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Important notice!!Act now, and get on board

2008-11-12T08:05:00.000-08:00

Hello, everyone....

My Alexa ranking is constantly improving, and I am now nearly at 700k; I am improving by 200k every week...that's incredible if you know the meaning of alexa.I am also well represented in blog catalog.
So I have decided to do put ads of my friends on my blog..but ONLY picture ads, lets say, something like a 125 x 125 or 250 x250.
I am putting 5 slots near the HOME, INSURANCE menu on sale at 15 Us dollar/month by paypal...
And as many links as I can get in my sidebar at 10 dollars a month..
If you are interested contact me by leaving a comment to this post..I will check later.Leave your details...
The offers are great, because the top menu is VERY visible, and the pic links are very appealing...The icons can be made on several websites on the net..Just google it.

Thanks...

Latest news: One of the top slot has been sold....

I have also decided to start writing reviews for my blogger friends.I will be writing a weekly review about your blog or a particular post, I find interesting, for only 10 dollars per month.
Remember, all payments first, and by paypal.thanks...And ofcourse regular friends, and affiliates will have better prices.Act now!

I am bankrupt!

2008-11-12T07:39:00.000-08:00

Oh it had to happen one day, but It happened today:(
I became bankrupt even before having anything in the bank:)
Google banned me, and my blog has been removed from search engines and I am so sad.I will try to be honest now.....
Atleast, I will not use adsense again, as I was expecting this.I lost 256 dollars.I even bought a PDA, thinking i would get that sum soon..
I am so sad...
Keep visiting me to help me surmount this sadness....

I am sad today

2008-11-08T08:43:00.001-08:00

Today is one of the saddest day of my life....
One hour before i was swearing at alex ferguson because of whom manchester united lost to arsenal...
30min later.....and i realised that a win, a loss, a draw is nothing compared to death and misfortunes of life...
I just learned the death of a neighbour, who has been stabbed to death after 3 men attacked him in Uk...
Uk is getting really dangerous;ive been there once, and saw a gang fight, and how people were trying to intervene..i was frightened to death.
We are living in a dangerous world; people are bad, and care for no one..
I realised it today even more and learned that i should be happy with what i have; tomorrow, maybe our loved ones may not be here because of foolish, immature, irresponsible and heartless people...
I am so sad..

What is a credit report?

2008-10-31T21:18:00.000-07:00

Most people finance their homes with mortgages and pay for their cars with loans. Young people often obtain loans to pay for college. And, of course, lots of people make purchases with credit cards.

You can't expect to receive credit as a matter of course, however. You must apply for it. And just as you would hesitate to lend money to a stranger, banks, retailers, or finance companies will not grant you credit without knowing something about you.

It used to be that a retailer or bank would have to call each creditor you listed on an application form before they would decide to extend credit to you. Today, they rely on credit reports, so it's important for you to know what is in yours.

What Is a Credit Report?

A credit report is a record of your credit activities. It lists any credit-card accounts or loans you may have, the balances, and how regularly you make your payments. It also shows if any action has been taken against you because of unpaid bills.

Where Do Credit Reports Come from?

A company that gathers and sells credit information is called a consumer reporting agency (CRA). These types of companies collect information about your credit activities, store it in giant databases, and charge a fee for supplying the information. The most common type of CRA is the credit bureau.

There are three major credit bureaus that operate nationwide, plus many smaller companies serving local markets.

What Is a Credit Rating?

Your credit rating is drawn from your credit report, which outlines your borrowing, charging, and repayment activities. A good rating helps you reach financial goals; a poor rating limits your financial opportunities.

Since your credit report influences whether you are able to buy a home and get a job, it is extremely important to protect your credit rating by making loan and bill payments on time and by not taking on more debt than you can handle.

Who Is Allowed to See Your Credit Report?

Credit bureaus can provide information only to the following requestors: (1) creditors who are considering granting or have granted you credit; (2) employers considering you for employment, promotion, reassignment, or retention; (3) insurers considering you for an insurance policy or reviewing an existing policy; (4) government agencies reviewing your financial status or government benefits; and (5) anyone else with a legitimate business need for the information, such as a potential landlord.

Credit bureaus also furnish reports if required by court orders or federal jury subpoenas. They will also issue your report to a third party if you request this in writing.

What Type of Information Is on Your Credit Report?

There are usually four types of information:

Identifying Information: Your full name, any known aliases, current and previous addresses, social security number, year of birth, current and past employers, and, if applicable, similar information about your spouse.
Credit Information: The accounts you have with banks, retailers, credit-card issuers, utility companies, and other lenders (accounts are listed by type of loan, such as mortgage, student loan, revolving credit, or installment loan; the date you opened the account; your credit limit or the loan amount; any co-signers of the loan; and your payment pattern over the past two years).
Public Record Information: State and county court records on bankruptcy, tax liens, or monetary judgments (some consumer reporting agencies list non-monetary judgments as well).
Recent Inquiries: The names of those who have obtained copies of your credit report within the past year (two years for employment purposes).

Where Do the Consumer Reporting Agencies Get Their Information?

Credit bureaus collect information from parties that have previously extended credit to you, such as a department store that issued you a credit card or a bank that granted you a personal loan.

Who Decides whether or not to Grant You a Loan?

The lenders themselves make the decision about whether or not to grant you credit. The credit-reporting companies only supply the information about your credit history.

Why Should You Obtain a Copy of Your Credit Report?

To avoid any unwelcome surprises, it's important to see a copy of your credit report before you apply for credit such as car loans, mortgages, or credit cards. Errors in credit reports can be common. Keep in mind, however, that they are not part of a conspiracy against you. They are simply the result of human error.

How Do Errors in Reports Happen?

Think about how often your mail has a misspelling of your name or a mistake in your street address. Then, imagine the possibility for error in a report that contains much more information about you. Cases of mistaken identity, out-of-date information, and outright errors can easily occur.

How Do You Correct an Error on Your Credit Report?

Contact the consumer credit reporting agency immediately. The company is then responsible for researching and changing or removing incorrect data. This process may take as long as 45 days. At your request, a corrected report will be sent to those parties that you specify who have received your report within the past six months, or employers who have received it within the last two years.

What if the Consumer Reporting Agency Stands by Its Report?

You have the right to present your side of the story in a brief statement (100 words or less), which the credit bureau must attach to your credit file. Your statement should be used to clarify inaccuracies, not explain reasons for delinquency. Anyone requesting a copy of your credit report would also automatically receive your statement (or a summary of it), unless the credit bureau decides that it is irrelevant or frivolous.

What Should You Do if You Are Denied Credit because of Something in Your Credit Report?

The lender who denied you credit must give you the name and address of the credit bureau that produced the credit report. Then, you have up to 30 days to request a free copy of your report.

The credit bureau must tell you the nature and substance of all information contained in your report. It must also tell you the sources of the information and who has received your report for the previous six months (two years for reports furnished for employment purposes).

How Long Does Information Stay on Your Credit Report?

Generally, all your credit history information, good or bad, remains on your report for seven years. If you file for personal bankruptcy, that fact remains on your credit report for 10 years.

My dream nextel

2008-10-31T21:10:00.000-07:00

In a nutshell, the motorola Nextel i580 is the world's toughest multimedia phone. It makes reliable phone calls, plays MP3s like a boom box, and shrugs off shocks that would destroy lesser phones. It's expensive, but worth the price.

In the past, Nextel's phones have gone two ways—either rugged but basic, like the redoubtable i355, or powerful but less durable, like the i930 smartphone. The i580 makes no compromises, starting with durability: At 3.8 by 2.2 by 1.1 inches and 5.1 ounces, it's built like an 18-wheeler. Keys are pretty big and well separated. The monochrome, one-line external display shows Caller ID just fine, and the bright 262,000-color, 176-by-220 internal screen looks good even in sunlight.

I decided to find out just how rugged the i580 really is. Dropping it on concrete and even spiking it on a tile floor like a football didn't seem to hurt it any, though the phone does flip open when it hits the ground. Then I stuck the handset in the freezer for about 3 hours. It turned on, slowly, and reported that it had no battery. Amazingly, the phone returned to normal operation when the battery thawed. Next, I took it outside into 100-degree heat and then threw it from a second-story window onto concrete. The battery door popped off, but other than that, the phone was okay. Once I put the battery back in, the phone worked fine, with only a minor scratch in the corner of the case. Since it had hit the ground pretty hard, I decided to wash it off in the sink. The water-resistant i580 shrugged the cool spray off like a duck.

Okay, what can actually kill the i580? To make a point, I stuck the tough little phone under the wheel of a Saturn Sky roadster, which weighs about 2,680 pounds. Eight wheels later (two rolls forward and back), I'd managed to crack the i580's LCD screens—but astonishingly, the phone still worked! I could make calls, Direct Connect, and even use the camera.

The i580's durability is even more impressive because it's a really good phone. The speaker is extremely loud and unusually clear when making calls outdoors and doing Direct Connect. Push-to-talk sounds positively gorgeous. Indoors, you can hear a little bit of background hiss in the earpiece. The phone connected to Plantronics bluetooth headsets easily, and you can trigger voice dialing over Bluetooth (though voice dialing relies on recorded tags and is not speaker-independent.) Also, since the phone is designed for loud environments, ringtone volume and vibrate power will literally knock your socks off. Battery life was solid, too. The i580 yielded 7 and a half hours of talk time.

The built-in MP3 player uses a pretty handsome interface, playing MP3-format songs off a microSD card (a 64MB card is included) through the powerful speaker. It's quite audible outdoors. Unfortunately, you can't assign your MP3s as ringtones, but that's the usual deal for most U.S. phones. A 1.3-megapixel camera takes somewhat dim, soft photos. Low-light performance isn't outstanding, but it's not awful for a cameraphone. The video mode captures the usual 176-by-144, 15-frames-per-second cameraphone videos, up to 10 seconds long.

The i580 also does well at geekier uses: It has no problem transferring photos to and from PCs and Macs over Bluetooth. On my tests, I discovered that the phone will also work as a Bluetooth laptop modem for both PCs and Macs, though at dreadfully slow speeds, around 20 Kbps. Nextel packs in a few other nifty features here, too: Java Web browsing, GPS location services, its off-network Direct Talk walkie-talkie system, and the ability to download its Mobile Email Enhanced client, for example.

The Nextel i580 sets a new standard for Nextel, bringing together maximal features and rock-solid durability. Sure, you'll pay extra for that. If all you need is a purely voice-oriented rugged phone, the i355 will certainly suffice.

What is a credit card?(part 2)

2008-10-31T04:33:00.000-07:00

A diagram showing the front side of a typical credit/debit card.

(1) is the bank logo.
(2) is the EMV chip (commonly referred to as 'Chip And Pin')
(3) is the Hologram
(4) is the 16 digit card number
(5) is the logo of the card type
(6) is the expiry date
(7) is the name of the cardholder

What is a credit card?

2008-10-31T04:27:00.000-07:00

The plastic credit card with a magnetic strip many people carry in their wallets or purses is the end result of a complex banking process. Holders of a valid credit card have the authorization to purchase goods and services up to a predetermined amount, called a credit limit. The vendor receives essential credit card information from the cardholder, the bank issuing the card actually reimburses the vendor, and eventually the cardholder repays the bank through regular monthly payments. If the entire balance is not paid in full, the credit card issuer can legally charge interest fees on the unpaid portion.

Individual banking institutions have their own policies when it comes to credit card applications. Customers may seek either a secured or unsecured credit card, depending on their individual repayment histories. A secured credit card requires the applicant to deposit an amount of cash equivalent to the credit limit desired. A deposit of $1500 USD, for example, should be enough to be issued a credit card with a $1000 to $1500 spending limit. If the customer fails to make sufficient payments, the deposited money will be used to satisfy the credit card debt.

An unsecured credit card, on the other hand, is generally issued to those who have a good and have demonstrated an ability to repay the accrued debt on time. Credit limits are determined on an individual basis, and may be raised or lowered based on performance. An unsecured credit card is essentially a pre-approved loan, with higher than a similar personal bank loan. The main benefit of any credit card is instant access to more cash than you may have on hand. A recent college graduate, for example, may have to purchase a business suit for employment purposes. Earning the $200+ USD needed for an average suit could take weeks, and he or she needs the suit in order to earn the income. Putting the suit on a credit card would be the ideal solution; the borrower could repay the balance with his or her first paycheck and few interest charges would accrue.

Credit card use often becomes problematic when the holder accrues more debt than a regular monthly payment can cover. The issuing bank does allow credit card users to carry over balances every month (revolving credit), but significant interest rates may also accrue on those balances. Missing a scheduled payment can also prompt the bank to raise interest rates on a delinquent account. If a credit card holder can only afford to pay the minimal amount due every month, he or she will not be reducing the actual debt incurred. The minimal payments may only apply to the accrued interest. This is a financial spiral many credit card users may experience if they don't use proper spending restraint.

A credit card does give the holder an immediate credibility for services such as hotel reservations, car rentals and airline ticket reservations. Those without a credit card often have to guarantee their reservations with cash deposits or several forms of identification. Many credit card plans also include insurance coverage for theft fraud . If a credit card is reported stolen and then used illegally, the cardholder would not be held responsible for unauthorized charges. A credit card holder can authorize other people to use the card for purchases or services, however. Ultimately, the primary cardholder is responsible for all charges placed on his or her account.

A credit card is not a requirement for successful living, but even those who only pay for goods or services with available cash often find a credit card to be a convenient form of identification and instant credibility. In order to avoid excessive credit card debt, the holder must decide if the goods or services are worth the added expenses.

What are Extended stay hotels?

2008-10-30T07:45:00.000-07:00

Extended stay properties operate under several banners, brands and models, but all share the characteristic of offering guests accommodation for five days or more without the usual additional services of a full-service hotel. They generally fall into one of three categories:

• All-suite hotels;
• Apartment hotels or ‘aparthotels’;
• Serviced apartments

The concept of extended stay hotels dates back to 1974 when Marriott opened its first Residence Inn in the US. Since then the extended stay model has achieved strong growth in the US. The commonly-accepted definition of ‘extended stay’ in the US market is a hotel with selfcatering suites where guests stay for five days or more, but which usually does not offer the ancillary services such as bars, restaurants and porterage provided by fullservice hotels.

In the US today, 20 per cent of hotel stays are estimated to be five nights or longer – much of that accounted for by extended stay locations. Customers are mainly business travellers and include employment categories such as construction workers. The healthy growth in the extended stay sector has been driven by the geographical size of the US, and demand among travellers staying away from home for more ‘homely’ and value for money accommodation than the full-service hotel. The trends towards secondments and more flexible use of human capital have further strengthened demand. As the extended stay market has grown and become more sophisticated in the US, it has segmented into budget, mid-tier and upscale offerings.

When should you consider long-term studio suite accommodations?

Working on an extended project away from home

Going away on a budget vacation and still prefer to have a kitchen and access to laundry

Remodeling or buying a home

Relocating to a new job

Visiting relatives

What can you look forward to at Extended Stay Hotels ?

All suites come with a fully-equipped kitchen, appliances and linens

Unlimited local phone use, a computer data port and personalized voice mail

Housekeeping and guest laundry facilities

Select properties offer exercise centers and pools.

Wi-Fi high speed Internet access available in every room - chain wide.(possibly)

Consolidation of Private Student Loans: Know All Costs Behind It

2008-10-25T08:05:00.000-07:00

When looking for consolidation of private student loans program, first of all one must know all the costs in exchange for the loan borrowed. The most important cost is the fixed cost or likewise known as origination fees. Such costs are supposedly to cover whatever paper works needed in order to process the loan. This fees as the name implies are fixed and so whatever amount of loan that you might borrow, the fees that you need to pay will be the same.

Origination fees are actually a percentage of the total amount of loan. When you are able to acquire low rates of interest for your consolidated student loans, you will however have to deal with higher origination fees.

Because of the current competitive nature of the services on consolidation of private student loans, many lending companies are willing to discount the fixed costs. Some are even afraid not to get loan clients that they completely slash these costs off. This means with just a little more effort in online research, you can actually find a lending company that will change you such costs when availing of their student loan consolidation services.

Imagine the savings that you can enjoy if you obtain a program on consolidation of private student loans with no fees to worry about. Just make sure before you sign a contract with your choice of lender, this clause of non-payment of origination fees is present on the terms and conditions. Great move on lenders to disregard such costs as this entices prospective borrowers to employ their services. On the other, the students further enjoy having less financial responsibility to worry about, which is why they are getting loan consolidation program in the first place.

Student Debt Consolidation Loans: Replace Old College Debts

2008-10-25T08:03:00.000-07:00

A college student knows how expensive it is to stay as one until the time comes when he is finally able to receive his degree. And for some, the only option that they have to take is getting college loans in order to pursue their studies. Tuition fees, books, board and lodging, and other incidental expenses - these are the necessities that one has deal with and pay via many loans in order to maintain good academic standing. However, when the time comes when the repayment of such loans must be faced by the student, he realizes that great burden of doing so. And because of this, student debt consolidation loans can be availed to ease up the financial burden and stress being experienced by the student borrower.

What are student debt consolidation loans? These are the type of loans that are meant to replace the multiple loans initially gotten by the student; it is the consolidation of private student loans as well as government debts. In other words, they are new loans in place of all the burdensome studebt loans that you have obtained during your early years as student. They also help by providing you with a payment plan that are easier and more convenient for you; they can be in a form of smaller, more realistic monthly payments.

Student debt consolidation loans offer smaller payment amount because they have lower rates of interest. With lower rates and payment, you are now given the chance to pay your new debt on time - without fail. Consequently it help you make significant improvement on your credit standing. Of course, as you were able to do away with your previous lenders because of the new loan, it also helps in the improvement of your credit.

Refinancing

2008-10-23T21:56:00.000-07:00

Refinancing is when you apply for a secured loan in order to pay off another different loan secured against the same assets, property etc. If this original loan had a fixed interest rate mortgage which has now declined considerably, then you would like to avail of a new loan at a more favorable interest rate.

When is Refinancing an Option

Typically home refinancing is done when you have a mortgage on your home and apply for a second loan to pay off the first one. While taking the decision to go for the home refinancing option, it is important to first determine whether the amount you save on interests balances the amount of fees payable during refinancing.

Benefits of Home Refinancing

Imagine a scenario where you can have access to extra cash, while simultaneously lowering your monthly mortgage payment. This dream can become a reality through mortgage refinancing.

A house is the largest asset you may ever own. Likewise, your mortgage payment may be the largest expense you'll have in your monthly budget. Wouldn't it be great to use this asset to reduce your monthly payment and put extra cash in your pocket? When you refinance your mortgage, you can take advantage of the equity in your home and enable this to take place.

Lower Refinance Rate, Lower Payments

When you purchased your dream home, the financial environment dictated interest rates. While certain factors, like your credit rating and the amount of the down payment that you were able to afford, influenced your interest rate, the single most important factor was the prevailing rates at that moment. However, interest rates fluctuate. When the Federal Reserve enters a rate-cutting period, the prevailing rates may become significantly lower than when you originally purchased your home.

By refinancing your mortgage when interest rates are lower, you can exchange a higher interest rate for a lower one, which, in turn, will lower your monthly payment.

Shorten the Length of Your Mortgage when Refinancing

Another advantage of home refinancing is that you can shorten the term of your mortgage. Let's say, for example, that you originally had a 30-year mortgage and have been paying it for eight years. Thanks to mortgage refinancing, you can switch to a shorter term of either 10, 15 or 20 years. This can save you thousands of dollars of interest. Also, if the refinance rate is lower, but you maintain the same monthly payment, you will build up equity in your home more quickly, because more of your payment will be going towards principal.

Exchange an Adjustable Rate for a Fixed Refinance Rate

When interest rates are low,adjustable rate mortgages (ARMs) are the housing market's darlings. However, as interest rates increase, that adjustable rate may not look as sweet. It's also possible that you opted for an ARM because your financial future was less secure, or you weren't sure how long you'd stay in your home. If, however, you've become financially stable and know that you'll be staying in your home for several years, it may be beneficial to swap that fluctuating adjustable rate for a fixed one. You'll have more security knowing that your monthly payment will remain steady, regardless of the current market environment.

Access to Extra Cash - Cash-out refinancing

One way to put more money in your pocket is to tap into the equity you've built in your home and do a "cash-out" refinancing. In this scenario, you can refinance for an amount higher than your current principal balance and take the extra funds as cash. This can provide money for remodeling your home, paying off high-interest rate bills, or sending your kids to college.

Bye, Bye PMI

If you were unable to make a down payment of 20 percent when you purchased your home, you may have been required to purchase Private Mortgage Insurance (PMI). If your house has appreciated since then, and you've steadily paid down your mortgage, your equity may now be more than 20 percent. If you refinance, you will no longer need PMI.

In many ways, your house is like a cash cow. If you have discipline and knowledge of the benefits of refinancing, you can tap into its milk for years to come.

Debt consolidation

2008-10-23T10:03:00.000-07:00

Debt consolidation involves taking high-interest balances on a multitude of credit card bills and combining them into a single balance. It can involve a variety of different options, including debt consolidation loans, transferring balances to a zero percent credit card, or a home equity loan or home equity line of credit. Interestingly enough, however, some experts say individuals who take out a home equity loan to pay off credit card debt accumulate similar debt in a two-year period.

The reason for this is simple, accumulating debt is a habit and it is an exceedingly tough habit to break. If your tendency is to overspend, chances are you will continue to do so, even after you've taken out a home equity loan. In addition, if you need debt consolidation, it is likely that you will not qualify for the lowest possible interest rates. Those are reserved for people with the best credit ratings.

Debt Consolidation - What Are The Options?
Having a lot of debt is not uncommon today, and for many, it seems that knowing how to get
out of debt is just about as uncommon, too. If you have a lot of debt and want to find some
relief, there are a number of options that may be available to you.

Still, if you are determined to undergo debt consolidation, there are a few key things you need to know. To begin with, a home equity loan is a fast, simple way to dig yourself out of debt. However, if you have difficulty paying the loan back, you could end up losing your house. In addition, although interest on home equity loans is generally tax deductible, such a tax break could be limited. You may also be tempted to borrow more than you need just because the bank says that you can.

Another possible option is a zero-percent credit card, but you need to be careful about using it. For instance, the zero-percent interest rate may just be an incentive for you to switch cards. At the end of a certain period of time, say 12 months, you'll be back to paying sky-high interest rates. Also, you will only be able to hang onto the low introductory rate as long as you pay your bill on time. If you're late with a single payment, you'll end up paying a much higher interest rate. Additional fees and charges may cause the cost of the credit to soar. In addition, if you end up paying the bare minimum on your credit cards, it will be difficult for you to pay them off any time soon.

What about the conventional debt consolidation loan?
Such a loan can be quite convenient and a real time-saver, enabling you to pay your debt with one single payment each month. You may find that you can get the best rate at a local credit union rather than at a bank. By doing some comparison shopping, you may be able to save quite a bit of money in the long run.

Homeownership-the risks

2008-10-22T07:06:00.000-07:00

Homeownership is a large commitment, so the risks associated with homeownership are important to weigh in when deciding whether to become a homeowner now or at some other time in the future.

What are the risks? While every situation is different, here is a list of risks that all homeowners should consider:

Monthly housing expenses may be more than rental expenses. The amount you commit to paying for housing each month may be more if you're paying a mortgage versus paying rent. In addition to paying for the home itself, you also will be expected to pay for property taxes, insurance and other expenses you probably did not have to pay for while renting. Thus, even if your monthly mortgage payment would be the same amount as your current monthly rent payment, buying a home may be more expensive than continuing to rent.
You are the landlord. When you commit to owning a home, you become the landlord. That means, if something breaks or needs to be repaired, you pay for it. In addition, you are now responsible for other expenses as part of owning a home, such as paying property taxes, association fees, utility bills, and insurance, the costs of which may increase each year.
You may need to sell your home to move. If you decide to move, you may need to sell your home. Depending upon market conditions in your neighborhood or state, your home may not sell as quickly as homes in other areas.. In addition, you may need to incur the expense of hiring a real estate agent to assist you in selling your property.
Property values can remain flat or decline. The value of your home, starting from the price you paid for your property, may remain flat or fall over time. A property can lose its value for a number of reasons, such as changes in the local or national economy, if your home is not well maintained, your neighbors' homes are not well maintained, etc. If and when you decide to sell your home, you may not obtain the same amount you paid for it, and you may owe more than what the property is currently worth. As a result, you may be unable to move or may have to use savings to pay off the difference between the amount you receive from the sale of your home and the balance of your mortgage loan.

EQUITY

2008-10-22T07:03:00.000-07:00

Personally i did not know about equity until i did some research over the internet.Hope it helps you!!please comment:)

Equity is simply the amount of ownership value a homeowner has in the property. Equity is computed by subtracting the total of the unpaid mortgage balance and any outstanding liens or other debts against the property from the property's fair market value.A homeowner's equity increases as he or she pays off the principal balance of the mortgage and/or as the property appreciates in value.When a mortgage and all other debts against the property are paid in full, the homeowner has 100 percent equity in the property.

Equity exists in conjunction with the loan-to-value (LTV) ratio.The LTV ratio is an expression of the value of your property compared to the amount of your loan.You can determine your LTV by dividing your loan amount by your property's value or selling/purchase price, whichever is lower.

For example, let's say you buy a $200,000 home and make a $40,000 down payment with your own money, and cover the remaining $160,000 with a mortgage.Dividing $160,000 by $200,000 gives you a loan-to-value ratio of 80 percent and equity of 20 percent, or $40,000.

If you decide to sell your home at a later date, your equity will be determined based on the fair market value of the home less the amount you still owe on the home. So, continuing with the example above, let's say you live in your home for five years after purchasing it.During that time, you make monthly mortgage payments that reduce the outstanding balance of your mortgage loan by $5,000, from $160,000 to $155,000.In addition, during that five years the value of your house increases, and you are able to sell the house for $220,000.Because you still owe $155,000 on the mortgage, your equity would be determined by subtracting $155,000 from $220,000, which would be $65,000.After you subtract other costs, including the commission paid to a real estate agent to help you sell your home, you could use this equity to make a down payment on your next home.

Conversely, your equity may decrease if the value of your home decreases after you purchase the home.If, for example, instead of increasing to $220,000, the value of the home in the example above decreases to $180,000, your equity would be only $25,000 ($180,000 less $155,000 owed on the mortgage loan).The possibility that your home's value may decrease is discussed below.

Buying on the Web

2008-10-11T12:40:00.000-07:00

For new car buyers, the real wonder of the Web is how easily you can get reliable price information that will give you a much stronger negotiating stance. But the Web is also powerful if convenience and low hassle matter a lot to you.

If you plan to buy from a dealer, know your target price before you start shopping. Carprices.com can tell you the Manufacturer's Suggested Retail Price (often called the "list price") and the Dealer's Invoice Price, or what the car cost the dealer.

Focus any negotiation on that dealer cost. For an average car, 2 percent above the Dealer's Invoice Price (that would be $400 on a $20,000 car) is a reasonably good deal. The Web site Edmunds.com gives you another useful figure -- the True Market Value, or average selling price, for a particular vehicle in your region. Knowing that price will tell you immediately if you are being offered a good deal by an Internet service.

If you have no taste for going head-to-head on Dealer Row, you can choose two kinds of Internet service:

Dealer Referral

Autobytel.com, the major surviving service of this type, does not give you an immediate price quote for new car purchases (it does offer prices for used cars). Fill in the Autobytel form detailing what vehicle you want and your color and options preferences. Then you will get a phone call or e-mail from a local dealership (sometimes almost immediately, sometimes a day or so later). At that point, you will get a price quote and some idea of whether the dealer has - or can get - the vehicle you want.

Since you will already know the True Market Value price from Edmunds, you can tell if the offer is a good one. Autobytel prices are supposed to be non-negotiable, but dealers actually will sometimes budge from their initial offer.

The major drawback of Autobytel, however, is that each dealership gets exclusive territory, so you will get a price from only that dealership designated for your area. That means you won't get the advantage of competitive bids.

Direct Internet Service

With CarsDirect.com, you go to the Web site, fill in the vehicle you want and get an immediate, non-negotiable price. These prices usually are competitive and may be a little above or below Edmunds True Market Value number depending on the vehicle.

CarsDirect.com, which gets its cars through dealers, doesn't guarantee it will be able to deliver exactly the color and options you want on your new car. Your chances are good if you are buying, say, a Honda Civic, a Chevy pickup, or any other big-volume model in a popular color. When you find the price you want at CarsDirect, it really can't be any easier.

For another low-hassle option, consider hiring a car buying service. They do the hard part for you. For fees ranging from $190 to $750, depending on the level of service, they go out and get competitive bids from dealers and do all the negotiating for you. These services communicate with you via e-mail and telephone.

No to add-ons

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The salesman may call it "doing the paperwork" or some similarly innocuous description. But the finance manager you are about to meet hopes to boost dealer profits at your expense with attractive-sounding offers of mechanical and financial add-ons. In most cases, just say, "no." But there are some exceptions.

If you already have financing approved, just say so and you can avoid the financing pitch. The one exception: If you already know that the manufacturer is sponsoring a promotional deal with really low rates.

The next pitch you are likely to hear is for an extended warranty. Whether you want to consider this depends on how long you expect to keep the car. If it is the three years or less that matches the typical warranty, reject it immediately. If, however, you are almost sure you will keep your car for five years or more, you might consider an extended warranty contract, which can cost $400 to $1,200.

If you decide to buy one, ask when the extended-warranty coverage kicks in and what it covers. (So-called "power train only" warranties, for instance, may exclude expensive electronic repairs common in today's cars.) Also be sure you know how long the manufacturer's warranty runs. Volkswagen and Hyundai extend power train coverage for 10 years and luxury models Lexus and Infiniti for six to eight years.

The latest vogue in add-ons (replacing rustproofing now that almost all new cars are rustproof to start with) is security etching. Having your vehicle identification number etched into the glass on your windows may, as claimed, make your car somewhat less likely to be stolen. But it is certainly not worth the $1,100 some dealers charge.

Know your target price and be ready for dealer maneuvers.

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Before you head for the dealership you will have already done your homework, so you will know the dealer's invoice price, whether rebates or dealer incentives are available, and your target price, as well as where you plan to start bidding.

You want to start the bidding as low as you reasonably can, but not so low that you will seem like an uninformed buyer just making a low-ball offer. Pull together a folder showing your data and sources for these details so you can readily refer to them yourself or show them to the salesman.

At the showroom. Establish quickly that you are a serious buyer, not a browser. If you come across as just shopping, the salesperson will be eager to move on to a likelier sale. Don't say: "I'm looking at the Ford Taurus." Say instead: "I plan to buy a Ford Taurus LX within the next two weeks and I know pretty much how I want it equipped. I will buy where I get the best price. Let's talk about it."

That keeps you in control. The salesman wants to know as much about you as possible to start spotting potential profit points. Stay pleasant, but just turn away questions and say: "We can talk about me later. Let's talk about price."

Focus on the invoice price. As soon as you can, try to switch the discussion away from the MSRP, or list price, to how much you intend to bid over the dealer's invoice cost. Bring out your Internet printout to show you have done your research on this. The salesman may well say: "That is not the right invoice price for the car." He or she may in fact know less than you do since traditional dealer training focuses on the MSRP and many dealers do not give salesmen the invoice prices. Say: "This is the invoice price for the car I want with the equipment I want." Show him your printout.

A note on buying cars as a couple: If you're negotiating to buy a car with your spouse, make sure that you both agree beforehand on what you're going to say and not say. If you're buying as a team, it's imperative that you act like one in front of the salesperson - who will doubtlessly try to exploit any division of interests you and your spouse may have. The negotiation table is no place to sort out monetary or philosophical differences with your mate.

Start low. Though your target is $200 above invoice, you need to leave room for the dealership to budge you a little. So start out bidding at the invoice price on a car like the Taurus, where a rebate signals you to negotiate hard. You know you are entitled to the $500 consumer rebate that was offered recently, but don't bring that up yet. If that $500 had been a dealer instead of a consumer sales incentive payment, you would start out bidding to try to capture at least half that money. In that case, you would bid $300 below invoice and make it clear how you got that figure. "Since the dealership stands to get a $500 payment from Ford as a sales incentive, $300 below invoice seems fair."

He who hesitates loses. At this point, the salesman is likely to say something like: "I think this is way too low, but I will take your offer to my sales manager and see what I can do for you." He or she may not even intend to talk to the sales manager, but plans to keep you waiting in the glassed-in office to pressure you into a higher offer before even seeking approval. Tell him or her you do not intend to wait long. Then don't just sit there. Wander around the showroom or go outside to look at other cars. That usually brings the salesman back quickly. It's likely that he will bring the news that your initial offer was not good enough. At this point, if you started the bidding at the invoice price, agree to $100 over invoice.

If you get it, take it. If the dealership has a car in the color and equipment you want, and the salesman offers $200 over invoice, accept the offer. If not, get the best offer and take it to another dealer. If the second dealer beats the original offer, keep the competition going - play it back to the first dealer.

When you hit your target or come as close as you think you can, agree on the price. Now, and not before, is the time to talk about a trade-in. You already will know what your car is worth from checking local ads and looking up your model on sites like Edmunds.com and the Kelley Blue Book. If your car is a popular model in good condition and you are sticking with the same brand, you might match or slightly beat that price with your new-car dealer who sees potential profit in selling your used car. If the trade-in offer is a good one, say yes. If not, plan to sell it yourself or take it to the used-car lot of other dealers for a price quote.

Once your price and trade-in are set, you still have to finalize the deal. In our next section, we tell you how to close.

Setting your target price

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Having more information gives you more power. Not long ago, auto dealers had the upper hand because they had most of the information about price, but knowing where to look online can give you an advantage.

Using Web sites like Edmunds.com or Kelly Blue Book's KBB.com, you can find out the dealer's cost for any vehicle. You can also find out about customer or dealer rebates, subsidized lease deals, or other special breaks can cut your cost. Best of all, you can decide exactly what you intend to pay for the car or truck before you ever go near a showroom.

The number most often cited as the dealer's cost is the so-called invoice price - the wholesale price that the manufacturer bills the dealer on shipment. But that is not the whole story.

The manufacturer may offer so-called "dealer incentives" for slow-moving models - in effect, rebates paid to the dealer instead of the car buyer. Unlike heavily advertised consumer rebates, these dealer incentives are rarely publicized. If you have done your homework and know such an incentive exists, you often can negotiate half or more of that amount for yourself.

A hot-selling new vehicle may sell for a while at full MSRP with no bargaining possible. But for more ordinary vehicles, a good starting point is to aim for a target price of 2 percent over the dealer invoice price.

For a slow-selling model, you may be able to go even lower. If you discover that the model you want carries a sizable consumer rebate or dealer incentive of $750 or more, let that alert you to bargain harder, since the dealer and the manufacturer want to move that model.

Having a loan approved in advance lets you focus on price negotiations.

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When you go to a car dealership to negotiate for a new car, you're in a stronger position if you have a loan pre-approved. Unless your model has a special low-rate financing offer backed by the manufacturer, a local bank or credit union is likely to give you a better deal on a loan. And in most cases, you can take a rebate in place of any low-rate financing and use that to lower your purchase price.

Credit unions typically charge one-half to one percent lower interest than bank car loans. You may have access to a credit union where you work, or may be eligible through a professional organization (teachers, government employees).

If you don't have ready access to a credit union, check out your local bank offerings. Web sites specializing in loan information will give you a quick rundown on average rates and the best rates in your area.

HSH Associates gives you one car-loan rate per city - among the best found for each location in their survey. Bankrate.com gives five or more quotations for each major city, including the lowest rate available.

Capital One Auto Finance offers what is called a "blank check" auto loan. The company will approve you, online, for an auto loan and provide you with a check to be used for the purchase of an automobile.

When you get a pre-approved loan, that commitment usually is good for a month or more. So you can shop for the car you want knowing your financing is ready to go.

In addition to getting financing before you go to a dealership, you also need to do your price homework. That's our next lesson - setting your target price.

Buy or lease car

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In those new-car ads on TV, lease payments look awfully low. And they are, compared with loan payments for buying the car. But leasing is not for everyone.

Leasing is the easiest way to get a new car every few years while letting the dealer or leasing company worry about disposing of the old one. Leases have some major disadvantages.

One of the biggest drawbacks - especially if you are not accustomed to leasing - is that you are forced to make a major financial decision when your lease expires. You must either turn that car or truck back and buy or lease a new one, or decide to exercise your option to buy the vehicle at the lease-end price. (Typically, the value of your car or truck at the end of the lease is set in advance.)

On the other hand, if you buy a car or truck, you can postpone any decision about replacing it at least until mechanical trouble forces your hand. Some people just like knowing that they own the car once the final payment is made. If you don't mind driving an older car, the best decision on purely economic grounds usually is to buy a new car and keep on driving it long after your loan payments have stopped.

Which is right for you? If you typically trade for a new car every four years or less, want to avoid the loan down payment of 10 to 20 percent, drive close to but not more than the 15,000 miles a year allowed in most leases and typically keep your vehicle in good condition to avoid end-of-lease penalties, you might well be happy leasing.

Even so, before you opt for a lease, keep in mind that there is a reason why those low payments look so attractive: Instead of paying for the entire car, you're only paying the estimated depreciation over the time you are leasing it. So to get a really good lease deal, you need to look further than just the payments. You need to understand how leasing works, do your homework, and negotiate as hard as if you were buying the car. Here is a step-by-step guide:

Master the jargon. You can't successfully negotiate a lease without becoming fluent in the industry's terms. What you need to know before you start to bargain: The capitalized cost is the equivalent of the selling price, which you want to get down as low as possible. The residual value is the estimated worth of the car at the end of your lease. Your monthly payments are determined by the difference between these two figures, plus an interest charge known as the money factor. Thus, raising the residual value or lowering either the capitalized cost or the money factor will lower your payments.

Look for a manufacturer-subsidized lease. These deals, often promoted in splashy ads in newspaper auto sections, are likely to be the cheapest available. To identify a generous subsidy, go to LeaseWizard.com and, for about $25, download a software kit that identifies the best current leasing programs in your region. It also includes the standard residual value data published by Automotive Lease Guide, an independent research firm, and provides options for changing lease terms and mileage limits.

Set a target and negotiate hard. You can find out the so-called dealer's invoice cost for any car or truck by checking sites like Edmunds.com or Kelley Blue Book. Set a target price about 2 percent above the dealer's cost ($400 on a $20,000 car, for instance). Start bidding below your actual target and plan to wind up near that figure.

Be aware, though, that manufacturer-to-dealer incentives may lower the dealers costs to far less than the invoice price, which means you may have a lot more room for negotiating. Consult Edmunds.com, which provides some information about manufacturer-to-dealer incentives. Or go to Kelley Blue Book's site, KBB.com, where you can access the actual prices people are paying for cars, as well as whether manufacturer-to-dealer incentives are being applied to a particular vehicle.

The Web site for the car-buying service CarBargains.org also sells a monthly newsletter detailing available incentive plans including dealer incentives.

Buy new car or used car?

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There's nothing like that new-car smell. Buying a new car has a lot of allure: It's brand new and it's all yours; nobody has abused it. You can get the vehicle equipped just the way you want, and you get the full factory warranty. But hold on. Your best deal could well be a late-model used car.

The used-car market has changed dramatically in the past few years. To start with, today's new cars - and thus used cars - are simply made better. Overall quality and durability has increased as U.S. manufacturers pushed hard to catch up to imports. A second factor is the rise of leasing.

There are plenty of well-kept two- and three-year-old cars returning from leases. These cars provide a good supply of attractive, reliable used cars. New used-car superstore chains are making it easier than ever to buy with huge inventories and no-haggle shopping. The kicker is that if you opt for a three-year-old model instead, you could save as much as 30 to 40 percent over new.

In the last few years, car dealers, backed by manufacturers, have introduced what they call "certified" used-car programs for newer used cars (usually up to three years old). Manufacturers insist that a used car must pass a series of inspections before it can become certified. And once a car passes, the manufacturer adds a fresh warranty, sometimes 12 months or more.

If you want a used car, start by checking prices of the vehicles that interest you. Among the best Web sites are Edmunds.com and Kelley Blue Book's KBB.com. Both are free, and both will let you check the going prices for almost every make, model and year you could want. (Both sites list new-car prices as well.)

Sites like Autotrader.com and Cars.com list classified ads for used cars, mostly from dealers. Enter your zip code and you'll get a selection of cars within 100 miles or so of your home. While ads for these same vehicles undoubtedly also are running in your local paper, you get more detail online.

For those willing to venture farther from home, eBay Motors, part of the eBay auction site, lists used cars for sale. You can restrict your search to cars in your area, but you'll probably do better by looking at cars all around the country. eBay provides various protections, as well partnerships with used-car inspection services, to take some of the worry out of buying a used car entirely online. Read the eBay Motors "How to buy" page and see if you feel comfortable with the process.

Once you zero in on some possibilities, you need to double-check them. Unless you are buying a certified used vehicle, spend a little extra to check any specific car, truck, or van you are close to buying.

First make sure the odometer is honest and that the car has never been totaled. (The used car business may have become less sleazy than it used to be, but problems still do occur.)

Firms like Carfax and Autocheck will track down the history of your prospective vehicle by its Vehicle Identification Number (VIN), usually listed on a metal plate just inside the windshield. If, for instance, the car had 50,000 miles when its title last changed but now shows 30,000 miles, take a pass. If the car has ever been sent to a junkyard, a salvage title will show up on the report. About one in 10 cars in its database has some kind of problem, say Carfax officials.

Once a car has passed those big hurdles, you still need to get it checked by your own mechanic, if you have one. If you don't, many cities have specialized mechanic services that will make on-the-spot inspection of used cars. If you are considering spending $15,000 for a used car, that $100 to double-check it may be well spent.

If you're buying on eBay Motors, they've got an auto inspection agreement with SGS Automotive. Sellers can have their car inspected and a report posted for potential buyers to see.

The most important thing to remember: Anything's negotiable except the right to inspect. If the seller won't let you and your mechanic inspect the car, walk away, no matter how nicely it runs.

Often, this rule of thumb means you'll be buying from an individual rather than a dealer, for many dealers don't allow inspections. Those who do typically won't let you take the car off the premises and won't let you use their lift.

Unless you have an unusually close relationship with your mechanic, he'll want you to bring the car to his shop. This isn't unreasonable, for a lift is essential for hunting nasties like rust, worn brake drums, and deteriorating exhaust systems. However, a good mechanic can tell a lot from sliding underneath the car, inspecting the exterior paint for repaired body damage, and checking the odometer reading against actual wear.

Confining your search to individuals usually means you'll get a lower price - but it's more time-consuming because there's only one car at each location. Regardless of where you buy, there are some rules you can follow.

Jack Gillis, director of public affairs for the Consumer Federation of America, recommends what he calls the "touch and comment" technique often used by new-car dealers when they inspect trade-ins. "When you review the car, visibly point out the various problems that you note," he says. "An exaggerated touch of some loose parts or running your hand along body damage can put the seller in a defensive position."

This tactic can be used effectively when your mechanic is conducting an inspection within an earshot of the seller. Have your mechanic mention each problem, allowing you to comment grimly.

Having your expert on hand can make all the difference, because even if you know a lot about cars, you need an expert witness to present the damning evidence. Like any expert witness, however, mechanics must be paid. Some shops offer a pre-purchase checkout for a set amount that can vary widely depending on the shop and the procedures performed. Others offer on-premises inspections for their hourly labor rate, which can range from $40 to $70 an hour, depending on the region and the type of shop.

While indispensable, your mechanic is your consultant, not your agent. To get the best possible deal on a used car, you must do some work yourself. Some pointers:

- Before going to look at cars, visit nadaguides.com and peruse the Official Used Car Guide of the National Automobile Dealers' Association. It lists recent prices fetched by specific year models in your region. The range between the trade-in value and retail value is your room to maneuver. If you can by a decent car from a dealer for less than its NADA book trade-in value, more power to you.

- If the seller touts the car as an immaculate jewel, be sure to negotiate an acceptable price before bringing in your mechanic. Failing to do so could leave you with no bargaining leverage if the car actually is in great shape. Make sure the seller understands that the agreed-on price is entirely contingent on the vehicle making Phi Beta Kappa. Once your technician determines the car's shortcomings - and there are few used cars on the market without any - it's your job to put a generous price on each repair needed. After all, you intone, the initial figure was based on perfection.

- Before buying, try to arrange a test-drive at night and another on a rainy day. Nothing reveals a cheap windshield like oncoming headlights, and a replacement windshield may mean the car's been wrecked and then given a convincing paint job. Also, it's impossible to know if trunk and door seals are leaking except when it's raining. Again, leaking seals may mean that the car's been wrecked, especially on a car only a few years old.

There is a point at which too many glitches should eliminate the car from consideration. Says automotive author Mortz Schultz: "If you find a major problem, or if you rack up enough minor ones, forget the car."

In return for your rigors, do you get an absolute assurance that you won't regret the purchase? Of course not. It's still a used car, after all. Buyers must accept the occasional ping, ding, or rattle. But if your mechanic is competent, and you negotiate adroitly, you can get a great vehicle for a substantially lowered price.

If you decide, however, that you really want a new car, you have a different choice to make: Should you buy or lease?

What can you afford?

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After your mortgage or rent, car loan or lease payments are likely to be the next-biggest item in your monthly budget. So calculate carefully what you can really afford. Remember to take into account such items as insurance costs, which can run as high as 12 percent, but more typically 5 to 8 percent of the purchase price.

A new (or used) car calls for a new state registration, with fees typically running from $50 to $125. These items usually figure into the total amount you borrow with a loan or finance with a lease - and therefore help determine your real-life monthly payments.

A good rule of thumb is to plan on spending 10 to 15 percent of your total monthly budget on all automotive expenses. If you are buying a new car, your warranty will cover major repairs for at least the first three years in most cases, but will usually not cover routine maintenance such as oil changes or replacement for items such as batteries, windshield wipers, or tires.

A new car means higher insurance costs. (Opting for a late-model used car can cut those costs.) Your premiums for liability coverage, required of all drivers, may not change much from your old car. What will increase is the so-called collision and comprehensive portions of your policy.

Collision pays to repair accident damage to your car, while comprehensive covers theft, fire, and natural disasters. Since you will want these types of coverage for a new car, your costs could shoot up sharply - especially if you have been driving an older car or truck and have dropped collision and comprehensive coverage to save money.

Check the record. One way you can cut your insurance costs before you buy is to choose a model that has a good safety record and/or a low theft rate. Insurance costs vary not only by model but also by metropolitan areas, and even from city to suburbs within those areas. So when you have narrowed the number of cars or trucks on your wish list to a handful, call your agent for a rate quote, or check theft and safety records on the Web.

For federal crash test results, go to www.safercar.gov. The site operated by the insurance-company sponsored Highway Loss Data Institute will give you rankings for injury and property losses for any vehicle, plus a list of the most- and least-stolen models. Both those factors affect insurance costs as well as your safety and peace of mind.

Buy the correct car

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Hey, wait. Don't go down to the car dealer and start shopping immediately. Are you sure that the car, pickup, sport utility, or van you have in mind is what you really need?

If you rush into a deal without carefully considering how you will really use the vehicle, you could be making a $25,000 mistake, at the average new-car price.

Sure, you want a car that will make you smile. But consider the purpose of most of your driving. Is it commuting? Hauling kids? Weekends? Vacations?

If you drive more than half an hour to work every day, a combination of a comfortable ride and reasonable gas mileage is important. If you frequently drive clients or co-workers to lunch, a sleek coupe won't be welcoming for whomever has to crawl into the back seat; you need a four-door sedan.

If you frequently haul your kids and their many friends or classmates, a minivan or sport utility with three rows of seats may be essential. If weekend errands involve hauling building materials or large bushes, that same utility or van will come in handy.

Be honest with yourself. What is the largest number of people you carry regularly? What is the biggest pile of gear, luggage, or haul from Home Depot that you regularly carry?

Once you have made this practical match up, however, you still have lots of choices. With careful planning, you can get a vehicle that you need and really want.

Things to know before buying a car

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1. Make sure you are getting the right vehicle.

This seems obvious, but you could wind up an unhappy car owner if you haven't thought carefully about how many people and how much luggage or gear you need to carry.

2. Assess the worth of your old car.

Whether you plan to trade it in or sell it, your current car can be an important factor in your budget. Checking the right Web site and maybe your local newspaper will give you a realistic valuation. Selling it directly instead of just trading it may also mean a sizeable difference in what you get for it, though it may take a while longer to reap the proceeds.

3. Decide whether new or used is best for you.

Cars are built better now than in the past, so used cars make a lot of sense. But if you get a rebate or other cost break, the math may be on the side of a new vehicle.

4. Consider whether leasing or buying makes more sense.

Leasing provides lower monthly payments than buying with an auto loan. But it's not for everybody. If you don't have money for a down payment or if you trade your car every two or three years, you may be a good candidate for a lease.

5. Do your homework and set your target price.

The Internet has made it easier than ever to find out the dealer's cost for each vehicle and its options. That's the first step to getting the best possible deal.

6. Shop for money before you shop for the car.

If you plan to buy with a loan, check your credit union or local bank quotes online to find the lowest rate. Getting a pre-approved loan will give you added confidence in negotiating a good price.

7. Negotiating a lease.

In the complicated world of leasing, the dealer will have the upper hand unless you learn the jargon and how to negotiate the various segments of a lease deal.

8. Negotiate a purchase.

If you are doing it yourself, get bids from several dealers, keeping the focus on the dealer's invoice price, which you will know from your research. You may also be able to get bids without going to showroom after showroom.

9. If you hate haggling, consider using a car-shopping service.

Auto-buying services, such as Web sites or discount clubs, make things easy with pretty good, no-haggle prices. But with most of them, you get quotations from only one dealer. Consumer services that shop several dealers near you may deliver even better prices.

10. Don't let the deal-closer close out your savings.

The finance manager isn't there just for the paperwork. He or she wants to sell you high-profit financial and mechanical add-ons. These are seldom worth the money.

Free Cars - Fact or Fiction ?

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Are these claims about free cars too good to be true? Are there companies who will actually provide you a free car?

Yes, almost, but not quite true. There's a little more to it. However, there's enough truth in it and enough potential opportunity to make it worth a serious further look.

The companies DO exist, and they DO pay people to drive, and they DO provide free cars. Real people are currently participating in these kinds of programs every day.

How Does it Work?
In short, you agree to drive a car that displays advertising for a company's product or service. Since you do the advertising, you get a free car to drive or get paid to drive your own car. In some cases, you may get a free car AND get paid to drive too.

These arrangements are typically not handled directly by the company selling the product or service, but by an marketing or advertising company hired by the product/service company. Some of these marketing and advertising companies provide brand-new vehicles, some offer almost-new vehicles from their fleet, others may pay you to drive your own car.

The company "wraps" the car in an easily-removable paint-safe vinyl film that contains an attractive graphic ad that promotes a client company's product or service. For example, the ad might promote a cell phone service or a new restaurant in town.

Some ads might cover the entire vehicle (looks great on SUVs, minivans, PT Cruisers), some only partially, and some only on side or rear windows. Don't worry, you can see just fine through windows that have vinyl ads applied.

The company offering the product or service pays the advertising company, who pays you to drive your own car or provides you a free car with the advertising already applied.

The amount you get paid, or whether you get a free car, depends primarily on three factors:

Number of miles you drive per month
Where you drive
Where you park

In other words, you're selected according to the number of people who will potentially see your wrapped vehicle in an average day.

You'll be paid more and have a better chance at a free vehicle if you drive lots of miles and drive in a heavily populated and high traffic area. In some cases, you may be asked to drive a specific route every day. The more people that have a chance of seeing your car as it's being driven or where it's parked, the greater your opportunity.

If you only drive a few blocks to a part-time job, back and forth to school in the suburbs, or just to church on Sundays, you probably won't qualify for this kind of program.

It's not too difficult to figure out whether or not you might qualify for one of these cars-for-free programs when you consider the objectives of the advertisers. They simply want their ads to be seen by as many people as possible in a specific area.

What's the Catch ?
You have to be at least 18 years old, have a drivers license, and have a good driving record. You pay for insurance and, in some cases, for maintenance, especially if you drive your own car.

New cars aren't always available and you may not be able to drive the make/model of your choice. However, depending on the company, you may have enough choices that you can find something that you like.

You may or may not be able to select the ad that goes on your car or the duration that the ad stays on the car. Of course, if you don't like the ad program, you can turn it down and wait for a better one. Most ads are attractive and well designed so that you wouldn't be embarrassed to be seen with it.

Keep in mind that the "free" car belongs to the advertising company, not you. At the end of the agreement, which could be as much as five years, you give the car back.

Also remember that the ad stays on your car 24 hours a day, seven days a week. You can't take it on and off. If this is your only car, you must be prepared to drive the car everywhere you go — to weddings and funerals, to work, to school, to the mall, and everywhere else that you drive.

Competition for free cars is very heavy, outstripping demand in many cases. It may take up to 90 days to get accepted into a program. Therefore, you have to be well qualified and patient in your attempt to land one of these deals. Free is not always easy.

But, for a car, it might all be worth it.

How Do I Sign Up ?
There are many companies, in many different locations in the U.S. and other countries, that use this form of vehicle-based advertising. Some companies only advertise in a specific city or advertise certain types of products. Some provide new cars, others only pay you to advertise using your own car, and some do both. Some do full-car wraps, others may only do spot ads.

Therefore, the best way to find the companies that would work best for you, where you live and drive, is to "subscribe" to an information directory that lists all such advertisers. These directories are compiled and provided by companies who specialize in this kind of service. There are a relatively small number of these companies, who can be found on the Internet, in newspaper ads, and in auto-related magazines.

There is typically a one-time charge for the directory subscription, usually about $30, and usually with a 90-day money-back guarantee.

Since the directory is always changing and being updated, make sure you get a lifetime "membership" if possible, and that all future updates to the directory are free.

With the list of advertising companies and contact information, it's up to you to apply for their programs. Some directory companies offer help with the application process, although you should not pay extra for this service. And you should not pay extra for a "premium" listing or to be placed at the "top" of the list of applicants.

Be honest and provide accurate information in your application. Most companies will check your credentials. Of course, there are no guarantees that you'll be accepted or that you'll find a deal that you like, but completing an application is a small investment of your time for the chance at a rewarding possibility.

Where Do I Get the Information I Need ?
The following companies listed below provide free-car and drive-for-pay program directories. The directories include programs in the U.S. and other countries all over the world.

Subscribing with more than one company might be somewhat beneficial but, generally, it should be expected that one company's directory will be much like another's.

Not Free, But Close
Salvage cars that have been declared total losses by insurance companies can often be a source of easily repaired vehicles at low cost. In many cases, these vehicles have only minor problems, possibly only water damage.

Car rental success

2008-10-11T12:17:00.000-07:00

Driving a rented car can be just as easy and safe as driving your own automobile—with the right preparation. How can you be sure that you're properly prepared each time you drive a rental? Here are some National Safety Council suggestions that can help to put you on the road to car rental success, especially where your safety is concerned.

Getting to Know You

Don't rent a vehicle larger than you are physically capable of controlling.
Spend a few minutes getting acquainted with your rental car.
Take a look at the dashboard. Note the location of the speedometer, the temperature gauge, the gas gauge and so on.
Locate the air conditioner, heater, windshield wiper and washer, defroster, and light switches. Turn them on and off to make sure that you know how they work.
Test the brakes—with the engine running—to get the "feel" of them. Some brakes are "softer" than others, and you don't want to discover this when you're stopping for the first red light. At the same time, get the "feel of the wheel" by testing the "play" in the steering wheel. And make sure the hand brake works.

Check It Out

It's a good idea to inspect the rented car to make sure that everything's in working order.

Be sure the tires are properly inflated. Underinflated or overinflated tires can greatly affect your safety, especially at high speeds.
Check the headlights. Know where the switch is even if you'll only be driving during daylight hours—you might suddenly find yourself driving through a tunnel or facing a weather front in which you would want to turn on your lights. Do the lights work on bright and dim?
Test the turn signals, windshield wipers and horn for any operating problems.
Inspect the contents of the trunk. It should have a spare tire and a jack in it. Inquire about the availability of an emergency road kit if you're interested in extra protection, or provide your own.
If you need special equipment, such as chains for driving on ice or child restraint seats, be sure to ask for it before you leave the rental lot.
Check for any scratches or dents and report them to the rental agency before you leave the premises. Although these will probably not affect the car's performance, you do not want to be held responsible for them when you return the automobile.

Some Things are "More Different" Than Others

The differences between the rented car and the car you own may be more significant than simply the layout of the dashboard or the positioning of the gear shift. Following are some examples.

A Stick-y situation

If you're used to driving an automatic and the rented car is a stick shift—or vice-versa, it's important to reacquaint yourself with handling the new transmission before you begin driving.

More power to you!

Power steering and power brakes require a light touch. If you're not used to driving with them, you may want to get a "feel" for them before moving into heavy traffic.

Sizing things up

You may be used to a big car and the extra power that it affords you. Or, you may be used to squeezing your little compact into the smallest of parking spaces. In any case, if your rental car is significantly larger or smaller than the car you usually drive, be aware of its limitations.

Another alternative

If you're concerned about the differences between the car you rent and the car you own, you might want to request a rental that is similar to the make and model of your own automobile. Most rental agencies will be happy to oblige if they carry that model.

A Few Minor Adjustments, Please

Now it's time to customize the rented car to your personal driving habits.

Position the driver's seat so that you feel comfortable and at ease behind the wheel. Be sure you are seated at least 10"-12" from the steering wheel to allow airbags to inflate if necessary.
Be sure the headrest is level with the top of your ears.
Adjust the rearview and sideview mirrors so that they're in the right positions for you.

Getting the Hang of It

Take the rented car for a simple trial run, especially before you head for the freeways or a crowded downtown area. You may be more comfortable if you drive across the parking lot once or twice, or around the block, to become even more familiar with it. If you've got any questions, or if the car isn't performing up to par, go back to the rental agency immediately.

In Case of Emergency

Be prepared to deal with a crash or other emergency situation while on the road.

Review your insurance options with the clerk when you sign out the car. Know what your personal insurance will cover, and use that information to determine what additional coverage, if any, you may need to purchase.
Be aware of the rental agency's emergency road service provisions. If they have no specific road service available, inquire as to whom you can contact in the event of an overheated engine, a tire blowout, or similar emergency situations. A good company will give you an information sheet with an 800 number to call in an emergency.

Things to Consider When Renting a Car

2008-10-11T12:10:00.000-07:00

Drivers should educate themselves before they reach the auto rental counter. Carefully review your auto insurance policy and check with your credit card issuer about auto insurance benefits. Protect yourself and save money by taking a few precautions and asking the right questions.

Car rental companies offer several different insurance options that your existing policy might already cover.

They typically offer the following products at the counter:

Collision Damage Waiver (CDW) is also referred to as a Loss Damage Waiver (LDW). If you have comprehensive and collision coverage on your own car, you will likely not need this additional protection. (Comprehensive insurance covers vehicular damages caused by accidents such as fire, theft, wind, hail or a run-in with a deer, vandalism, or theft. Collision insurance covers the cost of repairs or the actual cash value of the vehicle, if damaged in a crash or rollover.) This protection can cost an extra $10-$20 a day.

Liability Insurance covers medical expenses and damages to another person’s property as a result of a car accident caused by the insured’s negligence. If you are adequately insured on your own car, you may consider forgoing this additional liability protection. This supplemental insurance can cost $7-$14 a day.

Personal Accident Insurance offers coverage to the renter and passengers for medical bills resulting from a car crash. If you have adequate health insurance and disability income insurance, or are covered by personal injury protection under your own car insurance, you will likely not need this additional insurance. It usually costs about $1-$5 a day.

Personal Effects Coverage provides for the theft of personal items inside the rental car. If you have a homeowners or renters insurance policy, it generally covers this already. If you frequently travel with expensive jewelry or sports equipment, it may be more cost-effective to purchase a floater under your home or renters insurance policies so the items are fully protected when you travel. Generally, this coverage costs $2-$5 a day.

Car Rental Insurance Tips:

Review your auto insurance policy or call your insurance agent before you reach the rental car counter.

If your current policy doesn’t offer coverage for a rental car, see if an insurance rider can be added for a small fee.

Many credit cards include some level of collision and theft protection. In most cases, these benefits are secondary to your personal auto insurance or the car rental company’s insurance, meaning the credit card company will only pay claims after other insurance coverage has been exhausted. The NAIC recommends you call your credit card company and ask about benefits.

If you lack personal auto insurance and your credit card does not provide benefits, it might be wise to purchase the liability insurance and collision damage waiver at the car rental counter.

Keep in mind that if it is a longer-term rental (e.g., a week, a month or more), there might be limitations on the coverage your existing auto insurance policy provides. Check with your insurance company or agent for details.

If you don’t own a car, you might want to consider purchasing a non-owner auto insurance policy, because it provides benefits in addition to coverage for a rental car.

When traveling on business, a personal auto policy will generally not apply, so check with your employer for guidance.

Know that you are not alone if you find car rental insurance confusing. If you are unclear about the car rental insurance options, or are concerned that a rental company is misrepresenting information, check with your state insurance department.

The future of the car rental industry

2008-10-11T12:08:00.001-07:00

The car rental industry has been rarely viewed as a world leader in the sense of technological development. In the past, even the quality of the cars being used was called into question, some customers claiming that the cars they hired had been so damaged by previous customers that they were just as likely to breakdown at the roadside as get you to your destination. This situation has definitely changed however; the car rental industry now embraces technological change, providing customers with an efficient and reliable service.

One of the largest influences on the car rental industry has been the impact of global warming and more widely the environmental concerns of customers. It is hoped by many car rental companies that by introducing more efficient cars into the fleet, fuel efficiency will be increased and customers will receive a better deal. This is not all of the car rental companies, but some have noticed the niche in the market for customers with an environmental conscience; revealing a wider trend not only in car hire but in society more generally.

The most obvious way that car rental companies can reduce their environmental impact is by introducing highly efficient cars into their fleets. An example would be the hybrid cars that are becoming extremely popular at the moment; they bring the benefits of a smaller environmental footprint and cheaper fuel rates for customers. Not all have embraced the introduction of hybrid cars however, some view their introduction as purely a temporary measure that in no way tackles the root causes of emissions. Additionally, the use of bio-fuel cars has been growing, while this fuel is cheap and produces less harmful emissions critics have been quick to realise that if all of the arable land in the world was turned over for the production of bio-fuel plants, then foodstuffs would be extremely short. It is all rather Malthusian but it is a good point nonetheless.

Some of the more future conscious car rental companies have been studying the ways in which to change the application of rates to customers. In the past companies would charge for the hire of a vehicle on a daily basis, meaning that if you returned the car just half an hour late, another day's charge would be added to the bill. Many companies have noticed that this is not great customer service and have subsequently introduced an hourly pay structure into their operations. While some profits may be surrendered following this strategy, customer service will be increased whilst a bi-product is that fewer cars will be on the road at any one time.

Many car rental companies have been quick to realise the benefits of GPS technology and the ways in which it can aide their operations. GPS tracking devices give the rental company the option to track their fleet vehicles, allowing them to record the way in which cars are being driven and their location. While for many this may be seen as an invasion of privacy, it is not; it is simply a reaction to the large amount of organised crime that focuses on the theft of rental cars. With GPS technology the chances of a company recovering the stolen vehicle are increased considerably, showing that this strategy is simply a way for companies to protect their assets.

The introduction of high technology to the car rental industry has been a long time in coming. Whether this is due to a reluctance to change or simply because the technology has not been effective enough is hard to ascertain. One thing is certain however, with the introduction of GPS, biometric data recorders, environmentally friendly cars and revolutionary pay structures; the future of the car rental industry is bright.

Driving in canada

2008-10-11T12:04:00.000-07:00

Auto rental

Canada has several car rental companies found at airports and in major towns and cities. Rates vary depending on the season, type of vehicle and length of rental. The minimum age to rent a vehicle ranges from 21-25 years old. Most companies require renters be at least 25 years of age, or may charge additional fees for those under 25. You must also possess a major credit card. Requirements may vary from province to province. Be sure to reserve your car ahead of time during peak travel times, from mid May to summer.

RV rental

Camper and motor home rentals are also widely available. Reserve well ahead of time for the peak summer season. Many provincial and national parks, private campgrounds and other conservation areas in Canada allow you to camp with your RV.

Rules of the Road

Canadian traffic rules are similar to American rules. For example, Canadians drive on the right side of the road. But most safety laws are determined on a provincial and territorial level, so make sure you know the particular rules for the province you will be visiting.

Here are some important tips and safety advice to make your journey to Canada safe and memorable:

Canadians drive on the right side of the road.
Seat belts are compulsory.
Children under five must be in child restraints.
If your car is not equipped with daytime running lights, drive with your headlights on, especially just prior to sunset and immediately after dawn.
Right turns on red lights are permitted in most cities across the country after a full stop; however, certain areas of Quebec prohibit such turns. For more information, check with the Government of Quebec's website.
Traffic signals, such as a flashing green light, do not mean the same thing across all provinces and territories. Check the driving websites of the provinces you plan to visit.
Radar detection devices are illegal in many Canadian provinces.
Motorcyclists must wear helmets.
Pedestrians have the right-of-way and you must yield to pedestrians at crosswalks.
The speed limit on the auto routes (limited-access highways) is usually 100 km/hr (62 mph). Speed limits are enforced.
Drivers must carry proof of insurance in Canada at all times.
Driver tips for summer road trips can be found at the Canada Safety Council website.
For practical road safety tips, visit the Transport Canada website.
You can find a complete rundown of Canadian traffic regulations by consulting the online version of the Motor Vehicle Safety Act.

Driver's Licenses & Permits

U.S. Visitors – Your American driver's license is valid in Canada

Make sure you bring along proof of insurance by asking your insurance company for a free "Non-resident Inter-Provincial Motor Vehicle Liability Insurance Card" before you leave, or carry the policy itself. If you're driving a borrowed car or trailer, bring a letter of permission signed by the owner. If you're driving a rented car, carry a copy of the rental contract.

All other visitors to Canada – Applying for the International Driving Permit (IDP)

If you are visiting from Britain, you can apply for an International Driving Permit (IDP) from the Automobile Association before you leave but is not mandatory.

The IDP is a special license for tourists, authorized by UN treaty, which is printed in 10 languages and recognized in over 150 countries around the world.

What is mandatory is that international drivers arriving in Canada must present a valid driver’s licence from their country of residence. If the driver's licence is in a language other than English, an International Driver's Permit is required in conjunction with the country of residence driver's license.

This will allow you to drive in Canada and rent a car here.

Driving in Spain

2008-10-11T12:02:00.001-07:00

Drive on the right
Do not drink and drive – Spain has tough drink driving regulations
Seat belts must be worn, front and rear
Children should have an appropriate car seat and children under 12 years are not allowed to ride in the front
Always carry your driving license (EC pink/green versions) and your passport to confirm your identity. If you have an old style green license (or non European version) you will also need to carry an International Driving License. It is advisable to carry your rental agreement also as proof of insurance.
If you wear glasses, you must carry a spare pair with you whilst driving
Using a mobile phone whilst driving is illegal, unless it is a hands-free set. You should not have anything in your ears (for listening to music or using your phone) other than a hearing aid.
Traffic coming from the right has priority. However, where a minor road intersects a main road, the traffic onthe main road has right of way (even if you do not see a “Ceda El Paso” sign). Traffic already on a roundabout also has right of way.
Watch your speed – radar traps are commonplace and can carry on-the-spot fines. If you are not able to pay the fine on-the-spot, you may be arrested or your car impounded.
Some towns use special speed detectors linked to a series of traffic lights. If you are travelling too fast, the lights will change to red to modify your speed.
Carrying a radar detector in your car is illegal
Remember to use your indicator to overtake, particularly on motorways as this is strictly enforced
If you break down in Spain, you should put on a bright reflective vest before getting out of your car to seek help
Headlights should be used during the day if there is poor visibility
Headlights should always be used through tunnels.
Motorways (“Autopista” and marked “A”) can be subject to tolls (“peajes”). The toll is dependent on the distance travelled. Some toll booths accept credit cards but it is always best to ensure you have some change to hand.
Unlike the UK, traffic lights are usually situated above the stop line at a junction with a smaller set at window height to the right. These can take a bit of getting used to for first time visitors.
When turning left (across the oncoming traffic), you must often first turn right and follow a filter lane round, crossing the traffic via traffic lights or over/underpass. These types of turn are usually signposted ahead of the junction (“Cambio de Sentido”)
Parking regulations are strictly enforced and offenders can be heavily fined or towed. Do not park where the pavement curb is painted yellow or if there is a no parking sign. Most towns have dedicated car parks for supermarkets and shoppers – often underground. Parking is restricted in “Zona Azul” areas. Keep a look out for parking areas where you need a sticker to park (from a machine or attendant). Some areas require a special parking disk which is sold at tobacconists, tourist offices or the town hall. You will notice that some Spanish still park wherever they can find a gap (sometimes around roundabouts or two abreast!) but do not be tempted to follow suit – parking regulations have been toughened and you may find yourself towed.
Be aware that the automatic petrol pumps (“pay at pump”) do not always accept international credit cards.
Be aware that rural petrol stations rarely open 24 hours
Some roads in rural villages can be extremely narrow and some are not suitable for cars. Don’t be surprised if the way is blocked by a vehicle unloading or parked or if you have to reverse back up the road for an oncoming vehicle. This can be particularly problematic on “fiesta” days when the town centre is closed off for festivities and pedestrians and all cars are diverted around the back streets.

Renting a car in Europe or US

2008-10-11T11:58:00.001-07:00

Are you planning a big trip to Europe(Uk)? Have you thought about renting a car while you are there? If you haven't, perhaps you should. Renting a car while in Europe is actually quite simple. There are a few things you ought to know, and luckily I am about to tell you!

Research Insurance Options
There are two options for this, the first being that you acquire your insurance locally and the second is to see if your credit card has rental insurance on it. Do the research into both and find out which will work best for you and pick the one you feel most comfortable with. Make sure when doing the research into both options to tell them where exactly you will be traveling and what cities you will be renting in. The more they know, the better they can help you to make a choice on insurance options.

Advice of Travel Plans
Tell the rental agency in advance where you plan on taking the vehicle, that way they can tell you if you need special paper work to be able to go certain places. There are many restrictions, and if you don't have the proper paperwork you could be denied access.

Manual Transmissions
Most people plan their trips well in advance, especially Europe trips. Know that in Europe driving an automatic transmission is extremely rare in most parts of Europe and that if you insist on driving an automatic transmission it could end up costing you up to $300 USD/ per week! If you don't know how to drive a manual transmission, your best bet would be to find someone who does and have them teach you how to beforehand, cause if you wear out the clutch on your rental car your insurance will not cover it.

Request Your Extras
Be sure to remember that you are responsible for requesting your own extras. Depending on your own navigational skills, you might want to request your own GPS system for the vehicle you plan on renting. Also if you are bringing children along, then you might want to mention child seating. Most places charge little for this necessity. Be sure to ask the pricing and restrictions.

Be Aware of Additional Fees
Most airports charge a pick-up surcharge, which is an un-needed expense since most hotels are located extremely close to the airport, if your hotel isn't. Then there is the option of a taxi, which is often cheaper than the airport surcharges in most cases.

Research the Driving Restrictions
Familiarize. Do the research so you know the proper road signs and laws,. Things are quite different in Europe so the better prepared you are, the smother things will go for you.

Remember there are NO Dumb Questions
Don't be afraid to ask questions. Contracts can be quite confusing, so never be afraid to ask about something you don't understand.

Renting a car in Sydney

2008-10-11T11:56:00.000-07:00

Plan to holiday in Sydney, Australia? Well, indeed a good choice, but how do you get about once you land there? Hire a car of course! There are many ways in which a car can be hired out here. The easiest (but not necessarily cheapest) way is to ask your travel agent to do the needful. This would save you a lot of trouble but is perhaps not the best bargain. Your travel agent may have 'tie ups' with some car rental company which pays him a commission which means he makes money both ways, while you lose out on the better deals.

So what's the solution? Well a smart approach would be to scour the Internet for good car rental offers and book your car online. Carefully peruse the terms and conditions of every car rental company. The rental services have user friendly online forms that need minimal details - your planned date of arrival, date of completion, as well as the delivery details and of course your basic personal information. And most car companies conveniently accept credit card payments. Some are more tech savvy and even take paypal payments or wire transfers.

So what are the fees to look out for when renting a car in Sydney? The base rate of rentals is in the range of $70 to $100 per day. Other standard fees charged by car rental companies in Sydney include toll pass fees $2.00 per day and Insurance Excess Reduction of $15.00 per day. Other fees may be applicable depending on your choices - additional driver fees at $3.00 per day, baby seat fee at $9.00 per day, Sat Nav GPS $35.00 flat fee as well as a fee of $10.00 per day for under age driver (under 25). As you can see, hiring a car in Sydney is not cheap but hunt for the better bargains by browsing through online ads to check out the discounts on offer. Discounts are invariably available only through direct online bookings and not through an agent.

While car companies may claim that the prices offered on the net are fully inclusive, it is in your best interests to examine the terms and conditions as most hidden costs are not immediately discernible. Fees such as Collision Damage Waiver (CDW) are a case in point. An international driving license is a must. The validity for using your international driving license in Sydney is three months. Always check that your personal travel insurance covers you for motor vehicle accidents and rental car insurance excess as it is more economical than paying the car rental company in the event of an accident. If you wish to land a real bargain, try taking 'off the beaten track'. Hound the Sydney centered blogs, Yahoo chat sessions and you will find plenty of folks who will rent out a car at rock bottom prices. Ensure, however, that you don't fall prey to unscrupulous scammers; the possibility of being swindled or even falling for a stolen car is quite high. You may land up in deep trouble with the law enforcement agencies - you don't want to be on the wrong side of the law! So take the tried and true path; research and pick the best car rental deal, the safe and effective way.

10 Things Your Rental Car Company Won't Tell You

2008-10-11T11:50:00.000-07:00

1. "We're a tax magnet."

As with the rest of the travel industry, business is up for car rentals and expected to climb even higher after having remained fairly flat for several years. But customers are already paying more, due to an unprecedented slew of taxes and fees.

However, that extra money doesn't go to the rental car companies but into city and state coffers, where it's used to fund municipal projects. For example, in 2005, car rentals in Arlington, Texas, were hit with a 5% tax to help pay for the new Dallas Cowboys stadium. Car rentals get tapped as fundraisers because local politicians won't feel the repercussions at the voting booth. "They're taxing people who are flying in from someplace else," says Hertz spokesperson Richard Broome. "These people can't and don't vote locally, so there's no harm for them."

But there's a way for consumers to dodge some of these fees: Pick up your car in town, not at the airport. Last year Travelocity found that taxes and fees were 45% lower for off-airport rentals. An added bonus, according to Neil Abrams, president of Abrams Consulting, is that you'll save on rates, too: On average, they're $10 cheaper per day in town.

2. "We track your every move."

Over the past few years, rental agencies have begun to install GPS devices in their vehicles. These units allow companies to track cars that are lost or stolen. But the technology also lets them know when a renter has been speeding or has taken a car into another state, which may be construed as increasing wear and tear. "Opportunity for a rental car operator to impose geographic limitations was never pitched by GPS sellers, but was discovered coincidentally," says Michael LaPlaca, an attorney who specializes in rental car law.

To date, most companies don't use the technology to impose fines, but it can and does happen. American Car Rental, for example, was charging customers in Connecticut $150 each time they topped the speed limit for two minutes at a stretch, claiming it damaged their vehicles. The good news for consumers: Connecticut's Consumer Protection Commission deemed the fines excessive and ordered the rental car agency to refund penalized customers. Last year the state's Supreme Court affirmed the decision. Other states, including New York and California, have passed laws preventing rental car companies from imposing such penalties.

3. "Our prices are etched in sand."

Trying to find the best rental deal can be very frustrating, since rates can fluctuate dramatically from day to day, even minute to minute. "Prices are constantly changing," Abrams says. That's because rental car agencies use something called yield-management technology, which continually adjusts pricing depending on how many cars are available. A sudden rash of cancellations or bookings can push rates up or down. When we recently priced an Enterprise rental for a spring trip to Los Angeles, the cost vacillated dramatically: Two hours after we first checked the company's web site, the per-day rate for a full-size car dropped almost $8. Over the next week it continued to yo-yo, ranging from a low of $32 to a high of $73.

Even the way you book can affect prices: When we called the Avis desk at LAX to reserve a minivan, we were quoted a price more than $150 higher than the amount being advertised simultaneously on the company's Web site. Also, online travel agencies like Orbitz or Priceline can have completely different prices. That's why it pays to comparison-shop and check back later to see whether rates have fallen — there's usually no fee to cancel a reservation or rebook at a lower rate.

4. "You probably don't need our insurance."

Most companies make reserving and renting a car very easy — until it comes to the issue of insurance. That's where they offer a bewildering array of supplemental coverage, which can easily add $10 to $30 to your daily bill. What the overeager reps won't tell you is that you may already be covered, either partially or completely.

There are two major types of insurance you'll want: a collision/damage waiver and liability. The former covers repair and replacement costs to the car should anything happen to it; the latter protects you from lawsuits if you've injured anyone or damaged property when driving. If you have auto insurance, it usually extends to rental cars, providing both collision/damage and liability, as long as you're on a leisure trip. And many credit cards cover damages to the vehicle but don't offer liability.

As with any type of insurance, it's always more complicated than it seems. "You shouldn't assume you're covered by your credit card," says Jeanne Salvatore, spokesperson for the Insurance Information Institute. Check ahead of time with both your credit card and auto insurance providers to see if, when and how you're covered.

5. "Your reservation doesn't mean bupkis."

Andy Parker was looking forward to spending his vacation in February exploring the back roads of Aruba. He even reserved a Jeep with Hertz to handle the rough driving conditions. But when he went to pick it up, he was told all they had on the lot was a sedan. "It was a sore spot," says the Buffalo, N.Y., meteorologist, who got stuck with a small Nissan.

As Parker found out, a reservation isn't a guarantee. The rental agreement is contingent on availability. In fact, you're not reserving a specific car model, but simply a class of car. (One exception: Hertz allows you to reserve high-end models in its "Prestige Collection.") What a reservation actually means is that the company is supposed to have some kind of vehicle on the premises for you to rent. So if you get a smaller car than what you reserved, be sure to ask for a rate adjustment. (Parker got Hertz to take 20% off his bill.)

If the lot is empty, the company is supposed to find you a car even if it means calling another agency and covering the difference. So if the clerk doesn't offer, remind him that the company is liable if you wind up paying more for a rental car elsewhere.

6. "Special orders are our bread and butter."

Just like supermarkets, rental car companies bank on getting their customers to do some impulse buying at the checkout counter — where you can now choose from a sizable menu of a la carte amenities and services. The strategy seems to be working: 2005 revenue was up almost 15% since 2003 and at its highest level since 2001.

According to Justin McNaull, a spokesperson for the American Auto Association, a rental vehicle tricked out with extra features could run you $20 more a day. Here's how it breaks down: GPS with turn-by-turn directions costs about $10 a day. Satellite radio, roughly $3 a day. Avis and Budget are rolling out a service that for up to $2 a day will let you pay highway tolls electronically — but that fee doesn't include the tolls themselves. And if you want a baby seat for the minivan, add another $10 a day.

Companies have also begun pushing specialty cars: "It can be a place to make money," McNaull says. Last year Avis inaugurated the "Summer of the Hummer," when it added the H3 to its lots, and even low-priced Thrifty stocks the trendy Dodge Magnum and Chrysler PT Cruiser.

7. "The little guys charge less."

If you're like most travelers, you check with a few big car rental agencies and then choose the best deal. But there are hosts of smaller, independent companies that often offer significantly better rates. Good to know, since rental car prices — which have remained relatively flat since 2000 — are beginning to rise again. American Express Business Travel forecasts rental car rate increases of as much as 8% in 2006. That would represent the biggest year-over-year rate hike in a decade.

How to find a good independent rental car agency? Start online with CarRentalExpress.com. On this site you can search more than 300 small car rental firms worldwide, all of which promise to be 15 to 30% cheaper than the large chains. A recent search of the site, for example, turned up a $39 rate for a Saturday rental from EZ Rent A Car, located at Atlanta's Hartsfield-Jackson International Airport. That's $30 less than what Avis was charging.

8. "We're cutting corners anywhere we can."

You may not have noticed, but over the past few years the fine print on rental contracts has not so subtly been changing, even for the industry's best customers. For example, this past winter Hertz shortened the grace period for returning a car from one hour to half an hour for everyone including its #1 Club Gold members; customers also can no longer return a car after a location has closed for the night without incurring a late fee.

In another move to cut corners, rental companies across the board have begun making customers liable for damage caused by so-called acts of God, such as hurricanes and floods. Avis and Budget, the last major holdouts to this policy change, will soon be adding it, even to their frequent renters' contracts. The new rule means it's now up to renters either to return a car before the natural disaster hits, drive the vehicle out of harm's way...or pay up for the newly developed insurance option to cover this type of damage.

9. "Think gas prices are high at the pump? Look what we charge."

Even when Brandon Harris is in a hurry, he tries to gas up before returning his rental car. Last spring, when he was on vacation in Costa Rica, he went 15 minutes out of his way to find an open station. "I don't think the rates that [rental agencies] are charging are fair," the Chicago resident says. "It's cheaper to do it yourself."

According to McNaull, rental car companies generally charge more than $5 a gallon for gas. You're paying for the gas plus the luxury of not having to pump it yourself, he says, and not filling up the tank can tack on an additional $20 to your bill. Car rental companies do offer you another option: prepaying for a tank of gas at a more reasonable rate when you pick up the car. Sure, it beats having to worry about finding a station at the last minute, but you're likely not going to return the car empty. "Whatever gas you leave in the tank is a donation to the rental car company," McNaull says. Unless you're tight for time, it still pays to make a pit stop. But when you do fill 'er up on your own, watch out for gas stations right next to the airport since they usually have higher rates. "Stations make a killing on out-of-towners filling up rental cars," McNaull says.

10. "We offer some terrific deals — on Thursdays when the moon is full."

Jay Winger thought he had found a great deal. He was planning to use a Budget double-upgrade coupon when he rented a car for his Las Vegas vacation in March. The coupon had been accepted when he made the reservation online, but when he arrived at the rental desk, the agent refused to honor it. Why? At the bottom of the coupon in "really small print," Winger says, it stated that the coupon wasn't valid in all areas. And Las Vegas wasn't one of them. "There are always certain locations that don't take part in national promotions," says Avis Budget Car Rental spokesperson Susan McGowan. Winger wound up spending about $60 more than he had planned. "Renting a car is really tricky," the Minneapolis native says.

On every rental car company Web site, there are ads flaunting the companies' latest deals. Not to mention the paper coupons that appear regularly in newspapers. But there are so many rules and restrictions involved that it's often impossible to get exactly the deal that's being advertised. For starters, some require a Saturday-night stay or a minimum five-day rental. Companies also designate blackout days, exclude popular locations like New York and Las Vegas, and reserve the right to terminate any given offer at any given time. Hertz, for one, reserves the right to revoke its free upgrade special "especially during periods of peak demand," which, given the recent travel boom, should be fairly often.

Steering Wheel in Ferrari Formula One Racecar

2008-10-10T12:12:00.000-07:00

Steering Wheel in Ferrari Formula One Racecar

2008 Bentley Brooklands

2008-10-10T12:11:00.000-07:00

The 2008 Bentley Brooklands is one of the grandest coupes on the planet. Hand assembled, and limited to only 550 examples, this luxury four-seater features a high-output version of the Azure's hand-built, 6.75-liter, twin-turbocharged V8. This engine produces a stunning 530 hp and 774 lb-ft of torque, and represents the latest evolution of the original Crewe-built V8 launched in 1959.

USA - Electric Car

2008-10-10T12:10:00.001-07:00

A New York City Park Department employee uses one of the 275 all-electric vehicles in Central Park - Global Electric Motor cars - or GEMs - that run for a day and then are plugged into a wall outlet to recharge overnight.

1991 GM EV1 or GM Impact Electric Concept Car

2008-10-10T12:08:00.001-07:00

One of the first modern EVs was the General Motors Impact. GM changed its name and started leasing the GM "EV1" in 1996. This sleek looking car even set a World Record of more than 180 miles per hour! General Motors engineers and their outside consultants designed the EV1 from the ground up. The automobile combined lightweight materials, aerodynamic design, a system that recharges the batteries during braking, and sophisticated computer-controlled propulsion to create an electric vehicle.

2007 Great Wall i7

2008-10-10T12:06:00.001-07:00

2007 Great Wall i7 is a five door hatchback, and is expected to go on sale in China in 2008. It is powered by a new family of 1.3 to 1.5 litre gasoline engines.

1930 Doble Steamer Coupe

2008-10-10T12:04:00.000-07:00

Steam powered automobiles use their fuel to heat a boiler containing water that quickly turns to steam. Regulating the steam pressure controls the power, so the car has few moving parts and requires no gear shift or clutch.

2006 Toyota F3R Hybrid Synergy Concept

2008-10-10T11:55:00.000-07:00

The 2006 Toyota F3R Hybrid Synergy Concept is a hybrid powered design study targeted to a "hipper" minivan automotive market segment.

2006 Honda Civic GX Natural Gas Vehicle (NGV)

2008-10-10T11:53:00.000-07:00

The 2006 Honda Civic GX NGV car has been crowned as "America's Greenest Car" by the American Council for an Energy-Efficient Economy (ACEEE), and is certified as AT-PZEV (almost zero emissions) by the Californian Air Resources Board (CARB). Powered by compressed natural gas, this Honda is renown for having the cleanest internal combustion engine in the world.

James Bond's 2003 Aston Martin V12 Vanquish

2008-10-10T11:52:00.001-07:00

This 2003 Aston Martin V12 Vanquish is the same model used in the James Bond movie Die Another Day. Harking back to the classic Aston DB5 used in Goldfinger, the movie version of the Vanquish had all the requesite Bond modifications, such as a pair of machine guns that come up through the bonnet vents, five heat-seeking missiles and a brace of shot guns that operate from the front radiator grille. Although the street version is a bit less flamboyant, it still has a 48-valve V12 engine with a top speed of 190 mph.

The 2010 Nissan Cube

2008-10-10T11:51:00.001-07:00

The Nissan Cube has been sold in Japan for the last 10 years, but is only now being launched in USA as a 2010 model. Sales kick off in early ‘09; about seven years after Toyota introduced the equally boxy Scion xB. Happily for Nissan--and maybe for you, too--this funky, frugal subcompact looks like just the thing to help Americans cope with $4 gas and other new economic miseries. A pure battery-power version is expected early next decade as part of Nissan’s new Green Program 2010. It was recently previewed by the Denki Cube concept (Denki means “electric” in Japanese).Like the xB, the 2010 Nissan Cube is a tall, square-cut, 4-door, five-passenger wagon based on a small mainstream front-wheel-drive hatchback (in this case Nissan’s March/Micra minicar, which has never been sold in the U.S.).
The Cube, however, actually predates (and allegedly inspired) the Scion’s original Toyota bB parent. The Cube coming stateside is somewhat smaller than the newly enlarged 2008 xB. It’s basically the redesigned 2002 Japan-market Cube with trim and equipment alterations to suit North American driving conditions and buyer tastes.In its early years, the Cube was a gotta-have ride for young Japanese fashionistas. Though no longer considered so trendy a decade on, it’s bound to seem like a way-cool novelty here in the States. But the 2010 Nissan Cube should appeal to anyone looking for good fuel thrift and a city-friendly package with surprising interior space. The home-market Cube offers two-row accommodations for six via a front bench seat and steering-column shift lever, but the U.S. version will probably have two front seats with a floor shift in between. There’s also a seven-passenger version, called the Cube3 or “Cubic,” with an extra 6.9 inches of wheelbase making room for a small 3rd-row seat and even more maximum load space. No word on whether that model is coming here too, but we won’t be surprised if it does. In fact, it might be the only one we get, as the wheelbase for the Denki Cube concept was stretched 9.4 inches from the regular model’s, though that was partly to accommodate the bulky batteries of its all-electric drive.However long it is, the U.S.-market 2010 Nissan Cube is generally expected to carry a 1.8-liter 4-cylinder engine instead of the 1.4-liter unit used overseas.

The New Land Rover LRX

2008-10-10T11:47:00.000-07:00

This stylish compact crossover coupe is Gerry McGovern's first concept vehicle since becoming Land Rover's design head. As such, it provides a revealing look at where Land Rover may be heading, at least stylistically.

With an emphasis on luxury and performance, the LRX concept places a special emphasis on weight reduction with polycarbonate windows that are 40 percent lighter than glass.

The interior features various recycled materials, the vehicle was on display at the 2008 Detroit Auto Show.

Buy Term or Whole Life insurance?

2008-10-09T08:35:00.000-07:00

FOR MOST PEOPLE, the right type of life insurance can be summed up in a single word: term. But before we explain why, it's important to understand the differences between the most common types of insurance available.

The basic difference between term and whole life insurance is this: A term policy is life coverage only. On the death of the insured it pays the face amount of the policy to the named beneficiary. You can buy term for periods of one year to 30 years. Whole life insurance, on the other hand, combines a term policy with an investment component. The investment could be in bonds and money-market instruments or stocks. The policy builds cash value that you can borrow against. The three most common types of whole life insurance are traditional whole life policies, universal and variable. With both whole life and term, you can lock in the same monthly payment over the life of the policy.

Forced Savings

Whole life insurance is expensive: You're paying not only for insurance but also for the investment portion. That extra cost might almost be worth it if these policies were a good investment vehicle. But usually they aren't. Insurance agents like to call these policies retirement plans, emphasizing the "forced savings" inherent in forking over the premiums each month "for retirement."

Leaving aside the fact that there are many better ways to save for retirement, these policies come with high fees and commissions, which sometimes lop off as much as three percentage points from the annual return. On top of that, there are up-front (but hidden) commissions that are typically 100% of your first year's premium. Worse, it's often impossible to tell what the return on the investment will be, and how much of what you pay in goes toward the insurance and how much toward the investment.

Premiums for term insurance are downright cheap for people in good health up to about age 50. After that age, premiums start to get progressively more expensive. The same holds true for whole life policies, though people who need coverage starting in their 60s and beyond may have no alternative but to buy whole life. Most companies simply won't sell term policies to people over about age 65.

Term: Where the Value Is

To get a real sense of the value of term, let's compare a term policy and a universal life policy. Say a 40-year-old nonsmoking male has a choice between a $250,000 Met Life universal policy with a $3,000 annual premium and a same amount of renewable term coverage with a 20-year fixed premium of $350. At the end of one year, the universal policy, assuming it paid 5.7% per year, tax-deferred, would have a cash value of exactly zero (cash value is the amount you would get back if you canceled the policy). But say he had instead invested $2,650 (the difference between $3,000 and $350) in a no-load mutual fund that averaged a total return of 10% annually. At the end of the first year, he'd have $2,841, accounting for taxes on the earnings at a 28% rate. At the end of 10 years, he would have accumulated more than $46,000 in after-tax savings in the mutual fund. Over the same period, the cash value of the policy would have climbed only to $31,819.

That's not to say that whole life insurance is always a bad idea. Wealthy people can use whole life in their estate planning by setting up an insurance trust that will pay their estate taxes from the proceeds of the policy. And for the growing number of people in their late 40s or early 50s who are just starting families, whole life is at least worth a look.

Sizing Up a Whole Life Policy

One of the great problems with whole life is only an expert can tell if a policy you own or are considering will ever become a decent investment. James Hunt, actuary for the Consumer Federation of America, who has analyzed thousands of policies, notes that whole life policies hardly ever yield a reasonable return unless held for 20 years or more. So if you buy one be prepared to pay into it for the very long haul.

The key to a whole life policy is its internal rate of return -- the yield on the policy after all fees and charges are subtracted. A competent analysis can determine at a minimum whether the weight of the fees and charges built into one of these policies will ever allow a worthwhile return. Such an analysis will also pinpoint the minimum amount of cash value that you can derive from a policy at any given time interval.

Some financial planners, actuaries and accountants can perform internal rate of return analysis on your policy. The Consumer Federation has a service that will do this, calculating the real return year by year and comparing it with other investments. The fee is $70 for the first policy, $50 for each additional. (Click here for details).

Keep Your Old Policy?

You've been faithfully paying into that whole life policy a good pal of your brother-in-law sold you 10 years ago. And now you're thinking, "Hey wait a minute, I should be bailing out and getting a cheap term policy." Not so fast. First and foremost, keep in mind the substantial sum you've probably paid in over the years. How much will you get if you "surrender" or cash it in now? The answer to that question can be found in the illustrations you got when you signed on the dotted line. If you can't determine the surrender value you may have to -- heaven forbid -- call your agent and ask. But it's worth taking the trouble before you make a decision.

Most policies don't start to build decent a cash value until their 12th or 15th year. So if you cash in after 10 years, you could be out of a lot of money. And you can be sure that if you surrender in the first five years or so, practically every dime you put in will be down the toilet. The next thing you have to consider is whether you are still insurable at a reasonable rate if you switch to term. That's because you'll have to requalify medically. If you are over 50, smoke or have health problems, you may find it's cheaper to hold onto your old policy. Another option worth considering is a tax-free transfer of the value in your old policy into a better one, perhaps from a low-commission company like Ameritas.

How to Check an Insurer's Ratings

If you're looking for whole life coverage or a term policy that you'll want to keep 20 or 30 years, the financial soundness of the insurer is a critical concern. You want some assurance the company will be around in case you aren't. For insurance companies, the major credit agencies like Standard & Poor's rate claims-paying ability.

Fortunately, information on the credit worthiness of insurance companies is easy to obtain. Reports are cheap or free over the Internet. You can always contact the insurance company and ask about its ratings, but it's best to get this information independently. In general, go with an insurer rated A or better; the most financially sound insurers are rated AAA, though some rating agencies use slightly different letter grades.

The premier Web site in terms of detail and ease of use, (best of all, it's free) is insure.com where you can get ratings online from Standard & Poor's as well comprehensive reports on individual insurers. AM Best has a huge database, but you have to pay for it. While you can access ratings free of charge, a detailed company report will set you back $75.

Make sure any report you get is current, say within the last six months. Be extra careful to confirm ratings you'll find on many of the online quote services, which may be stale.

Buy health insurance online

2008-10-09T08:34:00.001-07:00

Many companies now sell life insurance on the Web, as well as give free quotes and advice.

The key to buying on the Web is to shop by price and by the company's rating. Several agencies, including Standard & Poor's and A.M. Best, rate insurers on their claims-paying ability. Stick with companies with low prices, the term you want, and a top rating.

Here are some sites that sell the policies of multiple companies:

- Insure.com has quotes from over 90 companies and plenty of detail on the policies available. The site also supplies ratings for the insurers from the major rating agencies, such as A.M. Best.

- Insweb has some pretty good worksheets and advice, lets you save quotes for later retrieval, and lists an 800 number.

- Accuquote has over 1,600 policies in its database. But you need to fill out a lengthy form to get a quote. The site is an independent service

Insurance can be difficult and expensive to obtain if you are not in good health.

2008-10-09T08:33:00.001-07:00

The cheapest rates, known in the business as select or preferred, go to those who are in good health and who have a family history of good health.

If you take heart medication or are grossly overweight, you may pay 50 percent more than preferred rates.

If you smoke, have a risky occupation, or engage in risky sports like skydiving, you'll pay even more for life insurance.

If you fall into one of these more expensive categories, it pays to shop around. One company may charge much more than another, depending on how it estimates the risk of your condition (that's called underwriting). This is where a knowledgeable agent may come in very handy. Internet and phone quote services aren't set up to deal with nonstandard policies.

Why, some people might ask, should I tell the insurance company about negative information that will raise my rates? Well, even if you somehow get around the medical tests and other checks done before the policy is issued, it doesn't pay to try to fool the insurer.

Insurers may investigate suspicious claims. If the company finds out you've lied, the claim may be denied, or your heirs could be tied up in court for years.

So there's a good case to be made for getting a policy early in life while you are still in good health. However, it doesn't make much sense to buy one until you have dependents

Secrets to determining how long you'll need health insurance

2008-10-09T08:32:00.001-07:00

Agents like to talk about policies you can keep throughout your life. What they sometimes won't tell you is that you don't need life insurance coverage throughout your life.

The secret to buying a policy with the right term is figuring out how long you need to be insured. You start by estimating when your children will be out on their own and no longer in need of your financial support.

So if your children are 3 and 5 now, you'd probably want a policy that covers you at least until the youngest is 22, so that's about a 20-year term. But this depends somewhat on your age as well.

Say you also want to cover your spouse for your lost income until what would be your normal retirement age, 65, and you're only 35 now. Then you would want a 30-year policy.

Keep in mind that insurance gets very expensive as you leave your 50s. So you may pay more to cover yourself until 65, even if you lock in a level-premium 30-year policy when you are 35. Coverage past age 70 or so may be unattainable.

Life insurance is not a substitute for a retirement plan. You want to plan so that you'll have enough to live on when you retire, and you won't have to keep paying insurance premiums.

There are exceptions, however. People who start families late in life, or who have complex estate-planning issues, may well have a need for life insurance beyond the customary retirement age.

One more thing: Steer clear of so-called mortgage insurance policies, which pay off the balance on your mortgage if you die. The problem is that you are paying for a steadily declining amount of coverage, as you pay down your mortgage. It's best to include the mortgage payments in your calculations when determining how much coverage you need.

How much coverage do you need?

2008-10-09T08:31:00.001-07:00

If you're going to buy life insurance, make sure you've got enough.

There is no simple answer to how much coverage is enough.

Some financial planners say you need enough insurance to replace five to seven years of your salary. If you have young children or significant debt, you should bump up your coverage so you have enough to replace as much as 10 years of your salary, they say. That would mean a person making $50,000 a year should have anywhere from $250,000 to $500,000 worth of coverage or more.

Remember, the sole purpose of life insurance is to replace your income in case you die, so that your dependents can maintain their current lifestyle.

Factors to consider include whether the surviving partner will have childcare expenses if one partner is out of the picture. Do you have other assets on which to draw? Will your children be out of the nest soon? These, and many other factors, influence the decision on how much coverage you need.

Buying a whole-life policy doesn't necessarily mean you are fully insured. Because of the investment component of whole life, the policies are much more expensive than term. Don't simply buy less coverage, as it defeats the purpose of buying insurance in the first place: to cover dependents.

Next, you've got to figure out how long you need the policy.

Strategy to buy health insurance

2008-10-09T08:30:00.001-07:00

Life insurance is a highly competitive business, in which the salesforce depends almost entirely on commissions.

Insurance companies pay fat commissions to their agents for selling whole-life policies - perhaps 80 percent of your first year's premium goes to paying the agent's commission - and the premiums for these polices are often five times that of term. By contrast, the typical commission to the agent who sells a term policy is about 10 percent.

It's no wonder, then, that agents push whole-life policies as if their livelihoods depend on it, because, well, they do. If whole-life policies were beneficial to consumers, our story would end here. The fact is the vast majority of those who need insurance should buy term.

Today, the annual premium on a $500,000 term policy for a healthy, nonsmoking forty-year-old male might be about $500. The same policy for a healthy woman, aged 30, might cost about $260 annually.

Not long ago you couldn't buy term policies with level premiums for periods of more than 10 or 15 years. Today you can easily find 20- and 30-year term policies.

Agents will argue that whole-life policies are superior because you can keep them the rest of your life and build up cash in them tax-free, which can then be borrowed.

That's true enough, but they don't tell you about the high fees and commissions built into whole life as well as surrender charges (if you want to cancel the policy) that often leave you with little or no cash value five and even 10 or 15 years after you take out the policy.

The point of a tax-free buildup of cash just isn't that powerful anymore, given the proliferation of IRAs, 401(k)s, and other tax-advantaged savings vehicles that have tiny commissions, much higher yields and complete portability.

So stick with term, and do your investing elsewhere.

Types of health insurance policies

2008-10-09T08:28:00.000-07:00

There are two basic kinds of life insurance policies: whole life and term insurance.

Whole-life policies, a type of permanent insurance, combine life coverage with an investment fund. Here, you're buying a policy that pays a stated, fixed amount on your death, and part of your premium goes toward building cash value from investments made by the insurance company.

Cash value builds tax-deferred each year that you keep the policy, and you can borrow against the cash accumulation fund without being taxed. The amount you pay usually doesn't change throughout the life of the policy.

Universal life is a type of permanent insurance policy that combines term insurance with a money market-type investment that pays a market rate of return. To get a higher return, these policies generally don't guarantee a certain rate.

Variable life and variable universal life are permanent policies with an investment fund tied to a stock or bond mutual-fund investment. Returns are not guaranteed.

The other type of coverage is term insurance, which has no investment component. You're buying life coverage that lasts for a set period of time provided you pay the monthly premium. Annual-renewable term is purchased year-by-year, although you don't have to requalify by showing evidence of good health each year.

When you're young, premiums for annual-renewable term insurance are dirt cheap - as low as a few hundred dollars per year for $250,000 worth of coverage.

As you get older, premiums steadily increase. Level-premium term has somewhat higher - but fixed - premiums for longer periods, anywhere from five to 30 years.

Top things to know about life insurance

2008-10-09T08:22:00.000-07:00

1. All policies fall into one of two camps.

There are term policies, or pure insurance coverage. And there are the many variants of whole life, which combine an investment product with pure term insurance and build cash value.

2. Insurance is sold, not bought.

Agents sell the vast majority of life policies written in the U.S. because the life insurance industry has a vested interest in pushing high-commission (and high-profit) whole-life policies.

3. Whole life is expensive.

Policies with an investment component cost many times more than term policies. As a result, many people who buy whole life often can't afford an adequate face value, leaving themselves underinsured.

4. Whole-life policies are built on assumptions.

The returns quoted by the agent are simply guesses - not reality. And some companies keep these guesses of future returns on the high side to attract more buyers.

5. Keep your investing and insurance strictly separate.

There are better places to invest - and without the high commissions of whole-life policies.

6. Buy enough term coverage to fill your needs.

Life insurance is no place to skimp, especially with rates at historic lows.

7. Match the term of the policy to your needs.

You want the policy to last as long as it takes for your dependents to leave the nest - or for your retirement income to kick in.

8. Buy when you're healthy.

Older people and those not in the best of health pay steeply higher rates for life insurance - so buy as early as you can, but don't buy until you have dependents.

9. Tell the truth.

There's no sense in shading the facts on your application to get a lower rate. Be assured that if a large claim is made, the insurance company will investigate before paying.

10. Use the Web to shop.

Buying life insurance has never been easier, thanks to the Internet. You can get tons of quotes - and avoid the pushy salespeople.

Which Life Insurance Is Best?

2008-10-09T07:43:00.000-07:00

LIFE INSURANCE COMES IN three flavors. Term insurance offers plain-vanilla protection at a low cost. Then there's whole life, which has a savings component. A third type, the return of premium, is essentially a hybrid of the first two.

Term life is generally recommended, as its low premiums allow consumers to get maximum coverage at little cost. (They can then invest on their own the savings they'll reap by forgoing pricier options.)

But don't just take our word for it. Before you head to an insurance broker's office, you should be familiar with the pros and cons of each policy type. Insurance agents are notorious for their heavy-handed sales tactics. Arming yourself with some knowledge ahead of time is the best way to make sure you wind up with the policy that's right for you.

It's easy to buy. All you need to do is figure out how much you need — and how long you'll need it — and then shop around a bit to find a competitive rate. A broker could help you out, of course, but you also can do quick searches on the Web at sites like TermAssistant.com, AccuQuote or Insure.com. Just make sure the company you ultimately select is financially stable by checking out its rating with a service like Standard & Poor's or AM Best. Go with an insurer that's rated A or better.

It covers a temporary need. Remember, life insurance is meant to provide for your dependents. Later in life — after the kids are in college and you and your spouse have socked away a generous retirement stash — you might not have any dependents. So while you might buy a policy when your first child is born (and you might increase it as you have more children), you may only need life insurance for, say, 30 years.

The Cons:

It expires. There's a dark side to the expiration date of term insurance. If you find that at the end of that term you still need life insurance — maybe your company's pension plan just imploded, leaving your spouse potentially ill-equipped for life without you — you're starting from scratch. The older you are, the tougher the term market is going to be to you: If you're not in good health, you might not be eligible for coverage at all.

If you outlive your policy — or cancel it at any time — you get nothing back. Assuming things go the way you — and the insurance company — plan, you'll still be alive and well when your term insurance policy comes to an end. That means you will have paid thousands of dollars (most likely tens of thousands) for a policy you didn't use. You won't get any refunds for your accomplishment, which makes some folks feel like they've wasted their money.

But think of it this way: If you invested on your own the savings you enjoyed over the years by going with cheaper term insurance rather than whole life, you almost surely came out significantly ahead.

Whole Life Insurance

The Pros:

It's permanent. Provided you pay your premiums, year in and year out, whole life policies never expire. Since death is one of the inevitabilities of life, with a whole life policy, you know you'll have something to leave behind for your heirs.

It's forced savings. Whole life policies don't come cheap, but that's because whole life policies build up a savings account (called a "cash value") that grows tax-deferred, and which can be tapped in retirement. For folks with little or no savings discipline, this can be a lifesaver. (Just keep in mind that your death benefit is reduced by the amount you withdraw.)

It's a great estate-planning tool. For those who fear their estate will bear a hefty tax burden, financial planners often recommend purchasing a whole life policy. The death benefit is tax free, and if other aspects of your estate will be subject to estate tax (which in 2005 applies to estates worth more than $1.5 million), the payout can be used to cover that bill.

The Cons:

It's expensive. Not everyone will be able to afford the premiums required to obtain the amount of coverage they need. If paying the premiums would be a stretch, better to pick up a term policy for the right face value, says TermAssistant.com's Place. Another problem: People scrape together their pennies for the first couple of years of a whole life policy only to ultimately find they can no longer afford the bill. If this happens in the early years, they won't even break even in terms of what they receive as a return of premium. Surrender values (also known as the cash value of your policy) won't equal the premiums until the policy is anywhere from 12 to 15 years old.

Shopping around for the right policy will make your head spin. Whole life policies are very confusing and often sold based on rosy illustrations for how much the company intends to pay in dividends over the lifetime of the policy. These illustrations are only estimates and some companies are going to be more aggressive than others. A good agent can help you analyze the internal rate of return (i.e., the yield on the policy after all the fees and charges are subtracted).

You can most likely do better saving for retirement on your own. Whole life policies are notorious for having higher fees and administrative costs than other investment vehicles. While returns will vary, don't count on doing better than 4% to 5%, says AccuQuote's chief executive Byron Udell. Resist pitches from brokers who might tell you that a whole life policy can substitute for a 401(k) or IRA. It won't.

Return of Premium

The Pros:

It's a compromise. As with all insurance plans, with a return-of-premium policy, a death benefit is paid out should you pass away. But if you live past, say, the 30-year term, you get all of your money back dollar for dollar. So no matter what happens to you — whether you die while covered or outlive the policy — money is distributed.

It's pretty affordable. While a return-of-premium policy isn't as cheap as term life, it's significantly more affordable than whole life. A return-of-premium policy will cost approximately 50% more than a comparable term life plan.

No confusion here. Like term life, return-of-premium policies are easy to shop for. As long as you go with a good company, you can make your selection on price.

The Cons:

Don't expect a return on your investment. If you outlive the initial term, you only get back what you paid in. The insurer keeps whatever interest or investment returns your money made over the, say, 30 years you lent it. So you gave the insurer a free loan.

You most likely could do better on your own. A 0% return on your investment is no great shakes. So you need to think about alternatives, such as buying term life insurance and investing the money saved on premiums. The return on this strategy will depend on market performance as well as your personal investing choices. But it's safe to say that you don't need to be Warren Buffett to come out ahead with a term policy.

If you cancel this policy you get next to nothing in return. On a 30-year policy, if you walk away from your return of premium policy after, say, 10 years, you only get back 9% of the cumulative premiums you paid in, according to AccuQuote's Udell. After 20 years, you'll receive 35% and not until you hit 30 years will you get your full investment. "If you get out early, you get creamed," Udell says.

Health insurance in the United States

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The US market-based health care system relies heavily on private and not-for-profit health insurance, which is the primary source of coverage for most Americans. According to the United States Census Bureau, approximately 84% of Americans have health insurance; some 60% obtain it through an employer, while about 9% purchase it directly. Various government agencies provide coverage to about 27% of Americans (there is some overlap in these figures).

Public programs provide the primary source of coverage for most seniors and for low-income children and families who meet certain eligibility requirements. The primary public programs are Medicare, a federal social insurance program for seniors and certain disabled individuals, Medicaid, funded jointly by the federal government and states but administered at the state level, which covers certain very low income children and their families, and SCHIP, also a federal-state partnership that serves certain children and families who do not qualify for Medicaid but who cannot afford private coverage. Other public programs include military health benefits provided through TRICARE and the Veterans Health administration and benefits provided through the Indian Health Service. Some states have additional programs for low-income individuals.

In 2006, there were 47 million people in the United States (16% of the population) who were without health insurance for at least part of that year.About 37% of the uninsured live in households with an income over $50,000.

In 2004, US health insurers directly employed almost 470,000 people at an average salary of $61,409. (As of the fourth quarter of 2007, the total US labor force stood at 153.6 million, of whom 146.3 million were employed. Employment related to all forms of insurance totaled 2.3 million. Mean annual earnings for full-time civilian workers as of June 2006 were $41,231; median earnings were $33,634.)The insurance industry also represents a significant lobbying group in the US. For the 2007-2008 election cycle insurance was the 8th among industries in political contributions to members of Congress, giving $13,411,561, of which 56% was given to Democrats (lawyers and law firms were number 1, giving $59,205,616, of which 80% went to Democrats). The top recipient of insurance industry contributions was Senator Christopher Dodd (D-CT). The leading contributor from the insurance industry — as measured by total political contributions — was AFLAC, Inc., which contributed $907,150 in 2007

Health insurance in the United Kingdom

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The Uk's National Health Service (NHS) is a publicly funded healthcare system that provides coverage to everyone normally resident in the UK. It is not strictly insurance system because (a) there are no premiums collected, (b) costs are not charged at the patient level and (c) costs are not pre-paid from a pool. However, it does achieve the main aim of insurance which is to spread financial risk arising from ill-health. The costs of running the NHS (est. £104 billion in 2007-8) are met directly from general taxation.

Private health care has continued parallel to the NHS, paid for largely by private insurance, but it is used by less than 8% of the population, and generally as a top-up to NHS services.

The NHS provides the majority of health care in the UK, including primary care, in-aptient care, long-term health care, ophthalmology and dentistry. Recently the private sector has been increasingly used to increase NHS capacity despite a large proportion of the British public opposing such involvement. According to the WHO, government funding covered 86% of overall health care expenditures in the UK as of 2004, with private expenditures covering the remaining 14%.

Health insurance in the Netherlands

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In 2006, a new system of health insurance came into force in the Netherlands. This new system avoids the two pitfalls of adverse selection and moral hazard associated with traditional forms of health insurance by using a combination of regulation and an insurance equalisation pool. Moral hazard is avoided by mandating that insurance companies provide at least one policy which meets a government set minimum standard level of coverage, and all adult residents are obliged by law to purchase this coverage from an insurance company of their choice. All insurance companies receive funds from the equalization pool to help cover the cost of this government-mandated coverage. This pool is run by a regulator which collects salary-based contributions from employers, which make up about 50% of all health care funding, and funding from the government to cover people who cannot afford health care, which makes up an additional 5%.

The remaining 45% of health care funding comes from insurance premiums paid by the public, for which companies compete on price, though the variation between the various competing insurers is only about 5%. However, insurance companies are free to sell additional policies to provide coverage beyond the national minimum. These policies do not receive funding from the equalization pool, but cover additional treatments, such as dental procedures and physiotherapy, which are not paid for by the mandatory policy.

Funding from the equalization pool is distributed to insurance companies for each person they insure under the required policy. However, high-risk individuals get more from the pool, and low-income persons and children under 18 have their insurance paid for entirely. Because of this, insurance companies no longer find insuring high risk individuals an unappealing proposition, avoiding the potential problem of adverse selection.

Insurance companies are not allowed to have co-payments, caps, or deductibles, or to deny coverage to any person applying for a policy, or to charge anything other than their nationally set and published standard premiums. Therefore, every person buying insurance will pay the same price as everyone else buying the same policy, and every person will get at least the minimum level of coverage.

Health insurance in Canada

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Most health insurance in Canada is administered by each province, under the Canada Health Act , which requires all people to have free access to basic health services. Collectively, the public provincial health insurance systems in Canada are frequently referred to as Medicare. Private health insurance is allowed, but the provincial governments allow it only for services that the public health plans do not cover; for example, semi-private or private rooms in hospitals and prescription drug plans. Canadians are free to use private insurance for elective medical services such as laser vision correction surgery, cosmetic surgery, and other non-basic medical procedures. Some 65% of Canadians have some form of supplementary private health insurance; many of them receive it through their employers.Private-sector services not paid for by the government account for nearly 30 percent of total health care spending.

In 2005, the Supreme Court of Quebec ruled, in Chaoulli v. Quebec, that the province's prohibition on private insurance for health care already insured by the provincial plan could constitute an infringement of the right to life and security if there were long wait times for treatment as happened in this case. Certain other provinces have legislation which financially discourages but does not forbid private health insurance in areas covered by the public plans. The ruling has not changed the overall pattern of health insurance across Canada but has spurred on attempts to tackle the core issues of supply and demand and the impact of wait times.

Health insurance in Australia

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The public health system is called Medicare . It ensures free universal access to hospital treatment and subsidised out-of-hospital medical treatment. It is funded by a 1.5% tax levy.

The private health system is funded by a number of private health insurance organisations. The largest of these is Medibank private, which is government-owned, but operates as a governement busineess enterprise under the same regulatory regime as all other registered private health funds.

Some private health insurers are 'for profit' enterprises, and some are non-profit organisations such as HCF Hleaht insurance. Some have membership restricted to particular groups, but the majority have open membership.

Most aspects of private health insurance in Australia are regulated by the Private Health Insurance Act 2007.

The private health system in Australia operates on a "community rating" basis, whereby premiums do not vary solely because of a person's previous medical history, current state of health, or (generally speaking) their age (but see Lifetime Health Cover below). Balancing this are waiting periods, in particular for pre-existing conditions (usually referred to within the industry as PEA, which stands for "pre-existing ailment"). Funds are entitled to impose a waiting period of up to 12 months on benefits for any medical condition the signs and symptoms of which existed during the six months ending on the day the person first took out insurance. They are also entitled to impose a 12-month waiting period for benefits for treatment relating to an obstetric condition, and a 2-month waiting period for all other benefits when a person first takes out private insurance. Funds have the discretion to reduce or remove such waiting periods in individual cases. They are also free not to impose them to begin with, but this would place such a fund at risk of "adverse selection", attracting a disproportionate number of members from other funds, or from the pool of intending members who might otherwise have joined other funds. It would also attract people with existing medical conditions, who might not otherwise have taken out insurance at all because of the denial of benefits for 12 months due to the PEA Rule. The benefits paid out for these conditions would create pressure on premiums for all the fund's members, causing some to drop their membership, which would lead to further rises, and a vicious cycle would ensue.

There are a number of other matters about which funds are not permitted to discriminate between members in terms of premiums, benefits or membership - these include racial origin, religion, sex, sexual orientation, nature of employment, and leisure activities. Premiums for a fund's product that is sold in more than one state can vary from state to state, but not within the same state.

The Australian government has introduced a number of incentives to encourage adults to take out private hospital insurance. These include:

Lifetime Health Cover: If a person has not taken out private hospital cover by the 1st July after their 30th birthday, then when (and if) they do so after this time, their premiums must include a loading of 2% per annum. Thus, a person taking out private cover for the first time at age 40 will pay a 20 per cent loading. The loading continues for 10 years. The loading applies only to premiums for hospital cover, not to ancillary (extras) cover.

Medicare Levy Surcharge: People whose taxable income is greater than a specified amount (currently $50,000 for singles and $100,000 for families) and who do not have an adequate level of private hospital cover must pay a 1% surcharge on top of the standard 1.5% Medicare Levy. The rationale is that if the people in this income group are forced to pay more money one way or another, most would choose to purchase hospital insurance with it, with the possibility of a benefit in the event that they need private hospital treatment - rather than pay it in the form of extra tax as well as having to meet their own private hospital costs.
- The Australian government announced in May 2008 that it proposes to increase the thresholds, to $100,000 for singles and $150,000 for families. These changes require legislative approval. A bill to change the law has been introduced but has not yet been passed. There have been criticisms that this proposed change will cause many people to drop their private health insurance, causing a further burden on the public hospital system, and a rise in premiums for those who stay with the private system. Other commentators believe the effect will be minimal.

Private Health Insurance Rebate: The government subsidises the premiums for all private health insurance cover, including hospital and ancillary (extras), by 30%, 35% or 40%.

How health insurance works

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A health insurance policy is a contract between an insurance company and an individual. The contract can be renewable annually or monthly. The type and amount of health care costs that will be covered by the health plan are specified in advance, in the member contract or Evidence of Coverage booklet. The individual policy-holder's payment obligations may take several forms

Premium: The amount the policy-holder pays to the health plan each month to purchase health coverage.
Deductible: The amount that the policy-holder must pay out-of-pocket before the health plan pays its share. For example, a policy-holder might have to pay a $500 deductible per year, before any of their health care is covered by the health plan. It may take several doctor's visits or prescription refills before the policy-holder reaches the deductible and the health plan starts to pay for care.
Copayment: The amount that the policy-holder must pay out of pocket before the health plan pays for a particular visit or service. For example, a policy-holder might pay a $45 copayment for a doctor's visit, or to obtain a prescription. A copayment must be paid each time a particular service is obtained.
Coinsurance: Instead of paying a fixed amount up front (a copayment), the policy-holder must pay a percentage of the total cost. For example, the member might have to pay 20% of the cost of a surgery, while the health plan pays the other 80%. Because there is no upper limit on coinsurance, the policy-holder can end up owing very little, or a significant amount, depending on the actual costs of the services they obtain.
Exclusions: Not all services are covered. The policy-holder is generally expected to pay the full cost of non-covered services out of their own pocket.
Coverage limits: Some health plans only pay for health care up to a certain dollar amount. The policy-holder may be expected to pay any charges in excess of the health plan's maximum payment for a specific service. In addition, some plans have annual or lifetime coverage maximums. In these cases, the health plan will stop payment when they reach the benefit maximum, and the policy-holder must pay all remaining costs.
Out-of-pocket maximums: Similar to coverage limits, except that in this case, the member's payment obligation ends when they reach the out-of-pocket maximum, and the health plan pays all further covered costs. Out-of-pocket maximums can be limited to a specific benefit category (such as prescription drugs) or can apply to all coverage provided during a specific benefit year.
Capitation: An amount paid by an insurer to a health care provider, for which the provider agrees to treat all members of the insurer.
In-Network Provider: A health care provider on a list of providers preselected by the insurer. The insurer will offer discounted coinsurance or copayments, or additional benefits, to a plan member to see an in-network provider. Generally, providers in network are providers who have a contract with the insurer to accept rates further discounted from the "usual and customary" charges the insurer pays to out-of-network providers.

Prescription drug plans are a form of insurance offered through some employer benefit plans in the US, where the patient pays a copayment and the prescription drug insurance part or all of the balance for drugs covered in the formulary of the plan.

Some, if not most, health care providers in the United States will agree to bill the insurance company if patients are willing to sign an agreement that they will be responsible for the amount that the insurance company doesn't pay. The insurance company pays out of network providers according to "reasonable and customary" charges, which may be less than the provider's usual fee. The provider may also have a separate contract with the insurer to accept what amounts to a discounted rate or capitation to the provider's standard charges. It generally costs the patient less to use an in-network provider.

Health plan vs. health insurance

Historically, HMOs tended to use the term "health plan", while commercial insurance companies used the term "health insurance". A health plan can also refer to a subscription-based medical care arrangement offered through health maintenance organization, HMO, PPO or POS plan. These plans are similar to pre-paid dental, pre-paid legal, and pre-paid vision plans. Pre-paid health plans typically pay for a fixed number of services (for instance, $300 in preventive care, a certain number of days of hospice care or care in a skilled nursing facility, a fixed number of home health visits, a fixed number of spinal manipulation charges, etc.) The services offered are usually at the discretion of a utilisation review nurse who is often contracted through the managed care entity providing the subscription health plan. This determination may be made either prior to or after hospital admission (concurrent utilization review).

Comprehensive vs. scheduled

Comprehensive health insurance pays a percentage (may be 100, 90, 80, 70, 60, 50, percent) of the cost of hospital and physician charges after a deductible (usually applies to hospital charges) or a co-pay (usually applies to physician charges, but may apply to some hospital services) is met by the insured. These plans are generally expensive because of the high potential benefit payout — $1,000,000 to 5,000,000 is common — and because of the vast array of covered benefits.

Scheduled health insurance plans are not meant to replace a traditional comprehensive health insurance plans and are more of a basic policy providing access to day-to-day health care such as going to the doctor or getting a prescription drug. In recent years, these plans have taken the name mini-med plans or association plans. These plans may provide benefits for hospitalization and surgical, but these benefits will be limited. Scheduled plans are not meant to be effective for catastrophic events. These plans cost much less then comprehensive health insurance. They generally pay limited benefits amounts directly to the service provider, and payments are based upon the plan's "schedule of benefits". Annual benefits maximums for a typical scheduled health insurance plan may range from $1,000 to $25,000.

Inherent problems with insurance

Insurance systems must typically deal with two inherent challenges: adverse selection, which affects any voluntary system, and ex-post moral hazard, which affects any insurance system in which a third party bears major responsibility for payment, whether that is an employer or the government. Some national systems with compulsory insurance utilize systems such as risk equalisation and communitu rating to overcome these inherent problems.

Adverse selection

Insurance companies use the term "adverse selection" to describe the tendency for only those who will benefit from insurance to buy it. Specifically when talking about health insurance, unhealthy people are more likely to purchase health insurance because they anticipate large medical bills. On the other side, people who consider themselves to be reasonably healthy may decide that medical insurance is an unnecessary expense; if they see the doctor once a year and it costs $250, that's much better than making monthly insurance payments of $40. (example figures).

The fundamental concept of insurance is that it balances costs across a large, random sample of individuals. For instance, an insurance company has a pool of 1000 randomly selected subscribers, each paying $100 per month. One person becomes very ill while the others stay healthy, allowing the insurance company to use the money paid by the healthy people to pay for the treatment costs of the sick person. However, when the pool is self-selecting rather than random, as is the case with individuals seeking to purchase health insurance directly, adverse selection is a greater concern. A disproportionate share of health care spending is attributable to individuals with high health care costs. In the US the 1% of the population with the highest spending accounted for 27% of aggregate health care spending in 1996. The highest-spending 5% of the population accounted for more than half of all spending. These patterns were stable through the 1970s and 1980s, and some data suggest that they may have been typical of the mid-to-early 20th century as well. A few individuals have extremely high medical expenses, in extreme cases totaling a half million dollars or more. Adverse selection could leave an insurance company with primarily sick subscribers and no way to balance out the cost of their medical expenses with a large number of healthy subscribers.

Because of adverse selection, insurance companies employ medical underwriting , using a patient's medical history to screen out those whose pre-existing medical conditions pose too great a risk for the risk pool. Before buying health insurance, a person typically fills out a comprehensive medical history form that asks whether the person smokes, how much the person weighs, whether the person has been treated for any of a long list of diseases and so on. In general, those who present large financial burdens are denied coverage or charged high premiums to compensate. One large US industry survey found that roughly 13 percent of applicants for comprehensive, individually purchased health insurance who went through the medical underwriting in 2004 were denied coverage. Declination rates increased significantly with age, rising from 5 percent for individuals 18 and under to just under a third for individuals aged 60 to 64. Among those who were offered coverage, the study found that 76% received offers at standard premium rates, and 22% were offered higher rates. On the other side, applicants can get discounts if they do not smoke and are healthy.

Moral hazard

Moral hazard occurs when an insurer and a consumer enter into a contract under symmetric information, but one party takes action, not taken into account in the contract, which changes the value of the insurance. A common example of moral hazard is third-party payment—when the parties involved in making a decision are not responsible for bearing costs arising from the decision. An example is where doctors and insured patients agree to extra tests which may or may not be necessary. Doctors benefit by avoiding possible malpractice suits, and patients benefit by gaining increased certainty of their medical condition. The cost of these extra tests is borne by the insurance company, which may have had little say in the decision. Co-payments, deductibles, and less generous insurance for services with more elastic demand attempt to combat moral hazard, as they hold the consumer responsible.

Other factors affecting insurance prices

A recent study by PriceWaterhouseCoopers examining the drivers of rising health care costs in the US pointed to increased utilization created by increased consumer demand, new treatments, and more intensive diagnostic testing, as the most significant driver. People in developed countries are living longer. The population of those countries is aging, and a larger group of senior citizens requires more intensive medical care than a young healthier population. Advances in medicine and medical technology can also increase the cost of medical treatment. Lifestyle-related factors can increase utilization and therefore insurance prices, such as: increases in obesity caused by insufficient exercise and unhealthy food choices; excessive alcohol use, smoking, and use of street drugs. Other factors noted by the PWC study included the movement to broader-access plans, higher-priced technologies, and cost-shifting from Medicaid and the uninsured to private payers

Health insurance

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The term health insurance is generally used to describe a form of insurance that pays for medical expenses. It is sometimes used more broadly to include insurance covering disability or long term nursing or custodial care needs. It may be provided through a government-sponsored social insurance program, or from private insurance companies. It may be purchased on a group basis (e.g., by a firm to cover its employees) or purchased by individual consumers. In each case, the covered groups or individuals pay premiums or taxes to help protect themselves from high or unexpected healthcare expenses. Similar benefits paying for medical expenses may also be provided through social welfare programs funded by the government.

Health insurance works by estimating the overall risk of healthcare expenses and developing a routine finance structure (such as a monthly premium or annual tax) that will ensure that money is available to pay for the healthcare benefits specified in the insurance agreement. The benefit is administered by a central organization, most often either a government agency or a private or not-for-profit entity operating a health plan.

History of health insurance
The concept of health insurance was proposed in 1694 by Hugh the Elder Chamberlen from the Peter Chamberlen family. In the late 19th century, "accident insurance" began to be available, which operated much like modern disability insurance..This payment model continued until the start of the 20th century in some jurisdictions (like California), where all laws regulating health insurance actually referred to disability insurance.

Accident insurance was first offered in the United States by the Franklin Health Assurance Company of Massachusetts. This firm, founded in 1850, offered insurance against injuries arising from railroad and steamboat accidents. Sixty organizations were offering accident insurance in the US by 1866, but the industry consolidated rapidly soon thereafter. While there were earlier experiments, the origins of sickness coverage in the US effectively date from 1890. The first employer-sponsored group disability policy was issued in 1911.

Before the development of medical expense insurance, patients were expected to pay all other health care costs out of their own pockets, under what is known as the fee-for-service business model. During the middle to late 20th century, traditional disability insurance evolved into modern health insurance programs. Today, most comprehensive private health insurance programs cover the cost of routine, preventive, and emergency health care procedures, and also most prescription drugs, but this was not always the case.

Hospital and medical expense policies were introduced during the first half of the 20th century. During the 1920s, individual hospitals began offering services to individuals on a pre-paid basis, eventually leading to the development of Blue Cross organizations. The predecessors of today's Health Maintenance Organizations (HMOs) originated beginning in 1929, through the 1930s and on during World War II.

SEE HOW HEALTH INSURANCE WORKS

Health insurance definitions in the US

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CPS Health Insurance Definitions

The Census Bureau broadly classifies health insurance coverage as either Private (non-government) coverage or Government-sponsored coverage.

Private Health Insurance

Private health insurance is coverage by a health plan provided through an employer or union or purchased by an individual from a private health insurance company.

Employment-based plans
Employment-based health insurance is coverage offered through one’s own employment or a relative’s. It may be offered by an employer or by a union.

Own Employment-based plans
Own employment-based health insurance is coverage offered through one’s own employment and only the policyholder is covered by the plan.

Direct-purchase plans
Direct-purchase health insurance is coverage though a plan purchased by an individual from a private company.

Government Health Insurance

Government health insurance includes plans funded by governments as the federal, state, or local level. The major categories of government health insurance are medicare, medicaid, the State Children’s Health Insurance Program (SCHIP), military health care, state plans, and the Indian Health Service.

Medicare
Medicare is the Federal program which helps pay health care costs for people 65 and older and for certain people under 65 with long-term disabilities.

Medicaid
Medicaid is a program administered at the state level, which provides medical assistance to the needy. Families with dependent children, the aged, blind, and disabled who are in financial need are eligible for Medicaid. It may be known by different names in different states.

SCHIP
SCHIP, the State Children’s Health Insurance Program, is a program administered at the state level, providing health care to low-income children whose parents do not qualify for Medicaid. SCHIP may be known by different names in different states.

Military health care
Military health care includes TRICARE/CHAMPUS (Civilian Health and Medical Program of the Uniformed Services) and CHAMPVA (Civilian Health and Medical Program of the Department of Veterans Affairs), as well as care provided by the Department of Veterans Affairs (VA).

TRICARE/CHAMPUS
TRICARE or CHAMPUS is a military health care program for active duty and retired members of the uniformed services, their families, and survivors.

CHAMPVA
CHAMPVA is a medical program through which the Department of Veterans Affairs helps pay the cost of medical services for eligible veterans, veteran's dependents, and survivors of veterans.

VA
The Department of Veterans Affairs provides medical assistance to eligible veterans of the Armed Forces.

State-specific plan
Some states have their own health insurance programs for low-income uninsured individuals. These health plans may be known by different names in different states.

Indian Health Service*
Indian Health Service (IHS) is a health care program through which the Department of Health and Human Services provides medical assistance to eligible American Indians at IHS facilities. In addition, the IHS helps pay the cost of selected health care services provided at non-IHS facilities.

*After consulting with health insurance experts, the Census Bureau modified the definition of the population without health insurance in the Supplement to the March 1998 Current Population Survey, which collected data about coverage in 1997. Previously, people with no coverage other than access to the Indian Health Service were counted as part of the insured population. Subsequently, the Census Bureau has counted these people as uninsured. The effect of this change on the overall estimates of health insurance coverage was negligible.

Travel insurance (holiday insurance)

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Holidays can be dangerous occasions - especially abroad. If someone falls ill it is much more difficult than it would be at home to cope with the situation, so make sure you're covered.

Holiday insurance or travel insurance as it might be known can be bought as a complete package or selectively. Package policies usually include

Cancellation

Protects against the loss of deposits, advance payments, and other charges if a holiday has to be cancelled. The cancellation may be due to death, injury or illness of the traveller or a close relative, business associate, or other member of the party. It may be because of jury service or witness summons. Cancellation cover does not, however, extend to previously existing medical conditions or pregnancy. Some policies also pay compensation if departure is delayed by industrial action or if the holiday has to be curtailed.

Medical Expenses

Even in the EU, where there are special arrangements for British people to have free or cheap medical treatment, it is sensible to take out separate insurance. This not only covers the cost of treatment but also extra travel, accommodation costs, and air ambulances home if necessary. Cover is often for £1 million or more.

Personal Accident

Pays compensation if the policyholder is accidentally injured.

Personal Liability

Pays for any damages the policyholder may incur to another person.

Baggage and Money

Pays for up to £1,000 or more of baggage, with 250 pounds or so for lost money.

Auto insurance (car insurance)

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Most people know something about motor insurance. This is because any vehicle driven on public roads must have a certain level of insurance.

This article covers auto insurance or car insurance as it might be known.

The Road Traffic Act ensures that drivers must meet liabilities they incur should they injure other people or cause damage in an accident.

The person who is injured is known as the third party. The first and second parties are the car driver and their insurance company respectively. The third party may be a pedestrian, a passenger in the car driven by the insured person, or the driver or passenger in another vehicle.

The injured third party can claim compensation from the driver of the offending car. The driver then relies on his or her insurers to pay the other person's claim.

Different Types of Motor Policy

The law says that drivers must have insurance against third party injury or damage claims and that the insurer must give to the insured a certificate of motor insurance. However, most motor insurance policies provide far more extensive cover than this. There are four basic types of cover available in Britain:

Act only - This brings only the minimum required by law - third party liability risks incurred on public roads. Policies of this type are very rarely issued. Few motorists would be content to rely on them unless, because of a poor driving record, they could not obtain any other cover.
Third party - As well as covering the insured when driving on public roads, this type of policy applies on private property. It covers third party claims and provides protection against other legal liabilities. For example passenger indemnity, covering the possibility that a passenger in the car may cause an accident perhaps by carelessly opening the door and knocking a cyclist over. It also provides cover against certain legal costs.
Third party fire and theft - In addition to the protection given by third party insurance, this type of policy covers loss or damage to the insurer's own car as a result of fire, theft, or attempted theft.
Comprehensive - The widest form of cover available, although it cannot protect against every conceivable risk. In addition to the covers described in 1, 2 and 3, comprehensive cover protects in other valuable ways. The most important of these is accidental damage cover -policyholders can have their own damaged vehicle repaired or replaced. Comprehensive policies also include personal accident insurance, providing payments for death and specified serious injuries such as the loss of a limb or sight. Such payments are usually restricted to the policyholder and his or her wife or husband. Other cover with a comprehensive policy can include small amounts of medical expenses cover for anyone in the insured car, who is injured in an accident, and for loss or damage to personal effects in the car.

Different Types of Vehicles

Insurers draw on their statistics and on their experience to issue special policies for various types of vehicle on the roads. There are, for example, private cars, and motorcycles including motor scooters and mopeds. Commercial vehicle insurance covers all vehicles used for transporting goods and passengers for commercial purposes, including hire cars and taxis. The insurance of agricultural and forestry vehicles and special types of vehicle covers a whole range of machines. Then there are vehicles constructed for specific purposes such as mobile cranes, earthmoving equipment and ambulances.

Motor Traders

Motor traders pose a different type of risk and therefore need specialised insurance policies. There are three basic types of motor trader policy.

"Road risks" covers the trader for any vehicles which they own or which are in their custody or control while they are away from the premises of the insured business. "Internal risks" covers them only for liabilities incurred on their own premises. "Combined road and garage" includes both these as well as other risks.

Insurers will only issue motor-trader policies to traders with their own premises. Traders working from home will have difficulty getting cover.

Calculation of Premiums

The cost of claims varies widely, depending on the risk involved. From their claims statistics motor insurers can relate premiums to the degree of risk. This gives fair treatment to all policyholders.

There are four main factors in calculating private car insurance premiums. These are:

the type of car
the drivers
use to which the car will be put
district in which it is kept

Type of Car

Cars are divided by insurers into 20 groups. The higher the group number, the higher the premium. The groups take account of factors such as the cost of body parts, the ease with which the car can be repaired, its value when new, its top speed, Its acceleration, and the degree to which h resist theft. Sports and high performance cars are more expensive to insure because statistics show that they are involved in more accidents and also that repairs are more costly than with other types of cars. They are therefore given a higher group rating than, for example, a small low-powered saloon.

Drivers

Information about drivers affects the premium significantly. Important factors include drivers' ages and their driving experience. Young drivers - particularly those under 25 - pay a higher premium because statistics show that they are far more often involved in accidents. Young men have more insurance claims than young women. This means that some insurers will charge young women lower premiums than men of the same age.

The premium may also be affected by drivers' occupations. Other factors include the accident record and history of convictions - drivers convicted of drunk-driving will, when they come back to driving, have to pay a very high premium for a policy providing only limited cover

Use

The use to which a car is put also affects the risk. Most insurers recognise three common classes;

use for social domestic and pleasure purposes and use by the policy holder in person in connection with his business or that of his employer or partner
use for social, domestic and pleasure purposes and for the business of the policyholder or that of his employer or partner
all this cover, plus commercial travelling.

All of these types of cover exclude the use of the car for racing, competitions, and rallies or for carrying passengers for hire or reward. However, taking money from passengers in return for a lift (known as "car sharing") is allowed, as long as the lift is not part of a business arrangement.

District

The risk is also influenced by the district in which the car is kept. Areas with a high density of traffic are more risky than a remote country area. Also, some areas have a significantly higher-than-average record of car theft or vandalism. Insurers therefore divide the country up into a number of categories of area according to their experience of the risks involved. Sometimes, theft is not covered where a car is left overnight in the open.

No Claim Discount

Motorists who go for a year or more without making an insurance claim qualify for a no claim discount off the basic premium. Most insurers offer a reduction of around 25% after one claim-free year. This discount rises, year by year, to 60% or 65% after four or five years. If the motorist has to claim off his own policy he may lose some or all of his discount. The discount is allowed for not making a claim and the question of blame for any accident is not relevant. Therefore if motorists make a claim they will lose part of their discount (even if they are not to blame) unless their insurers can recover their claim payment from another motorist who is at fault.

Many insurers issue special policies which allow, say, two claims in three years without the no claim discount being affected. These "protected discount" policies of course cost more to buy.

The Excess

The excess is an arrangement whereby motorists meet the first part of a claim for accidental damage to the car or its theft. The amount of the excess is set out in the policy.

Excesses may be agreed by motorists on a voluntary basis to reduce the level of the premium or they may be imposed by the insurer. Compulsory excesses are often imposed, for example, on learner drivers or those who are young or inexperienced. A motorist with a poor claims record may also have to face a compulsory excess.

These excesses cut down the cost to insurers of small claims and therefore benefit all policyholders.

Motoring Abroad

All private motor policies issued in the UK extend automatically for use in all EU countries, and certain other European countries. The cover, however, is limited to third party liability.

To enjoy the full level of UK cover, such as fire, theft and accidental damage, motorists should tell their insurance company before departure. The company will then arrange to extend cover during the period of the visit.

Home insurance (household insurance)

2008-10-09T06:38:00.000-07:00

There are two basic types of household insurance; contents insurance and building insurance...

Contents insurance covers the contents of a home such as furniture, carpets, clothes, television, refrigerators, jewellery and so on. In other words, what you would take with you if you moved. Buildings insurance protects against damage to the actual structure of the home and to its fixtures and fittings. Contents and buildings policies can be bought separately or together in one package.

Contents Insurance

Everyone needs contents insurance, even if living in rented accommodation or sharing with friends. Tenants are responsible for their own property and they should make sure they have insurance against the risk of damage by fire, storm, or flood. There are of course other dangers which affect rented as well as owner-occupied homes, think of burglary for example. Unfortunately many people, particularly those living in rented property, ignore these dangers. About one in four households in Britain has no contents insurance at all.

Policies vary between insures. They give cover to the contents while they are inside the home and, in some cases, while they are outside in the immediate surroundings of the home. Most policies extend to give limited cover for contents which are temporarily away from the home. For example in the UK they may be at your place of work or at a holiday hotel.

Contents insurance covers damage from a very wide range of risks. These include fire; theft; escape of water from tanks or pipes; oil leaking from fixed heating systems; storm; flood; riot or malicious damage; explosion; lightning may impact by aircraft, vehicles or animals; falling trees; subsidence and earthquake. A contents policy also covers the loss of rent or the additional cost of alternative accommodation if the home is made uninhabitable. Contents cover includes accidental breakage of mirrors and glass in furniture and there is some cover for damage to rented property where the tenant is liable for this.

An important extension of contents insurance covers the legal liability of the occupier. Liability could arise if other people are injured or their property damaged as a result of the occupier's negligence. This is a little known but very important fringe benefit of household insurance. If, for example, a householder carelessly let a dog run free and caused a serious road accident, then the householder ... and not the car drivers ... could be legally liable and face an expensive bill for damages and legal fees. Many household policies also offer cover for any legal expenses to sue someone or if you are sued.

Buildings Insurance

Buildings insurance covers the structure of the house including fixtures and fittings, together with garages and outbuildings. There is limited cover for boundary walls, gates, paths, drives and swimming pools. In general, anything that would be left behind if the occupier moved is included in buildings insurance. If you're renting, buildings insurance is paid by the landlord, not you.

The policy should cover damage caused by fire, explosion, lightning, earthquake, the impact of aircraft vehicles or animals, theft or attempted theft, the breakage of aerials, and oil leaking from a central heating system. It also covers damage caused by riot and malicious persons, storm, flood, the escape of water from tanks or pipes, subsidence, landslip or heave, and falling trees. The cover for subsidence involves an excess and many policies have an excess on other sections such as theft or flood.

Buildings insurance can't cover everything. Exclusions often include storm or flood damage to gates and fences, and frost damage. If the home is left empty or unoccupied for over 30 days malicious damage, water leakage and theft won't be covered. Other exclusions are damage caused by war, rebellion and revolution and damage caused by sonic booms and contamination from radioactive fuel or waste. Householders can be compensated for damage from this last cause through special arrangements with the Government.

The Sum Insured

When householders buy contents or buildings insurance they must decide the right value to put on the items covered. This amount is known as the "sum insured". The premium to be paid depends upon this amount. Premium rates may be higher for certain special risks - for example for a home in an area where burglary happens frequently or for a thatched cottage.
The sum insured must be sufficient to cover the total value of the goods and buildings concerned. Many people unfortunately underestimate the cost of replacing or repairing their homes and their contents. If the sum insured is set too low then, when damage occurs, the householder will find that the insurance could cover only a part of the cost.
For buildings, insurance must cover the full cost of rebuilding the property including architect and surveyors fees and the cost of clearing away the debris and meeting any new building regulations or by-laws. This is not the same as the market value of the house.
Rebuilding costs often rise at times when house prices are not moving and vice versa. Take the case of two identical houses in the same town. One is next door to a noisy factory in a crowded industrial area while the other house is on the outskirts of town with pleasant country views. The houses will command very different market prices but the rebuilding cost will be the same.
For contents, the full value is the cost of replacing the house as new. If a everything in new policy is replacement as not taken, then an allowance should be deducted for wear and tear. The sum insured must be reviewed regularly, particularly at times of high inflation. Otherwise the householder will soon find that the sum insured is too low. Most insurance companies offer index-linked policies where the sum insured is automatically adjusted in line with general rises in costs.

Accidental Damage

Policies spell out clearly the risks they cover - like fire, theft and flood. For "accidental damage" cover you have to pay much more premium. Then, you are covered against such risks as spilling paint on a carpet, or dropping a camera and breaking it.

Indemnity or Replace-as-new?

Indemnity policies take full account of the wear and tear on goods so that any claim payment would reflect the age or condition of damaged items. For example the policy would pay less for a ten-year-old carpet damaged by fire than for a carpet which was only a few months old. Replacement-as-new policies provide for the full replacement of badly damaged or destroyed goods with new. There are usually some exceptions such as clothing and household linen.

Clearly, with such a policy, the sum insured (on which the premium is based) must be higher. For a replacement-as-new policy, the contents of the house must all be valued at their new price. Mixed policies can also be bought. These provide replacement-as-new cover for some items such as furniture, carpets and electrical goods which are less than a certain number of years old and indemnity cover for the rest.

Payment protection insurance

2008-10-09T06:33:00.000-07:00

Ever wondered how you'll pay the bills if disaster strikes? You could take out insurance to cover certain debts in the event of an accident or unemployment, but is it worth it?

In a nutshell?

When you take out a loan, credit or store card, you're often asked to take out an insurance policy. This is meant to cover the loan or card repayments if you become unable to afford them yourself because of illness, unemployment or because you have an accident or become disabled.
Most policies also include a life benefit which will pay off the outstanding balance on a loan or card if you die. This type of insurance is called 'Payment Protection Insurance' (PPI). It can cover repayment of car finance, personal loans, credit and store cards, catalogue debts and mortgages.
Very often, payment of PPI is included with the loan repayments. Although they're taken out at the same time, loans and PPI are different things. When a lender sells you PPI, you must be told the price of PPI separately to the cost of the loan or card. You should also be asked to sign for it separately.
You don't have to take out PPI. However, some companies won't agree to give you a loan unless you do so. So, if you don't want PPI it might be better to go to a different lender.

Do I really need it?

Think carefully before you agree to buy PPI. Here are some questions to consider:

The cost of the insurance. The cost of PPI can be high, so shop around to get the best deal.
Do you really need to take out the insurance? You might already be covered under your life insurance or employer's sick pay scheme, which will cover the loan or credit repayments if your circumstances change.
Does the insurance policy really meet your needs? Many PPI policies won't cover you in certain circumstances, for example if you're self-employed or have a particular medical condition.
How long does the policy pay out for? Typically, PPI only covers the loan or credit repayments for twelve months. Also, many policies pay out in blocks of 30 days. This means that if you returned to work after 28 days, you wouldn't get a payment.
Will you be covered for unemployment? PPI will only cover you for unemployment under very specific circumstances.

Other conditions to consider:

You must normally be in permanent, full-time employment. This usually means you have to work at least 16 hours or more a week.
If you full-time, but for a number of different employers, you may not be covered. Make sure the insurance company knows the exact details of your working arrangements before you take out PPI.
Many PPI policies don't cover you if you're on a temporary contract or self-employed. Check the details of a PPI policy before taking it out.
Some policies won't cover you if you're dismissed from your job or take voluntary redundancy.
Many PPI policies won't cover you for certain illnesses. For example, policies don't usually cover conditions involving pregnancy, drugs or alcohol. Nor will they provide cover if you fail to disclose any pre-existing conditions.

Cancelling a PPI policy

You have the right to cancel a PPI policy within 14 days of buying it, or 30 days if the policy includes life cover.
If you pay monthly premiums for your PPI, you can usually cancel at any time, although you may need to give a period of notice.
You may also be able to cancel a PPI policy due to mis-selling (see below).

Making a complaint about PPI

If you have problems claiming on a PPI policy, you should first complain to the insurance company. If you aren't satisfied with their response take your complaint to the Financial Ombudsperson service of your country, if applicable.

Mis-selling

If you're unable to make a claim, this could be because you were sold a policy which was wrong for your circumstances. If so, it's worth complaining to the company which sold you the policy as you may be able to get a refund.

Insurance

2008-10-09T06:28:00.000-07:00

Put basically, insurance enables those who suffer a loss or accident to be compensated for the effects of their misfortune. The payments come from a fund of money contributed by all the holders of individual insurance policies. In other words, individual risks are pooled and shared, with each policyholder making a contribution to the common fund.

The contribution is known as the premium. Premiums are paid to insurers - these are institutions which accumulate the money into the fund from which claims are paid. The loss is in fact paid for by the policyholder making the claim and by all the other policyholders who have not suffered in the same way.

Insurers are professional risk takers. They know the probability of different types of risk happening. They can calculate the premiums needed to create a fund large enough to cover likely loss payments. Clearly, only a proportion of policyholders will require compensation from the fund at any one time.

So two important factors arise when calculating the premium. Firstly, the general likelihood that a loss will occur. Secondly, whether the particular policyholder is above or below average in risk.

Take three examples. In motor insurance a young person with a high powered car, or a driver with a long history of accidents will pay a higher premium than a mature and experienced driver with a modest saloon who has been accident free.

Similarly, the owner of a fish and chip shop will pay a higher premium for his fire insurance than, say, the owner of an office. The risk is greater, so the premium is higher.

Someone who is young, fit and in a risk-free job will find it easier to buy life insurance, and will pay lower premiums than someone who has a heart condition or is in a risky occupation.

Two kinds of Insurance

There are two different kinds of insurance - life insurance and general insurance. With life insurance you don't renew your policy each year. Instead, you agree to pay a fixed premium for a set number of years. In other words you enter a long-term commitment when you buy a life insurance policy.

What is the Difference?

General insurance pays out:

* if a car has an accident or is stolen;
* if a house catches fire or is burgled;
* if a holiday has to be cancelled;
* if someone is careless and damages other people's property.

Most life policies, on the other hand, pay out when an event happens;

* when someone dies;
* when someone survives beyond a specific date.

Anyone can buy life insurance but, of course, the premium will depend on your age, your health, and your occupation.

Husbands and wives can insure each other's lives. However, you cannot insure the lives of other people unless you have a financial involvement in their life. This principle of insurance is called "insurable interest".

Insurable Interest

Insurable interest is a fundamental principle of insurance. It means that the person wishing to take out insurance must be legally entitled to insure the article, or the event, or the life. In other words, the happening of the event insured against, or the death of the life insured must cause the policyholder financial loss. Mr Smith would not be able to insure Mr Brown's house because its destruction would not cause Mr Smith financial loss. Similarly, you cannot insure the lives of other people unless you have a financial interest in the life being insured. The principle of insurable interest demonstrates the difference between insurance and a wager or bet.

General Principles

Other principles apply to all kinds of insurance.

* Insurance can provide compensation only for the actual value of property. It cannot cover the loss of sentimental value, for example.
* There must be a large number of similar risks so that the likelihood of a claim can be spread among other policyholders. It must be possible for insurers to calculate the chance of loss so that a premium can be set which matches the risk.
* Losses must not be deliberate and not inevitable. Clearly, you could not buy fire insurance for a house which was already burning nor life insurance for someone on his or her deathbed.
* Lastly, there are some risks which have financial implications so vast that they can be dealt with only by the state. These risks (mainly those arising from war or the major escape of nuclear or radioactive material) are normally not insurable.
* Insurance takes the risk away from people's lives and businesses. It brings peace of mind to the policyholder. In return for paying premiums the policyholder knows that, if the unexpected happens, financial compensation will be available from the fund of premiums.

An Advance On New Generations Of Chemotherapy And Antiviral Drugs

2008-09-08T10:26:00.001-07:00

Researchers are describing progress toward developing a new generation of chemotherapy agents that target and block uncontrolled DNA replication - a hallmark of cancer, viral infections, and other diseases - more effectively than current drugs in ways that may produce fewer side effects. Their article is scheduled for the Aug. 27 issue of ACS' Biochemistry, a weekly journal.

In the article, Anthony J. Berdis updates and reviews worldwide research efforts to develop drugs that target DNA polymerases, the enzymes responsible for assembling DNA from its component parts. Several promising strategies are already in use that inhibit uncontrolled DNA replication, particularly in anticancer therapy, but most produce severe side effects and are hampered by drug resistance, the researcher notes.

Berdis says that one of the more promising strategies to date involves the use of so-called nucleoside analogues, artificial pieces of DNA that inhibit replication by substituting for natural segments. Most nucleoside analogues directly target the active site of the polymerase enzyme, a non-specific approach that can also harm healthy cells which contain the enzyme. Berdis describes an alternative approach in which the drugs directly target damaged DNA while avoiding healthy DNA, side-stepping the polymerase enzymes of normal cells. The development, which shows promise in preliminary lab studies, could lead to improved nucleoside analogues with fewer side effects, he says. - MTS

Yerkes Researchers Create Animal Model Of Chronic Stress

2008-09-08T08:36:00.001-07:00

In an effort to better understand how chronic stress affects the human body, researchers at the Yerkes National Primate Research Center and the Department of Psychiatry and Behavioral Sciences, Emory University, have created an animal model that shows how chronic stress affects behavior, physiology and reproduction.

Developing the animal model better positions the researchers to understand the neurohormonal causes of such stress and the body reaction in order to develop more effective treatment options for humans. The study is available in the current online edition of Molecular Psychiatry.

According to lead researcher Mark Wilson, PhD, chief of the Division of Psychobiology at Yerkes, "Chronic stress can lead to a number of behavioral changes and physical health problems, including anxiety, depression and infertility."

Via the animal model, the researchers found corticotropin releasing factor (CRF) is a key neurohormone involved in stress response. Wilson explains, "CRF is located in several different brain regions, serving different functions. Its release is important for our ability to adapt to every day stressors and to maintain our physical and emotional health."

In response to stress, CRF levels rise; CRF levels decrease when the stressor no longer is present. Chronic stress, however, increases the length and volume of expression of CRF in areas of the brain associated with fear and emotion, including the amygdala. Such chronic stress changes the body's response, and the resulting increased expression of CRF is thought to be the cause of such health-related stress problems including anxiety, depression and infertility.

To study the importance of CRF, the research team used a viral vector to increase the production of CRF in the amygdala of female rats.

"In our study, rats that continuously were exposed to CRF from this area of the brain experienced anxious and depressive behavior, decreased libido and disrupted ovarian cycles suggesting that persistent release of CRF such as occurs in chronic stress clearly affects multiple body systems," says Wilson. "These behavioral changes are similar to what we see in human females who are exposed to stressors on a daily basis."

Dr. Wilson and his research team next will attempt to learn more about the negative effects of increased CRF by examining actual molecular and cellular changes in specific brain areas targeted by the neurohormone. Knowing how CRF affects the brain positions the researchers to develop better treatment options.

Youth In Rwanda That Head Households Commonly Depressed

2008-09-08T08:13:00.001-07:00

Of the orphaned youth who are heading households in rural Rwanda can be classified as depressed, according to a report released on September 1, 2008 in Archives of Pediatrics & Adolescent Medicine, one of the JAMA/Archives journals.

Rwanda has one of the largest groups of orphans in the world, a result of the 1994 genocide and the epidemic of HIV infection. According to background information in the article, an estimated 290,000 orphans lived in the country in 2005. The authors note that these children are often placed in adverse conditions as a result: "Most African orphans have been absorbed into informal fostering systems," they say. "Such systems, however, are increasingly overwhelmed, and many orphans either head households or live on the street."

To investigate the effects of this change on the group, Neil W. Boris, M.D., of the Tulane University School of Medicine, New Orleans, and colleagues examined 539 Rwandan youths who were serving as the head of their households. A total 539 young people were evaluated, all younger than 24, with an average age of 20. The youth met with trained interviewers who administered scales that measured symptoms of grief, depression, adult support, and community marginalization, as well as surveys regarding demographics, health, vulnerable conditions, and risky behaviors.

In examining the data, the scientists found:

77% of the youth population were performing subsistence farming.
7% of the youth population had six or more years of schooling.
In the status of their parents, 71.4% reported both parents dead, 26.2% reported one parent dead, and of these, almost 25% indicated that the genocide led to at least one of their deaths. s
44% reported only eating one meal per day in the last week.
80% gave a health rating as poor or fair.
The average depression scale score was higher than the standard cutoff score for adolescents. 53% of the subjects were positive in screening for depression.
76% agreed with a statement indicating that there is community rejection or orphans.
26% strongly agreed that they had at least one friend.
64% said they had lost their confidence in people.
40% agreed that life was meaningless or had lost faith in God since their parents' deaths.

The authors note some additional trends trends in this data. "Hunger, grief, few assets, poor health status and indices of social marginalization were associated with more depressive symptoms in this sample," they say. "Ten years after the Rwandan genocide and in the midst of the HIV/AIDS epidemic, the effects of poverty and social disruption on the most vulnerable youth in Rwanda are evident."

They state that further research is needed, examining the families that are supported by these youths. "The effect of caregiver depression on younger children living in youth-headed households is not yet known," they say. "Further study of orphans and vulnerable children in countries such as Rwanda, in particular, studies that inform large-scale interventions, are necessary if the next generation of youth is to thrive."

Adolescents From Certain Races Participating In Religion May Become More Depressed

2008-09-08T03:48:00.001-07:00

One of the few studies to look at the effects of religious participation on
the mental health of minorities suggests that for some of them, religion may
actually be contributing to adolescent depression.

Previous research has shown that teens who are active in religious services
are depressed less often because it provides these adolescents with social
support and a sense of belonging.

But new research has found that this does not hold true for all adolescents,
particularly for minorities and some females. The study found that white and
African-American adolescents generally had fewer symptoms of depressive at
high levels of religious participation. But for some Latino and
Asian-American adolescents, attending church more often was actually
affecting their mood in a negative way.

Asian-American adolescents who reported high levels of participation in
their church had the highest number of depressive symptoms among teens of
their race.

Likewise, Latino adolescents who were highly active in their church were
more depressed than their peers who went to church less often. Females of
all races and ethnic groups were also more likely to have symptoms of
depression than males overall.

Setting all other factors aside, the results suggest that participating in
religion at high levels may be detrimental to some teens because of the
tensions they face in balancing the conflicting ideals and customs of their
religion with those of mainstream culture, said Richard Petts, co-author of
the study, who did the work as a doctoral student in sociology at Ohio State
University.

"Most research has shown that religious participation, for the most part, is
good and can be very helpful for battling depression. But our research has
shown that this relationship does not hold true in all instances," he said.

While the study shows that females and males from certain groups may be more
inclined to become depressed, involvement in religious services still had an
overall positive affect for many youth in the study. The results do provide
important insight into the impact of religious participation on teenage
depression, but race and gender may only be part of the reason certain youth
were more depressed, Petts said.

"The study shows that we need to consider the broader social aspects of
institutions such as religion on an individual's well being, both good and
bad. We focus specifically on race and gender, but these are not the only
two factors that may be contributing to higher and lower depression among
youth," he said.

Petts, who is now an assistant professor of sociology at Ball State
University, conducted the study with Anne Jolliff when they were both
doctoral students at Ohio State. Jolliff is now a research coordinator at
Indiana University-Purdue University Indianapolis. The pair based the study
on data from the National Longitudinal Study of Adolescent Health, a study
surveying middle and high school students throughout the United States.

Adolescents in grades 7 through 12 were initially interviewed in school and
a random number of students were again interviewed at home. Students were
asked to identify the positive and negative feelings they had experienced in
the preceding week such as depression, loneliness, isolation, happiness, or
excitement. They were also asked about their behavior in the last year and
asked to identify their race, religious preference, and how often they
attended services during the same period of time.

Adolescents were then interviewed a second time one year later at home about
the same topics. Parents of these adolescents were also asked about their
child's moods and behaviors. Only the 12,155 adolescents who participated in
both parts of the study and had information from their parents were included
in this study.

The results were recently published in the journal *Review of Religious
Research.*

Among adolescents who never attended church, Asian-American adolescents
reported 4 percent fewer symptoms of depression in the preceding week than
did their African-American peers.

In comparison, Asian-American youth who attended church at least once a week
reported 20 to 27 percent more symptoms of depression than their white and
African-American peers who attended at the same level.

Latino adolescents fared about the same as Asian Americans, reporting 6 to
14 percent higher rates of depression symptoms than did African-American and
white teens when attending church at least once a week.

The results showed that in stark contrast to the findings for white and
African-American adolescents, Asian-American adolescents who never attended
services and Latinos attending at intermediate levels were the least likely
to be depressed within their groups.

The results suggest that something unique was affecting adolescents within
these two groups when they went to church often. Petts believes that the
traditional nature of religion for these two groups may be conflicting with
the ideals and customs of mainstream American society. This conflict may be
putting additional stress on these youth as they try to balance competing
principles and traditions, he said.

"Asian and Latino youth who are highly involved in a culturally distinct
church may have a more difficult time balancing the beliefs of their family
and their traditional culture with mainstream society. Their religious
institution is telling them what should be important in their lives and how
to behave, and mainstream society is saying something else," he said.

At higher levels of participation, Asian-American and Latino adolescents had
a harder time juggling which set of ideals to adopt because they were more
involved and committed to their religion.

Meanwhile, Asian-American adolescents who had lower levels of involvement in
church were able to focus more on life without worrying about conflicting
ideals, resulting in lower depression. At lower levels of involvement,
adolescents still gained the social support of their religious community
while also feeling in touch with mainstream society, Petts said.

The results also showed that the problem for Latino adolescents may be
two-fold. At high levels of involvement in their religious community, Latino
teens experienced the same tension between culture and society as some
Asian-American teens. This led to higher reports of depression symptoms
among these youth.

But Latino teens who never attended church reported high levels of
depression as well, reporting 26 to 28 percent higher rate of depression
symptoms than did white and African-American American youth. Religion is
often an important part of social support for these adolescents and no
involvement in their religion may leave these teens without a sense of
connection to their community and culture, he said.

"Participating to a certain extent may enable these youth to balance their
lives better. They have a connection with a religious community and all the
benefits it offers, but they are not so immersed that they're out of touch
with mainstream society. So they're sort of getting the best of both
worlds," Petts said.

The tension between society and religion may also help explain why females
who were sexually active report higher levels of depression than do sexually
active males. The disconnect between how their religion told them to act and
what they chose to do may cause these females to have higher emotional
distress and increased depression, he said.

In addition, Latina females who participated heavily in their religion were
more likely to become depressed then Latino males. Not only were these young
women more at risk for feeling depressed than were their male counterparts,
but they were also more depressed then Latina females who attended church at
intermittent levels.

"Females in these religious institutions often have subordinate status and
if females feel that they don't have equal say in that religious
institution, that may contribute to higher levels of depression," Petts
said.

This may also explain why attending church at intermediate levels resulted
in lower depression for these females. Latina females who attend at moderate
levels may benefit from the social support of the religious community, while
avoiding the patriarchal tensions experienced by those who attend services
weekly.

Innate Immune System Targets Asthma-Linked Fungus For Destruction

2008-09-08T02:54:00.001-07:00

A new study shows that the innate immune system of humans is capable of
killing a fungus linked to airway inflammation, chronic rhinosinusitis and
bronchial asthma. Researchers at Mayo Clinic and the Virginia Bioinformatics
Institute (VBI) have revealed that eosinophils, a particular type of white
blood cell, exert a strong immune response against the environmental fungus
Alternaria alternata. The groundbreaking findings, which shed light on some
of the early events involved in the recognition of A. alternata by the human
immune system, were published recently in the Journal of Immunology.*

Eosinophils typically combat parasitic invaders of the human body larger
than bacteria or viruses, such as flukes or parasitic worms (collectively
known as helminths). Evidence from different experimental approaches
suggests that asthma and chronic sinusitis can arise when the body perceives
that it has encountered a disease-causing organism. Environmental fungi such
as Alternaria do not typically cause invasive infections like parasites but
for some reason, in certain people, the body responds as if it is being
attacked and chronic inflammation can result from the ensuing cascade of
immune-related events.

Principal Investigator Hirohito Kita, M.D., from Mayo Clinic, remarked: "Our
results strongly demonstrate that eosinophils have the capacity to recognize
and exert immunological responses to certain fungi such as Alternaria. We
have shown that CD11b receptors on the surface of eosinophils recognize and
adhere to beta-glucan, a major cell wall component of the fungus. This in
turn sets in motion the release of toxic granule proteins by the white blood
cells, leading to extensive damage and ultimate destruction of the fungus.
To the best of our knowledge, this is the first time that live eosinophils
and not just the intracellular components have been shown to target and
destroy a fungus."

The researchers used fluorescence microscopy to determine the outcome of the
interaction between eosinophils and A. alternata. The contact of fungus with
eosinophils resulted in bright red fluorescence due to the damaged fungal
cell wall and subsequent death of Alternaria. Immunohistochemistry confirmed
the release of toxic granular proteins by eosinophils due to contact with
the fungus.

Dr. Chris Lawrence, Associate Professor at VBI and the Department of
Biological Sciences at Virginia Tech, remarked: "T helper 2 (Th2) cells in
the immune system typically produce cytokine signaling molecules or
interleukins that lead to the recruitment of eosinophils for the
dysregulated immune response commonly associated with airway inflammatory
disorders. Continual exposure of sensitized individuals to common
environmental fungi like Alternaria may result in Th2 cells being constantly
activated to recruit eosinophils and this sustained defense mechanism
results in chronic inflammation. It has been shown previously that
degranulation of eosinophils causes damage of airway mucosa and enhances
inflammation. The next step in our transdisciplinary research collaboration
will be to use recombinant fungal proteins and fungal knockout mutants for
specific genes to dissect the different molecular steps involved in the
development and progression of this acute immune response."

Hirohito Kita added: "We have taken an important step in showing that the
innate immune system of eosinophils is capable of targeting an
asthma-associated fungus for destruction. The biological significance of
these results will need to be verified further in animal models and in
humans and our collaborative efforts with Dr. Lawrence's research group for
proteomics and functional genomics will be invaluable in this respect. We
suspect that the dysregulated immune responses to Alternaria, other
filamentous fungi, and perhaps chitin-encased insects, such as mites and
cockroaches, may play a pivotal role in chronic inflammation and the
subsequent development of bronchial airway disease."

CMAJ Study Reveals Higher Anaphylaxis Rates After HPV Vaccination

2008-09-08T01:55:00.001-07:00

The estimated rate of anaphylaxis in young women after human papillomavirus
(HPV) vaccination was significantly higher - 5 to 20 fold - than that
identified in comparable school-based vaccination programs, according to a
study published in *CMAJ* http://www.cmaj.ca/press/179_6_525.pdf. However,
the overall rates of anaphylaxis were low with no associated serious lasting
effects.

In a study of 114,000 women, a team of Australian researchers found 12
suspected of anaphylaxis, and confirmed 8 of these, in a 2007 vaccination
program in New South Wales, Australia. Symptoms included difficulty
breathing, nausea and rashes.

Dr. Julia Brotherton and colleagues postulate that reasons for an increased
rate of anaphylaxis may include possible allergic reaction to the vaccine
components, enhanced adverse event surveillance, higher rates of anaphylaxis
in women from midadolescence compared with men, and an apparent increase in
incidence of anaphylaxis in Australia.

The estimated rate of anaphylaxis following HPV vaccination was 2.6 per
100,000 doses administered compared with a rate 0.1 per 100 000 doses
administered in a 2003 school-based meningococcal C vaccination program.

HPV vaccination programs will begin this fall in the United Kingdom and
other European countries as well as in parts of Canada and the United
States.

Dr. Brotherton stresses "the importance of good training for staff
administering vaccines in school or other settings in the recognition and
management of suspected anaphylaxis and its reporting." They conclude that
anaphylaxis following the HPV vaccine is rare and vaccine programs should
continue.

Anaphylaxis is a rare but serious adverse event and highlights the
importance of vaccine safety studies after vaccine licensing and careful
management of reactions in immunization clinics, says Dr. Neal Halsey,
Institute of Vaccine Safety, Johns Hopkins Bloomberg School of Public Health
in a related commentary http://www.cmaj.ca/press/179_6_509.pdf. He states
"before concluding that the HPV vaccine is associated with higher rates of
anaphylaxis than other vaccines everywhere, cases in other populations
should be reviewed….As of July 21, 2008, 11 cases have been reported [in the
US] in 2008. Over 13 million doses of this vaccine have been distributed as
of the end of 2007."

A *CMAJ* editorial http://www.cmaj.ca/press/179_6_503.pdf states that this
study indicates the HPV vaccine is "remarkably safe." The study provides an
excellent opportunity for Canada's public health community "to restart
public discussions about the safety of the HPV vaccine, the precautions
taken to mitigate risks if anaphylaxis occurs, and the care taken in
surveillance for adverse events following vaccination," write Drs. Noni
MacDonald, Matthew Stanbrook and Paul Hebert.

CYPHER(R) Sirolimus-eluting Coronary Stent Comparable To Bypass Surgery In Key Safety Measures In Patients With Diabetes And Multi-Vessel Disease

2008-09-08T01:31:00.001-07:00

Data from the largest randomized trial of its kind performed to date
indicate that the use of percutaneous coronary intervention (PCI) with the
CYPHER(R) Sirolimus-eluting Coronary Stent was comparable to bypass surgery
(coronary artery bypass grafting or CABG) in key safety endpoints in
patients with multi-vessel disease and diabetes. These data were presented
here recently at the European Society of Cardiology meeting.

The CYPHER(R) Stent is the only drug-eluting stent with such randomized
clinical data indicating that it is comparable to bypass surgery in these
key safety areas in patients with diabetes and multi-vessel disease, whose
coronary artery disease presents unique challenges.

Data from CARDia (Coronary Artery Revascularization in Diabetes Trial)
showed that after one year, there was no significant difference between PCI
with the CYPHER(R) Stent and bypass surgery in terms of death, heart attacks
or stroke, the primary endpoints for this study (10.1 percent for the
CYPHER(R) Stent compared to 10.2 percent for bypass surgery; p=0.98).

"The results of CARDia provide important new information to our
understanding of the treatment of patients with multi-vessel disease and
diabetes who present with coronary artery conditions," said Akhil Kapur,
M.D., London Chest Hospital, Barts and London National Health Service Trust,
London, UK, and one of the principal investigators.

"This is the largest randomized data set comparing angioplasty and surgery
in diabetic patients. The results of this study indicate that PCI with the
CYPHER(R) Stent was comparable to CABG in key safety outcomes in these high
risk patients." Aside from providing limited support for the CARDia trial,
Cordis Corporation has no financial relationship with Dr. Kapur and the
other principal investigators.

Key secondary endpoints, including revascularization (need for another
procedure), were remarkably low in both arms. As expected, patients who
received the CYPHER(R) Stent were somewhat more likely to undergo
revascularization (7.3 percent versus 2.0 percent; p=0.013). This
contributed to low but not statistically different rates of the composite
outcome of death, heart attack, stroke and repeat revascularization (15.1
percent for the CYPHER(R) Stent compared to 11 percent for bypass surgery;
p=0.217).

All patients in the study had diabetes and multi-vessel disease and were
amenable to either surgery or PCI.

The trial, conducted at 24 medical centers throughout the United Kingdom and
Ireland, was designed as a non-inferiority trial. In the discussion of the
trial in the hotline session, the CARDia investigators were congratulated on
the trial, but it was pointed out that due to enrollment of only 510 of the
originally planned 600 patients that there was insufficient power to answer
the specific question whether stenting was non-inferior to surgery in this
population.

*Overall Results Favorable for PCI (the CYPHER(R) Stent or a Bare Metal Stent)
*

The CYPHER(R) Stent portion of this study was part of an overall comparison of
PCI versus surgery. The CARDia trial included 510 patients randomized to
receive bypass surgery (254 patients) or PCI with either the CYPHER(R) Stent
or a bare metal stent (256 patients). Of those patients who received PCI,
180 patients (71%) were randomized to receive the CYPHER(R) Stent and 72 were
randomized to receive a bare metal stent. The CYPHER(R) Stent cohort was
uniformly numerically lower for all outcomes compared to the overall PCI
population.

The composite rate of death, heart attack and stroke at one year was similar
between the two groups (11.6 percent for PCI and 10.2 percent for surgery;
p=0.63). Specifically, the rates of death for total PCI was 3.2 percent
compared to 3.3 percent for bypass surgery (p=0.83) and clinically reported
non-fatal heart attacks was 8.4 percent for PCI compared to 5.7 percent for
bypass surgery (p=0.25). The rate of stroke showed a trend toward being
lower with PCI (0.4 percent) compared to bypass surgery (2.5 percent,
p=0.09).

*Trial Results Show Benefits of PCI to Bypass Surgery for Patients *

For many years, patients with multi-vessel disease and diabetes were treated
with coronary bypass surgery, considered to be the gold standard for these
difficult-to-treat conditions. However, surgery is associated with higher
health care costs as well as a lengthy recovery period. Patients receiving
PCI are treated with minimally invasive techniques that greatly reduce both
health care costs, as well as the amount of time it takes a patient to
recover and resume activities of daily living.

"Prior to this trial, there were limited randomized clinical data directly
comparing the CYPHER(R) Stent to bypass surgery in diabetics so these results
are critical to our understanding of how to optimally treat coronary artery
disease in patients with diabetes," said Campbell Rogers, M.D., Chief
Technology Officer, Cordis Corporation. "These results are also important
because the CYPHER(R) Stent is now the only drug-eluting stent with randomized
clinical data compared to bypass surgery specifically in this
difficult-to-treat patient population."

The study was supported by major grants from the Hammersmith Hospitals
special trustees, Eli Lilly Corporation, Sanofi Aventis and Cordis
Corporation. Further support was provided by Boston Scientific, Medtronic,
Guidant and Jomed.

*Data Consistent with other Trials of the CYPHER(R) Stent in Patients with
Diabetes*

The use of drug-eluting stents in patients with diabetes has been the focus
of debate and discussion within the medical community for some time. The
data from CARDia are consistent with other clinical trial data on the use of
the CYPHER(R) Stent in patients with diabetes.

According to data appearing recently in the *Journal of the American College
of Cardiology*, in patients with diabetes, the CYPHER(R) Stent outperformed
the Taxus(R) Stent with significantly lower rates of in-segment restenosis (a
reblockage within the stented area), target lesion revascularization (TLR;
the need for another interventional procedure) and major adverse events
(MACE, a composite of death, heart attack and TLR) at nine months.

In this multi-center randomized clinical trial, the six month rate of
in-segment restenosis was more than five times lower for the CYPHER(R) Stent
compared to the Taxus(R) Stent (4.0 percent vs. 20.8 percent respectively (p <
0.001). Most important for patients and physicians, key clinical outcomes
measures were about four times lower for the CYPHER(R) Stent -- at
nine-months, clinically driven TLR for the CYPHER(R) Stent was 1.5 percent
compared to 6.0 percent for the Taxus(R) Stent (p=0.032) while the composite
clinical endpoint of MACE was 2.0 percent for the CYPHER(R) Stent compared to
8.0 percent for the Taxus(R) Stent (p=0.010).

The CYPHER(R) Stent does not have an approved indication for use in patients
with diabetes or multi-vessel disease in the United States.

*About the CYPHER(R) Stent *

The CYPHER(R) Stent has been chosen by cardiologists worldwide to treat
approximately three million patients with coronary artery disease. The
safety and efficacy of the device is supported by a robust clinical trial
program that includes more than 70 studies that examine the performance of
the CYPHER(R) Stent in a broad range of patients.

Study Shows PDE5 Inhibitor More Effective When Used On-Demand In Erectile Dysfunction

2008-09-08T00:27:00.001-07:00

Nerve-sparing radical prostatectomy (NSRP) is the gold-standard therapy for
prostate cancer in men with a life expectancy of 10 years or more. The risk
of erectile dysfunction (ED) following NSRP is significant. This is caused
by neuropraxia - the usually temporary failure of nerve conduction in the
absence of structural changes due to compression, ischemia or blunt injury -
which inevitably occurs during the procedure. Ultimately this may lead to
the development of fibrosis within the corpus cavernosa and cause ED.

To prevent the onset of postoperative ED, the use of phosphodiesterase type
5 (PDE5) inhibitors was introduced. These agents prevent the breakdown of
cyclic guanosine monophosphate in cavernosal tissue, which plays a role in
the prevention of cell death and fibrosis, and may thus exert a protective
effect on cavernosal smooth muscle.

Participants were recruited to this first robustly designed, evidence-based,
multi-centre study approximately one month before they were scheduled to
undergo NSRP. A total of 423 patients completed the study. The inclusion of
the on-demand dosing regimen enabled comparison of the currently recommended
guidelines for the use of PDE5 inhibitors with a proposed nightly dosing
regimen, which was suggested to have potential positive effects on erectile
function. The results clearly show that nightly dosing with vardenafil does
not have any effect beyond that of on-demand use.

The study shows that on-demand use of vardenafil during the treatment period
was associated with significantly greater erectile function and sexual
intercourse completion rates compared to placebo. The success rates for the
vardenafil on-demand group were also higher than for the nightly group.
These data indicate that the use of on-demand vardenafil is of greater
benefit than nightly treatment in patients following NSRP surgery and, in
general, support the on-demand use of PDE5 inhibitors following NSRP surgery
over a daily dosing regimen. This prompts reconsideration of the current
practice of prescribing nightly PDE5 inhibitor therapy, as on-demand use of
vardenafil is equally effective in men with ED following NSRP, a notoriously
difficult-to-treat patient population.

Tips For Parents Of Middle Schoolers From AAAS About Alcohol

2008-09-07T23:32:00.001-07:00

Nearly twenty percent of 14 year-olds say they've been drunk at least once,
according to the U.S. Surgeon General, and recent news points out dangers of
alcohol use by the young:

- The Partnership for a Drug-Free America released a study in August,
2008 of 6,500 teens in which 73% said school stress caused them to drink and
take drugs.

- A Columbia University study, also released in August, found that
"problem parents," those who let their kids stay out past 10:00 p.m. on
school nights in particular, are putting them in situations where they are
at risk for drinking and drug use.

- About 100 university leaders called for a national discussion of
lowering the drinking age back to 18, saying it's not clear that 21 works.

The middle school years are crucial in the battle to prevent early alcohol
use. Young adolescents' bodies and friendships are changing. They start
pulling away from parents; yet seek out other adults for guidance. It's the
most vulnerable time, specialists say, but also one of the last times they
still can be influenced by adults.

No one sets out to be a disengaged parent. But it's hard to be vigilant and
talk to your kids about complicated topics when you are constantly on the
go. "As parents better understand the physiological effects of alcohol on
the body and the fact that their children might be starting younger, it can
motivate them to have this sometimes awkward conversation," says Shirley
Malcom, head of the Education and Human Resources office at AAAS. "That's
where the science can help."

Members of The Science Inside Alcohol Project at AAAS are writing a book for
middle school parents and developing an interactive Web-based science and
health curriculum explaining how alcohol affects adolescents' brains and
bodies. Based on extensive research, the AAAS team suggests five steps
parents can take to talk with their kids about alcohol.

1. Find Teachable Moments -- We live in a culture of celebrity. If a
celebrity your child admires admits to a drinking problem, or an instance of
alcohol abuse occurs in your community, talk about it. Ask your middle
school student if she knows anyone who drinks alcohol and whether it is at
parties or has been brought into her school. Answer questions. Have this
conversation often.

2. Talk to Your Kids When Everything is Fine -- Middle school students
are volatile, hormonal beings. They are sweet and wonderful one moment, and
blow up the next. Pick a time when things are quiet and they're a captive
audience such as in the backseat of your car. Don't take no for an answer.

3. Engage Your Kids in the Science of Alcohol -- Adolescents are
incredibly self-involved. Alcohol can cause memory loss, impair sports
performance, incite embarrassing behavior and affect how they feel and look.
Make them aware of these facts. If there is a history of alcoholism in your
family, explain about genetic predispositions towards alcohol abuse.

4. Be Vigilant -- There's no alternative to monitoring your kids. Have an
early curfew. Know where they are at all times. Even if you are not home on
a weeknight, make sure you can reach your kids by phone. Get to know their
new friends and their parents. Find out what their rules and level of
engagement are.

5. Learn to Trust Your Child -- Now's the time when all the work you've
put into creating a value system for your child begins to pay off. Set
limits and enforce rules, but remember to give your child room to make his
or her decisions, within your comfort zone. Praise them when they do well.
It's worth a thousand words.

Case Report: Delivering A Full-Term Baby While On Hemodialysis Is Possible

2008-09-07T22:41:00.001-07:00

For women with chronic kidney disease (CKD), getting pregnant is very rare,
and a successful pregnancy is even more uncommon, especially for women on
dialysis.

In the July-August 2008 issue of *Nephrology Nursing Journal,* Mary Coyle
and co-authors present a case report of a 35-year-old woman with Stage 5 CKD
who successfully completed a 39-week pregnancy while on hemodialysis. The
pregnancy was diagnosed at seven weeks, and five three-hour hemodialysis
sessions per week were started right away, say the authors.

A care team was assigned to the patient and her family, which included a
nephrologist, a dialysis center nurse practitioner, a nurse manager, a
dietician, a social worker, and a core group of nurses who would dialyze
her. This group, say the authors, was crucial in monitoring signs and
symptoms and maintaining a continuum of care. The care team used
recommendations in the available literature to manage blood urea nitrogen
levels, fluid removal by ultrafiltration and other issues.

The nurse practitioner also shared status updates with the perinatologist
and perinatal center nurse practitioner throughout the pregnancy. The
perinatologist saw the patient every two weeks and with greater frequency
when she reached 24 weeks.

The patient's anemia worsened during the pregnancy, and she also developed
hypertension, pre-eclampsia and polyhydramnios, all common among women on
dialysis. Despite these complications, fetal heart rate testing and OB
ultrasounds revealed an active, growing fetus. A scheduled cesarean section
took place at 39 weeks, and the patient delivered a five-pound, seven-ounce
daughter. Mother and baby were discharged after five days.

Coyle and co-authors say that they were fortunate their patient was highly
motivated and committed to following treatment guidelines. While limited
data currently exist, more extensive research is needed to determine
appropriate guidelines, better understanding of risks and clear indications
of how medications and treatments affect the fetus.

*"A Successful 39-Week Pregnancy on Hemodialysis: A Case Report."* Mary
Coyle, MS, FNP; Elyn Sulger, BSN, RN, CNN, CAN-BC, CPHQ, LNC; Cindy
Fletcher, MSW, LMSW; and Diane Rouse, MS, RD, CDN *Nephrology Nursing
Journal*; July-August 2008; http://www.annanurse.org/journal

*Nephrology Nursing Journal *is a refereed clinical and scientific resource
that provides current information on a wide variety of subjects to
facilitate the practice of professional nephrology nursing. Its purpose is
to disseminate information on the latest advances in research, practice, and
education to nephrology nurses to positively influence the quality of care
they provide.

Newspapers Examine Reaction To GOP VP Nominee Palin's Announcement Of Daughter's Pregnancy

2008-09-07T20:50:00.001-07:00

Alaska Gov. Sarah Palin (R) on Wednesday accepted the vice presidential
nomination for the Republican Party at the party's national convention in
St. Paul, Minn., the AP/Washington
Post<http://www.washingtonpost.com/wp-dyn/content/article/2008/09/03/AR2008090300488.html>reports
(Espo, AP/Washington
Post, 9/4). Several print publications recently reported on the reaction to
the nomination, as well as the announcement that her 17-year-old daughter,
Bristol, is pregnant. Summaries appear below.

~ ABC News <http://abcnews.go.com/Health/story?id=5711359&page=1>: ABC
Newsexamined how the announcement of Bristol Palin's pregnancy has
"reignited"
debate over whether abstinence-only education programs, which Palin
supports, are effective in curbing teenage pregnancies. According to ABC
News, sexual health experts "overwhelmingly" agree that comprehensive sex
education programs are a more effective strategy in reducing teen births
than abstinence-only programs (Childs, ABC News, 9/3).

~ Miami Herald<http://www.miamiherald.com/news/top-stories/story/671263.html>:
The Herald examined views of teen pregnancy among South Florida teens, of
whom 7,000 become pregnant annually, as well as parents in the region.
According to the Herald, the presence of teen pregnancy in the news has
provided an opportunity for parents to discuss sex and pregnancy with their
children (Kaleem, Miami Herald, 9/4).

~ New York Daily News: The "unwed pregnancy" of Bristol Palin "has been
spun" by Republican presidential candidate Sen. John McCain's (Ariz.)
"message-managers as an example of strong family values," the Daily
Newsreports. According to the Daily
News, the "muted, nonjudgmental" reaction of social conservative leaders
lies in contrast to conservatives' praise of former Vice President Dan
Quayle's (R) criticism in 1992 of the show "Murphy Brown," in which the
title character had a child out of wedlock (DeFrank, New York Daily News,
9/4).

~ New York Times<http://www.nytimes.com/2008/09/04/fashion/04marriage.html?partner=rssnyt&emc=rss>:
Reporting on Bristol's plans to marry the father of her child, the
Timescites studies that show teenage marriages today are two to three
times more
likely to end in divorce than marriages between people ages 25 or older.
According to the Times, even some experts who "acknowledge that teenage
marriage is a risky proposition" said that marriage is a "healthier choice"
for the pregnant woman than single motherhood (Kershaw, New York Times,
9/4).

~ Philadelphia Inquirer<http://www.philly.com/inquirer/magazine/20080904_Teen_pregnancy_s_new_twist.html>:
The Inquirer examines whether the public's perception of teen pregnancy has
changed in light of Palin's daughter's pregnancy and other recent
high-profile teen pregnancies (Pompilio, Philadelphia Inquirer, 9/4).

~ Pittsburgh Post-Gazette<http://www.post-gazette.com/pg/08247/908943-470.stm>:
The "'Mommy Wars' -- the seemingly endless debate over whether mothers
should work or stay home with their kids" -- has "erupted" over the choice
of Palin as McCain's running mate, the Post-Gazette reports. According to
the Post-Gazette, many women can relate to Palin's situation, considering
that the most recent government statistics available show that nearly
two-thirds of mothers in the country with preschool-age children were in the
work force in 2003 (Carpenter, Pittsburgh Post-Gazette, 9/3).