Term Life Insurance is by far the least expensive form or type of life insurance that you can currently purchase. Over the last few years rates on this type of policy have drastically reduced due to better carrier efficiencies and extended mortality rates and tables. Even Financial guru Dave Ramsey preaches how Term Life Insurance is the most cost effective plan to purchase.
So how do you buy a term life insurance policy? I’m talking about the absolute best priced, best carrier with the best plan options. The best place to start is definitely with a really good and experienced broker or agent. Lets clarify the difference, a broker is typically an agent who represents multiple carriers. An agent can be a broker or work for one company specifically like New York Life or Northwestern Mutual. So be careful ask whoever you are working with if they can write with multiple carriers. This is critical and a huge advantage for you to be able to find and buy the cheapest most affordable rates.
Now that you have a good broker and he has quoted you multiple carriers have him sift through typically the top five for the cheapest rates. This is the time for you start asking your broker some questions.
- First, who has the best ratings? This is extremely important you want a carrier that you know will be there when it is time to pay a death claim. Especially since you have seen the meltdown of some of the nations largest insurers like AIG.
- Second who has the best underwriting, not all carriers are the same. Just because xyz company has the cheapest rates you may never get them because they are so stingy in underwriting. Underwriting issues come about if you have a health history that would affect your premiums. For an example if you have Diabetes, Cancer or Heart Disease.
- Lastly you need to know who has good permanent life product that you could possibly convert to later down the road. Why you need to know this is if you have a major health event that would impair you from getting a good offer down the road. This way you know if you got a Preferred Rate Class offer on your Term Life Plan then you can convert it to a permanent plan later at the Preferred Rates. Now your rates are offered at your current age but even so they typically would be much more affordable than a rated up policy.
These three tips on How To Buy Term Life Insurance really are the big three that in our opinion you need to be concerned with. From here you should be able to find and purchase a policy that meets your families or business needs with a premium that you feel comfortable paying and can afford.