Despite the devastation the pandemic has caused over the past year, perhaps there is a silver lining to be found in COVID-19’s dark clouds. Mortality and financial wellness have been brought into sharp focus, resulting in more people seeking life insurance coverage to protect their families.
Thirty-one percent of Americans now say they are more likely to buy life insurance,* up from just 11% in 2011. However, a common misconception around life insurance affordability persists — the majority of people overestimate the cost of life insurance by as much as three times the actual cost. This misconception, combined with a tendency to prioritize other financial needs, leaves too many families vulnerable to financial hardship if a loved one unexpectedly passes away.
Of the two main types of life insurance — term and permanent* — term insurance can be an attractive option to many due to its affordability. With the help of term insurance, families can afford to make sure they will be able to maintain their lifestyle and keep their dreams within reach even if a family wage earner dies.
Greater accessibility and speed make buying term insurance easier today* than it was in the past. Many companies have expanded their suite of online tools and resources to offer an accelerated application process, faster underwriting, and more efficient application processing.
Term insurance can also be a central pillar of a long-term financial plan. It can lock in your insurability — the ability to qualify for insurance — at the same time it locks in affordable death benefit protection for a set period of time.
A closer look at locking in future insurability with a term life insurance policy reveals three significant benefits.
Protection through health changes. As people age, they are more likely to develop health problems that could make life insurance more expensive or even disqualifying. Many term life policies have a conversion feature, which allows a policyholder to convert their term policy to a permanent policy before it expires without going through another medical exam, regardless of health changes. This ability to lock in insurability is advantageous given the many health changes you might experience throughout your life.
Protection through job changes. Ten percent of workers lost employer-provided life insurance coverage as a result of the pandemic. Even those with employer-provided group coverage often overlook the employee-paid, Optional Term Life plans during open enrollment, leaving them with inadequate protection. While it’s ideal to have a combination of coverage individually and through your employer, term insurance offers higher levels of coverage and more stability during employment disruptions.
Protection against debt and final expenses. Americans are currently carrying approximately $14.35 trillion in mortgage and non-mortgage debt. Life insurance can help your loved ones pay off debts while maintaining their lifestyle and forging ahead in pursuit of their hopes and dreams.
Want to know more about Term Life Insurance or ready to get started? Give USA Mutual Insurance a call at 718-285-6500 to speak with a Life Insurance Professional.
As a small-business owner or partner, you may wonder what would happen to your business should anything happen to you. How would your family cope with the loss of income? What about your employees and their families? What happens when a business has debts that are backed by assets like the family home?
You’ve probably planned for some of these questions, but before you take that leap of faith, take a look at these common myths and consider a reality check.
Here’s where life insurance comes in. Three important ways that life insurance can protect your small business include:
Give the team at USA Mutual Insurance a call at 718-285-6500 to schedule an appointment with a Life Insurance Professional to help guide you through the best policy options to help protect you and your business.
What type of insurance do I need to run my business? This is one of the most common questions that new businesses ask themselves when they are looking for ways to protect their company. There are many different types of coverages, so it can be difficult to know where to start. Here is a list of some basic coverages every business should consider:
Property insurance protects your business property. This can include the building you are in, equipment and machinery that is used to run your business, as well as any inventory or supplies you have on hand. If anything was ever destroyed due to fire or other natural disasters, you would be reimbursed for the cost of replacing what was destroyed.
Liability insurance protects your business in case someone gets injured on your premises or claims that they were injured due to something used in your business. This can include a customer slipping and falling, being burned by a hot oven, etc. It also includes product liability coverage in case a customer claims that they were injured due to using your product. You would be reimbursed for the cost of medical care and any lost wages, as well as legal fees in some cases when you are sued.
Business Owner's Policy (BOP)
A Business Owner's Policy (BOP) is designed specifically for small businesses with one owner or two co-owners who are actively involved in the business. A BOP is a combination of all types of coverage, including liability and property insurance as well as umbrella and workers compensation coverages which are not included with basic commercial policies. This type of policy is often more economical than buying separate plans for each type of insurance that you need to protect your company.
Directors and Officers Coverage
Directors and Officers are the people who are in charge of your business. If they have any claims made against them due to their position, you could be held personally responsible for the costs if it is determined that you were negligent in appointing these individuals or not providing adequate training or supervision. Directors and Officer Liability coverage protects your company from legal fees and judgments that could result from lawsuits filed against these individuals.
Errors and Omissions Coverage
If your company writes contracts, there is a chance that you will be sued if you cannot complete what was promised under the contract. Legal costs and judgments resulting from claims made by customers or clients can quickly add up to financial disaster for any business that does not have Errors and Omissions coverage in place. Misrepresentation and failure to disclose information are two common causes of errors or omissions in contracts, so you should consider adding this type of coverage for your business if it does not already have such a policy in place.
If your company stores customer data electronically (such as credit card numbers), then there is a chance that someone could hack into your server and steal all of that information. If this happens, you could be held responsible for the security measures you took as well as any costs associated with notifying each customer that their personal data has been compromised. This type of policy can reimburse those customers who have had to pay additional fees due to fraudulent charges on their credit cards or bank accounts.
USA Mutual Insurance can help you get started with any of the above insurance policies. To get started, visit our website at www.usamutualins.com or give us a call at 718-285-6500
An umbrella policy is a type of liability insurance that can be used to cover damages in excess of what you're currently insured for. It provides protection against catastrophic losses and lawsuits, and may also provide coverage for your car or boat.
If you own an expensive home or vacation property, it's worth looking into this inexpensive form of protection before the next storm hits!
Who Should Get An Umbrella Policy?
Anyone who wants protection against the unexpected could benefit from umbrella insurance. Umbrella policies are usually offered in increments of $100,000 to cover potential costs like attorney fees and damage caused by car accidents or other injuries.
The umbrella policy is often a great idea for:
Why Do I Need An Umbrella Policy?
An umbrella policy is a great way to provide additional coverage for your assets, such as your home and car. You can also use it to protect yourself from lawsuits that might arise due to incidents on public property or in the case of false claims against you. These policies typically start at $300-$500 per year and can be purchased alongside auto insurance with most providers.
You may even qualify for discounts if you have other types of insurance - ask about umbrella insurance savings today!
In addition, some umbrella policies offer protection while traveling overseas--be sure yours does before heading out of town! For more information about our Umbrella Policy coverage, visit our website at www.usamutualins.com
Group Health Benefits are a type of medical coverage that is offered by an employer to its employees. The idea behind this type of benefit is that it costs less for the employer than individual insurance, and in some cases may be more comprehensive than what the employee could get on their own.
There are both pros and cons when it comes to group health benefits, and the group that they are available to may vary. For example, if you're a full-time employee at a company, then group health benefits would cover all of your medical expenses related to your job such as any co-payments or deductibles for office visits.
On the other hand, if you work part-time but still wish to Group Health Benefits is a type of medical coverage that is offered by an employer to its employees. The idea behind this type of benefit is that it costs less for the employer than individual insurance, and in some cases may be more comprehensive than what the employee could get on their own.
Additionally, group health benefits may provide coverage for dependents such as a spouse and children. It's important to note that group health benefits are only available through an employer; you would not be able to get group health benefits from anywhere else or anytime other than your employment with this company.
How Can I Get Group Health Benefits?
Group health benefits are typically offered to employees who work full-time, but it is possible for part-time workers to qualify too.
Some group plans require that you meet certain requirements such as working a minimum amount of hours or being in the group plan for a specific length of time before becoming eligible for group health benefits. However, group health benefits are not available to everyone who works for this company, so you will need to check with your employer if group health benefits are something they offer.
If group health benefits aren't offered by your job, then there is a chance that insurance coverage may be obtainable through the Affordable Care Act Marketplace or Medicaid in some states. To find out more about group health benefits, speak to your employer or check with the Human Resource department at your company. If your company would like to purchase Group Health Benefits, you can contact one USA Mutual Insurance's Insurance Professionals by clicking here to get setup with Group Health Benefits.
There are many benefits to having Life Insurance.
One is that the Life Insurance policy owner doesn't have to worry about their loved ones financially if they were no longer around.
Another benefit is that Life Insurance policies offer tax advantages, which can be beneficial not only for you but your family as well.
Life insurance also helps protect your estate against expenses and debts when one dies unexpectedly by covering funeral costs or debt repayment plans along with other fees charged after death such as credit card bills or loans taken out during life time; this will help make sure all of these payments are satisfied without over burdening your beneficiaries who may already be experiencing grief knowing someone close to them has passed away.
Lastly Life Insurance can provide financial support through its payout which can be used to help pay for medical bills, education expenses or living costs. Life Insurance is an important part of financial planning and it's benefits should not be overlooked.
Life insurance policies offer tax advantages, which can be beneficial not only for you but your family as well.
Life Insurance coverage is a must-have for every Life. There are many types of Life Insurance policies on the market, term Life or Whole Life insurance which both provides different benefits and options depending on your personal financial situation and needs.
You can find out more about what type of Life Insurance best suits you by speaking with one of our Insurance professionals today.
When you reach your 50s, you have many things to look forward to. Your kids are most likely older or already grown, and you are probably more financially secure than ever before.
By this point, you are closer to retirement, and you can kick back and enjoy everything you have worked hard for these past few decades. However, when it comes to financial planning for your 50s (and up), does life insurance have a place?
In this article, we will look at why someone aged 50 and up might or might not need life insurance and explore some options if you are considering it for the first time.
Why people 50 and older should have life insurance
Life has unexpected twists and turns, many of which were not adequately prepared for. Its been reported that many Americans have not taken critical steps toward protecting their family’s financial future if the unexpected happens. 52% of Americans say they often worry about the financial situation they will leave behind for their children/future children after they pass away. Life insurance, at its core, is meant to alleviate financial concerns and protect those who are vulnerable in the event of your death.
If you’re over 50 years old and find yourself without life insurance, it is likely for one of a few reasons. You could have had a term life insurance policy that expired, coverage through an employer that expired once you left your job or retired, or you’ve never had life insurance coverage in the first place.
Regardless of which situation applies to you, life insurance in your 50s is worth considering either for the first time, or again. When weighing the options, ask yourself, “Does someone rely on me or my income for their wellbeing?” If the answer is yes, you likely need life insurance.
Here are some additional reasons you may need life insurance if you are 50 years old or older:
Why you might not need life insurance if you are 50 or older
Life insurance also might not be necessary for some people in this age bracket. Depending on your circumstances, life insurance could be unnecessary at this stage of your life.
Here are some reasons why you may not need life insurance:
Best types of life insurance for people 50 and older
If you are now considering life insurance in this phase of your life, you have two reliable options: term life insurance and permanent life insurance. Let’s explore the benefits of each.
Term life insurance is a good fit for people who are looking for coverage for a set period. For example, you may feel that you need coverage until your kids are finished with school, or until your mortgage is paid off. Put simply—term life insurance is the most accessible and most affordable option. It provides coverage for a set period or “term” (typically 10–30 years) and is designed to protect your dependents during that term. If you pass away during the term period, your beneficiaries receive a cash payment referred to as the “death benefit” that can be used to cover expenses or income loss related to your passing.
Permanent life insurance is a good option for people who want the security of lifelong coverage (as long as payments are made). Permanent life insurance can be helpful with final expenses and legacy planning, and the cash value component can be beneficial to retirees. However, due to the cash value component and the coverage duration, permanent life insurance policies are more expensive than term. Therefore, it is essential to ensure the premiums are within your current and future budget.
USA Mutual Insurance can offer you a guaranteed-issue whole life insurance policy that is another worthy option to consider. The policy guarantees coverage to all applicants between 65–85 and is a good fit for people looking for help with their final expenses.
The bottom line on life insurance in your 50s—and beyond
Life insurance can be a valuable financial tool for people 50 and older. Even though life insurance later in life is more costly, it can be well worth the cost for those who need it. Now is still the best time to get life insurance, primarily if people rely on you and your income. USA Mutual Insurance makes life insurance more straightforward and affordable than you think—get started today by getting a personalized quote.
Being a business owner can be overwhelming. You have an endless list of responsibilities, including choosing a group health insurance plan.
To help make the process easier, do your research in order to understand what you’re looking for, and get the right plan.
Keep reading to learn the 5 questions to ask when choosing group health insurance!
1. What Are the Different Types of Health Insurance Plans for Businesses?
Before you can understand who will be covered and how much it will cost, you need to learn the different types of insurance plans. The two main types are PPO and HMO.
Preferred provider organization (PPO) refers to a network of health care providers. This means your employees can choose from a list of these providers within their area or network.
A health maintenance organization or HMO is another common plan that provides health care but means your employees must use the health care providers in their organization.
2. Will All Employees Receive Coverage?
Who you cover will affect how much you can afford to pay. You will want to cover yourself, and likely you are trying to cover your employees. But does this include all employees?
Do you intend to cover part-time and full-time employees? Will your employees receive prescription drug coverage and dental?
Consider the needs of your current employees. Think about how frequently they may need to visit the doctor and what types of health coverage are most important for their needs.
3. How Much Can Your Employees Afford to Pay?
Did you know that the average cost of individual health insurance under the Affordable Care Act is over $462 a month, without subsidies? You may also not know that this is because employers cover the difference in cost.
If you are able to contribute 50 percent or more of the premium toward employee plans, this will help make the health insurance cost far more affordable for your employees.
4. Would Your Employees Rather Have Low Deductibles or Low Premiums?
The first main type of cost associated with health insurance is paying the monthly premium, which is the amount that must be paid to maintain coverage. But there’s also deductibles, which are the expenses employees pay when they actually receive care.
If you choose a health insurance plan with a low monthly premium, the trade-off might be a higher deductible.
5. Do You Want to Cover the Family Members of Your Employees Too?
As the employer, you’ll need to decide if you want to offer coverage to the families of your employees in addition to the employees.
This might all depend on what you can afford and your general demographic for employees. If you work at a small store with very young employees, this may not be a priority.
Understand What to Ask When Choosing a Group Health Insurance Plan
Choosing the right group health insurance for your business can be overwhelming. By following this guide above, you’ll ask all the important questions and make sure your employees are covered.
Contact the team at USA Mutual Insurance to learn more about employee benefit solutions we can offer you today!
You need cash, and you’re thinking about borrowing from your life insurance policy. Right now, you’re on the fence, because you don’t know whether this idea is brilliant or extremely unwise.
The last thing you want to do is make a move that will have a detrimental impact on your financial future, so you need to make a fully informed decision. Here’s a look at the pros and cons associated with taking a loan from your life insurance policy.
Pro: No Fees
You can take out cash without paying any initial fees. This can be very wise, if it’s your only source of available liquidity in the event of a personal or business emergency.
Con: Reduction in Death Benefit
If you borrow from your life insurance policy, you might end up leaving less money to your loved ones.
When you take out a loan from policy, the total outstanding balance gets deducted from the death benefit. This means that less money will be handed to your beneficiaries after your death.
Pro: Low Interest Rates
If taking out a traditional loan is your only other option, you might face much higher interest rates.
The interest rate on this type of loan is adjusted and low in comparison to the personal loan you take from the bank.
In fact, it’s possible you even took your life insurance policy out with a loan in mind. If you designed the policy to accumulate excess cash for the purpose it is being used, proceeding with this plan is a good idea.
For example, if we designed an accumulation life insurance policy so we can have supplemental retirement income or help to pay for college education, it is wise to withdraw or borrow funds from the policy tax-free.
Con: You Could Be Charged Interest
Borrowing from your life insurance policy might have a lower interest rate than a personal loan, but you still have to pay it back.
If you do not pay back the loan, the interest will be charged on the remaining cash, reducing the cash value. And if the loan is not paid even after a long period of time, chances are, your policy will be canceled.
Pro: Easy Access
Since the life insurance policy is already yours, getting the money is a notably simple process.
There is no lengthy application that you need to fill out in order to take out a loan as the insurance company uses your cash-value account as collateral. Additionally, borrowing from your life insurance policy won’t affect your credit score.
Con: Possible Tax Consequences
You might be borrowing from your own policy, but that doesn’t mean you can’t be hit with a tax bill. If you are unable to repay the loan, you could owe tax on the money you have not paid back.
Digging a bit deeper, cash-value life insurance policies are usually taxed on a first in, first out (FIFO) basis. For this reason, when one withdraws money from a policy, the first money taken out is considered principle and there is not income tax.
After the policy owner has withdrawn all of the basis, he said they can borrow from the policy and receive additional funds tax-free. The catch is, if the policy ever lapses or is surrendered before death, all of the gain received from the policy would be considered ordinary income and taxed at ordinary income tax rates.
Ultimately, borrowing from your life insurance policy can be a savvy move or a seriously unwise one, based on your individual circumstances. Thoroughly cover the bases with your research before deciding which route is best for you.
Since you are essentially borrowing money from yourself, there is no approval process or credit check. As a result, you are free to use the cash to pay for any expenses such as bills, financial emergencies or vacations.
Source: MSN Money
Life insurance is there to benefit your survivors, and it’s vital to decide which of those people should receive the proceeds of your policy after you die. The choice can help ensure the right family members receive the policy’s benefits, and quickly and simply.
Failing to choose a recipient, on the other hand, has the exact opposite effects. Life insurance that lacks a beneficiary when you die must go through the probate process. That could add “six months to a year” to the timing for the payout and cost thousands of dollars in legal fees.
Naming a life insurance beneficiary overrules the instructions in your will. Without named beneficiaries, he explains, your insurance proceeds will be distributed like any other assets, as set out in the will. Absent a will, the death benefit will be given to your closest living relative. Those default assignments may not align with your wishes for your life insurance.
We asked experts for tips on how to best ensure your death benefit reaches the people you want, and quickly, and how to manage your beneficiary designations along the way. Here’s their advice.
1. Pick the person who most relies on your income
As a rule, the proceeds from your policy should go to the person — or people — who will be most affected financially by your death, Buhrmann advises. For example, a spouse and/or children have a financial interest in the life of the insured because they likely require income…to successfully run the household.
Consider adding more than one name to the policy. For one, experts say it’s wise to pick a secondary beneficiary — someone who will receive the payout should the primary beneficiary pass away before the policy is updated. That way, you don’t need to tackle this chore as you are simultaneously wrestling with other issues associated with your beneficiary’s death.
You can also elect to have more than one beneficiary. We cover below how that can work for family members. But you might not want to limit your payout to just your family.
In particular, if you own or co-own a business, you may want to arrange for a payout to your colleagues, either from your personal life insurance policy or another designated to the business. This insurance — archaically known as key man coverage, from the days in which business owners were almost invariably male — can help the business stay afloat as it undergoes the (possibly lengthy) search for your replacement.
2. Decide how benefits will be distributed
Remember, you can name more than one person to receive death benefits from your policy. But if you do so for family members, you need to decide how the policy proceeds will be distributed.
There are two main choices, and it’s important to understand the difference between them because it determines how benefits are divvied up.
The simplest of the two is Per Capita distribution, in which the policy’s benefit is divided equally among everyone you list as a beneficiary. This is the option to choose if, for example, you want your three children to each receive a third of the payout, regardless of the number of heirs each may have.
But there are advantages to the other choice, which is known as Per Stirpes — after the Latin word for “branches.” Under Per Capita distribution, if one of your children dies before you, and themselves have children, their family would not receive any policy benefits. Instead, those would be distributed only to beneficiaries who are still alive.
Under Per Stirpes distribution, by contrast, benefits are distributed equally among all branches of the family — thus allowing you to provide for your grandchildren in the event their parents pass away before you do. The children of a deceased beneficiary would receive the share of the proceeds that would have gone to their parent, were he or she still alive, divided equally among them.
Should you for any reason prefer to skip benefiting a child and directly benefit a grandchild, you can do so by naming that child of your child as a beneficiary. But that can involve extra contingencies in case the grandchild is a minor when they come into their insurance benefit.
3. Elect when and how minors will receive their funds
It’s prudent to take steps in advance in case children or grandchildren become beneficiaries of your life insurance when they are still minors — defined as under the ages of 18 or 21 in most states, and 25 in a few. However, you might not be comfortable having, say, an 18-year-old inherit a large sum because what they do with that money could make you roll over in your grave.
There are several ways to prevent your children from potentially blowing their benefits on NFTs and streetwear. The easiest option, is to instruct a trusted adult beneficiary to use the money for the children’s benefit. More formally, the site says, you can also elect to name an adult custodian under your state’s Uniform Transfers to Minors Act (UTMA). Most insurance companies permit this and have forms for it.
Alternatively, you can name a family member or attorney as trustee of the funds. “A testamentary trust receiving the proceeds and managing them accordingly may be more desirable” than leaving an inheritance in the hands of a teen.
4. Let your beneficiary know they’ve been selected
The people you choose to benefit from your life insurance shouldn’t be in the dark about their status. Not only informing them that they’re a beneficiary but of the amount of the benefit they will receive, “so they can be prepared to act properly.” Inform not only family members but any business partners who will be beneficiaries.
5. Adjust beneficiaries as your life changes
Life isn’t static, and just as you should adjust the policy itself in step with changing circumstances, including a divorce, your list of beneficiaries should also be re-evaluated from time to time. When a major life event such as a divorce or death occurs, it’s so important to update beneficiaries. You’d be surprised at how often people forget to do this.
Source: MSN Money