Like all domestic animals, dogs descended from wild ancestors, and they still have wild instincts hardwired deep within their brains. One of these instincts is to protect their territory, their food, their young, and even other pack members—sometimes including their human owners—by barking, growling, and even biting. The Centers for Disease Control (CDC) report that 4.7 million people are bitten by dogs each year. That is an average of 12,876 dog bites per day. Only a fraction of these bites—800,000—are serious enough to merit medical attention, but that’s still more than 2,000 per day. Some 386,000 of these cases end up in hospitals, making dog bites the second leading cause of injuries treated in emergency rooms (after softball/baseball injuries).

Sadly, children make up half the dog bite victims who visit emergency rooms. In fact with group with the highest incidence of dog bite injuries is boys aged 5 to 9 years, with 60.7 victims per 10,000 persons. Because of the large number of children bitten, the median age of dog bite victims is only 15. Because of their diminutive stature, children are often bitten above the shoulders. Nearly three quarters (73 percent) of children admitted to emergency rooms for dog bites were bitten in the face and neck. Only 30 percent of adults suffer bites in the same areas. The CDC states that on average 16 people die from dog bites each year. It is a miniscule portion of dog bite victims—just 0.0002 percent of the total number—but it is a chilling fact nonetheless.

The states are not united about how to govern dog bite liability. Some states apply traditional legal standards of liability, requiring a showing of negligence on the part of the dog owner. If the dog has bitten before, acted aggressively toward others, or in some other way given an indication that it was a danger to people, the owner could be held liable for the dog bite. Other states do not require a showing of negligence before assigning liability to the dog owner. California has a law that reads, in part: “The owner of any dog is liable for the damages suffered by any person who is bitten by the dog while in a public place or lawfully in a private place, including the property of the owner of the dog, regardless of the former viciousness of the dog or the owner's knowledge of such viciousness.”

In the past, homeowners insurance policies offered blanket coverage for dog bite liability, but no more. Some insurers exclude all liability arising from dog bites. Others provide coverage for most but not all breeds. Breeds considered prone to biting, such as the American Pit Bull Terrier (pit bulls), German Shepherd, Rottweiler, Saint Bernard, and Doberman Pinscher, are now excluded from liability coverage by some insurers. The CDC, which has studied dog bite injuries and fatalities in depth, does not agree with the premise of these exclusions. “A CDC study on fatal dog bites lists the breeds involved in fatal attacks over 20 years,” states the CDC website. “It does not identify specific breeds that are most likely to bite or kill, and thus is not appropriate for policy-making decisions related to the topic.”

As with all liability coverage, read your homeowner insurance policy carefully to see if dog bites or the bites from the breed of dog you own are excluded. If you have questions about liability, call your agent. You might be able to add a rider to your policy to cover dog bite liability. Do not delay. A dog bite can occur in a fraction of a second, but the consequences can last for years.

As a property owner, you are responsible for maintaining your home in a safe condition. If your walkway, porch, or floors are slippery or, conversely, sticky, they might cause a person to slip and fall. Uneven surfaces, loose tiles or boards, and unmarked step-downs also present hazards to visitors. A fall resulting from an improperly maintained property can result in claim of liability due to negligence.

Premises liability is the term for the liability homeowners face for injuries on their property. If you have homeowner insurance, your insurer is responsible for defending you against premises liability lawsuits. Your insurance will likely pay for damages, too, if they are due to carelessness or negligence on your part. Although your insurer is bound to defend you against all lawsuits, it is not bound to pay all claims. Your home owner insurance policy likely excludes coverage for damages arising from intentional actions on your part. Intentional actions would include setting booby traps, digging pits, or otherwise attempting to entrap, ensnare, injure, or deter trespassers or burglars. You probably would never think of doing such a thing, but that would not prevent a litigant from alleging that you did.

Consider this scenario: Imagine that you decide to replace a damaged plank on a deck on the front corner of your home. You remove the board to mark and cut the replacement, but you are interrupted and do not finish the task. You tell your spouse and children about the missing board, but you do not mark the dangerous area with caution tape or any kind of signage, never expecting a stranger to visit that evening and seek admittance from the deck, rather than from the entry door. The stranger steps into the opening of the deck, falls, and is injured. The stranger has grounds to sue because your failure to replace the plank or to mark the area for danger was negligent. However, nothing would prevent the stranger from alleging intentional action as well. His or her attorney could argue that the missing board was a booby trap meant to injure or perhaps catch trespassers or burglars.

If that were the case, your insurance company might issue a letter stating that while it would defend you in court, it would not accept responsibility for damages arising from a finding of intentional action. If the attorney for the stranger somehow was able to convince the court that your actions were meant to intentionally harm visitors to your property, then you would have to pay damages yourself.

It is always important to read your insurance policy, but it is especially important when it comes to premises liability. If there are special circumstances with your property, such as an unusable swimming pool that could entice skateboarders to test their skills, you might need a special rider to cover your liability. Do not hesitate to call your insurance agent with questions regarding premises liability.

Basic Leads. The basic Internet mortgage lead has changed little in the twelve years since it was introduced: A consumer logs onto a website and completes a form; the Internet lead provider “scrubs” the lead for accuracy then forwards it to the lending professional via email. Lead quality depends on how the consumer got to the lead form. Did the consumer click on a banner ad or pop-up? Was he or she enticed by the promise of a giveaway? Or did the consumer arrive at the website organically, after using a search engine? The difference between an ad lead and an organic lead is enormous. In the case of an ad, the marketer has taken the initial step, reaching out to the consumer, perhaps luring him or her with a gimmick. With an organic lead, the consumer initiates the contact after a rigorous search. He or she is proactively looking for a solution to a financial challenge and has requested help from a lending professional. An organic lead is a qualified lead.

Enriched Leads. A recent survey by Bankrate.com revealed that fully 37 percent of homeowners cannot name the type of loan they have. This poses a significant challenge to lending professionals using Internet mortgage leads, since the consumer traditionally has been the source of the loan and property information in the lead. To ameliorate this deficiency, California-based iLeads.com has developed a patented process to enrich its organically generated Internet mortgage leads with data from its partner since 2001, First American Financial Corporation, the nation’s largest provider of real estate information with $8.2 billion in annual sales. iLeads.com creates long-form leads populated in real time with data from First American, such as loan type, original lender, appraised value, equity position, property square footage, construction date, APN, and more. Marketed as “Mortgage Plus” leads, these enriched Internet leads allow lending professionals to shorten the discovery process and avoid untenable loans.

Adjustable Rate Mortgage (ARM) Leads. Using similar technology that draws on First American data, iLeads.com can identify the four million Americans facing increases in their adjustable rate mortgages over the next three years. As with the Mortgage Plus leads, iLeads.com is able of offer detailed loan and property information with their ARM leads. iLeads.com can provide these refinance mortgage leads as much as 120 days before the ARM recast date, giving the lending professional plenty of time to initiate contact and pursue a refinance loan. Since these ARM refinance leads are culled from existing records, rather than volunteered by the consumer, iLeads.com screens out consumers on the federal Do-Not-Call registry.

Live Transfers. A “Plain” Internet mortgage lead is sent to the lending professional via email. The “Peanut” version is a lead already on the phone. Live transfer or “hot transfer” leads are called by the Internet lead provider, rather than by the lending professional. The center further qualifies the consumer by making sure he or she still is interested in the loan. If the lead remains qualified, the call center transfers the call to the lending professional. There is a fee for the service, of course, but many lending professionals find that the guaranteed contact with the consumer and the added layer of prequalification justify the higher cost.

Aged Leads. Some Internet leads are sold to just one lending professional. They are “exclusive” in the sense that they are not sold more than once. Of course the consumer can complete more than one lead form, leaving the possibility that a competitor can buy the lead from another Internet mortgage lead supplier. Other leads are sold more than once, at reduced price. As time passes, the value of shared or nonexclusive leads goes down, since the consumer in all likelihood has been contacted by more than one lender. Contact is not necessarily a sale, however, because the consumer does not always sign with initial lenders. A lead several days old still might be viable. These “aged” or “vintage” leads can be purchased at drastically reduced prices, providing an excellent ROI for the lending professional who knows how to turn the situation to his or her advantage. Aged leads also provide a low-cost way for new hires to gain experience talking to consumers seeking loans.

The costs of Internet mortgage leads vary. Since an ARM lead is not initiated by the consumer, it can cost as little as $6 each. A “shared” mortgage lead may cost around $25. An “exclusive” mortgage lead may cost as much as $50, depending on where it is located. Interestingly, iLeads.com charges the same for its “Mortgage Plus” leads as it does for its traditional leads, believing that the quality of the information provides an enormous competitive advantage in today’s mortgage market. A “live transfer” lead can cost from $80 to $160, depending on the location of the lead. The relative value of each lead depends on how the lending professional prefers to work, his or her sales skills, and how competitive his or her products are.

Many homeowners believe that virtually any damage to their home is covered by their homeowner’s insurance. In fact, many kinds of property loss are excluded from a standard homeowners insurance policy. In the doomsday scenario above, for example, only damage caused by the meteorite would be covered under standard homeowners insurance. Some of the other disasters could be covered by separate insurance policies, or by additions to the policy known as riders or endorsements. Some things are simply uninsurable. Let’s examine the disaster scenario, point by point:

Hostile attacks. The damaged caused to your roof by the flying piece of concrete would not be covered by homeowner’s insurance, because it was the result of a terrorist act. The result would be the same if the dam were blown up by an incoming missile from a hostile state. Acts of terrorism and war are excluded from homeowner’s insurance because the damage could be so widespread that insurance companies could not pay all the claims without going broke.

Floods. As residents of New Orleans learned when a levee broke as a result of Hurricane Katrina, flooding is not covered by homeowners insurance, even when the flooding is caused by the failure of a man-made flood control system. Floods are excluded from homeowner’s insurance for the same reason that war is: the damage can be too widespread. Since private insurer’s will not cover flood damage, the U.S. Congress passed the National Flood Insurance Act of 1968, which created the National Flood Insurance Program (NFIP). Funded by premiums from homeowners and supplemented with income tax dollars, the government program is the only flood insurance available.

Animals. According to the American Pet Products Manufacturers Association’s 2007-2008 National Pet Owner’s Survey, nearly two thirds (63 percent) of American households own a pet of some kind, including more than 43 million homes that own dogs. Pets of all kinds can cause damage to the home. Because of the widespread risk posed by pets, insurance companies exclude pet damage from home owners insurance coverage. The pets themselves are not covered either. According to a survey by the National Association of Insurance Commissioners, 22 percent of respondents mistakenly believed that their homeowners insurance covered injured or stolen pets. Damage caused by infestations of rats, bats, termites, ants, or any other wild creatures is also excluded from coverage.

Earthquakes. Since 1900, earthquakes have occurred in 39 states and caused damage in all 50. Earthquake damage can be massive. According to the Federal Emergency Management Agency (FEMA), earthquakes are responsible for $4.4 billion in property losses per year. Because of the cost and frequency of earthquakes, standard home owner insurance policies exclude property losses dues to the shaking of earthquakes. Cracked walls, broken foundations, ruptured sewer lines, even the collapse of a home caused by shaking is not covered. However, if an earthquake causes secondary damage, such as a fire, the secondary damage would be covered by homeowners insurance. Separate earthquake insurance policies are available in many states. After the 1994 earthquake in Northridge, many insurance companies stopped offering earthquake insurance in California, however. Pressured by fearful homeowners, the state legislature passed a law requiring property insurance companies to offer California residents earthquake insurance through participation in the California Earthquake Authority (CEA). To limit the cost of claims, the CEA-backed policies cover living spaces only, not swimming pools or other nonessential structures.

Other types of damage may be excluded from your homeowners insurance policy, including damage caused by your own children. The home is the largest asset most people own. To be sure its value is protected, consult with your insurance agent to make sure you have separate policies, riders, or endorsements for your greatest insurable risks.

Many people think any kind of permanent life insurance is a waste of money. They argue that a person needs life insurance for only part of a lifetime: those years when an individual is responsible for supporting a family. They reason that if a person dies after the children are living on their own, the surviving spouse ought to be able to support himself or herself without the help of a life insurance death benefit. According to this logic, a term life insurance policy that covers the 20- to 30-year span when an individual is supporting his or her family is all a person should need. Since the odds of a person in his or her twenties or thirties outliving a term life insurance policy are great, term life insurance is the least expensive type of insurance a younger adult can buy.

Consumers who favor permanent life insurance see a flaw in the term-life scenario: it does not take into account the possibility that a surviving spouse or family will need a death benefit to meet expenses later in life. For example, a spouse might develop a long-term illness or physical disability that prevents him or her from holding a job. If a person’s spouse dies after his or her term life policy has expired, the disabled person will not receive a death benefit and might not be able to meet expenses. Not all children are self-supporting, either. They, too, can become disabled through sports injuries, automobile accidents, or illness. If one of the family’s breadwinners dies after his or her term life has expired, the surviving spouse might not be able to maintain the family lifestyle on his or her own.

Standard term life insurance also fails to address the needs of people who remarry later in life due to divorce or death of a spouse. Term life policies taken out when a person is in her twenties or thirties may cover his or her first family, but many people find themselves starting a new family in their forties and even fifties, due to divorce or the premature death of a spouse. These middle-aged moms and dads with small children may find their term life policies expiring just as they have a new need for coverage.

Middle-aged people can apply for a new term policy, of course, but there is no guarantee that they will be insurable. If the person has gained a significant amount of weight or has developed a serious illness, insurance companies can refuse coverage to cover him or her, or the cost might be so high that it is not affordable. A person can purchase “renewable” term life insurance that costs more than a standard term life policy. With a renewable policy, the person can extend coverage without a physical examination, but he or she will pay more due to increased age. A middle-aged person will pay much more for term life insurance than he or she would have when younger, wiping out some or all of the cost savings realized during the period covered by the first term life policy. For example, a 50-year-old woman will pay $1,120 a year for a 30-year, $500,000 term life policy that would cost a 30-year-old woman $325 a year. A 50-year-old man will pay $1,475 a year for the same policy, while a 30-year-old man will pay just $395 a year. If the middle-aged consumers are overweight—as 66 percent of adults now are, according to the Centers for Disease Control—the policies cost much more than that. Being just 10 pounds overweight will cause premiums to increase 30 percent.

The only way for a younger adult to control insurance costs and guarantee insurability into middle and old age is to buy permanent life insurance rather than term life insurance. Permanent life insurance insures a person until they die, so it never expires. Once the premiums are set, they cannot be raised base on changes in weight, health, or age. Permanent life insurance costs more than term life insurance does early in life, but if a person has to renew or take out a term life policy later in life, it will cost more than a permanent life insurance policy taken out when a person is in his twenties or thirties.

Permanent life insurance also has a mechanism to generate savings, unlike term life insurance. Early in the life of the insured, the premiums of permanent life insurance exceed the cost of insuring a life. The insurer deposits the surplus amount (less fees and profit) into a savings account, then invests the funds. The funds in this account, known as the cash value, increase with each premium payment and as the funds earn a return. The earnings are tax-deferred. The insured can access the cash value by borrowing it, withdrawing it, or using it to secure a loan. The cash value can also be used to pay the premiums later in life, when the insured is on a fixed income. The cash value is also known as the surrender value, since the insurance company will pay this sum to the policyholder if he or she decides to cancel the policy.

Consumers who opt for permanent life insurance can choose between whole life insurance and universal life insurance. A third option, variable universal life, is a type of universal life. Both universal life and whole life types offer permanent coverage. Both accumulate cash value. Universal life allows the policyholder greater flexibility to change the terms of the policy than whole life does. With whole life, the death benefit is fixed at the time the contract is signed. The premiums remain the same throughout the duration of the policy. Cash value accumulates at a guaranteed, unchanging rate.

With universal life, the policyholder can adjust the death benefit to fit changing circumstances, such as a substantially increased family budget due to the birth of children or the purchase of an expensive home. Premium amounts can be changed, as well. Payments can be decreased in the event that an income earner is unemployed his or her business experiences a downturn. Premiums can be increased in good times to speed up the accumulation of cash value. The rate at which a universal life policy’s cash value accumulates varies depending on the performance of the insurance company’s investments. If her investments do well, the cash value will grow more quickly than the cash value of a whole life policy. If the investments do not earn a good return, however, the cash value could increase more slowly than the value of a similar whole life policy.

Universal life insurance offers permanent coverage, cash value, and flexibility of payments and benefits. Its cash value is tied to the performance of the insurance company’s investments, which can do well or poorly. Those who are not worried about being insured later in life might find term life insurance a better, less expensive option than universal life. Those who want permanent coverage with an unchanging premium and death benefit and guaranteed cash value might prefer traditional whole life. Those who want permanent coverage with ability to adjust the policy over time might decide that universal life insurance is the best way to handle the unforeseen changes of life.

Use email. Internet insurance leads include an email address. Do not overlook this tool. The Internet insurance lead is computer savvy and spends more time at the keyboard than the average person. Email is their link to the world. Send a personalized message, introducing yourself and your company. Tells the prospect how you gained their contact information and why you think you can help them. If you do not already use an email signature, start now. Treat it as a mini-biography, telling your prospect your name, company name, and website address.

Clear your mind. A bad day can adversely affect your call, so make sure you are in a positive frame of mind before picking up the phone. Focus for a moment on the prospect. This person is unknown to you, but you can help free them from their financial or other anxieties. You can be their hero if you set aside your own worries and focus on theirs. In return, this stranger can help you on your road to success.

Do not delay. You no doubt have many things to do, but calling your insurance lead has to be at the top of your priority list. Depending on when the lead was sent to you, the prospect may still be online when you call. That means you can begin your conversation while the prospect is in solution mode. Besides, waiting even a few minutes opens the door to a competitor. Although you may have signed up for “exclusive” leads, nothing will prevent the prospect from visiting another website and asking for another quote.

Persist. If you do not receive your insurance lead in real time, and sometimes even if you do, the prospect may not answer your first call. Stay positive, and direct your energy into being persistent. Continue to call back until your make contact. You should call no less than six times in a day. Be sure to hit the key hours in a work day: before the day begins (7 to 9 am), during lunch (11:30 am to 1:30 pm), and check-out time (5 to 7 pm). If you have not made contact by the end of the first day, leave a message.

Mention their request. The fact that the Internet lead initiated the contact with you is a huge advantage. Be sure to leverage this by immediately reminding the prospect of the action they have taken, and how you can help. Identifying the Internet as the source of your call carries a bit of a “wow” factor that makes you look technology-forward, savvy, and capable of solving problems.

Be aggressive but courteous. After you have connected with the consumer, sell yourself, your solution, and your company. Never assume that the business is yours. Stay aggressive and focused. Convince the prospect that you are their advocate, offering the best solution for their particular situation.

Ask for the sale. When you have identified a solution certain to help the prospect, ask him or her for a commitment. You might offer a trial close first, such as asking if the client as any more questions. If not, make a definite, assumptive statement, “I will email these documents to you” or “What is a good time to set an appointment?”

The October fires were a grim reminder that fire remains the deadliest and costliest type of disaster in American. The National Fire Protection Association (NFPA), a nonprofit group that studies fire activity in the United States reports that U.S. fire departments responded to 1,642,500 fires in 2006, an average of one fire every 19 seconds. Of those, 51 percent were outdoor fires, 32 percent involved structures, and 17 percent were automobile fires. 412,500 of the fires occurred in residences. Although only 25 percent of the total number of fires, residential fires accounted for 80 percent of the civilian fire deaths. Of the 3,245 civilian fire deaths in 2006, 2,580 occurred in homes and apartments.

As grim as these statistics are, they nevertheless represent a significant improvement from 2005 and a huge improvement since the late 1970s. Overall, civilian fire deaths decreased 11.7 percent from 2005. Residential fire deaths declined even more: 14.2 percent. Since 1977-1978, when NFPA started its survey, the number of civilian deaths from residential fires has decreased an astonishing 57 percent.

The number of fire injuries also declined in 2006. The 16,400 civilian fire injuries reported in 2006 represented a decrease of 8.5 percent decrease from 2005. As with civilian fire deaths, the vast majority of civilian fire injuries—78.8 percent—occurred in residential fires. NFPA reports that 12,925 civilians were injured in house and apartment fires, a decrease of 6.5 percent from 2005. The group cautions, however, that the estimate of civilian injuries may be lower than the actual number “due to under reporting of civilian injuries to the fire service.”

Although the numbers of fatalities and injuries declined in 2006, the actual number of fires increased by 2.5 percent. The damage to property caused by all fires increased 6 percent, to $11.3 billion. Losses due to fire are greater than those from any other disaster, including hurricanes ($5.4 billion), floods ($5.2 billion), and earthquakes ($4.4 billion). Sixty-two percent of those losses—almost $7 billion—were the result of residential fires. Since homes are the largest asset most people have, it is not surprising why fire insurance is the central feature of homeowners insurance.

Several factors have contributed to the decline in fire-related deaths and injuries. Two of the most important innovations, the residential smoke detector and the 9-1-1 emergency phone system, were introduced in 1967, with the first 911 system in operation in 1968. The development of fire-resistant mattresses and upholstery also contributed to the decline, as did the creation of the child-resistant disposable lighter in 1993. One of the biggest changes has been the decline in adult smoking, which has decreased 50 percent since 1965.

To save more lives, the NFPA suggests five more steps be taken: 1) Increase awareness and education about fire safety; 2) Increase the number of smoke detectors in homes; 3) Encourage the use of in-home sprinkler systems; 4) Introduce more fire-resistant products in the home; and 5) Focus efforts on the people most vulnerable to fire, including the very young, the very old, and the poor.

As the Ocean Isle Beach fire showed, however, fire kills regardless of age or income. Everyone needs to be vigilant when it comes to fire safety, especially in the home.

Part of the reason for the decline is competition. Websites that offer price comparisons are causing insurance companies to lower their prices to compete. It is a variation on the theme of the “when banks compete, you win.” When insurance companies compete, you win, too. The Internet has also helped by automating—and thus lowering the cost of—the application process.

Another reason prices are falling is the declining death rate. The age-adjusted death rate in 2004 was 800.8 deaths per 100,000 people, a decrease of 3.8 percent from the 2003 rate and a the lowest recorded U.S. figure. Fewer deaths mean the insurance companies pay fewer death benefits. This reduces costs and gives the insurance companies more time to earn more income from the premiums paid into the system. Some of the extra income goes to the bottom line, enhancing profits, but some income is plowed back into operations, allowing the companies to lower their rates.

The Insure.com survey included 10-, 20-, and 30-year level term policies with three popular death benefits: $250,000, $500,000, and $1,000,000. The survey assumes the consumer is in ideal health, meets stringent guidelines for height-to-weight ratios, and does not partake of any risky activities, such as skydiving, motorcycle racing, or mountain climbing. To keep the survey simple, it focused on rates in just one state: California.

The survey found that lowest annual rate for a 10-year level term policy worth $250,000 was $108. The lowest rate for a 20-year, $250,000 policy was $153 a year. Those rates were available to both men and women aged 30 and 35. The lowest annual rate for a 30-year, $250,000 policy was $228. That rate was available to 30-year-old men and women. At 35, the rate rose slightly for both genders, to $250 a year.

Rates increase with age. They also go up depending on other factors, such as death rates at certain ages. Because women encounter breast and cervical cancer at relatively early ages, they actually pay more than men do for 30-year policies at age 40. Women pay $355 a year for a 30-year, $250,000 policy, while men pay $335 a year. Men and women age 40 pay the same for 10-year policies ($130 a year) and 20-year policies ($203 a year).

The actuarial tables begin to turn at age 45. Women no longer pay more than men do for any policy. However, men pay more than women do for 20- and 30-year term policies: $340 and $520 a year for men, compared to $318 and $428 a year for women. Men and women both pay $183 a year for 10-year term policy worth $250,000.

The pattern holds at age 50: Men and women pay the same for a 10-year policy ($263 a year), but men pay more than women do for a 20-year policy ($510 a year compared to $370 a year) and for a 30-year policy ($768 a year compared to $585 a year).

Men and women no longer pay the same for any term policies, beginning at age 55. The lowest rate for men for a 10-year, $250,000 policy is $403 a year. For women, it is $345 a year. The lowest rate men can get for a 20-year policy is $773 a year, while women can get the same policy for $580 a year. Age 55 is the last year in the survey that men or women can qualify for a 30-year term policy. The lowest rate for men was $1,550 a year; the lowest rate for women was $1,080.

The purpose of the death benefit is to replace the lost income of a deceased family member. The amount of the death benefit should equal the deceased person’s annual income for a period of years, giving the family time to adjust to the changes. Experts differ on how long that period should be. Some say as little as three years, others say as much as 10 years. If the breadwinner contributes $50,000 a year, then a $250,000 death benefit would cover five years of lost income. To cover 10 years of lost income, the death benefit would need to be $500,000. To compensate for 10 years lost of an annual $100,000 income, the policy would have to pay $1 million.

As death benefits increase, so do rates, of course. The gap between men and women increase for the larger amounts, as well. This is because differences in mortality rates that are statistically insignificant at $250,000 begin to have an impact at the $500,000 level. Rates are not the same for 30-year-old men and women seeking a 30-year term policy worth $500,000. The lowest rate for men is $395 a year. Women can get the same policy for 18% less, or $325 a year. The difference between the genders increases—not just in dollar amount, but in percentage—at the $1 million level. 30-year-old men must pay $710 a year for a $1 million, 30-year term policy. Women the same age pay 21% less, or $565 a year, for the same policy.

Although the survey was based on individuals in ideal health, the increases in life expectancy and ongoing competition among insurers mean good deals are available for almost everyone.

Long term care is not cheap now and it will be even more expensive in the future. A report issued in October 2007 by the MetLife Mature Market Institute states that the average price of a private room in a nursing home is $77,745 a year. If a person stays the average 876 days (2.4 years), the total cost would be $186,588.

There are three options for paying for long term care: 1) using personal savings, 2) through Medicaid, the federal government’s healthcare program for low-income Americans, or 3) with long term care insurance. Very few individuals or families can afford to pay $70,000 to $300,000 out of pocket, so most people use Medicaid or long term care insurance.

If a person has any assets at the time of retirement, such as a retirement account, stocks, bonds, annuities, or cash, Medicaid will require that most of those assets be spent on care before it will begin paying benefits. A home does not count toward Medicaid eligibility, but home equity above $750,000 does. Anyone thinking of transferring assets to a friend or relative will have to think ahead: Congress put a five-year “look back” period in place for property transfers that occur before applying for Medicaid.

An individual also must look ahead when buying insurance. Insurance companies sell insurance to people before they need the benefits, not when they already do. Also, premiums are lower for younger people. For example, 50-year old will pay about $1000 a year for a policy that covers four years of long term care at $150 a day. A person who is 65 will pay more than double that: $2200 a year. By 80, the cost will be $7500 a year.

To reduce premiums, some people reduce the daily rate the insurance covers. According to the MetLife report, the cost of staying in an assisted living facility is $35,628—about half the cost of a nursing home. If the insured thinks that assisted living is all he or she will need, then the cost of care could go down from $213 a day to just $97 a day. Reducing the daily rate will reduce the cost of the insurance.

Other people lower premiums by reducing the period the policy covers. They reason that the if the average stay in a facility is just 2.4 years, then there is no need for coverage to extend beyond this period. This approach involves a risk, however. If the need for coverage does continue beyond the insurance period, the additional costs could wipe out a person’s life savings.

A wiser way to reduce premiums is for the insured to assume more of the risk by increasing the elimination period (waiting period before benefits begin). For example, delaying the benefits for 100 days would lower the premiums substantially. The insured would then pay the additional $15,000 in costs. This may seem like a lot of money, but at least the amount is limited. If a person requires care for years or even months beyond the cut-off period of the insurance, the cost could be astronomical. It is better pay a known amount than to risk paying a larger, unknown amount.