It's one of those questions that causes millions of Americans to lose sleep every night: Should I shop my insurance online or get out the phone book and call around?

Alright. So maybe it's not the source of insomnia across the country. But with new technologies like the Web—which invariably make our day-to-day life easier—also bring with them concerns for safety and identity protection.

This is almost always the case when it comes to shopping for financial products like insurance. Folks want the convenience of the Web but the safety, security and personal touch that comes with talking to a human.

So what if I told you that you could have it both ways?

As someone who recently shopped her auto insurance, I can tell you that what I wanted first was to compare rates. And I wanted to be in the driver's seat—meaning that I wanted to tell agents what I was looking for, receive initial quotes, and decide who I wanted to work with from there. And though I write about insurance for a living, I wanted easy access to insurance-related information so that I was armed with the necessary facts and saving tips needed to secure a good rate and a solid policy.

When it comes to finding information and getting preliminary quotes and estimates, the Web is where it's at. And luckily for us consumers, there are plenty of free online shopping services that help people find the insurance info they need and get free quotes. Of course, I work for InsureMe.com, and biases being what they are, I used InsureMe to find auto insurance quotes.

And that experience went a little something like this:

1. I filled out the online form with some info about my vehicle, driving record and past insurance history
2. The system matched me with local insurance professionals
3. I was able to state (in the quote form) that I wanted to receive initial quotes via email, and included my email address
4. I received multiple auto quotes (four by email; two by phone), compared initial estimates, and narrowed my choices down from there

Once I narrowed my choices, I used the Web to do a little homework on the insurers in question.

Sites like AM Best allow you to view the financial strength and customer service rating of insurance companies for free. It's quick and easy and helps to ensure that you don't partner with a seedy insurer.

At the end of the day, your insurance purchase shouldn’t bring surprises. You should know exactly what you’re getting and for how much.

So use the Web to find insurance information and to shop around. Doing so cuts out the time and hassle involved with finding an affordable insurance rate. And take advantage of free shopping services that put you in touch with local agents—allowing you to compare quotes and speak to a human.

If I were you, I’d shop using InsureMe.com—your one-stop shop for all things insurance. But now I’m just shamelessly promoting our company. :)

Happy shopping...and don't hesitate to leave your insurance questions via comments. Or, email our staff insurance expert, Jeb at AskJeb@insureme.com We're here to serve, and also to protect. :)

Posted by Megan Mahan at 01:53 PM | Permalink | Comments (1)
 

As an election issue, health care always sits high up on the list of voter concerns. This election cycle is no different. Makes sense. Health care is expensive and getting more so each year.

What is striking, however, is that during elections, politicians do every thing they can to avoid talking about our country’s health care woes.

According to recent Kaiser Family Foundation release, many pols steer away from the issue because of its complexity. “The issue is difficult to discuss through sound bites, 30-second commercials and lawn signs,” says the foundation. A recent op-ed from the Baltimore Sun offered a similar explanation: “[Health care] and paying for it is a large and growing concern for most Americans ... but neither politicians nor voters have many fresh ideas on what to do about it.”

Given an opportunity, however, candidates will jump to criticize a rival’s position on health care. For that reason, most keep mum on the subject. You don’t have to be a seasoned political strategist to know that nuanced and open debate on tough subjects is to be avoided at all costs during an election. The risks are too great.

If a candidate is forced to talk about health care, we can expect platitudes, such as “I’m for developing a cure for the common cold.” Or, platitudes with a barb: “I support a cure for cancer, but my opponent does not … and she eats small children.”

Posted by Jeb Foster at 01:39 PM | Permalink | Comments (2)
 

Links from this week's video:

The Price of Health Care, a Honda

Living on the Edge: Not Just an Aerosmith Song

Home Inventory Made Simple

Insurers Recoil from the High Cost of Mental Illness

Posted by Jeb Foster at 06:04 AM | Permalink
 

Consider this startling stat from the National Institute of Mental Health (NIMH):

An estimated 26.2 percent of Americans ages 18 and older — about one in four adults — suffer from a diagnosable mental disorder in a given year.

The NIMH adds that mental disorders are “the leading cause of disability in the U.S. and Canada for ages 15-44.”

Mental health treatment is one of the big drivers of health care cost inflation, and as you might guess, health insurers are trying to find ways to reduce outlay. One tactic that’s proven effective (if unpopular) is to deny individual coverage to anyone who has taken a red-flag raising medication—such as an anti-depressant.

MSN Money’s Debora Vrana has a comprehensive article on this practice. Her story is entitled “Prozac: Hazard to your health insurance.” It’s worth a read.

Vrana says people who have sought mental health treatment regret letting their insurer pick up the tab, as they’ve been branded “insurance untouchables.”

Because insurers are so skittish, many therapists and counselors warn their patients to keep their mental health history under the radar and pay for treatment out of pocket.

“The moment I give them a label, it can follow them for their entire life. I really worry about that,” says Dr. Peter Gumpert, a therapist quoted in the article. “This whole thing has a chilling effect on people getting the help they need.”

Read the entire article.

Posted by Jeb Foster at 08:27 AM | Permalink
 

I’ve always been a sucker for the products touted on those late-night infomercials—scissors that cut through metal, a plastic tube that stores and cooks your pasta, miracle powder that removes any stain from grape juice to motor oil. Basically, if it makes my life easier, I’ll buy it, or at least put it on my ever-expanding wish list.

In the home-inventory software from the Insurance Information Institute, I’ve finally found a product that helps keep track of all those possessions. Knowing what you own and its worth allows you to get insurance that provides adequate coverage.

You no longer need to walk through each room with a notepad; the software prompts you with questions about each room and allows you to upload photographs and receipts when necessary. It organizes all the information in a report, which you can burn onto a CD or print out and store at a friend or relative’s house. Best of all, when you buy that new juicer/food processor, it’s easy to add it to the inventory.

Download the Software for Free

Download Lists that give you an idea what to include in your home inventory.

Posted by maribeth neelis at 02:44 PM | Permalink | Comments (1)
 

Maybe robot insurance isn't just silly joke fodder.

According to this recent MSN tech article, an estimated 39 million households could include robots by the end of the decade.

CNET also has a great FAQ article about robots. Check it out to learn what robots are doing now, and what they could be doing in the future. It also wouldn't hurt to learn the difference between a robot and an android. Just for future reference.

With all the new robot technology, I figure there's got to be some insurer out there calculating the risk of a robot gone haywire. I've seen all three Terminator movies. I'm aware of the possibilities. :)

Posted by Megan Mahan at 10:59 AM | Permalink | Comments (2)
 

Do you have the cash reserves on hand to deal with a medical emergency?

A recent study by the Kaiser Family Foundation (KFF) found that only 22.3 percent of middle-class families could financially cope with a small medical emergency—an equivalent of just over $3,000—which would treat injuries like broken bones.

The middle-class seems to be living on the edge, points out a recent MSN Money story, which explores the findings produced by the Democratic-funded Center for American Progress.

Financial declines over the last five years are to blame for the monetary squeeze in the middle class, says the CAP. As a result, the income for middle-class families has remained "stagnant or flat" since 2001, while prices for life's essentials—housing, education, transportation and health care—have dramatically increased.

Of course, the increased cost of health care in recent years has also driven up the number of Americans without health insurance. The U.S. Census Bureau reports that the number of uninsured Americans rose by 1.3 million last year, bringing the grand total of uninsured adults in this country to well over 46 million.

To that end, MSN Money reports that the KFF found that the cost of family health insurance has skyrocketed by nearly 90 percent since 2000. And remember that aforementioned 'small medical emergency'? Today, just over 22 percent of middle-of-the-road families could afford to pay for something like a broken ankle, which is down from the nearly 35 percent that could handle that expense in 2001.

As a result, MSN Money reports that Americans are taking on record amounts of debt and dipping into the equity of their homes to pay for things like health care and education.

And while these figures are quite compelling, conservatives have attacked the CAP study, arguing that the concern for middle America has been blown out of proportion:

"Let's not kid ourselves. The data say we're wealthy. And we're one of the wealthiest nations on Earth," said Tim Kane, a director at the Heritage Foundation, a conservative think tank in Washington, D.C. "You can make a case that there is increased inequality, with the rich getting richer, but I don't think there is increased poverty."

Politics aside, I'd say from what I've observed both in my own life and in my work and research here at InsureMe, that folks are having a rough go of things where health care and health insurance are concerned. And, while costs in these areas are growing, it's important for families not to skimp on the insurance if at all possible. Because while a small medical expense could set you back three grand, a larger medical expense could put you in debt for years.

Check out the full MSN Money article here, and visit the links below for health insurance information and resources.

From the InsureMe Insurance Resource Center:

Tips for Medical Insurance Shopping

The Uninsured: Falling Through the Cracks

Health Insurance FAQ's

All about Health Savings Accounts

The Many Forms of Managed Care

You can also find health insurance information as it pertains to your state by browsing our state-related articles.

Posted by Megan Mahan at 01:27 PM | Permalink
 

We Americans are thrifty. We know how to comparison shop and sniff out a good deal—particularly when it comes to our cars and household appliances.

We’re not penny pinchers when it comes to health care, however.

Washington Post columnist Michelle Singletary has an interesting article this week on our yen for saving money on everything but medical care.

“More people probably know the whereabouts of Osama bin Laden than the average cost of their health services,” says Singletary, who pens the “Color of Money” column for the Post.

According to a recent study, people estimate the cost of a routine doctor’s office to be about $95. The actual average cost is much higher—twice as high, actually. When asked to guess the cost of a four-day hospital stay, respondents underestimated the cost by nearly two thirds. Their guess average: $7,762. Reality: $20,000. People were more likely to come closer to the price of a Honda Accord. (On average their guesses were within $300.)

Why the discrepancy? Well, for one, people who have coverage through their employer have little incentive to find out the cost of care and hunt for bargains. Most of us simply pay our co-pay and get care; the difference is someone else’s responsibility, we think.

The other reason is that unlike shopping for cars, groceries or plane tickets, it’s hard to comparison shop for health care. We can’t cruise the aisles and check prices. There is no blue book for health care. No Travelocity.

As more and more people opt for consumer-driven health care plans, however, they will need to have a better understanding of the costs of medical treatment. Otherwise, people who underestimate their annual care costs are going to find themselves in a pinch—with only themselves to foot a hefty hospital bill.

There is also a big-picture benefit to understanding the true cost of care. Part of the reason our system is ailing is that patients spend (other people’s) money like drunken sailors. The reason HSAs and other consumer-driven plans are popular on a public policy level is that they encourage people to be efficient and show some fiscal prudence when it comes to getting care.

Although it’s hard to shop for health care, it’s not impossible. One good resource according to Singletary is Healthgrades.com. The company, as the name suggests, offers ratings and cost estimates for 55 medical procedures.

Also, the Life and Health Insurance Foundation for Education (LIFE), has a cool interactive Web page that shows the cost for certain services. You’ll be surprised to learn that even seemingly minor procedures carry huge price tags—and keep in mind the estimates are only for the procedures themselves—not the cost of room and board. So if you think spending $2,310 on knee surgery is a steal, consider the fact that staying at the hospital and the ensuing physical therapy will raise the cost even more.

[Hat tip]: to Tim McTavish for the Singletary column.

Posted by Jeb Foster at 10:26 AM | Permalink
 

Links to this week's video:

Insurance, Climate Change, and Other Light Topics

Earthquake Insurance: Few Have It, Many Need It

Long-Term Care Insurance: Down to the Nitty Gritty

Fast Food and the Rising Cost of Healthcare

Posted by Megan Mahan at 04:13 PM | Permalink
 

A couple of weeks ago we talked about why the cost of health care is so high. The big reason, according to New York Times business writer David Leonhardt, is that we’re getting more health care than ever before. And that health care is of exceptional quality—and quality ain’t free, folks.

Makes sense. But that can’t be the whole story. Because people in other industrialized countries have longer life expectancies and pay less for health care. According to the CIA World Fact Book, 47 countries rank higher than the U.S. in terms of life expectancy. What gives? Shouldn’t the longest life spans belong to the people who spend the most on health care? Why should folks in Andorra live longer than we do when we're the ones spending the big bucks?

As it happens, in an another article published this week, Leonhardt hints at one of the possible reasons Americans pay the most for health care but don’t live the longest:

We’re fat.

According to the results of a recent study published The New England Journal of Medicine, the U.S. is on the verge of a first-ever drop in life expectancy. “Looking out the window, we see a threatening storm — obesity —that will, if unchecked, have a negative effect on life expectancy,” said S. Jay Olshansky, PhD, one of the researchers involved in the study. The study concludes that obesity could end up chopping 5 years off the average American’s life.

Why are Americans fat? Well, a possible explanation is that we prefer to exercise our cars more than ourselves, and, further, we like to exercise our jaws on fast food while we let our cars do the heavy lifting. Sure, the rest of the world shares our fondness for salty, fatty food and motorized transportation, but because of cultural differences, budget constraints or lack of access, they can hardly keep our pace.

Yes, I know, fast food is an easy target. With all the bad press fast food companies get these days, you almost have some sympathy for them. Almost. But then you learn that obesity is blamed for 300,000 deaths annually and costs upwards of $100 billion dollars each year. And of course there’s heart disease, the leading cause of death for men and women over 35, which costs $300 billion each year. Heredity and smoking habits factor into those stats, but diet is huge component.

To look at it one way, our system of health care is weighed down by people who are suffering from the effects of fast food. Then think about the fact that according to Karen Davis of the Commonwealth Fund, 10 percent of the population accounts for 70 percent of health care expenditures.

But how do you get people to change their habits? Well, education is one way. It may seem like most people don’t need to be told that fast food is unhealthy, but according to recent study by the Annals of Internal Medicine, many people underestimate the calorie content of various fast food items.

Recently a Bronx city councilman named Joel Rivera proposed a zoning ordinance against fast-food restaurants. Some towns have zoning restrictions against fast food chains for aesthetic reasons, but what’s motivating Rivera is a concern about public health. While the idea has been derided by some as “nanny-state nonsense,” it has also picked up quite a few supporters.

The idea seems draconian at first, but when you read about rising obesity, ballooning health care costs and shrinking life spans, it starts to seem less extreme.

Late addition: Incetives to shed a few pounds: live longer, save at the gas pump

Posted by Jeb Foster at 01:33 PM | Permalink | Comments (1)
 

If you ask me, long-term care insurance is about as cringeworthy a topic as life insurance. Who wants to think about aging and regressing to a state where you need to be cared for 24/7? However, it’s worth a moment of discomfort as you muse what life might look like for you and your family if you don’t consider LTC insurance.

On average, a year of full-time care costs almost $60,000. After discovering you have no LTC insurance, your son or daughter decides to move you into his or her basement. You haven't lost all your faculties, so you are acutely aware of the musky odor and odd noises. Because your family doesn't want to leave you home alone and can't afford to hire someone, they enlist the help of the garish, outspoken neighbor, Babs, who loves having someone to talk to while she watches her soaps. Your body may be failing you a bit, but your mind is not and you can't bare her incessant chatter and patronizing nature. Each night as you fall asleep on your damp, basement cot, you dream about how your life might be different if you had purchased LTC insurance instead of that mid-life crisis Corvette.

A sort of hybrid between life and health insurance, LTC insurance enables your family to pay for any care you need. Your LTC insurance might cover your rent at an assisted living facility, the fee for adult day care or the expenses if a family member becomes your full-time caregiver. It will guarantee you a comfortable environment free of obnoxious neighbors and clammy basements.

Consider a few statistics courtesy of the Insurance Information Institute.

—11 percent of the individuals who applied for LTC insurance in their 50s, 19 percent in their 60s and 43 percent in their 70s were rejected.

—In 1999, about 160,000 of the people living in nursing homes were under age 65 (almost 10 percent of the total). Of those receiving home health care services, roughly 400,000 were under 65 (about 30 percent of the total).

—According to a report from the Kaiser Foundation, over five million people ages 18-64 need some type of long-term care in their lifetime.

If you expect to qualify for Medicaid by the time you’re 65, you should not purchase LTC insurance. The government program will subsidize the cost of care. Conversely, if your net worth is above 1.5 million, excluding your home, you can safely forego the LTC insurance as well.

But since the middle class makes up nearly 50 percent of the population, chances are you fall in between those two extremes, and might want to consider LTC insurance so your children or siblings aren’t saddled with the financial burden.

Links:

http://www.longtermcarelink.net/

http://www.medicare.gov/LongTermCare/Static/Home.asp

http://www.opm.gov/insure/ltc/

Posted by maribeth neelis at 10:35 AM | Permalink
 

It seems as if everyone's been so caught up in hurricane madness over the last year, that we've sort of forgotten about another serious catastrophe: earthquakes.

That is, until last week when a 6.6 magnitude earthquake rattled Hawaii.

Robert Hartwig, the executive vice president and chief economist for the Insurance Information Institute (I.I.I.) said last week's quake was "a reminder that disaster can strike anywhere at any time."

Not to scare the bajeezus out of you, but it's true. And fortunately there's something you can do to protect yourself from earthquake damages.

Like flood insurance, earthquake insurance can be purchased in addition to your home insurance policy. As the name suggests, it covers damages to the structure of your home—and in most cases your belongings—resulting from an earthquake. And, like flood insurance, many homeowners don't realize that earthquake-related damage is not covered by a standard home insurance policy.

And if you're anything like me (a properly landlocked native of Iowa, living far, far away from seismic activity), you want to learn everything you can about earthquake coverage so that you can adequately protect yourself.

Let's embark on this adventure of earthquake insurance edumacation together, shall we? :)

According to the I.I.I., earthquakes have occurred in 39 states since 1900, and have caused damage in all 50. (Interesting fact: the New Madrid earthquake of 1811 could be felt 1,000 miles away.)

And though about 5,000 quakes can be felt in the U.S. every year, a recent report by A.M. Best shows that 85 to 90 percent of people lack earthquake coverage. Which is pretty disconcerting when you consider that damages from the latest earthquake in Hawaii may top $100 million.

But unlike flood insurance (which is purchased through FEMA's National Flood Insurance Program), earthquake insurance is purchased through private insurance companies, which means that policies are largely subject to individual state regulations. But there are some things you can count on, says the I.I.I., no matter where you live.

Policy coverage:

An earthquake insurance policy provides coverage against structural damage to your home or business, as well as damage to your personal belongings. It's important to point out that fire and water damage (from bursting pipes, for example) occurring after an earthquake are covered by a standard home insurance policy. Damage to vehicles are covered by the comprehensive coverage in your auto insurance policy.

Deductibles:

Policy deductibles—the amount you pay out-of-pocket before the insurer starts paying—consist of a percentage rather than a dollar amount. Percentages range from 2 to 20 percent, and are based on the replacement cost of your home.

Thus, if the replacement cost for your home is $200,000 and your policy deductible was set at two percent, you would pay $2,000 if you had to file an earthquake-related claim.

Not surprisingly, riskier states will see higher deductibles. And, like other insurance policies, the higher your deductible, the lower your premium will be.

Premiums:

If you're looking at purchasing property in an quake-prone area, keep in mind that older buildings will come with higher earthquake insurance premiums. That's because older structures often buckle and collapse easier than newer structures.

Additionally, homes built with wood frames may receive discounts as they've been shown better withstand quakes better than homes made of other materials.

Of course, the very act of purchasing earthquake coverage is likely to save you a fair bit of coin in the long run, especially if you live in a high risk area. (I'm talking to you, California!)

Interested in learning more about earthquake coverage? Check out these handy links:

Earthquakes: Risk and Insurance Issues [I.I.I.]
Few Sign Up for Earthquake Coverage [Houston Chronicle Online]
The California Earthquake Authority (CEA)

Posted by Megan Mahan at 01:24 PM | Permalink
 

[Disclaimer: this post could be a little depressing.]

I think climate change is a fascinating subject. I know, I know—it may seem morbid to be fascinated by something that promises to be (and perhaps already is) such a destructive force. But what intrigues me is not the potential devastation, but humankind’s response to this challenge—and on a more specific level, the insurance industry’s response.

Insurance is all about managing risk. You are managing risk when you buy a policy, and insurers are doing the same when they issue one. If the latter party thinks something (or someone) is risky, they charge more—partly because they need to have enough cash on hand when when 16-year-old Johnny totals the family station wagon or when a hurricane comes trundling down Hurricane Alley.

If you believe the science of climate change, it looks like we’re in for a bumpy ride – one that’s fraught with risks, both known and unknown.

The insurance industry is particularly adept at managing that first kind of risk. They know that from looking at their records that Johnny is probably going to roll stops signs more often than his 75-year-old grandmother. They know that homes built in the Gulf Coast are more likely to be flattened than ones in built in Connecticut.

While insurers are good at poring over the historical record, they’re not quite as good at looking into the crystal ball, which is where we all need to be looking in order to prepare for the effects of climate change. Sure, we have the geologic record, which can tell us about previous warming periods, but that’s pretty difficult to draw practical conclusions from. Besides, human-caused warming is new territory.

Recently, Allianz, an international insurance and investment services provider, and the World Wildlife Fund (WWF) published a paper entitled: “Climate Change and Insurance: An Agenda for Action in the United States.” According to the report:

For U.S. insurers, past events continue to form the basis for catastrophic risk modeling and weather-event planning, despite the fact that the science indicates that the future for many years to come is going to be significantly different from the past as a result of anthropogenic climate change.

The folly of the current approach is pretty clear: it’s like driving a car by looking in the rearview mirror. If the road is perfectly straight and wide—and the risks known and accounted for—driving in this way is in fact possible. But what if you don’t know the road and it’s windy and narrow?

O.k., it’s a clunky analogy, but you get the point: insurers need to look to the future as well as the past when they decide how much risk to take on.

As the report notes, re-insurers are already doing this. (Re-insurers are the insurers of the insurance companies.) The result, perhaps not surprisingly, is that they are charging insurance companies more.

Here’s the rub: When the federal government and/or insurance companies underestimate the amount of risk they take on—or when state legislatures mandate artificially low premiums that don’t reflect the real amount of risk—we all lose. Because eventually there will be a correction, and premiums will rise accordingly. The problem is that by that time we’ve already settled into our condos on the waterfront and are used to paying artificially low premiums.

The Allianz-WWF report says the National Flood Program (NFIP) is a case in point. The NFIP charges artificially low premiums—something that keeps homeowners happy but is not a sustainable policy. According to the report, the artificially low premium sends the wrong message to homeowners, essentially saying that there is little risk in building in a flood prone area.

"The program also makes payments to consumers who have failed to pay premiums, and to homeowners who continue to build, over and over again in high risk areas,” the report notes. “Some 120,000 properties have received multiple payments from NFIP, costing U.S. taxpayers about $7.75 billon. 26,000 of those have received four or more payments."

The NFIP is $21 billion in debt. What does that mean? If the past is any indication, a correction is somewhere around the corner.

Read the entire Allianz-WWF report here.

Posted by Jeb Foster at 02:46 PM | Permalink | Comments (2)
 

Links from this week's video:

Robot Insurance: Got Yours?

Live Longer with Electronic Stability Control (and Fish Oil)

New Car? Don't Forget the Insurance!

Planning for the Golden Years

National Book Month: [Finance] Book Favorites from InsureMe Top Dogs

Cost of Employer-Sponsored Health Plans to Increase in 2007

Posted by Megan Mahan at 10:17 AM | Permalink
 

Those of us insured through our employers can expect to pay slightly more for health coverage next year than we're paying in 2006, according to a recent article in Reuters News.

Total employer/employee health insurance costs are expected to rise in 2007 by 6 percent, a slight climb which marks the fourth straight year of a lowered increase.

The human resources firm which conducted the survey on which this article is based predicts that employees will be picking up about 22 percent of the overall cost of health insurance next year, as compared with 20 percent this year. That amounts to an average increase of about $518 per employee over the span of the year, according to a press release on the firm's study.

But our employers will also be paying more to help keep us insured: from an average of $7,000 to $10,000 per employee, depending on the percent contributed. That reflects an increase of at least 11 percent in employer-covered costs for nearly one in five companies.

If you're searching for ways to counter this extra expense, you might want to consider an HSA, or Health Savings Account. This is a tax-free account you set up specifically to cover health-related expenses.

For more information:

All About HSAs
Health Savings Accounts
High Deductible Health Plans with Health Savings Accounts

Posted by Penny Hagerman at 07:00 AM | Permalink
 

O n learning that October is the time to celebrate all things literary,

But then I reconsidered that idea.

How many people want to read an entire book devoted to insurance? Sure, people want to know what’s what about finding the right coverage, but reading a whole book about insurance seems rather sadistic, doesn’t it? (Most of us would probably prefer to give ourselves paper cuts with our declaration pages.)

Then again, people do love to save money, even if it means putting down the latest from Danielle Steele and picking up a weighty tome on personal finance. The stacks at Barnes and Noble testify to our predilection for pinching pennies.

So I’m skipping the insurance book idea and expanding the scope to personal finance in general. Insurance is an important component to everyone’s economic well being, but what good is getting a deal on your insurance when you’re just pouring the savings into bad investments and extravagant purchases you can’t afford?

The folks here at InsureMe know a thing or two about proper money management, so I decided to ask a few of them for a list of recommended reading. Here are their suggestions:

Teach Your Children Well, Shred Your Debt, Skip the McMansion

Name: Lori Reed
InsureMe profile: Director of Marketing
Book selection: “Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money – That the Poor and Middle Class Do Not” by Robert T. Kiyosaki and Sharon L. Lechter
Bottom line: “It made so much sense to me,” says Reed. “It made me think about making money work for itself (and me) rather than just thinking I am supposed to work harder and longer.”

Name: Mike Sajdak
InsureMe profile: Chief Financial Officer
Book selection: “The Total Money Makeover” by Dave Ramsey
Bottom line: Sajdak: “It takes complex financial topics and makes them easy and enjoyable for everyone. I especially like Dave’s focus on shedding all debt.”

Name: Tim McTavish, a.k.a. “The Frugal Scotsman”
InsureMe profile: President and Chief Executive Officer
Book selection: “The Millionaire Next Door” by Thomas Stanley
Bottom line: “The book analyzes how [millionaires] live and think differently about money than the non-millionaires,” says McTavish. “Most surprising is that most millionaires don’t look like the person who’s loaded with cash. Instead, they’re probably the person next door. That guy driving the fancy car, living in the mansion, well, he’s likely as broke as you are. Millionaires live well within their means, don’t flaunt their cash, are thrifty (flying coach and using coupons), pay for higher education for their kids, and rarely if ever borrow money.”

Posted by Jeb Foster at 08:00 AM | Permalink | Comments (1)
 

Gone are the days of Betty Freidan’s Feminine Mystique. Today, 61 percent of married women bring home a paycheck compared to only 23 percent in 1959. But on average, women still earn less than men, spend less time in the workforce and receive fewer retirement benefits.

Lower Total Earnings. Women earn an average of 73 cents on every dollar a man makes.

Less Time in the Workforce. It’s usually women who leave their jobs for extended periods to care for children or ailing parents.

Fewer Benefits. A Women’s Institute for a Secure Retirement (WISER) study reported women receive only 50 percent as much pension as their male counterparts.

Considering those disadvantages and that the average woman spends more of her life single than married, it reasons you should spend a little more time thinking about retirement regardless of your age.

Life Insurance

You may believe you’re covered in the case of your husband’s untimely death because he has a life insurance policy. In essence, that is the job of life insurance. However, how much you have left over for retirement depends on the type of policy he has chosen. After medical expenses, funeral costs and outstanding debts; that may not be much. It’s wise to be involved when he is shopping life insurance. And bear in mind a $500,000 death benefit only pays out $2500 per month for 17 years—not including a retirement program or other employer-paid benefits.

Aside: Sixty-four percent of women don’t have life insurance of their own. If you have children and share a joint policy with your husband, or you’re simply counting on his death benefit, what would your children receive upon your death?

Annuities

Megan wrote an informative post about annuities, which as it turns out, is a subject avoided about as ardently as life insurance. With retirement lasting 20 plus years, some people are actually retired longer than they worked. How can you plan for such a stretch of unemployment?

Annuities might be the answer. Unlike 401(k)s and 403(b)s, the amount you can contribute to an annuity is not limited. You don’t have to stress about taxes gobbling up your savings—annuities are tax-sheltered, in contrast to social security and IRAs.

Learn more about the various types of annuities at the Insurance Information Institute (III)

Take a proactive stance when it comes to your retirement. Make plans, set goals and speak with a financial advisor. It can mean the difference between living over your son’s garage and having a beach house in Florida.

Posted by maribeth neelis at 03:35 PM | Permalink
 

Shopping for a new car brings many considerations. Aside from a car's fun features, you're probably evaluating things like size, gas mileage and horsepower. What many people forget to check on, however, is how a new car will affect insurance rates.

Yes, in addition to your own personal stats (including things like your driving record, age, sex, credit history and geographic location), your car can play a big role in how much you pay for auto insurance.

What gives?

Comprehensive and collisions costs are mostly to blame, according to this article, featured by MSN Money. Because, unfortunately, when repairs need to be made, insurance rates increase. This is especially true for higher-end cars. Generally speaking, the more your car is worth, the more it's going to cost to repair. Insurers realize this and will take it into account when determining your premium.

In addition to repair costs, insurers look at a variety of other factors when it comes to putting a premium price tag on your vehicle.

Here are a few other rules of thumb:

Horsepower matters. If it goes fast, chances are that we'll drive it fast. And that means a greater chance of speeding tickets and accidents. Accordingly, sporty cars tend to see higher insurance premiums that family sedans.

Size matters. According to the MSN Money article, small sport cars are involved in more car crashes. Smaller cars also tend to bear the brunt of the damage during an accident. Conversely, SUVs may see higher premiums, as they cause more damage than average-sized cars.

Attractive features may attract thieves. Music crankin', rims spinnin'...might be your idea of a dream car, as well as the hooligan's down the street. So before pimping that ride, check to see what the insurance will cost you.

So what is your best bet for cheap insurance? Well, statistically, station wagons, mini-vans and family sedans show a much lower accident rate and generally come with less expensive premiums.

Of course, working here at InsureMe, I knew all of these things as I shopped for a new car last year. And while I didn't feel like spending my shoe budget on insurance, I wasn't exactly eager to reach for the keys of a mini-van, either.*

The solution? Gather a list of your automobile picks as you're shopping and run them by your insurance agent. Before you buy the car. Factor any possible premium adjustment into your car payment. If you can afford it—and comfortably—then you'll be able to make a sound purchasing decision about your new car.

I did a little homework of my own last year and ended up with affordable insurance and a safe, fun set of wheels that I loved. And you can be sure it wasn't a mini-van. :)

Check out the MSN Money article here to learn about the 10 costliest (and 10 cheapest) cars to insure. And don't forget to check out our article, Auto Insurance: What You Drive Could Cost You.

*Disclaimer: I don't see anything wrong with mini-vans. We had one while I was growing up and it was very functional for active kids, made for easy college moving and was pretty fun to drive. It's just that I'm a young person (if you were confused by my use of the word 'hooligan') and I don't really need all that room. And also I never had much luck getting a date in my parents mini-van.

Posted by Megan Mahan at 04:04 PM | Permalink | Comments (2)
 

The scenario: You’re buying a car and thinking about which features and add-ons you want. Forty-eight-inch rims? Chest-caving subwoofer? Mammoth spoiler? Or, that ESC thingy the sales associate is hawking but only adds a little button on the dash and won’t impress the ladies?

If the choice is between optional electronic stability control (ESC) and a fancy stereo, always choose ESC. Unless that stereo has a sensor that detects when your car is about to roll over and brakes the necessary wheel in order to help you regain control.

I don’t know about you, but any technology that could potentially save 10,000 lives annually is music to my ears.* Forget the stereo.

We’ve covered the benefits of ESC here at the Insurance Blog before. (See Penny’s original post here.) This wonder technology is not news, really. But even if it’s not a fresh story, I just wanted to wave my own pompoms in support of this life-saving gizmo. (To see how it works, click here.)

Perhaps swayed by Insurance Blog reportage (or by an Insurance Institute for Highway Safety study that said ESC could prevent nearly one-third of all fatal crashes), the National Highway Traffic Safety Administration last month established a deadline for car manufacturers to make the technology standard. By 2012, all cars will have ESC, although many of the big car manufacturers are trying to beat this deadline. Ford says it will equip its entire fleet with stability control by 2009. GM plans to do so by 2010.

This is great news for drivers and insurers. And it’s a great PR opportunity for the car maker that gets to 100 percent ESC first.

Now, if we can reduce driver distraction, get more people on the fish oil train and alert more of our seniors to the dangers of robots, we’ll have a good shot at making living a less deadly activity.

*Insurance Institute for Highway Safety

Posted by Jeb Foster at 11:19 AM | Permalink
 

Because you never know when robots will strike...and eat your medicine for fuel.

Thanks to our affiliate Brian M. for passing this along!

Posted by Megan Mahan at 11:11 AM | Permalink | Comments (1)
 

Links from this week's video:

Too Much Doe: It's Deer-Car Collision Season

Breast Cancer Awareness Month

Fish Oil: Fun to Say, Good for the Heart

Follow-Up: Smoking and Heart Attacks

Posted by Megan Mahan at 02:58 PM | Permalink | Comments (2)
 

We all know smoking isn't good for us. It increases our risk of heart attack—whether we smoke ourselves or breathe in others' toxins—and costs us millions of dollars in health care every year (as discussed in last week's post).

Evidence in the case against smoking continues to mount, as more and more studies reveal the real and sometimes hidden effects this habit has on our bodies and lives. But now, the latest controversy centers on aspirin, a common anti-heart-attack treatment.

Doctors usually prescribe a small daily dose of aspirin for patients at increased risk of heart attack, either because they've already experienced one, they've had a stroke or high blood pressure is a problem. But a new study by Dr. Michael Domanski of the National Heart, Lung and Blood Institute in Bethesda, Maryland, now reveals that caring for smokers with this normally highly effective course of treatment may not reduce their risk of further heart-related complications, as experienced by those who don't light up.

In fact, according to the study by Dr. Domanski and his colleagues (as published in the American Journal of Cardiology last month), smokers are nearly 12 times more likely to be resistant to aspirin and its anti-clotting effects than non-smokers.

Translation: If you smoke, taking aspirin won't help keep your arteries clear…and that can mean life-threatening blood clots—another killer.

A story in Reuters on the subject concludes, "The finding adds still more weight to the importance of abstinence from smoking."

Posted by Penny Hagerman at 04:07 PM | Permalink
 

Before you read this post about the wonders of fish oil and how we Americans are missing the boat, consider these alarming statistics:

Two stats that'll make your heart skip a beat

• Heart disease and stroke accont for nearly 40 percent of all deaths in the U.S.*
• Heart disease and stroke cost the U.S. more than $350 billion in 2003.**

Omega-3 to the rescue
According to an Italian doctor quoted in the New York Times, not prescribing fish oil to patients who've had heart attacks is, in Italy, "tantamount to malpractice."

Fish oil is high in omega-3 fatty acids, and for that reason, most doctors in Europe give it to their patients, usually a high-concentrated dose in pill form. It has been shown to reduce fatal heart rhythms and help a heart attack victim's chances of survival.

Yet very few doctors in America—17 percent according to the Times—treat their patients with the oil. And despite being a highly credited treatment in the Old World, it is not recognized by the FDA as a treatment for heart disease. For that reason, U.S. drug companies can't promote it and insurance companies won't pay for it.

The result, given the huge role big pharma has in our medical treatment, is that few doctors and even fewer patients in America know about the benefits of this natural substance. (We do, however, know about the benefits of expensive FDA-approved cholesterol drugs like Lipitor.)

In short, fish oil is the business. To learn more about this wonder oil, check out these resources:

[Links]:
Original NY Times Story
American Heart Association
The Fish Oil Blog
Solway-Omacor

*Centers for Disease Control and Prevention
**American Heart Association

Posted by Jeb Foster at 12:50 PM | Permalink
 

There’s a reason you don’t spend the afternoon gabbing on your cell phone. It’ll cost you—that and you probably have a job. But to free up air waves during peak hours, companies offer incentives to consumers who opt to use their phones during “off peak” times, such as evenings and weekends. Following suit, some London insurance companies have begun offering similar perks to drivers to stay off the roads when they are congested and driving is more dangerous.

Basically, “