Do You Need Asteroid Insurance?
Insurance usually is for big-ticket expenses that could adversely impact your finances. It isn’t always necessary to carry insurance or file claims for things you can comfortably pay to repair or replace out of pocket. However, there may be certain concerns that keep you up at night.
For example, during the 2017 hurricane floods, we watched a storm surge devastate a large metropolitan city (Houston) that is not situated directly on ocean shoreline. Especially for those who live near lakes, streams and coastal shores, the reality of flooding may have cut too close to home. Although the likelihood of similar flooding in other areas may be low, some people may still have concerns about their home being flooded and recognize it would be difficult to recover financially in such circumstances.
For this reason, certain types of optional insurance can be an important purchase. Everyone has different pressure points and concerns, and a reasonable annual premium could be a small price to pay to help put those concerns to rest.
Speaking of insurance, here’s an interesting tidbit: Most homeowner insurance policies cover falling objects from the sky, including asteroids, meteors, satellites and other debris from space.1 Just one less concern to keep you up at night.
Insurance guarantees rely on the financial strength and claims-paying ability of the issuing insurer.
1 Brightway Insurance. Feb. 8, 2018. “Ask the experts: Does my insurance cover asteroids, meteors and falling satellites?” https://www.brightway.com/news/ask-the-experts-does-my-insurance-cover-asteroids-meteors-and-falling-satellites. Accessed March 4, 2018.
Money Saving Tips
Permanent Life Insurance Policies
Most people think of life insurance as a way to protect loved ones with a lump-sum benefit in the event of the policy owner’s death. That is life insurance’s primary purpose; however, a permanent life insurance policy can offer much more. Consider the following features and benefits:
- Tax-free death benefit proceeds paid to beneficiaries
- Tax-deferred growth of interest earned on the portion of premiums paid that is applied to the cash value
- Competitive interest rates
- Higher contribution amounts are allowed, relative to IRA and 401(k) limits
- Should a policy owner let his policy lapse, he is still able to withdraw any money that remains in the cash value.
- A permanent life insurance policy owner has the ability to borrow against the death benefit of her policy through the use of policy loans.
- A policy owner who takes out such a policy loan may control the amount and frequency of repayments to his account; however, any outstanding policy loans and interest will reduce the total death benefit payable to beneficiaries and may cause the policy to lapse. Additional premium payments may be required to keep the policy in force.
- Permanent life policies offer a variety of rider options for an additional fee, such as accelerated benefits, creditor protection, guaranteed insurability and waiver of premium.
It’s important to remember that most life insurance policies are subject to medical underwriting, and in some cases, financial underwriting, and the costs of a life insurance policy, including premiums and any cost of insurance charges, is dependent on your age and health at the time of application. If properly structured, proceeds from life insurance are generally income tax free. Guarantees rely on the financial strength and claims-paying ability of the issuing insurer. Additonal riders are not available on all life insurance products and may not be available in all states.
Neither our firm nor its agents or representatives may give tax advice. Individuals should consult with a qualified professional for guidance before making any purchasing decisions.
Specialty Vehicle Insurance
As we approach summertime, many people break out their “adult toys” like boats, motorcycles, RVs and ATVs. Because these vehicles aren’t always used year-round, owners may be tempted to drop insurance coverage during the months they sit idle.
However, it’s important to remember that insurance isn’t just for accidents. It can cover vandalism, theft, fire, flood damage and injuries. That’s why it’s important to maintain year-round coverage. Without liability coverage, the owner may be responsible for any costs associated with injury or damage during those non-use months.1