Term Life Insurance Shopping Strategies
Term Life insurance shopping can be overwhelming. With so many different life insurance carriers and options out there how do you put together a strategy? Here are some tips we think will help:
1: Determine what coverage amount you feel would be sufficient. Don’t just pick a random number or go with the same amount somebody you know has. Each person has different needs they need to take care of. So sit down and review what your needs are. Are there young children you support? A mortgage on a home? Student loans, bank loans and any other areas you would want term life insurance money to help take care of for you upon your passing. If you passed away tomorrow how much money would be needed to take care of the people and things you support today?
2: Know the life insurance companies you are calling. There are many life insurance companies out there. Some have been in business for a very long time. Other companies may be relatively new. Find these companies web sites and click through the different areas on the site. You can look at a company’s ratings from rating agencies such A.M. Best or Moody’s to get a feel for how the company is rated based on such things as financial strength and if you go to the news section or about us section you can read press releases and other general information to get a feel for the company’s background - how long they have been in business, business values and mission statement.
3: Gather quotes. Keep in mind when you are gathering quotes for term life insurance as they are simply estimates and may not be the final payment you are approved for. There are different ways to gather quotes. A quick quote is where you provide a few pieces of information such as your date of birth, gender, state you live in and tobacco/nicotine use. You could come across a quoting tool that may go into more detail and ask about such things as medical history, family history, income and adventurous activities such as sky diving or piloting a plane. You could end up speaking to a life insurance agent over the phone that may run through a series of questions similar to what I have listed above. Most people I speak with gather quotes from 3 different life insurance companies. I think this is a good rule of thumb. With three carriers you will be able to see if the quotes are similar in cost or if any are significantly different from each other.
4: Ask the life insurance company what the application process involves. Is there a medical exam required? How long does the application take to complete? Is the application done over the phone, on the website, or in person with a licensed agent? Is it mailed out to you? How long does it usually take to receive an answer as to what the final approval and payment amount is? These are all good steps to help you gauge how long the process will take.
5: Make note of the company (and or companies) and agents you have spoken with, quote estimates you have been given and contact phone numbers so you can call people back in the event you are interested in applying with that particular company. Doing this will save you time and energy as well as helping you to stay focused on obtaining life insurance and not just continually shopping.
About the author: Dan Cody has been in the life insurance business for over 7 years. He loves playing a variety of instruments including the guitar, bass, drums, and piano. He also supports cancer research foundations and volunteers at local pet shelters. Dan enjoys helping customers understand life insurance, so they can find a solid policy that fits their needs. You can reach Dan at 1-800-651-1953 or DCody@Pivot.com.