Nov
18
2010
What is Insurable Interest?
The principle of insurable interest is basic to insurance law. The principle essentially states that an individual with insurable interest on the subject of insurance must stand to lose financially or suffer harm in some ways if the subject of insurance is damaged or destroyed or lost. Example, you have an insurable interest in your house since you stand to lose financially if it is burnt down or damaged in any way.
Hence, to be legally enforceable, all insurance contract must be supported by insurable interest. A question may arise as to when must an insurable interest exists. In property insurance, the insurable interest ought to exist at the time of loss. There are two main reasons why this is the case.
First, the majority of property insurance contracts are contracts of indemnity. The principle of indemnity would be violated if the insured is paid when no loss to him is present at the time of claim. If for instance, Ricky sold his factory to Jim, and a fire occurs before the policy is cancelled, Ricky cannot claim from the policy because he no longer has an insurable interest in the property. Assuming Jim has not purchased a fire policy on the factory, he too cannot claim from the old policy since he is not registered as the insured.
Second, in marine insurance for instance, the insured only have an insurable interest when the cargo is on board as the insured’s property. Hence, although an insurable interest does not exist at the time the insurance contract is issued, insurable interest exists in the goods at the time of loss.
Insurable interest is said to arise when an individual benefits by its safety or suffers by its loss. The following are examples of how insurable interest could arise:
- Ownership of property;
- Trustees in respect of property held in trust for others;
- Mortgagees in respect of property held as security for a loan;
- Bailees (carriers, inn keepers, pawnbrokers, warehouseman, etc. in respect of property held by them;
- Tenants who have covenanted to insure a property;
- Losses in respect of leased property;
- Husband on the life of his wife or vice versa;
- A corporation on the life of an officer or employee
** Financial Life Planning **
Tags: can be insured, contracts of indemnity, insurable interest, insurance, insurance law, principle of insurable interest | 
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13
2010
To make time for things that matters, you have to identify what they are. If you are clear about your own values and goals, it will be a lot easier.
First, clarify your values. Values can be derived from many different aspects, including family, work, health, wealth, friendship and lots more. Then, ask yourself, ‘Which of these values are most important to me?’
After that, consider all the goals that you would like to achieve in life. What is the difference between values and goals? Well, we can say that values are ongoing, whereas goals can, at some point, be achieved and marked off as completed.
What goals might you set for yourself? Do you want to spend more time with your family? Find employment that is more suitable? Improve your skills in a favorite hobby? Find a new one? Develop a certain quality? Take a vacation? Read a book? Write a book?
Next, decide which of these goals are most important to you. Make sure that they are compatible with your values. If, for instance, you set a goal of becoming extremely rich, you are likely setting yourself up for conflict.
Now, for the goals you selected, consider a number of activities that would contribute to reaching each goal. For example, if one of your goals is to lose a certain amount of weight, exercise is an activity that can help you do that.
How Can This Analysis Help You?
If your goals harmonize with your values and you carry out the activities that contribute to achieving your goals, your life will take a unified direction. You will find yourself spending more time on what matters to you. Of course, that does not mean you should be callous to the needs and desires of others. It does mean that you will be better able to identify and turn down opportunities that have nothing to do with what is truly worthwhile.
Admittedly, there will be challenges. Some tasks may be relatively unimportant but are necessary nevertheless. These may threaten to fill your day, leaving little or no time for what is most important to you. Emergencies may arise. And changes in your life situation may throw your schedule out of balance. But by taking practical steps to spend more time on the things that matter, you will have more control over how you spend your time and live your life.
Tags: control your time, goals in life, prioritize your activities, take control of time, time management skills |
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4
2010
Healthy or successful aging is a confluence of three functions: Low probability of disease or disability; high cognitive and physical function capacity; and active engagement with life.
These three functions are interrelated and interdependent. To achieve the desired or optimal results, the aim is to maximize desired outcomes and minimize undesired outcomes.
The Australian National Aging Research Institute has published a guideline on how to achieve optimal results. They include:
- Planning your long-term housing and financial needs as well as your retirement activities;
- Exercising regularly. Commit yourself to at least 30 minutes of moderately intense exercise every day. Do a range of exercises that involves balancing, walking, strength flexibility and cardio-respiratory activities;
- Keeping your mind active. Read, write, do crossword puzzles, play music, play games, learn new activities or skills;
- Having a medical check-up at least once a year; and
- Maintaining contact with your family and friends. Stay active, social and productively engaged through work, volunteering, recreational activities and involvement in the community.
** What is Life Planning **
Oct
28
2010
They save time for some but waste time for others. A personal digital assistant, or PDA, for example, may include a calendar, a list of phone numbers and addresses, to-do lists, a word processor, a memo pad, a camera, and access to e-mail and the Internet. You can use such a tool to save time if you keep it up-to-date and carry it with you. However, you can easily waste time if you do a lot of irrelevant browsing, tinkering, or customizing or if you buy unnecessary accessories or allow use of the device to get in the way of important relationships or responsibilities.
Tip: Research before you buy. If an electronic device malfunctions frequently, much time will be required to fix it. Also, any electronic device is only as good as its user. So if you have one, use it to save time, not waste it.
** Managing Your Life Well **
Tags: electronic organizer, pda, pda vs time management, personal digital assistant, time management |
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Comments Off Oct
21
2010
About Junk Bonds
Junk Bonds, which were first popularized in the US bond market, refer to speculative-grade bonds or bonds that are rated “BB” or below. Given the element of increased risk in investing in such bonds, they are more appropriately considered as a speculative grade of fixed-income investment. However, they also come with the scope to obtain a higher level of return. Average spreads between government-bond yields and junk-bond yields hover between 3% and 4% points.
Bonds are classified as junk due to the fundamental governing their bond rating; one where the lower credit rating reflects the higher risk the bondholder will have to bear and the other where the issuer may find a higher level of difficulty in servicing their debt obligations.
That is where the higher bond yield comes into the picture — to entice investors to take on the extra risk for opportunities of higher return. Given the nature of these bonds, most bondholders would be in it for the higher return and having short-term objectives, which is characteristic of most speculative activities in the capital markets. Therefore the term ‘junk’ is a pejorative term characterizing the fact that these bonds are highly speculative in nature, appropriate only for investors with high risk appetite.
It is important to note that junk bonds are different from defaulted bonds. In the case of the latter, the issuer has defaulted on its debt repayment or obligations. For a junk or speculative-grade bond, there is a high risk that the issuer may be unable to honor its debt obligations or interest payments. On the other hand, a bond that has defaulted is one where issuer has not been able to honor its debt obligations.
In the US, the bonds are seen not only as an investment entity in itself, but some are repackaged as collateralized bond obligations.
** Planning Your Life **
Tags: about junk bonds, characteristics of junk bonds, nature of junk bonds, risks of junk bonds, what are junk bonds, yields of junk bonds |
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Comments Off Oct
15
2010
Set to Reach Your Retirement Goals
We may have heard, too often, people telling about how they do not achieve their retirement dreams as initially planned. When probed further, they may tell you how fantastic they expect their life after retirement to be. And we know the so called ‘ideal’ destination is just too far from reality.
However, the true idea of dismiss yourself from active working life is not about enjoying life without a specific budget. It is more about do what you have intended to do but have been restricted due to busy working life. It is also another different arena for you to learn how to manage your money with limited or no income at all.
It is not impossible to achieve retirement goals, on the other hand. The outcome is always determined by you; how you plan, implement and review your retirement planning. Here are some tips: -
Change Your Spending Habits and Start Saving
The only issues with retirement planning are your commitment and the need to overcome procrastination. You have to be disciplined and persistent.
Break Your Retirement Dreams into Smaller Goals
When you have smaller goals which require smaller amounts of savings, you will be able to see the progress of your action. Although it is just a small step towards your ultimate goal, a step closer can be a great encouragement to you. By setting smaller goals, your bigger goals are still in the picture.
Live Frugally Now
Humans are habitual beings. Upon getting your pay or salary, you must pay yourself first. Avoid living on credit. These habits significantly affect whether your retirement goals are achievable. It is always easier to go from a frugal background to spending with more discretion than spending extravagantly and suddenly having to limit your spending during retirement.
Postpone Your Retirement
If you still want to keep that retirement goal but short of money, you may have to consider putting off your retirement.
>> More financial tips: ** Financial Life Planning **
Tags: achieve retirement goals, prepare to retire, reach retirement goals, retire rich, retirement dreams, retirement planning |
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Comments Off Oct
7
2010
Benefits of Preference Shareholders
If you aim to get some fixed returns from the equity market which is more secure, then preferred stocks may be the ones that suit you. Preference shares are issued by listed companies on a need-to-do basis to raise capital. They are traded in the stock market just like the ordinary shares. However, unlike ordinary stock shareholders, preferred stock shareholders do not have voting rights. When dividends are declared by a company, the preference shareholders are paid before the ordinary shareholders.
Some preference shares may have a cumulative clause. If a company is unable to pay out dividends to the preference shareholders in a particular year, then when it can pay in the following year, it needs to pay preference shareholders the interest for the year before and current year before the current year dividends are paid to the ordinary shareholders.
That means the preference shareholders will always get their fixed interest, unless the company goes bust. However, it is rather illiquid for investing in preference shares. The choices are also limited somehow.
>> More tips: ** Financial Life Planning **
Tags: benefits of preference shareholders, equity investment, invest preferred stock, what is preferred stock |
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Comments Off Sep
30
2010
Medicare After Retirement
There are people who have to work through age 65, worrying that they cannot cope with the escalating medical cost with their existing retirement fund. For those whose retirement is around the corner, health insurance has become something that they need to seriously think about.
Continue Existing Group Health Insurance
Some employers may allow their existing employees to continue enjoying the benefits of the group health insurance policy, with the premium fully paid by the employees after their retirement. Although this may sound an extra burden to the retiree, but to purchase an individual policy at this age may even be more costly to them.
Opt for Medicare Part C
There are employers who offer basic high-deductible insurance, so they can enrol their employee in Medicare Part C upon their retirement. Medicare Part C combines the benefits of Part A and Part B, with less costly compare to the Original Medicare Plan.
Insurance to Cover Till Age 65
If you are healthy enough, then you may buy the medical insurance which covers you for the period between your retirement age to age 65. This helps you to save.
Save Some Money Early
Plan early, as you know the Medicare does not cover your medical cost fully. You should set aside a portion of your money for medical purposes when you retire.
>> More tips: ** Financial Life Planning **
Sep
24
2010
Changing new car has become the trend of the modern lifestyle. Replacing old and damaged car is no longer the primary reason of buying a new car. Rather, it is a status show off. New car models come up every year and there is always market ready for them.
People are so used to paying for car installment every month until it has become a routine to them. It seems like if they do not pay the car installment, they do not know what to do with the excessive money. Installments after installments are paid until they have too little for their own savings. To them, that’s life.
Owning a car could be a basic necessity, but keep on changing cars is luxurious and wasteful. If you plan to buy a new car, ask yourself a few useful questions:
- Do I really need it?
- Is my existing car still in good condition?
- Are there any other alternatives, which could solve my problems, instead of going for a brand new car?
- Are there any other areas where I can put my money to better use?
Instead of draining the money for new cars, the money can be used for much better purposes, such as:
Remember, a beautiful life is not always about how much you own, but also how generous you are willing to give.
>> More tips: ** Financial Life Planning **
Tags: buying new cars, car instalments, frugal living, money for better use, save the money |
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Comments Off Sep
17
2010
Credit cards can pose a real problem to you if it is not well managed. In the modern days, people tend to have excessive number of cards, which eventually lead them to debt accumulation.
There are ways that one can use to get rid of the debts. One of the useful ways is to consolidate them into one account, with the lowest annual percentage rate (APR), of course.
Debt consolidating is a no-new thing. Banks are competing with one another to come out with the best offer to assist you in doing it, so you can manage your debt better. However, you have to be careful and read the fine print before deciding on signing up one.
As you can read from the newspapers, some banks even advertise their offer in bold: 0% APR. If you proceed to the details, the offer is applicable for a short period only, usually in 3, 6 or 9 months. After the special offer period, the APR will be different, which is often higher. Therefore, when you shop around for the debt consolidation package, you need to look seriously into 3 things:
- Introductory APR
- Introductory period
- Standard APR
Introductory APR
This is the most attractive area and the offer rate is usually very low, for example, 0%. You know you can break the growth rate of your debt here. It is like the oxygen supply for people who are almost drowned.
Introductory period
The longer the period, the more benefited you are.
Standard APR
This is the area you must wary of. The rate will be applied to the outstanding balance should the debt is not fully paid off within the introductory period. If it is too high, and you know you are not going to pay off your debt fully within the special offer period, then it may not be the best card or solution for you. If you are sure you can clear off the debt within the introductory period, then you should be alright with the package.
Consolidating debt is one of the best ways to get you out of the debt roller coaster. Therefore, you should utilize it wisely.
>> More tips: ** Financial Life Planning **
Tags: apr, consolidate credit card debts, debt consolidation, get rid of debts, lowest annual percentage rate, manage credit card debts |
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