4 Things to Confirm on the Life Insurance Quotes You Just Ran
So you have run yourself some Term Life Insurance quotes, now what? Before deciding on a life insurance carrier to apply with, here are a few items to double check on. The first two are common areas people make mistakes when quoting themselves. The latter two, I feel are two important points to check on before filling out an application.
- Rating Class - This is a key component of what will determine the cost of your life insurance coverage. Take a moment to read the criteria for each individual rate class (click the little ‘i’ next to the Rating Class selector for details). This is a time to be honest – and maybe even a little conservative. Do you think you fall into the Preferred category? If so, take note of the premium associated with that class, but also run another quote for one class down (Standard Plus). This way you will be aware of the cost difference should you end up in that lower rate class.
- Date of Birth vs Age – Some quote tools have you enter your date of birth. Others ask you to only enter your age. Using just age can cause issues as most carriers use ‘age nearest’ to determine your age for pricing. You may inadvertently quote yourself a year younger than the carrier will view you. Say you are one month away from your 40th birthday. You may enter 40 in a quote tool that asks for only your age, but most carriers would call you 41 for life insurance purposes. The Pivot Quote Tool takes the guess work out of this step. We ask you to enter your date of birth and the results automatically take into account each carrier’s method of calculating your age.
- Carrier Ratings – You may have seen ratings on our site from AM Best, Moody’s, Fitch or Standard & Poor’s under each Carrier’s bio page.These basically rate the financial health of that carrier. Life insurance is a long term agreement, so you want to be sure the carrier you select will be around to pay the benefits when you need them most. NOTE: Pivot only works with top-rated carriers – many of whom have been around for 100’s of years.
- Conversion Options – Lastly, you want to make sure the policy you are looking to buy has conversion options. These allow you to exchange your term policy for a permanent life insurance policy WITHOUT having to go through underwriting again. You may never use this option, but it is an important feature to be aware of. It adds no cost to the policy either. Everyone’s situation – and health – is forever changing. You may say to yourself now that you did not need a policy to cover your past 20 years, but it is hard to say if that will be the case 5, 10, 15 years in the future. A decline in your health may also make exercising this option a good idea.
Making sure you used the correct rating class and captured your age correctly are key to making sure you get life insurance quotes back that will be close to what you can expect to pay once a policy is issued. And once that policy is issued, you want to make sure the carrier will be around when you need them most, and provide you with multiple options should your health or financial situation change during the term period.
About the author: Seth Gowdy is the Sales Manager for Pivot Insurance and holds multiple insurance and securities licenses. He has been part of the financial services industry for nearly 20 years. In his free time he enjoys being outdoors fishing, hiking, and geocaching with his wife and two children. Seth most enjoys helping clients with Pivot’s anonymous life insurance quote process and needs calculators. You can reach Seth at 1-800-651-1953 or SGowdy@pivot.com.