An Overview about Tax Efficient Life Insurance

If you have started up a business recently with a few number of employees, you must be planning of providing life insurance cover to each of the. Well, at most of the times, the employers of the small companies opt for a contract, in which the premiums are paid by the employer, on behalf of the employee, either from his own earnings or from the company's account. As a result of this, the employer spends a lot on the premiums. Moreover, these premiums of conventional life insurance policies are also subject to National Insurance payable. As an alternative to the traditional method of life cover policies, tax efficient life insurance has turned out to be a popular insurance policy among the employers, these days. According to the features of this policy, the employer don't need to enter any specific contract with your employees. You can just set up a death in service benefit for all your employees in which the payments are done by the company, and that too, in a tax efficient manner.

Who should opt for this cover?

This type of life insurance policy is especially designed for employers who have started up new businesses, with a few number of employees. This type of policy is absolutely not meant for companies that have the required number of workers to be eligible for a registered group life scheme.

Moreover, employees with high earning are especially benefited by this type of policy. This is so because the employees are allowed to keep the payouts separately from their pension or other annual allowances. Since the pension funds are high enough in themselves, it is important to keep these benefits separate from them. Since the premiums are not paid in kind, they are not subject to severe tax obligations. The employer, too, will get to enjoy certain substantial tax benefits like corporation tax relief as the monthly premiums are considered as trade expenses. 

Some positive aspects about Tax Efficient life insurance -

The recent changes made to relevant life legislation have proven to be extremely beneficial for the directors of the small companies. Initially, there was no individual scheme to be offered to the individual employees, whereas one could not apply for the registered group life scheme unless there were enough employees, to be eligible for that.

Due to such restrictions, mentioned in the legislation, there were some problems in providing life insurance policies to the employees and considering these problems, certain changes were made in the legislation, following which a client will be entitled to 15 times of his annual salary.

One should remember that the policy does not include any sort of surrender value and it expires when the beneficiary reaches the age of 75. Moreover, if the local tax inspector is convinced of the fact that the premiums can be considered as trade expenses and they qualify under the exclusive rules, they will be considered for certain tax exemptions. One can use a relevant life calculator to understand the effectiveness of tax efficient life insurance.

Why Would Anyone Insure Their Art?

Most of us are accustomed to seeking insurance cover for things such as our homes, our car, travel, and even for our health, but when it comes to insuring fine art work we may well think why bother. There was a time when the so called ordinary person would have perceived the idea of insuring artworks to be something that only the gentry did, but nowadays with people often putting any spare money into a work of art which is likely to appreciate in value, then insuring against loss, theft, or damage should be a reality. 

Insuring Against the Unexpected

Whether you own a small exquisite piece of fine art or are an art dealer with numerous priceless pieces adorning your gallery, insurance is paramount for peace of mind. Aside of the tragic loss of human life which happens when natural disasters like hurricanes or floods wreak havoc around the world, art galleries and swanky offices can sometimes be left assessing the level of damage to irreplaceable pieces of art which were damaged when the area flooded. Naturally they’re also worried about the cost of their insurance premiums rising, but the point here is that at least they did have insurance for when the unexpected happened.

Collections Borne out of Love

Under insurance is another big problem because plenty of people over the years amass large collections of antiques, jewellery, and art but many of them don’t have a real grasp on the true value of their collection. Because collections are invariably built out of love or passion for particular items, insurance isn’t approached in quite the same way as it would be if they were looking to insure their car for example. Often they just insure these valuable collections for the price which they paid for them some years ago.


To counter this problem people should be insuring items in their collections for the retail replacement value, which means getting someone to appraise them on that very basis, every few years or so. This means that they have appraisal reports which they can pass to insurance companies to ensure adequate coverage and it also means they have evidence to back up any future claims.


More insurance companies are starting to employ art consultants and can make their more wealthy clients aware of the importance of valuation and insurance. However, if you’ve got collectibles or art worth a couple of thousand pounds or more, then you may need a specific policy clause to cover your valuables, since most general home policies rarely cover items above that level.


There are plenty of specialist insurance companies such as Catlin Insurance UK who offer coverage for a variety of fine art. The range of inclusions under a fine art insurance policy is wide and includes such things as

• Furniture, lighting and mirrors 
• Historical artefacts 
• Arms and armour 
• Fine wine, bottles and glasses 
• Musical instruments 
• Ceramics, silver and glass 
• Fossils and mineral specimens 
• Textiles 
• Memorabilia 

• Toys and games 

It’s worth shopping around for the best deal but take care to find out just what risks are covered. Check that the policy offers protection against theft, accidental damage, and as in the case of a natural disaster, losses from fire and water damage.

Types of Taxes

Taxes are a fact of life. They are necessary to fund various institutions, programs and projects such as Social Security, Medicare, the military, schools, emergency services and highways. There are many different types of taxes; however, the most common are listed below.

Federal and State Income Taxes

Most everyone knows what federal and state income taxes are, and they know that they must file them each year. Federal taxes are handled through the Internal Revenue Service, and the deadline to file is April 15 of every year. While many people will need to pay taxes at that time, some will get refunds.

The requirements for state taxes vary, and some states do not even collect taxes. However, most of them do. As such, it is best for you to inquire with your state as to whether or not you need to file. You should also ask when the deadline is. Additionally, if you own a business, you may need to file federal and state taxes more than once per year.

Property Taxes

If you own any real estate, you will need to pay property taxes, known in some states as real estate taxes. Real estate typically includes such things as a personal home, a rental home, a piece of land or a commercial property. These taxes are based on the assessed value of the property in question. 



Property taxes are often collected by the state or county that you reside in and in some states, you may also need to pay property taxes on such things as recreational vehicles (RVs), watercraft and pets. Requirements, restrictions and due dates may vary by state or county.

Sales Taxes

Just as with income taxes, you probably already know what sales taxes are. Sales taxes are collected on the state level, and you pay them whenever you buy something or pay for a service. The amount of sales tax you will need to pay depends on the item or service you pay for and the state you live in. 

Payroll Taxes

If you own a business and pay people to work for you, then you are responsible for paying payroll taxes. These taxes are taken out of your employees' salaries before you distribute their paychecks. Also known as FUDA or FICA, payroll taxes help fund such programs as Social Security and Medicare. 

Other Taxes

These are the most common types of taxes that you need to pay regularly. However, there are more taxes you may need to pay depending on your unique circumstances. These can include such things as excise taxes, estate taxes, tariffs, corporate taxes and capital gains taxes.

Long Term Care Insurance: A Looming Problem for Baby Boomers

Living in a segment of town where there are a number of retirees renting their own homes make me wonder how fail-proof their retirement plans are. I wonder if they have planned for a rather long retirement phase ahead, as most of us will live longer than our counterparts in generations preceding us. I wonder what they used for their retirement plans, if they worked and put aside money in their 401K or equivalent pension plans, or if they invested their money and are living off of interest or monthly payments from the investment. I wonder how many of them take up odd jobs to keep the rent paid, and what those jobs construe. Retirement is both fascinating and frightening because it can seem like a daunting task to live several decades of your life without an income stream that is an active job you currently hold.

If you are a baby boomer, chances are you've already made your decisions on retirement plans. The Baby Boomer segment in the US has long been touted as the largest group to enter retirement with the most amounts of problems in long term care and Medicaid access. Many of us know that Medicaid is not sustainable in the long run, which makes the case for long term care for boomers even worse. This is because when the largest group requiring long term care retires, the ratio of working age to elderly population will be at its lowest. The tax base that ought to be providing the source for Medicaid funds will be the smallest in 80 years. This is a very bleak picture that has serious implications with very few concrete solutions. Long term care insurance can hedge against these problems, especially because Medicaid only steps in once a senior has spent down almost all their assets and retirement income. 

An interesting notes on the issue however, is that many boomers who can afford long term care insurance have still not bought any. Many boomers might think it unnecessary but LTC insurance covers an important segment of long term care that is the most expensive item on the LTC list: nursing home care. Nursing home care and home health care coverage are now standard on almost all LTC policies. 

As we all wait for the Federal Reserve to announce its decision on its updated economic policy, many are anticipating its call on the reduction in bond purchases if it decides that the economy has been faring well for itself and could do with a reduction in stimulus packages. With so much uncertainty looming in the economy still, it might be best to self-insure against long term care expenses right now while the market is still relatively stable. Last year, some prominent long term care insurance players including Prudential, Unum and MetLife disbanded their LTC offerings, saying that it wasn't a profitable enough business segment to offer any more new policies to new consumers. Before the supply of long term care insurance diminishes further or worse, becomes prohibitively expensive, look up some quotes and consider purchasing a policy if you are a boomer nearing or already in retirement.

The statistics predict a glut of boomers spending on nursing homes about 30 years out from now. This group includes forty year olds as well, so if you think you're too young to even consider LTC, think again! The need for long term care will come upon you closer than you think.

Author bio: Frank Mitchell has worked as a life insurance agent for 10 years. After an accident in 2011 that kept him at home for more than a year, Frank started offering advice on forums and other social media networks. He now works as financial advisor and in his spare time writes articles on subjects he is passionate about. On the weekends, you’ll find Frank dirt biking.

Reference:

http://www.acli.com/SiteCollectionDocuments/ACLI/PDFs/Public%20Affairs/LTCBabyBoomers05.pdf

http://www.cbsnews.com/8301-505146_162-57393433/prudential-quits-individual-long-term-care-biz/

Travel Insurance – Your Best Companion Abroad

A large number of people forget to take a very important item when formulating plans for the holidays and that is travel insurance. It is a holiday essential that safeguards the individuals and their families from the unexpected events that they might face in their trip. Without the proper travel insurance, there is every possibility that the individuals might expose themselves to some kind of financial risk and lose out considerable amount of money. This could really lead to the disaster vacations devoid of any fun and enjoyment. Here are a few prominent reasons why an individual planning a tour with their invaluable family members must consider taking travel insurance:

Illness and Injury

Anything may happen to you or the members of the family while on the holidays. Especially when you are travelling in a foreign country, there are chances that your immune system might not be very strong and you may catch cold or flu immediately. If you or a prominent family member happen to meet with an accident, then in such a situation, best medical attention is required. In some of the cases, hospitals do not provide care to the patients unless they have a travel insurance or significant amount of cash up front. It is imperative that you must stay protected by taking travel insurance for families and have a stress-free trip. 

Lost and Delayed Luggage

It cannot be denied that travelling is very stressful as it takes long hours to reach a particular destination. The problem becomes all the more worse when the luggage gets lost or delayed due to the negligence of the airlines. It is certainly a worrying situation as you are not able to start your tour because the precious personal belongings have been lost and there is nothing to wear. However, having an international travel insurance means you can claim a reimbursement for the invaluable items that have been mishandled.

Weather Delay and Natural Disasters

After boarding a airline plane, you find out that the flight has been cancelled in between because of the bad weather and you will be required to stay overnight at the airport hotel. What is worse that you figure out that the airline does not provide a cover for your accommodation and your luggage is in transit. In some of the extreme cases, the airlines do not reimburse the expenses arising due to the weather delay or natural disaster as it is not within their control. It is true that the bad weather conditions occur frequently all over the world and due to this many vacations are affected because of flight cancellation. Having an excellent travel insurance means you get an optimum coverage for the delayed or the cancelled flights due to the bad weather.

A very important point that should be noted here is that you should always focus on getting best travel insurance for a renowned company. There is no point of all getting this particular kind of insurance without undertaking a proper research work and suffering inconvenience during the trip. For making sure that you get a right insurance you can either devote some time towards researching online or take the help of an experienced agent to make sure you grab the right insurance according to your needs and requirements. If you are too pre-occupied with your work and do not get leisure time to do the research work, then you also have the option of taking the services of the travel concierge company. A travel concierge besides getting you a perfect insurance can also help you a lot in variety of things such as the arranging flight tickets, booking accommodation and completing other important formalities.

Having travel insurance provides a great peace of mind and lets you and your family members enjoy the worry-free holidays.

Things to Keep in Mind About Life Settlements

Senior life settlements are one way for those who are older to meet their financial obligations, and to use the resources at their disposal to help make themselves that much more comfortable later in life. However, in order to get a life settlement, it's important for a senior to know what category he or she fits into, and how likely it is they'll be able to get what they need.

What a Life Settlement Company Looks For

There are certain things that make a senior more likely to get a life settlement than they otherwise might be. For instance, many companies look for seniors that are over the age of 70, and who have roughly a 12 year life expectancy or less. The reason for that is because the company wants to see a return on their investment, and they don't get paid until the individual in question dies and the benefits will be transferred to the company that gave them the life settlement in the first place.

In addition to this though, a settlement company tends to look for seniors that have had their life insurance policies for two years or longer. If someone falls into these important categories, then it's likely that a settlement company will consider that person a "good" investment, if talking about someone's death can ever be considered good.

Checking The Terms

People turn to settlement companies for a variety of different reasons. Whether they have outlived their beneficiaries, they can't keep up on the payments for the policy, or another reason entirely, the idea of a lump sum that's more than what they're paying but less than the death benefit appeals to them. However, it's important that these persons look very carefully at what a settlement company is offering before they sign on the dotted line. Once the signature's there, there is no going back afterward.

Those getting the settlement need to see precisely what the company is offering, and what strings are attached to it. Different companies have different policies, and it's the duty of the person getting the settlement to read the fine print and make sure they're all right with it. This includes the amount of the settlement, as well as whether it's in a lump sum or paid out over time. It also includes the terms of the agreement, including dates, times and amounts. All of that is important, and once someone signs the contract, they are binding. It's better to carefully consider something and decide it's not right then to rush right in and realize that at a later date.

Check out your options. Talk to a reputable life settlement company and find out everything you need to know about your options. You are under no obligation to go with them, but their friendly customer consultant can help.