Today, leading insurance companies use websites to provide consumers, insurance agents, and insurance companies with a wealth of information and resources but the websites also provide numerous insurance tools that can make planning, buying, and claim filing so much easier. Although many companies use the same type of insurance tools, some offer something a little extra or special.
Probably one of the best insurance tools has to do with claims. The old method of filing a claim was long and complicated. Then trying to get an update on where the claim was at in the approval, denial, or payment phase was nearly impossible. Today, agents and consumers alike can use a special claims tool that makes researching and searching quickly and easy.
One of the fascinating aspects of the insurance industry is that while most companies and agencies have upgraded offices, installed computers, purchased new phone systems, and so on, many still use the old method of claim processing seen 15 to 20 years ago. Because this option is simply not acceptable, software companies have developed a number of insurance tools that help companies operate in a more efficient and effective manner.
Obviously, using insurance tools for handing the huge volume of claims saves insurance companies and agents a tremendous amount of time that could be used working on something else. However, these tools also improve overall customer support in that when a policyholder calls in to find out the status of a claim, the information could be obtained within seconds and the simple click of the mouse.
Another advantage to using insurance tools specifically for claims is that errors are avoided. Trying to manage claims by hand is an open door to disaster. Numbers are transposed, files put in the wrong place, payout dates misquoted, and so on. However, with the efficiency of insurance tools for claims, all of the problems that insurance companies and agents have dealt with for years have been eliminated.
With technology where it is today, software developers have been able to listen to the concerns of insurance professionals, as well as consumers and build a viable solution around that information. Obviously, for insurance tools of any kind to work, developers need to conduct a variety of interviews and listen to focus group discussions so they can gain a full understanding of the insurance tools needed.
Once developers have all the required data, they begin to design insurance tools using modern day computer technology. The outcome is insurance companies and agencies have a new business model that allows them to provide consumers with a better and more valued added solution. Some of the other popular insurance tools include financial planning, policy terms and rates comparisons, and more.
The insurance tools available today were simply not something that could have been offered a few years back. While there is an investment for each software solution initially, ultimately, the return on investment is incredible. Of course, as more and more insurance tools are developed and companies and agencies are buying greater volumes, the price for these software solutions will continually decrease in price.
Is Term Life Insurance a Waste of Money?
In this article, we wanted to address the question of term life insurance being valuable or a waste of money. For starters, the purpose of term life insurance makes it possible for people to purchase a life insurance policy needed at a time when permanent insurance does not fit within the budget or when life insurance protection is needed but only for a specified amount of time. Although there is no cash value, term life insurance does provide a guaranteed death benefit.
For premiums, these are designed to increase at set intervals, usually one, five, ten, and twenty years, based on the exact policy chosen. In addition, a policy of this kind is often used when life insurance protection is greater but only for a certain amount of time, followed by decreasing years down the road. For instance, this type of movement would be seen with the addition of new family members, followed by children growing up and moving away from home.
When needing supplemental insurance coverage to go with permanent insurance during the years when needs are greatest, term life insurance would make a great choice. When used for at a time such as this, you would have the opportunity to purchase death benefit protection while keeping the amount of premium low. Then, if you choose a convertible type of term life insurance policy, you would have immediately coverage but also have the option of buying permanent insurance in the future.
In response to the question of whether term life insurance is a waste of money, in most situations the answer would be no. Because this type of coverage is designed for a very specific purpose, people who take out a policy typically benefit from the coverage. Although there are many situations in which term life insurance would prove highly beneficial, you should also understand that some drawbacks exist as well.
As mentioned, term life insurance provides a death benefit but only for a predetermined about of time. Therefore, if you were to outlive the time for this benefit, then the beneficiaries on the policy would end up with nothing, meaning you invested time in a policy that provided no benefit. Another thing you should know is that at the time the term life insurance policy ends, all protection is also gone. The same would be true if you were to stop making the premiums for the life insurance policy.
One of the best ways to think of term life insurance would be when renting a home. By being a renter, you would be granted access to the property, as well as the rooms inside and any amenities on the outside. However, this access would only be made available for the term of the contract and if you are making the payments as agreed. However, once the rental contract ends and you move on, you take with you no cash value, even if you had lived in that home for five years.
When shopping around for a term life insurance policy, it would be worthwhile to choose one that converts automatically to permanent insurance. However, you want to pay close attention to the details since not all policies will convert. Even if you have a term life insurance policy that converts, make sure you understand any applicable restrictions. For instance, at the time of the term life insurance policy ending, whether it converts to a permanent policy or not, you may be required to go through another medical examination to prove you are insurable.
Remember, premiums for a term life insurance policy increase at set intervals and over many years, these premiums become expensive. In fact, it is common for a person to buy this type of insurance around age 25 while holding onto the policy until around age 65. At that time, premiums have become too high for most people to afford. Because of this, choosing a term life insurance policy that converts to permanent insurance is so important. Once you have locked into a permanent policy at a fixed premium, the policy cannot be cancelled ever if you continue making the scheduled payments according to the contract.
