Women's
Independent Guide to Insurance
Financial Decision Makers
The environment in which women now live, work and
care for their families is much different from previous eras.
Women juggle many roles: career, marriage, motherhood, caregiver
to aging parents. And, even in dual income families, women still
handle major responsibility for household management. Regardless
of our stage in life, educational background, economic situation,
marital status, or number of dependent children, women make--or
strongly influence--decisions affecting our financial well-being
and that of our families. Women must be prepared to act as advocates
and financial decision makers for ourselves and on behalf of
our spouses and families. They also must be able to plan effectively
for our futures to ensure financial security.
The Women's Independent Guide to Insurance was created
by the Independent Insurance Agents of America (IIAA) to help
you plan for and achieve your financial security goals. We have
provided information regarding the different types of insurance
available and suggested when various forms of insurance are most
appropriate. Our goal is to assist you in making sound, informed
decisions to meet your specific needs.
The Independent Insurance Agents of America is an association
of 280,000 agents and agency employees nationwide who bring value
to clients by offering the best combination of coverage, service
and price. IIAA members represent many insurance companies and,
as a result, can "shop" for policies that best meet
their client needs. Because we are not tied to a specific insurer,
we also serve as advocates of our clients' interests.
Your life will most likely differ greatly from your mother's,
just as her life differed from your grandmother's. Happily, the
role of today's women in family and business finances is broader
than previous generations ever could have imagined. IIAA wants
to help you meet each new financial challenge, helping to ensure
your success and your financial security.
Women continue to emerge as an increasingly powerful economic
force in today's society:
- 55% of employed women account for half or more of
household income;
- 60% of women now work, by 2000 women will account
for two -thirds of new entries into the workforce; and
- The 7.7 million women-owned businesses in the U.S.
are the fastest growing segment of the economy and employ 35%
more people in the U.S. than Fortune 500 companies do worldwide.
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Why Insurance?
Whatever form, insurance addresses risks and how to
effectively control your exposure to loss. Insurance is a means
to an end; a way to help ensure that you have sufficient resources
to survive the financial crisis that could be caused by fire,
auto accident, successful lawsuit, health problem or loss of
an income provider. By covering your exposure to risk, you minimize
the financial damage you might suffer.
Insurance works by spreading the risks of an individual--you--among
many individuals. The chances that everyone in the group would
experience a crisis at the same time are statistically very small.
Insurance premiums are collected from everyone in the insurance
pool and paid only to those who suffer a loss. The cost of your
insurance policy is determined by the likelihood that you will
file a claim. That's why, for example, an individual or family
with several speeding tickets or car accidents will pay more
for insurance than those with clean driving records.
To protect your financial security, independent insurance agents
recommend that you carry auto, homeowners/renters, life, disability
and health insurance in amounts appropriate to your situation
and needs. Agents also suggest that you revisit your insurance
coverage as changes in your life alter your financial security
needs.
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Lifestage Defines Need
Various factors significantly impact the types and
comprehensiveness of insurance you and your family or business
require.
For example, a single woman just beginning a career may not
be interested in or able to afford the broad coverage that is
required by a more mature worker with dependents. Similarly,
a woman approaching retirement age will have different financial
security requirements.
Your marital status influences your needs. A married woman who
is a full-time homemaker may rely on the insurance benefits provided
by her spouse's employer. Divorce or the death of your spouse
may change the scope and nature of the health, disability and
life insurance coverage you carry. Becoming a parent also impacts
your insurance needs.
Employment status is another factor. If you receive adequate
health and life insurance from your employer, you may not need
supplemental coverage. However, if you are a full-time homemaker,
self-employed or receive inadequate employee-related benefits,
you may have insurance gaps. And, if you are self-employed--with
a business in your home or other location--you need to secure
business insurance to protect your business and yourself.
Each time your lifestage changes, it is important to reassess
personal, family and business insurance needs. This evaluation
can be done with the assistance of a local independent insurance
agent representing a wide range of insurance providers. Ultimately,
your insurance choices will be determined by your individual
situation and the needs of your family.
Your stage in life often determines the type of insurance and
amount of coverage you need. Lifestage is defined by:
- Age
- Single, married, widowed or divorced
- Parent or childless
- Own or rent a home or other major property
- Employed or unemployed
- Work in traditional setting or at home
- Own business or employed by others
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Insurance Types
You essentially have three avenues to purchase personal and
business insurance: telemarketing companies (who use sales people
via 800 numbers), captive agent companies (who employ agents
to represent only their insurance company), and independent insurance
agents. For you, independent agents mean access to numerous options
that lead to the best combination of coverage, service and price.
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Tailor The Right Coverage
Property/Liability Insurance--Provides protection for
your home, automobile and household or other possessions, and
from claims against you for something you did or failed to do
which resulted in physical or financial loss to the person filing
the complaint.
Life Insurance--Pays money to the person(s) or organization(s)
named as a beneficiary by the policyholder if the policyholder
dies. Some life insurance policies also function as investment
vehicles by accruing value as premiums are paid or by replacing
estate assets depleted by inheritance taxes. Your employer may
provide basic life insurance for employees during their tenure
with the company. Often, employees are advised to maintain some
level of separate coverage if their employer's coverage is not
adequate. A personal policy also is good insurance in the event
that you are laid off and, due to health problems, would not
be able to get coverage for a new life insurance policy.
Health Insurance--Covers costs related to your health
and your family's health, such as doctor visits, hospital expenses
and diagnostic tests. While many employers provide some level
of health insurance, you may need to supplement the coverage
or, when self-employed, secure health insurance for you and your
family.
Disability Insurance--Pays the individual(s) covered
for income lost due to a disabling injury or illness. It enables
your earning power to continue even if your earnings do not.
Again, some employers offer basic disability insurance that covers
extended illnesses, but you need to determine if the coverage
is long or short-term to adequately meet your needs.
Long Term Care Insurance--Provides coverage for skilled
and custodial care in a nursing home. Some policies also may
cover home health care expenses. You can purchase coverage for
yourself, your spouse and your parents to offset the costly expense
of nursing home care, which most people pay out of their savings.
Policy costs are determined by the age and health of the individual,
type of care and other factors.
Government Benefits--The government offers several
types of supplemental insurance to the elderly, retirees, disabled
and disadvantaged individuals. Programs include health care,
disability, and compensation to laid-off or injured workers.
This insurance provides only minimal base coverage. Individuals
receiving government benefits should consult their independent
insurance agent to determine proper coverage to meet their needs.
Your independent insurance agent can offer more information
regarding the limits and types of coverage required by you, your
family and business.
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Driving Coverage For Your Automobile
Automobile insurance protects you, your family and your vehicle
in the event of injury or damage resulting from an array of occurrences.
Your policy will cover the cost of repairs or replacement and
furnishes protection against personal liabilities. Your independent
agent can tailor a policy that meets your needs and provides
several types of insurance coverage, including:
Liability--Covers injuries and damage you
cause to other people or their property while operating an automobile;
Collision--Covers damage to your vehicle
in an accident;
Comprehensive--Covers damage to your vehicle
from fire, break-ins, vandalism, theft and natural disasters;
Medical Payments--Covers emergency and related
medical payments for you and your passengers, regardless of who
is at fault;
Uninsured Motorists and Underinsured Motorists--Protects
you and your passengers in an accident with drivers carrying
insufficient or no liability coverage; and
Additional Coverages--Pays for expenses
such as towing, labor, rental vehicles, etc.
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Protecting Your Personal Property
Homeowners insurance provides comprehensive coverage for damage
to structures and personal property, unless the coverage is specifically
excluded. Coverage includes protection from damage caused by:
- Fire or lightning
- Windstorm or hail
- Explosions
- Riot or civil commotion
- Aircraft and other vehicles
- Smoke
- Weight of ice, snow or sleet
- Freezing of plumbing, heating, air conditioning or
other household system
- Theft or vandalism
- Falling objects
This insurance covers the repair/ replacement of your property
and furnishes protection against personal liabilities. Separate
policies are purchased for homes and other major property or
possessions. Because your home likely is your most valuable asset,
it is critical to insure it properly. For example, if you live
in a geographic area prone to certain weather problems--such
as floods, earthquakes or hurricanes--you need special policies
to protect your investment.
In addition, you should be aware of monetary limits on groups
of items, including jewelry, computer or electronic equipment,
artwork, some furnishings, etc. You can purchase additional insurance,
called floaters, by listing items that fall outside the limits.
Based on the value of your property, the cost of the floater
is usually minimal and outweighs the risk of leaving family heirlooms,
equipment and prized possessions uninsured and unprotected.
You also have the option to insure your property for the actual
cash value or the replacement cost, which determines the amount
of compensation you receive. Replacement value enables you to
replace property at the current market price, regardless of its
age or condition; whereas, under actual cash value coverage,
depreciation for age or condition is deducted from the replacement
cost, reducing your compensation.
Renters insurance provides coverage for your personal property
when you pay to live in a building owned by someone else. Personal
property includes all of your household possessions. You are
protected from disaster by a policy tailored to meet your needs
and based on the value of your belongings. Similar to homeowners
insurance, there are monetary limits on groups of items, coverage
can be supplemented with riders and you have compensation options.
Whether you own or rent your home, your policy should include
liability coverage. This important coverage protects you against
claims of bodily injury or property damage that result from your
negligence and may prompt a lawsuit. These claims can be caused
by any non-auto incident that occurs on or off your premises,
such as a dog bite or slippery sidewalk. Coverage also includes
medical payments for the injured person, such as first aid or
emergency room treatment. You need to consider a limit of liability
sufficient to protect you for the cost of a lawsuit and today's
high medical bills.
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Backing Your Business
Commercial or business insurance offers property and liability
coverage whether you operate from your home or another location.
While homeowners insurance may cover business property within
specified limits, it typically is insufficient and does not protect
against lawsuits related to your business activities. Selecting
the right insurance is just as important as the choices you make
for company stationery, equipment or services. Your independent
insurance agent can help you review your options and tailor coverage
that best meets your needs.
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Ensure Your Financial Protection
Insurance is an important component of your financial planning.
It is the safeguard to protect you, your family, your home and
other possessions, and your business from financial disaster
in the event of a catastrophe. As your life changes, so too,
do your insurance needs. An independent insurance agent can assist
you in matching insurance protection to your specific situation.
Personal service--based on an understanding of your needs and
your goals--is the hallmark of independent agents. For you, it
means protection and peace of mind.
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