Humans have always been relatively risk-averse. Its underlying essence of seeking to reduce risk by spreading it around is as old as mankind. From group elk-hunting expeditions to duelists seeking assurance against fatal goring to fear merchants’ fears of marauding tribal thieves making off with their entire cargo, people have sought loss protection since time immemorial.

As far back as 3000 BC, Chinese merchants redistributed goods among multiple ships during lengthy trans-oceanic voyages. This minimized potential loss from capsizing of any given vessel.

Likewise, the famous Hammurabi Code of 1750 BC revealed a similar practice of loss protection among Mediterranean shipping merchants. If a merchant borrowed money to finance a shipment, an additional sum was due in exchange for the lender’s loan cancellation agreement in event of cargo theft. Inscribed alongside the royal seal, these written arrangements are the oldest-known insurance policies.

During the Achaemenid Empire reign from 550 to 330 BC, Persian monarchs insured their subjects by requiring official registrations through public notaries. The process became so culturally entrenched as to constitute an annual tradition.

At the commencement of each Iranian New Year, ethnic leaders and other willing participants presented the king with gifts during an elaborate ceremony that was held to commemorate the event. Special registrations were required for gifts valued in excess of 10,000 Derrik.

Registration was highly beneficial to the gift giver, as it insured assistance from the king and the Royal Court if the donor found himself in subsequent trouble. For instance, such bequeaths went a long way toward facilitating proposed construction projects, gaining official permission for feasts, or obtaining marriage licenses for one’s children.

If registration archives revealed a prior gift from the petitioner in excess of 10,000 Derrik, he or she would receive double this amount.

Although disability insurance is nothing new, several factors have emerged during recent years that have heavily affected the disability insurance industry. These factors have forced insurers to fill bigger than ever before:

Chronic disease: Modern-day medical advances allow employees with serious illnesses such as multiple sclerosis to rejoin the workforce for satisfying, productive careers. In the face of recent legislation like the Americans with Disabilities Act, employers must make reasonable accommodations for such workers.

Economic recession: Meanwhile, employers must do more with less. Smaller staffs must perform more functions. Consequently, employer-sponsored group coverage dynamics have changed radically. Fewer employees mean higher group coverage costs.

Longer Life spans: More people are delaying retirement, thus creating an older workforce. This demographic shift has forced employers to find the ideal balance between the benefits of older workers’ greater experience and correspondingly higher insurance costs.

Providers of disability group coverage have taken the following steps to accommodate these shifting social and economic trends:

• Chronic disease management programs
• Participation incentives for weight-loss, stress management, and smoking cessation programs
• Employee assistance programs such as crisis or nutritional counseling
• In-person and online health coaching
• Integrated health and disability insurance programs.

This last step cuts insurer costs by streamlining healthcare services delivery and facilitating effective preventive measures.

A CIGNA 2007 study revealed that integrated plan enrollees receiving short-term disability benefits were much more likely to return to work than non-integrated plan enrollees.

Social Security Administration studies conducted in 2004 and 2005 revealed significantly decreased revenues. Increased benefit payments to aging Baby Boomers was cited as the primary causative factor. Projections indicate that this deficit will increase in years to come.

The lesson is clear. Take full advantage of ancillary services of employer-sponsored programs. The self-employed or those without employer-sponsored coverage must maintain adequate coverage through private insurers.

Pet Insurance

Once a rarity, pet insurance is now relatively commonplace. Pet lovers cherish their animal companions as highly as they do human family. Veterinary bills, bite liability, and compensation in the event of a beloved pet’s demise are standard features of pet insurance policies. Coverage is often available for less than $10 per month.

Body Parts Coverage

Insurance for particularly valuable body parts has long been popular among celebrities. Jennifer Lopez and David Beckham both carry high-limit coverage on their most prized “assets,” for instance. In typical fashion, the public is following suit. Athletes, musicians, and professional chefs are insuring their feet, legs, or hands with increasing frequency.

Such coverage may seem superfluous and vain. In fact, it is quite prudent. How can a professional drummer or saxophonist function without two hands? What good is a chef who no longer has two feet to support them while standing over hot stoves or ovens?

Baldness Insurance

Celebrities and high-profile actors with public images to maintain often have hair loss insurance. Visible aging is very injurious to their careers. Tom Jones and Troy Polamalu are just two notable examples of hair loss policyholders.

Weight Gain

Like those of balding colleagues, maintaining the right body image can literally make or break slim celebrities. Weight gain policies pay a lump-sum benefit if the insured’s body weight exceeds a pre-set limit. Insurers balance policyholder self interests against unavoidable weight gain due to health issues in tipping the scales of premium rates solidly in their favor.

Prize Winner Insurance

Winning a substantial sum in a contest or a similar context is usually a desirable occurrence. For event promoters and sponsors, however, jackpot payoffs can cause pecuniary devastation. Thus, promotional organizers commonly obtain coverage that reimburses top prize payouts. Benefits are payable only if someone actually wins the prize.

• First, verify that any prospective insurer is state-licensed. Avoid “trip protection” plans that are not insurance products at all. You may be left holding nothing more than a bunch of missing or empty bags to show for your troubles.

• Add-on flight insurance sold at airports is a very poor, overpriced investment.

• Beware of pre-existing policy exclusions. A prior history of anxiety disorder will cause claim denial for a flight anxiety attack that lands you in an Australian hospital.

Optimize Your Options

Travel insurance policies are not created equal. As with all insurance, what’s good for the goose isn’t necessarily good for the gander.

• Baggage Coverage: Lavish dressers should consider a policy with well-padded lost luggage coverage.

• Health coverage: This little-known travel insurance benefit is valuable to elderly, sickly, and international travelers.

• Medical evacuation coverage : Frequent globe gallopers appreciate this great advantage. Medical facilities are substandard in many countries. In addition, Medicare and most US health insurers don’t cover medical expenses incurred on foreign soil.

• Trip cancellation: In case of inclement weather, injury, illness, natural disaster, or death in the immediate family, your travel investment is intact.

• Business Failure: For small travel operations or those in obscure locations, insolvency always looms large. If you opt for this coverage, purchase the policy at least three weeks before paying any travel agent, tour operator, or airline. Also, buy from a third-party vendor as policies offered directly by carriers such as cruise lines invariably exclude this feature.

Getting the best premium

For business trips, begin with your employer. The company should also foot the full premium bill. Personal travel may be covered through employer-sponsored life or health plans at reduced rates.

Next, check with your credit card issuer. Many high-end cards include automatic travel insurance at no extra cost. If applicable, ask for group or family discounts.

How ID Theft Insurance Works

Like other insurance products, identity theft coverage is a form of loss protection. Should disaster strike, homeowner and auto insurers restore your pre-loss financial position by funding the replacement or repair of your property.

Likewise, ID theft insurers offer economic restoration following compromise or misappropriation of your personal identity. Potential identity theft fallout includes credit ruination, bank account depletion, and even erroneous arrest. In addition, ID theft victims may sustain major indirect costs for legal fees, lost wages, and tarnished reputations.

Comparing Coverage Costs

Very keen competition exists among insurance carriers. Also, a growing number of mortgage and credit card companies now offer identity theft insurance. To make the best choice, look for the following features in any proposed policy:

• Deductible: Policies with exorbitant deductibles are usually unfeasible. Studies by the Identity Theft Resource Center reveal that victims incur average out-of-pocket costs of slightly over $800. A deductible in excess of this amount makes a policy impractical.

• Legal Expenses:Adverse litigation, wrongful arrest, and having to retain legal counsel are potential consequences of identity theft. Verify that attorney’s fees and court costs are included in the policy’s provisions.

• Denied Credit: Victims often do not even realize that an identity thief has targeted them until they are denied new credit. Ascertain that credit denials and negative credit file deletions are covered.

• Lost Wages: Lost income coverage is indispensable. The FTC estimates that ID theft victims spend an average of 320 hours on rectifying consequent problems. This equals two months’ pay for most people.

• Premium: Identity theft insurance premiums average about $20 monthly. Seek a quote from your present auto, life, or homeowner’s insurance carrier first. Odds are you will qualify for multiple coverage discounts that may essentially make the choice for you.

Fact vs. Myth

Contrary to popular belief, landlord umbrella policies do not protect tenants. Some renters are unconcerned about insurance coverage because they do not own their residence. They do own its contents, however.

It may be tempting to avoid another bill in today’s tough economy. The consequences of foregoing renters insurance are far more costly, however.
Tenants have more invested in rented residences than they realize.

Unacknowledged Assets

Major appliances, lawn and stereo equipment, power tools, jewelry, and furniture are standard household incidentals for both lessees and landowners. For most renters, replacing these items in the event of a big disaster would be no small matter.

Replacement costs can easy amount to several thousand dollars. Per Insurance Information Institute statistics, renters insurance premiums average less than $20 per month. Yet, fewer than half of the nation’s tenants carry this vital coverage.

The Long Arm of Loss Protection

Renters insurance goes far beyond protecting you against damage or destruction of cherished belongings. Most policies also pay for relocation expenses and the costs of alternate living arrangements necessitated by fire or natural disaster.

Liability coverage for third-party damage claims is another major benefit of renters insurance. A single lawsuit can result in your complete financial ruination.

Do the Math

How long would it take you to save the current value of all your personal possessions at the rate of $20 per month? How much would the prices of those same items have risen by the time you finally accumulated such a colossal sum? Do you have sufficient savings or other resources just set aside to satisfy some colossal third-party damage claim?

It all adds up, as numbers never lie. Even as a non-homeowner, you have a lot more to lose than you ever imagined. There is no time like now for proactive measures that protect you and your family’s solvency and economic security.

Two calls, that’s all

The Insurance Information Institute advises consumers to make two telephone calls before renting a vehicle. The first call should be to your current auto insurance carrier.

First, find out how much personal auto insurance you already have. Any rental car coverage will have limits identical to those of your current policy. Ask if your existing coverage includes administrative fees, lost usage, and towing charges.

Frequent auto renters should consider buying a special rental car rider through their present insurance carrier. This option is much cheaper than buying separate coverage through the auto rental agency.

Next, call your credit card issuer. Credit card auto insurance coverage varies widely among auto rental firms and card issuers. If you hold several credit cards, contact each issuer to learn which one offers the best rental car insurance.

Be aware that credit card rental coverage is generally “secondary.” Benefits are not payable unless your primary policy benefits are exhausted or deemed inapplicable to specific claim(s).

All insurance offered by rental car agencies is very expensive. In fact, it can more than double the cost of renting a vehicle. Here are some helpful hints about the two major forms of rental car insurance available directly from rental agencies:

- Loss Damage Waiver (“LDW”)

Although technically not a true insurance product, LDW waives any financial liability for the loss or damage to your rental car. Forego the LDW if you presently have comprehensive and collision coverage under your existing policy.

- Liability coverage

State laws require all auto rental companies to provide the statutory minimum levels of liability coverage. If you already have adequate liability insurance, omit agency-provided liability coverage.

A new day has definitely dawned in the realm of retirement planning. Shifting social, demographic and economic forces have affected major reverses in world financial markets. Consumer retirement expectations have changed accordingly.

Studies reveal that twenty percent of American workers are unsure of their retirement income source. Sixty-five percent of Americans endorse financial planning as a vital for retirement comfort and success. A mere 36 percent are actively doing anything about it, however.

This is unfortunate, as those who plan their retirements end up with an average of two-and-a-half times more retirement income than non-planners do. Their average net worth is also 39 percent greater than that of those who fail to plan.

Prospective retirees are increasingly attempting to bridge ever-widening gaps between long-held dreams and harsh economic realities. A recent renaissance of annuity investing has resulted from such frantic efforts toward fiscal reconciliation.

A Business Week article of June 1, 2011, revealed that this year’s first-quarter figures for variable annuity sales reflected a 24 percent increase over last year. The promises of lifetime income and a protective hedge against declines in other financial markets are purportedly the main prompters of this phenomenon.

Annuities are essentially life insurance contracts that feature a future income stream. Part of the annuitant’s premiums cover actual life insurance costs while excess funds are invested for long-term growth. Annuities are available in two basic types: fixed and variable.

With variable annuities, consumers may choose how to invest their funds. Conversely, fixed annuities allow no annuitant investment input but are less risky than variable annuities. Traditional fixed annuities offer a set rate of return for a specified period. Upon expiration of this “guarantee period,” a fixed annuity’s value may fluctuate, but will never fall below a preset minimum level.

Obtain competent expert advice before buying any annuity. Regardless of the annuity you ultimately choose, take pride in knowing that your decision represents the positive step of taking greater responsibility for your retirement.

The market analyst firm attributed such ongoing health insurer profitability to several key factors. Chief among these were higher enrollment in health plans, widespread internal overhauls by insurers, and decreasing regulatory-related losses.

On the Right Side of the Law

Encouraged by recent health care legislative reform, Americans are apparently no longer foregoing or postponing needed medical treatment. This has resulted in much higher health plan utilization and correspondingly higher insurer revenues. Projections portend stabilized levels of increased healthcare utilization until 2012.

The recently enacted Health Care Reform Act (“HCRA”) is at the heart of all this increased marketplace activity. Effective as of this year, the HCRA mandates insurer maintenance of medical loss ratios of at least 80 percent for small group and individual health coverage. The new law requires a minimum ratio of 85 percent for larger commercial group policies. Medical loss ratio denotes the percentage of premium income that insurers must allocate to providing actual health care services.

A Banner Year

2011 portends to be a year of tremendous makeovers among major health insurance providers. Carriers must respond to a new regulatory climate, ongoing cost issues, and increasing consumer demands. This confluence of factors has forced insurers to re-examine their roles within the healthcare industry.

For instance, mandatory coverage for everyone, irrespective of pre-existing health problems has presented a major challenge for insurers. These phenomena are expected to temporarily decrease insurer profits for the next few years. Overall revenues are projected to re-stabilize with subsequent increased employment and consumer discretionary spending, however.

America’s aging population is also expected to fuel health insurance industry growth. Geriatric patients constitute a high-need segment of the market for healthcare services.

Combining Forces

Currently, several major health insurer consolidations are at various stages of fruition. Insurers are combining resources in an effort to cut operating costs and maximize profitability. UnitedHealth Group and WellPoint have both acquired several new subsidiaries during the last half-decade. Similar alliances are slated for the near future as much stronger leveraging power with pharmacies, physicians, and hospitals yield the desired results.

Although much progress has been made, a long journey remains ahead. All indicators portend continuing health insurance premium rises in the near future. According to a recent Kaiser Family Foundation study, employer-sponsored health insurance premiums rose by 114 percent between 2000 and 2010. During that same time frame, employee contributions increased by a whopping 147 percent.

Recently, Coalition Against Insurance Fraud official spokesman James Quiggle predicted that the fraudulent trend will continue and flourish in 2011. Many industry analysts even fear an unprecedented spike in health insurance fraud before year’s end. To effectively combat and contain this trend, Quiggle advised consumers to be on “high alert” about predatory health insurance scams.

He warned that a common health insurance fraud consumers should be especially wary of is the misrepresentation of policies as “full coverage” that are really watered-down medical discount programs – or totally worthless. To protect yourself, always contact your state’s insurance regulatory authorities to verify the credentials of the agent and carrier before buying any health insurance policy.

To identify potential health insurance scams, look for the following warning signs:

• Salesperson vague about policy specifics
• High pressure to sign immediately for a “special deal” or “discount”
• Sales agent reluctance to reveal entire policy in advance of purchase
• “Deals” that sound too good to be true

Federal legislation designed to overhaul the national health care system might instead be fueling fraudulent fires. Quiggle cited a specific door-to-door sales scam whereby shysters impersonate government agents. In exchange for advance payment of a hefty “premium,” unscrupulous operators ostensibly offer assistance to senior citizens caught in the “donut hole” of Medicare’s prescription rebate program.

A silver lining in the otherwise cloudy health insurance scenery is greater availability of policy features in accord with new health care legislation. Such health insurance policies offered by legitimate providers should always feature no-cost preventive health care and limit-free lifetime benefits.