Some Lesser Known Types Of Insurance
Some Lesser Known Types Of Insurance
The common and most popular insurance are home, auto and mortgage. There are also lesser known types of cover such as universal-life, variable universal-life and umbrella among others.
Universal-life cover is the same as whole life where a person contributes premiums and names a death benefit. This however is different from whole life in the sense that, a person can choose to change the rate of premiums and also rename a beneficiary. This policy puts up a cash value whereby a person contributing premiums can withdraw an excess amount of money later for personal use.
Variable-life is one unique type of insurance. Part of the policy is put into investment and this can be a good or a bad thing depending with the economy. If the investment increases, the death benefit will also increase but if there's a loss in investments, the death benefit will decrease consistently.
Variable universal-life is a combination of variable and universal life insurance. A person has the right to change the amount of premium contributed each month and rename the beneficiary. This policy allows the company to use part of the contribution in investments and the same profit and loss sharing applies as in variable life .
With term life , a person can purchase cover for a short period of time for example from 1-30 years. This policy does not build up a cash value and because it is temporary; it is cheaper than permanent policy.
Umbrella cover is not popular among many individuals or companies. This all areas that other cover policies do not cover. Auto cover and home cover risks that can be investigated. (How about finding out about MLC? Also make sure to visit AMP Life Cover.)
Umbrella insurance covers all what cannot be expected after home and auto cover have failed. The premiums for this cover are paid yearly and this is in addition to the other cover: auto and home cover. An example where umbrella insurance will benefit a person is when there has been a car accident and the court has ruled in favor of the other driver. This means that the driver who has to compensate for the accident needs to pay a lot of money and using the auto insurance cannot add up to the required value. The extra cash for paying the full compensation will come from umbrella insurance. A car that has been insured against collision alone will not benefit from insurance if a tree or people damage the car while rioting. The umbrella insurance will cover all these risks and including theft.
When a home insurance company cannot cover the loss incurred in a house, umbrella insurance will cover whatever losses have occurred. The normal house policies cover against risks such as fire, theft and natural calamities. If the house is destroyed by termites or poor foundation, the umbrella insurance is there to cover all the losses. Limits in auto or home insurance make an insurance cover very specific while umbrella insurance covers anything that can cause damage to property.
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