Life Insurance Introduction Term life insurance is exactly what it sounds like - life insurance for a period of time. It is the most popular type of life insurance available today. It is bare-bones insurance coverage. Term life insurance is a very straightforward product that varies very little from company to company other than by price. Term life insurance is a life-only coverage policy, in which the benefits are obtained after your die. So, it is only a death benefit. Term life insurance is temporary insurance and does not build cash value. It is a life insurance policy, which pays you a lump sum on the death of the life insured. It is only good for the life of the term. Term life insurance is cheaper than whole life insurance because your family only collects a settlement if you die during the term of the life insurance. Term Life Insurance is NOT permanent coverage, nor can it be paid up. Costs It is generally less expensive than other life products because when you buy a term policy you pay for life insurance and nothing more. Premiums are several times lower than whole life insurance. It is indeed the cheapest way to secure your family's future. Home Insurance Types of Home Insurance It is prudent for every homeowner to take on home insurance. Before you sign up for home insurance you should be aware of the different types of home insurance available, so that you can choose one that provides the kind of coverage that you require. Here is a look at the different types of home insurance policies: * Homeowners – 1 (HO – 1) – In this home insurance type, you receive coverage for specific terms stated in the policy. In other words coverage or protection against losses is limited here. Usually such policies suit you if you want to get insurance coverage for some valuable items in your home like an antique or a painting. * Homeowners – 2 (HO – 1) – This policy is very similar to HO – 1, but it provides coverage for a list of events against which you are insured for losses. This means coverage from the insurance company is limited to the events stated in the policy. * Homeowners– 3 (HO-3) – This policy is also known as the ‘all risk or ‘open perils’ policy. It is taken up by most homeowners and it covers most losses except situations such as war, flood, nuclear accidents, and earthquake. It provides coverage for items inside your home as well. * Homeowners– 4 (HO – 4) – This policy is referred to as renters insurance or renter's coverage. It provides coverage for losses incurred on those areas of the home and the items in the home which are not covered by the blanket policy written for the entire home complex. * Homeowners– 5 (HO – 5) – This policy is very similar to the HO-3, except that it is applicable to a home and not a condo or an apartment. Coverage is provided against losses suffered by the homeowners as well as any issues faced by visitors or passers-by. It covers more losses than what is covered in the HO- 3. * Homeowners– 6 (HO – 6) – This policy is also known as Condominium Coverage. It covers for losses incurred by the home owner for that part of the building that belongs to them and can also provides coverage for losses to guests of the insured in addition to personal property. * Homeowners– 8 (HO – 8) – This policy is also refered to as the ‘older home’ insurance as it enables owners with higher replacement costs to get insurance coverage at a lower market value rate. Flood Insurance Understanding Flood Insurance Most residents in the areas affected by Hurricane Katrina and Rita thought that they had hurricane insurance in their home insurance policy coverage. However, they were in for a surprise when they found out this was not so. Reason? Typical home insurance policy coverage will not cover for damages caused by hurricanes. It will only provide coverage for damages caused by wind and damage caused by water entering through a wind-damaged area. What is required to protect against flood damage caused by hurricanes is to take flood insurance. Flood insurance provides compensation in the event of damages caused by hurricanes which are experienced in the form of floods. You need to take flood insurance if you live in a flood prone area and if your home is susceptible to damage caused by tides, waves, and overflowing lakes and rivers. This insurance type was created in 1968, by Congress under the National Flood Insurance Program (NFIP). The government’s purpose of introducing flood insurance as a form of home insurance coverage was to reduce the increasing expenditure in providing relief of flood victims. Flood insurance not only covers floods caused by hurricanes, tides, waves, and overflowing lakes and rivers, it also provides compensation in case of flood damages caused by flash flooding that happens as a result of heavy rainstorms or rapidly melting snow. When you make a claim for damages caused by floods, you need to have all the necessary documentation ready. Take photos of the damages so that you can show them to the insurance company. The insurance company will assess the damage caused and will provide compensation accordingly. On the other hand, thinking that water is not really going to damage your home is foolhardy because just a little water over your home can cause a lot of damage. So be sure to consult with your insurance agent on this if you are living in an area prone to such flood risks. If you live in an area prone to flooding by hurricanes and you do not have flood insurance, you will be pretty much disappointed because the insurance company will not provide any compensation for your losses.