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Insurance is a term used to refer to an action, system, or business where financial protection (or financial compensation) for the soul, property, health and so forth get a replacement from unpredictable events that can occur such as death, loss , damage or illness, which involves paying premiums regularly within a certain period of time instead of a policy that guarantees such protection.




The term “insured” usually refers to everything that gets protection.

Basic Insurance Principles

In the insurance world there are 6 basic principles that must be met, namely:

• Insurable interest, namely the right to insure, arising from a financial relationship, between the insured and the insured and legally recognized.

• Utmost good faith, which is an action to disclose accurately and completely, all material (material fact) facts about something that will be insured whether requested or not. The meaning is: the insurer must honestly explain clearly everything about the extent of the terms / conditions of insurance and the insured must also provide clear and correct information on the object or interest insured.

• Proximate cause, which is an active, efficient cause that causes a chain of events that results in an effect without the intervention of one who starts and actively from new and independent sources.

• Indemnity, which is a mechanism by which the insurer provides financial compensation in an effort to place the insured in the financial position he had just before the loss occurred (KUHD article 252, 253 and affirmed in article 278).

• Subrogation, namely the transfer of claim rights from the insured to the insurer after the claim is paid.

• Contribution, which is the right of the guarantor to invite other guarantor who both bear, but do not have the same obligation to the insured to participate in providing indemnity.

Type of Insurance

1. Life Insurance

This type of insurance is known to provide financial benefits to the insured for his death. The payment system for this type of life insurance varies. There are insurance companies that provide payment after death and others can allow the insured to claim funds before his death.

Life insurance can be purchased for self-interest and on behalf of the insured alone or purchased for the benefit of a third person. Even life insurance is also known to be bought in other people’s lives. As an illustration, suppose a husband can buy life insurance that will provide benefits to him after the wife’s death. Parents can also insure themselves against the child’s death.

2. Health Insurance

This type of insurance is also quite well known by the people of Indonesia. Health insurance is an insurance product that handles the health problems of the insured because of an illness and covers the cost of the treatment process. Generally, the cause of the insured’s illness which can be borne by the insurance company is injury, disability, illness, until death due to accident.

Health insurance is also known to be bought for the benefit of the insured or the interests of a third person. Private health insurance companies such as Prudential, Allianz, AIA, Cigna, and Manulife are among the big names that provide a variety of insurance products to suit the needs of the Indonesian people and are widespread throughout the world.

3. Vehicle Insurance

The most popular vehicle insurance in Indonesia is a type of car insurance that focuses on injury coverage to other people or against damage to other people’s vehicles caused by the insured. This insurance can also pay for the loss or damage to the insured motor vehicle.

Vehicle insurance is one of the general insurance products. This type of insurance had become a boom when the riots broke out in May 1998 because the incident made people’s interest in protection ownership for private vehicles increase dramatically.

The financial site Cermati.com has partnered with well-known insurance companies in Indonesia so you as a customer can compare the best car insurance products with low rates.



4. Education insurance

Dizziness with children’s education costs? This type of insurance will help you overcome. Education insurance is the best alternative and a solution to ensure a better life, especially in children’s education assets. The cost of the premium that must be paid by the insured to the insurance company varies according to the level of education to be obtained later. Understanding the importance of using education insurance for children is now a matter of concern for parents. The high cost of education and other conditions that exacerbate the economy such as the weakening of our currency against the US dollar affect the cost of education for children later. Realizing that this clearly will burden parents, it is not uncommon for parents now to choose to have education insurance. So, education insurance can be classified as the types of priority insurance too, right? You will certainly be helped in taking care of the child’s future.

5. Travel insurance

Maybe for those of you who often travel or travel are familiar with this type of insurance. The various types of insurance also create a variety of protection for travelers. Overall, the function of travel insurance is not much different from the ordinary insurance function as a form of protection for customers with a short period of time that is for the premium buyer to travel until returning home. Benefits and protection that will be gained from having travel insurance include obtaining protection and coverage for accidents that affect premium buyers, personal accident benefits, dependents for emergency medical expenses, repatriation of bodies, medical evacuation, to protection of luggage that has a risk of being lost. or damaged.

6. Business insurance

For those of you who have a business field, this type of insurance is important to consider. In addition to the types of insurance that involve individual protection, insurance that protects businesses is also needed. Business insurance is a protection service against damage, loss and loss in a large amount that may occur in one’s business. This insurance provides compensation for damage caused by fire, explosion, earthquake, lightning, flood, hurricane, rain, collision, until riots. Insurance companies usually offer a variety of benefits from business insurance such as protection of employees as business assets, investment and business protection, comprehensive life insurance for all employees, to health insurance protection packages for employees.

Advantages of Insurance Companies

Insurance companies also benefit from investment. This is obtained from the investment premium received until they have to pay the claim. This money is called “float”
Insurers can get profit or loss from float price changes and also interest rates or dividends in float. In the United States, property losses and deaths recorded by insurance companies were US $ 142.3 billion in the five years ended 2003. But total profits in the same period were US $ 68.4 billion, as a result of the float.

Insurance Refusal

Some people consider insurance to be a form of betting that applies during the policy period. The insurance company bet that the buyer’s property will not be lost when the buyer pays the money. The difference in fees paid to insurance companies against the amount they can receive if an accident occurs is almost the same as if someone bet on horse racing (for example, 10 to 1). For this reason, some religious groups including the Amish avoid insurance and depend on the support received by their community when disaster occurs. In communities where close and supportive relationships where people can help each other to rebuild lost property, this plan can work. Most people cannot effectively support the system as above and this system will not work for big risks.






In this video, Dave Ramsey talks to Cynthia in Charleston. She has an indexed universal life policy with a death benefit and wants Dave to explain if that’s a …

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28 Replies to “Is Universal Life Insurance A Good Idea? | My Insurances Info”

  1. So I have a question, heres my scenario as a small biz owner, 3.5 yrs ago my fed tax bill was about $20k, i asked my cpa for options to avoid high taxes in the future, he told me about National Life Groups SecuredPlus Advantage 79-Universal Life Policy. Heres the gist, I pay into a 5 year contract which costs me $250K (thats $50k/yr for 5yrs) my premiums are $4167/mos. My death benefit is $1.4M, I have riders, terminal illness, chronic illness, and qualifying life event plus the lifetime income benefit rider. It features indexed crediting options. After the 5yrs, its supposed to sit and grow for 20 years. At 65 it has a loan provision of an assumed annual non-taxable income of $107k/year for 20 yrs. As of now I have 1.5 yrs to go-and approx $83K left to pay into it. In short was this a bad idea? Ive yet to meet anyone who is living off the income stream loan provision, have any of you? Do I cash out and just pay my mortgage off at this point and stop the madness? I have other life insurance.

  2. Dave is probably being paid by someone in congress to give bad advice because the IUL has no fees and is all tax free and has been averging 12% the past 30 years in an indexed account where you never lose money when the market crashes! Dave is a joke! Call me for more professional information ! 5597399961

  3. You’re absolutely wrong here Dave. It is clear you don’t understand insurance because all insurance is built off the same chassis. You should listen to Ed Scott the best IRA consultant in the industry. He could help you better understand what you really don’t. IUL is the cheapest most cost effective way to buy and invest with a guarantee over time. The secret to building wealth is don’t lose principal and don’t interrupt compounding. IUL is the best product in the industry for this. Your tax free Roth distribution will be zeros out 10 years before the comparable IUL because it doesn’t interrupt compounding. You also forgot to explain to this lady what it will cost her to guarantee a paycheck in retirement. IUL does this at 1/3 the cost. That a few hundred thousand in savings that you forgot to mention. You need to go to God with this as giving advice on something you truly don’t understand is not Godly advice at all.

  4. The reason term is so cheap is because only about 3 in 100 policies pay out. Universal is pretty much guaranteed to pay out same with whole life as long as you pay the premiums and don't cash it in.

  5. IUL's average 8-10% returns, have 0% floor so you won't lose if the markets crash, and only cost 1% if you build them correctly. Plus the IUL's are designed to provide TAX free income for life if built with a competent independent insurance professional. So lets get this straight, Dave has no idea what he's talking about with IULs, about 10 incorrect statements and his advice may have cost that caller thousands of dollars for surrendering her policy because of surrender charges early on in the policy. If dave wasn't making so much money on mutual fund kick backs and term insurance leads he would take the time to educate people properly. Poor poor advice Dave, I like you, but I am disappointed with your lack of education and poor advice for this lady.

  6. Term is best for most people period. Just make sure your 401 k has very little fees ! Or any investment you invest to you can always find out. IULs whole life and variable life 95 percent of the time are poor investments.

  7. Does He even have a license to talk these kinds of things? He’s feeding this lady some pretty bad advice. Compliance would be all over him if he had a license. Shame Dave Ramsey…

  8. This was some great advice about life insurance from Dave. All things considered, Term life ins. is the right kind of insurance ,for over 90% of the clients out there. Don't hold your breath ok, your life insurance agents will never tell ya that, because they want that thing Dave mentioned "commissions". There is an old expression in the insurance business "if u sell cash value life, insurance u can't sleep at night, when you sell Term life u can't eat".

  9. So what happens when you outlive your term policy and not enough in your investments to take of your family when you die because you've lost value in the market? Then what?

  10. Only purchase "Term Life Insurance" just like you would by auto or home insurance. Always do your investing with a "Registered Fiduciary Advisor" . Check with your "Registered Fiduciary Advisor" for advice on insurance needs.

  11. Even if it does come out to almost 5% return that's guaranteed ! Investments have a risk of LOSS. Simple as that. If you don't want to risk LOSING hard earned money, why not go with the IUL

  12. I’m surprised how a professional financial advisor still think that way about ULI and 401ks. Mutual funds are so expensive and 401ks are the biggest mistake for retirement after not having a retirement account. People: read more about money, don’t rely on financial advisors

  13. I used to like Dave but I think he gives advice for people with a small vision who aren't risk takers. My parents have followed Dave's advice for years… lost their house and are broke to this day because they are so scared to invest money into anything other than a mutual fund or a roth. Debt isn't evil either. Debt is a weapon like a gun. Yes you can financially kill yourself, or you can be responsible and make loads of money on another person's dime. When I stopped living my life from a scarcity mindset and stopped eating rice and beans I began making way more money. It's OK to drive a nice car. There is plenty of money out there. You just have to work hard and smart. Dream big and trust yourself. Do your own research.

  14. I respect Mr. Ramsey i know he is helping people who are in trouble but people who want to build wealth this is a really bad advice. Why would i advice anyone to put money in Mutual Funds, IRA that is tied to market and risk of loosing all growth and principal. Sad thing is she is asking this question because Agent did not take the time to explain the pro and cons of what she got.

  15. I’ve heard a lot about this guy so I don’t want to take away from what this guy knows…

    But he doesn’t know much about setting up IULs for retirement income. It’s not a waste of money. It’s actually a GREAT way to supplement retirement income with TAX FREE money.

  16. You have a choice, you can either pay 20-30% tax on your mutual fund growth and help the government bomb kids in Syria… Or you can pay 20-30% cost of insurance to an insurance company over the span of your IUL and get a death benefit out of it.

    The choice is yours…

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