The right life insurance policy can be a valuable safety net for your dependents if anything should happen to you. Policy details and prices can vary a great deal from company to company. It is in your best interest to compare at least three different companies before you purchase a policy, no matter what kind of policy you are looking for. A little research before you buy could save you money and help you buy a policy that fits your specific needs best.
Before you dig too deeply into the details of life insurance offered by different companies, figure out how much you can afford to devote to the premium. Once you have a solid idea of your budget, begin to research the standard rates from several different companies. An online quote generator can be a valuable tool for price comparison because you can receive quotes from many different companies after filling out one simple form. The quotes will give you a better idea of how much you should expect to pay for the policy you need. Then you can narrow your field of possible companies down to four or five, which makes the rest of the research easier.
Life insurance is offered in two different types: Whole life and term life. A whole life policy will cover you from the day you sign up until the day you die. These are usually the most expensive life insurance options because they are guaranteed to pay out at some point in the future. A term life policy is effective for a definite number of years. You can choose policies that last as little as 10 years or as much as 30 years. A term life policy is less expensive because it is easier to determine when the coverage will end. Usually a term life policy is used for the years when someone has children living at home, or to protect a non-working spouse until the policy owner retires and begins to draw from a retirement fund. Since the term is so specific, there is a good chance that the policy will never need to pay out, so the prices can be lower.
Some people find that dealing with a life insurance agent can be stressful and confusing. The agent might try to pressure you into buying a policy that you do not fully understand. Even someone comfortable with the types of policies available can be overwhelmed by a fast talking agent.
The best way to prepare for negotiating your life insurance policy is to do your homework before you speak with the agent. Look up the policies offered by the insurance company you are thinking of using. Become familiar with the different packages offered through that company and any specialized terminology that the company may use. A little specific research about the insurance company will make it easier for you to talk with an agent because you will recognize the terminology and know what the agent is talking about.
While you are comparing insurance companies, look for their ratings by companies like A.M. Best or Standard & Poor’s. These rating companies are not connected with the insurance companies in any way, and they can provide you with an objective analysis of the company’s history of customer service. Insurance companies that are rated highly will provide more timely claims processing and be easier to work with. Avoid companies that have low ratings, even if their policies are cheap. It is not worth saving a little money now and leaving your dependents to struggle to receive the life insurance claim from a less trustworthy company later.
Different life insurance agencies use different salary methods to pay their agents. Try to find out if the companies you are considering employ agents on a commission only basis or on a standard salary basis. Commission-only agents may try to push you into buying a policy that will give them the largest return, rather than a policy that would be the best fit for you. In many companies, commission agents receive larger payments for selling whole life policies rather than term life policies. It is understandable that an agent would want to sell the policy that brings home the best salary, but it is up to you to know what kind of life insurance you really want and need so that you will be able to stay firm about which policy you want to buy.
When you are comparing insurance companies, be sure to look at prices that reflect your personal information. Life insurance premiums are based on several factors that are unique to each individual. Your age plays a large part in determining how much you will pay. Older individuals typically pay much higher premiums because they have a higher risk of needing to file a claim. People in poor health also tend to pay higher premiums. If you purchase a term life policy that covers you until retirement, the premiums will be more expensive even if you are relatively young when you open the policy. If you receive an insurance price that is not based on your situation, the real cost of your policy will probably not be anywhere near the quoted price.
You can find several websites that offer life insurance quotes online. Doing your research through an online portal allows you to take your time and understand each policy on your own. You can also do your shopping at any time, day or night, rather than having to wait until the insurance office is open. Online quote systems allow you to narrow your search to a few companies so that you can concentrate on the specific details and compare them more completely before you make a decision.