When it comes to protecting your family, you want to make sure you have a suitable term life insurance policy based future planning. Below we cover key topics to learn how to compare term life insurance options.
Step 1: Decide how much coverage you need
When it comes to term life insurance, the amount of coverage you need will depend on a few factors, including your age, health history, and current financial situation. If you’re not sure how much coverage you need, it’s always a good idea to speak with an insurance agent or specialist to get an idea of what is available to you.
Step 2: Compare policies and carrier rating
It’s important to compare policies and rates to ensure you’re purchasing a policy that best fits your needs. There are a few things to keep in mind when doing your comparison:
- Policy Term – A shorter term (eg. 10 years) may have lower premiums, but it may not protect your dependents when they need it most. Imagine saving for your children’s college tuiton and paying a hefty monthly mortgage over a 20 year period. A longer term policy will have higher premiums since risk increases with age, and you may not have a need for term life insurance with sufficent cash and investments later in life.
- Carrier Rating – Not all life insurance carriers are created equal. There are five independent agencies that rate the financial strength of insurance companies, and they are: A.M. Best, Fitch, Kroll Bond Rating Agency (KBRA), Moody’s, and Standard & Poor’s. A.M. Best is the best-known of these agencies. The ratings scales and standards used by each company are unique to them, as is the population of companies that have been rated by them and the distribution of companies across their scales. Minor variations in rating from one rating class to another are represented by numbers or plusses and minuses in each agency’s system.
Step 3: Choose the policy that is the best match
How each carrier approaches rating, for its term life insurance products, can differ in criteria. Some will be very competitively priced for younger applicants, and others will be more lenient on pre-existing conditions. As an insurance broker, ProtectQuote works on your behalf to pinpoint the best carrier for your term life insurance needs. Our compensation is based solely on our ability to serve our customers in finding the best fit policy.
Conclusion: Comparing term life insurance policies is the best way to find the right coverage for your family. Make sure to compare rates, coverage, and other features to find the best policy for your needs.
