low for a given amount of insurance.
What is the cost of life insurance?
We need some basic information to obtain a quote. Premiums are based
on factors such as age, tobacco use, height and weight and your
general health. Most companies have several rating levels based
on your individual statistics.
I’m not sure I can afford life insurance right now, can
I wait?
Generally speaking it’s not a good idea to wait to purchase
life insurance. It is always possible that by waiting your health
or occupation could disqualify you for coverage or for standard
rates. It is best to purchase at the very least a small policy while
you are young and you are in good health.
There are so many different health plans out there. What does
all of those letters – HMO, PPO, POS, mean?
HMO – An HMO (Health Maintenance Organization)
is an organization that provides or arranges for coverage of
certain health care services required by members of
the organization. Typical HMO coverages include access to a
primary care physician, emergency care and specialists/hospitalization
when needed.
PPO – PPO (Preferred Provider Organization) is
a form of managed care under which health care providers
contract to provide medical services at pre-negotiated
rates. Members who subscribe to a PPO are required to use
the health care provides who participate in the PPO
network – utilization of a health care provider outside the
PPO
network may result in the member paying more out-of-pocket
for services which could have been provided within the
network.
POS – POS (Point of Service) plans allow the
individual policy holder or certificate holder to visit out-of-network,
non-participating doctors for a fee. If the services
of a non-participating health care provider are utilized, the
individual often obtains restrictions of benefits or
incurs more out-of-pocket costs.
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For more information, email us at life@sternergroup.com
or give us a call at 800.416.9138 |
