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How to Get Cheap Life Insurance Rates on the Internet
A recent LIMRA (Life Insurance Market and Research Association) survey highlights an interesting paradox. Almost 75% of Americans agree that life insurance is important; but 44% don’t have enough. It’s not just low-income families that are insurance deficient. One third of households with $100,000 or more in annual income admit they are underinsured.
Insurance is something we have a tendency to neglect. Why? The reasons include lack of time, knowledge and money. And, we simply do not like to think of our demise. We’d rather enjoy life than consider our death. But the horror stories from underinsured families are endless. Leaving your family with financial concerns is not an admirable legacy. Putting off the purchase of adequate life insurance could be the mistake of your life.
It’s not all doom and gloom; there’s good news. The Internet can make it quick and easy to find the right plan – cheap. It won’t take hours with an agent in your home, asking personal questions. Most quotes can be produced online in 5-10 minutes in the privacy of your own home.
Before beginning your search, arm yourself with the following tips to get the most insurance for the lowest cost.
Use a needs calculator
Most insurance companies have a life insurance needs calculator online. It takes the mystery out of how much insurance you actually need.
The general rule of thumb is 5-8x your annual salary, but that’s just a guideline. The right amount of life insurance depends on many factors, including your mortgage, assets, spouse’s earning, and plans for your children’s college education. Needs calculators personalize the life insurance amount to your specific situation. No more worries about an agent overselling his product at your expense.
Stick with a reputable carrier
Just like any business, there are reputable and non-reputable players. Rating agencies such as A.M. Best and Standard & Poor’s take the guesswork out of determining which companies you can place your confidence in. These agencies publish ratings of the company’s financial strength and ability to meet obligations.
Visit the company’s website and check out their ratings before making a financial decision. The last thing you want is to get a great deal on life insurance from a substandard company. Is it worth saving some money if your beneficiary goes through a hassle to receive the proceeds?
Use a site that will provide quotes from many companies
A few insurance sites offer user-friendly technology and a variety of quotes for you to review. You will need to answer a few questions about your age, height and weight, tobacco habits, and medical problems. Some sites also ask about your general family medical history. You can select from plans and amount of coverage available. It’s a simple way to determine how much you can afford.
If you are interested in any of the quotes you can complete the application online and wait to hear from the insurance company.
Know the basics
You don’t need an insurance degree, but you do need a basic working knowledge of insurance plans to make the right choice. Cheap insurance is not worth much if the plan you select is all wrong for your needs.
There are two distinct types of insurance plans – term and whole life. Term coverage pays your beneficiary if you die within the selected time period. For example, if you purchase a 10-year term life plan and die within those 10 years, your beneficiary will be paid. If you outlive the 10 years by even one day, your beneficiary gets nothing. Term insurance is the most popular type of life insurane because it is cheap and simple.
Whole life costs more but covers you until death. It is guaranteed to pay out, and builds up cash value that can provide emergency funds or even retirement income while you are still alive.
Read the fine print
Some policies include more bells and whistles than others. Don’t just look at the bottom line price – pay attention to what you are getting for your hard-earned money.
For example, some policies include a disability waiver of premium provision. If you become disabled and cannot work, the insurance will continue with no premiums required.
Some policies have exclusions for deaths resulting from risky activities such a sky-diving or auto-racing.
You also need to pay attention to the grace period. Just imagine how devastating it would be if your policy lapsed and your beneficiary was left with no proceeds.
Why wait?
Life insurance is something we’d rather avoid, but that’s simply not a responsible decision. Using the internet can make the dreaded task of finding life insurance much easier than expected.
So, what are you waiting for? The internet has taken away all excuses. Proper protection can be found with just a few keystrokes.
This entry was posted on Thursday, October 8th, 2009 at 8:47 am and is filed under Insurance, Internet. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.