Four simple steps to getting good coverage. At HSBC Insurance, we don't think getting life insurance should be a complicated and bewildering experience. That's why we've created the Guide to unconfusion, an interactive tool that helps you decide on the right life insurance for you and your loved ones.
As you work through each step, click the "Add" button for relevant sections to customize the HSBC Insurance Guide to unconfusion that you can print or save.
Ready to uncomplicate life insurance? Get started now by clicking on any of the buttons below.
There are two basic categories of life insurance: Term and Permanent. This section of the Guide describes the role they play in providing the security you need.
What Is Term Life Insurance? Term life provides a fixed amount of coverage, at a fixed premium, over a specific period of time, or term (10, 15, 20, or 30 years). If you die before the end of the term, your beneficiaries receive a lump sum equal to the amount of coverage you purchased. Coverage can be continued after that period, but at an annually increasing premium.
Why Do I Need It? Term life insurance coverage is best suited to periods of increased risk and exposure, like when paying off a mortgage, replacing your income during child-rearing years, or to set money aside for a child's college tuition.
It can also benefit others who may depend on you for support, such as an aging parent.
What Are Its Benefits? Besides its lower cost compared to permanent life insurance, term life offers the flexibility to get additional coverage if you need it, beyond any other life insurance you may have.
What Are Its Weaknesses? Term life only lasts for the term you set or until you stop paying the premium. It accrues no cash value paid out at the end of the term, if you're still living.
What Is Permanent Life Insurance? Permanent life insurance covers you from date of issue until the day you die, as long as you continue to pay your premiums.
Why Do I Need It? Because it never expires, permanent life can be used as the foundation of your overall life insurance plan.
What Are Its Benefits? It never expires and your beneficiaries receive a lump sum payment when you die. Another benefit of many permanent life plans are their accrued cash value over time, which can be borrowed against if needed.
What Are Its Weaknesses? Permanent life policies are more expensive than term policies, and may be less flexible on terms.
Is permanent life insurance the right choice for your needs? Permanent life coverage can be tailored to fit your requirements. Stop by a branch to speak with a licensed specialist.
Why do you need life insurance? When someone you care about relies on your support, it ensures they're taken care of financially if something happens to you.
Couple With Children
Consider whether your spouse would be able to cover expenses without you. From the time children are toddlers to college and beyond, your coverage can expand to keep pace with the financial demands of a maturing family.
Tip: By adding an optional Child Rider, you can provide even more financial protection by insuring dependent children.
Also, it's important to consider the beneficiary of the policy. Many choose their spouse, but naming any adult beneficiary for whom you have a financial obligation or duty of care is acceptable. Generally, it is not advisable to name minor children as beneficiaries, but arrangements for minor children can be made through trusts, or by appointing a guardian to manage assets on their behalf. That way, they'll also benefit from the nest egg you've provided should something happen to your spouse.
Couple (With No Children)
You and your spouse have created a cherished life together, committed to sharing the financial obligations necessary to secure a certain lifestyle for the rest of your days.
Life insurance is key to this commitment. Term life offers a way to help secure the level of coverage you need, ensuring that the other is taken care of in the way you'd want them to be.
Tip: You can double your coverage with an Accidental Death Rider, which means if you should die in an accident, your spouse will get double the coverage.
Single Parent
As caregiver, provider, homemaker, and mentor, your mission is to provide your children with the resources they need to achieve success in life. Should anything happen to you, HSBC Insurance will help ensure they're able to continue the life you want for them.
The benefits your coverage delivers will help the new caregiver you've chosen. If your children are old enough to take care of themselves, the coverage provides extra help for them as well.
Tip: Adding an optional Child Rider can help provide even more financial protection by insuring dependent children.
It's important to consider who the beneficiary of your policy will be. If you have children, it may be helpful to have additional policies with their trust or guardian, so they'll also have the nest egg you've provided.
Single (No Children)
If you're single and responsible for other family members, such as aging parents and siblings, your financial plans should provide for their needs as well. Term life can help provide the coverage you need, for as long as you need it, so those who rely on you will be taken care of.
Tip: If you have debts, like a car or student loan guaranteed by someone else, get coverage for the life of the debt. If you were to die, they'd be liable for your outstanding debt, and you don't want to leave them in the red.
Other Dependents
It's common for people to be responsible for others besides their spouse and children, such as extended family members or aging parents approaching retirement. Your financial plans should include sustaining care for them as well. Term life can help provide this coverage for as long as you need it.
Tip: You can double your coverage with an Accidental Death Rider, which means if you should die in an accident, your other dependents will get double the coverage.
Adding Up Your Debts
Below are the most common categories of debt. Consider these, and any others you have, when figuring your debt total.
- Mortgages, home equity loans, lines of credit
- Car, boat, RV, motorcycle, any other vehicle loans
- Personal or spouse student loans, any loans for your children's education
- Credit cards, personal loans
- Legal settlements, tax liens
- Debt from a small business or side business
- Other debts within your financial responsibility
Enter this info in box 3 of the Needs Assessment Calculator.
Calculating Expenses
Consider your entire household budget. Review the common recurring expenses listed below.
Weekly:
- Groceries, pet food, drugstore purchases, dry cleaning
- Gas, transit fares, tolls
- Household bills: cable, phone, electric, heating, daycare
- Prescriptions, medical expenses, nursing home payments for an elderly parent
- Housing association fees, groundskeeping costs
- Property taxes
- Tuition not covered by student loans
- Funeral costs
- Medical bills
- Estate fees and inheritance taxes
- Future events
- Wedding, religious ceremonies, college tuition
- Home maintenance, roof, heating system
- Replacement vehicle
- Retirement costs
- Dependent Child Rider covers all of your eligible dependent children up to age 23
- Waiver of Premium Rider waives your premium during Total Disability, though eligibility requirements apply
- Accidental Death Benefit Rider the coverage amount of your base policy will double in the event of accidental death
- No cancellation or increase in premiums due to changes in health
- No decrease in life coverage over the course of your term
Monthly:
Other recurring expenses:
Other Considerations
Below are the most common categories of debt. Consider these, and any others you have, when figuring your debt total.
Enter this info in box 5 of the Needs Assessment Calculator.
When selecting an insurance company, there are several important criteria to consider. By making sure that your provider satisfies your needs in each of the following categories, you'll eliminate potential problems.
Company Credibility
The stability and credibility of your insurance company are just as important as the coverage you get. The company you choose should have a long history of insurance expertise, a bright future, and the resources to make it through tough times.
1. Stability and Experience
To have confidence in your insurer, it's important to consider how long they've been in business and whether they've proven themselves able to withstand recessions and periods of economic uncertainty.
We're a member of the HSBC group, one of the world's leading financial services companies. HSBC has been in business for over 140 years. HSBC has been in business for over 140 years, with 9,500 offices in more than 85 countries. During the latest recession, HSBC was renowned for its financial health and consistency providing for customers without the help of government TARP funds.
2. Industry and Third Party Rankings
Like many other industries, insurance companies are ranked and rated by independent third-party agencies based on stability, service history, credibility, and overall performance. Rankings provide a sense of the reliability and integrity of an insurance company. It's important that the company you choose has a strong reputation that's been verified by an independent agency.
The primary rating agency for life insurance providers is A.M. Best Company. The criteria A.M. Best Company uses can be found here: http://www.ambest.com/ratings/methodology/bcrm.pdf
Another key independent source is the Better Business Bureau (BBB), which ranks companies across many industries based on business practices and how they treat customers. The BBB also provides accreditation for companies that meet its strict standards. BBB rankings and accreditations can be found at www.bbb.org.
HSBC Insurance has received an A Excellent rating by A.M. Best Company and is accredited by the BBB.
Services & Options
Carefully review the details of your insurance policy. You should be absolutely sure the insurance product is right for you and fits your lifestyle.
When considering these criteria, review the policy terms and conditions, available riders, customer service options, payment options, and product guarantees.
Policy Options
What are the available term lengths and coverage amounts offered? Are they enough to cover your needs? Do they have riders that cover you in case of disability and accidental death? It's critical that the answers to these questions satisfy your needs. If the policy doesn't meet the demands of your personal situation, it probably isn't right for you.
HSBC Insurance has policies of 10-, 15-, 20-, and 30-year terms available with coverage amounts between $100,000 and $500,000.
We also offer several optional policy riders for more complete coverage:
Payment Options
It's also important to consider the billing options your coverage provider offers. If you are more than 30 days late with a payment, the company is legally required to cancel your policy. It's imperative that you pay your premium on time, and your insurer should have the options in place to do so, like automatic payments, EFTs (Electronic Funds Transfer), or by credit card.
We accept all major credit cards, EFTs, and direct automated payments from your checking account.
Customer Service and Support
Due to the sensitive nature of life insurance, customer service and support should be available whenever you need it with answers to your questions. Consider whether the company has an online account management tool to let you update your beneficiary information, billing address, and/or payment info.
We offer our policy holders secure access to MyFolder, an online account management tool that gives you total control of your policy, billing data, beneficiary information, and more.
We also offer customer service centers staffed with licensed specialist to address your questions by phone or via online chat.
Process
Requirements for coverage, as well as the time it takes to get covered, vary greatly from company to company. Some providers require blood work, a urine test, blood pressure test, in-person doctor's visit, EKG, stress test, and many other time-consuming procedures. Some companies can take up to three months before they start your coverage.
We've developed the industry's first Smart Technology application process. It eliminates the hassle of medical tests and doctor's visits, and gives you answers to your life insurance questions and a competitive quote in minutes. It's all done online. To learn more about it click here.
Guarantees
The key guarantees to look for are: a 30-day free look with a full refund if you're unsatisfied, assurance that the company will not raise your premium or decrease your coverage for any reason, and a guarantee preventing the rescinding of your policy if your health situation changes.
We offer our policy holders the following guarantees:
A 30-day money-back guarantee if you are not completely satisfied with your policy or service
