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Guest Post by Liana Corwin There are few things, if any, more important to dads than the security of their families. So as a father or expecting father, you’re probably thinking of all the ways to make sure your loved ones are taken care of. From baby-proofing the house to setting up a college savings account, the list is far and wide. If you’re like most dads, life insurance is likely also on your list and you may be wondering: how much life insurance do I need? Finding the coverage that’s right for you and your family How much you should buy depends on your goals and budget. In the end, it’s all about figuring out how much risk you can afford to take off the table. You’ll find a lot of calculation methods around the internet to help you figure out how much term life insurance you need — you can even use Ladder’s free life insurance calculator to get you started. Want to get deeper into the numbers? Here’s a method for picking your term and coverage amount based on the simple but powerful idea of replacing your income. Picking your term How many years until you think you’ll retire? That’s your term. The reason why is that until then, you’ll most likely have people counting on your income (for example your spouse/partner and/or kids). Picking your coverage Pick a coverage amount that’s equal to your annual salary multiplied by your term. So for example, if you make $100,000 a year and have 10 years left until retirement, pick a coverage amount of one million dollars. If you have 20 years left until retirement, pick a coverage of $100,000 times 20, or two million dollars. The multiple is an annuity factor that takes into account average expected future salary inflation and investment returns. Calculating your coverage this way should enable your beneficiaries to invest in a life insurance payout (for example, in a mutual fund) and maintain their standard of living by recouping your lost income each year through investment returns. Of course, that all depends on market conditions. To make things even simpler, most experts recommend coverage of a minimum of 10x your annual salary. So if you don’t have the bandwidth right now, simply get your 10x in place, and figure out the rest later. Some insurers, like Ladder, offer adjustable term life insurance policies. If you’d rather think through your goals in more detail, here are three steps to follow: 1. Start by clarifying your goals Why do you want to buy life insurance? Or asked another way, what are you worried will happen (or not happen) if you were to die in the next 10, 20, or 30 years? Write down your answers and for each of them figure out if money would help mitigate your concern. If so, there’s your life insurance goal. Here’s a list of goals we commonly hear: I want my family to: Keep the house/buy a house Pay off my debts Afford daily expenses (groceries, health care, child care, housing, utilities, transportation, etc.) Afford traveling and hobbies Have a rainy day fund Afford higher education Have money for retirement Pay for my funeral These life insurance goals look a lot like general financial goals for you and your family. That makes sense because the purpose of life insurance is to replace economic value — in other words, you want your family’s financial picture to stay the same, regardless of what happens to you. 2. Put some numbers to it Now that you’ve outlined your goals, figure out how much money will be needed to get your family there. For example, how big is your mortgage balance? Or how much money do you think your kids will need to go to college, or for your spouse to retire? Finding your term To figure out your life insurance term, or how long you should be covered for, take the longest time horizon from your list. Calculating your coverage amount To figure out your coverage amount, or the size of the payout you’d want to leave behind, add up the total amount of money that will be needed over your term. Now subtract any savings you already have. Those go towards all the goals you’ve outlined above. Round things up (depending on what coverage level increments are offered by the life insurance company you choose) and you’ll find what amount of coverage and what term length is right for you. Now’s a good time for a gut check — does that feel like enough? While the math matters most, your intuition has a role to play in putting your mind at ease. If you’d rather go with the expert gut check discussed earlier, look at this number as a multiple of your income. The ballpark method recommends a minimum multiple of 10 to 12 times your salary, and a term equal to the years you have left until retirement. Don't worry about getting it all perfect right out of the gate. Get something in place that works for your goals as best you can determine and as soon as possible. If you need additional coverage, you can buy another policy. Or, with an adjustable policy, you can adapt your existing policy over time. 3. Work out what you can afford The good news is that term life insurance is likely to be a lot more affordable than you think. Start out by getting a ballpark quote for your ideal coverage and term. From there, there are a couple of ways to go: You have the budget and want to cover 100 percent of the risk If the quote fits in your budget, that’s great. Don’t cut corners if you don’t have to, and enjoy some sound sleep knowing you have everything covered. You need to trim your budget and afford more risk If money is tight, here are ways that can help make things fit a little better: Look into social security payouts — in some instances, the federal government pays death benefits to certain members of your family — and deduct those from your total coverage amount. If your spouse or partner brings in income, make sure you take that into account and only calculate how much extra money (your share) will be needed for achieving your goals. If you need to, go back to your goals — what’s the most important thing you want to make sure happens? — and trim your coverage accordingly. Alternatively, you can decide to max out your coverage but reduce your term to the years you feel are most critical for your family to get through, for example, when your children are young. Takeaways Experts recommend having coverage that's worth 10 times your income. For a more personalized calculation, take a look at your goals and budget. Ask yourself what the money would be used for (mortgage, college expenses, etc.), then add up those costs. If you’re over budget, don’t fret: there are ways to bring down the cost, like having a shorter term. When it comes to life insurance, something is always better than nothing. Liana Corwin is the Director of Communications and Editor of the Financial Literacy Blog at Ladder, an award-winning insurtech that’s using technology to make life insurance smart, easy, and affordable. Passionate about helping consumers, Liana has spent nearly a decade working with brands that solve hard problems and make consumer experiences delightful.
Guest Post by Liana Corwin As a new or soon-to-be parent, there are so many things to consider for the first time, or reconsider in a new light. Starting a family is an amazing adventure but it also requires us to consider how to secure our loved ones’ futures should anything happen to us. While the to-do lists may be long — and will probably be ever-growing — life insurance is one item worth an extra look. Why new parents need life insurance New parents need life insurance for the same reason anyone with dependents does: to make sure your loved ones are cared for in case you’re no longer around. You are now in charge of a new person who won’t be financially independent for a long time. While you may have some form of life insurance through your work, it may not be enough — and, like any other employee benefits, it is typically tied to your job — you leave, it may not move with you. Another important consideration is that, regardless of your age, the best time to buy life insurance is always right now. That’s because any kind of life insurance comes with higher premiums the older you are. As such, it makes sense to get a policy as soon as possible to lock in the best price. Which kind of life insurance is right for new parents Broadly speaking, life insurance policies come in two variants: “term life” and “whole life.” With the former, you choose a given time period (the “term”) during which you will pay monthly premiums and receive coverage for a given amount that, should you die within this period, will go to your beneficiaries. Conversely, “whole life” is an open-ended contract with no expiration date: if you keep paying in, it will cash out whenever you die. Some whole life insurance policies also include a cash value component, whereby a portion of the premiums are invested and accrue interest, raising the overall value (and cost) of the policy. “Term life” is likely the right kind of life insurance for new parents for several reasons: One, it is generally cheaper than whole life (3–10x less expensive), possibly an important factor given the impact of having children on a family’s budget. Two, it’s relatively easy to figure out the appropriate term length — typically 10 to 30 years — if your goal is ensuring your children receive support until they’re financially independent. Three, while “whole life” may offer an investment component of some kind, a financial strategy called “buy-term-and-invest-the-difference” may have higher returns and you control the investment. In this case, a customer buys term life insurance, then saves or invests the difference between the payment for that term life product and what it would have cost for a permanent life insurance product that provides the same coverage amount. Typical term life insurance can be rather limited, however. With most term policies, you select a policy and you're pretty much locked into it for the duration of your term—that means you have to project at the time you're taking out your policy what your family and financial picture will look like over the next 10, 20, 30 years. Typical term life insurance can be rather limited, however. With most term policies, you select a policy and you're pretty much locked into it for the duration of your term—that means you have to project at the time you're taking out your policy what your family and financial picture will look like over the next 10, 20, 30 years. That’s where laddering, or flexible term life insurance, comes in. Your life is dynamic, and you should have the option to change your policy as your needs change. Ladder gives you the option to decrease your coverage over the course of your term life policy, which decreases your premiums by the same proportion. For example, when your kids are grown up and no longer financially dependent on you, or when you pay off your mortgage early, you can decrease your coverage (and payments) with a few clicks online or taps in the app. Or maybe you apply to bump up coverage because you have a new baby or move to a city with a higher cost of living. As you increase or decrease your coverage throughout your term, your monthly premium payment will increase or decrease accordingly. Staying on top of your life insurance needs is a smart way to save money over the years while keeping your loved ones covered. Why both parents should get life insurance It’s important to note that we’ve been discussing which life insurance is right for new parents, plural. Whether you and your partner are both working or one of you is a stay-at-home mom or dad, you should consider both getting life insurance. That’s because the support provided by a parent isn’t only counted in dollars earned: if one parent isn’t around anymore, there is suddenly a deficit in terms of how much time they used to put into childcare, managing the home, cooking, transport, and so on. All of this non-salaried work will have to be provided by some other means, and a second life insurance policy will go a long way towards maintaining your family’s standard of living. What to consider if you’re a single parent If you are a single parent, one point to note is that most life insurance policies won’t pay out to minors, so it is worth consulting with an attorney to determine how best to make this work if you want the money going to your child(ren) or for their care. It is generally easy to do, you just want to make sure it's done correctly. Next step: figure out your life insurance needs If it all feels a little overwhelming, don’t fret! A free online calculator will help you figure out your needs in just a few minutes. Another item checked off the list! Liana Corwin is the Director of Communications and Editor of the Financial Literacy Blog at Ladder, an award-winning insurtech that’s using technology to make life insurance smart, easy, and affordable. Passionate about helping consumers, Liana has spent nearly a decade working with brands that solve hard problems and make consumer experiences delightful.
Technology has enabled creating a fast and convenient quoting and application experience for life insurance shoppers. Here's a closer look at Haven Life Insurance Agency's quoting process. Haven Life Insurance Agency Quote Process Life Insurance Quotes from Haven Life Insurance Agency Benefit from quick, realistic estimates and an online application process. Get Quote From Haven Life Insurance Agency's website, select "Check your price." Next, you'll provide the following information so you can receive a realistic quote: State of residence Gender Birth date Use of nicotine-containing products Perception of health Coverage amount Length of policy You'll be able to see several estimated rates without providing your contact information. The three main estimates vary by health condition — excellent, good, average — and are based on the information you provide and the kind of coverage you're looking for. Beyond these estimates, the yellow sidebar shows rates for similar policies that vary by length and coverage level. These estimates usually only show rates for people in excellent health. The ability to gauge pricing without providing contact information is an advantage of Haven Life Insurance Agency's quoting process. You'll also be able to seamlessly transition from your estimate page to an online application. Depending on the policy you choose and your health history, you may be required to schedule a medical exam before a policy can be issued. To complete the application process, you'll need to provide your driver's license number and expiration date, Social Security Number, current height and weight, and medical history for you and your family. Haven Life did not respond to inquiry about medical exam time frame and time between application and issuing a policy. Life Insurance Quotes from Haven Life Insurance Agency Quickly get an estimate on life insurance coverage through Haven Life Insurance Agency. Get Quote Instant Life Insurance Quotes from Haven Life Insurance Agency Haven Life Insurance Agency's quote process is quite fast and prioritizes showing realistic quotes. After submitting a few details about your situation, you can view several estimated rates adjusted by health status, coverage amount, and policy length. This makes it easy to gauge where your rate may fall. Another advantage of choosing Haven Life Insurance Agency is its online application. If the estimates shown look good to you, you can continue to apply for a policy online. Customer Review: Kudurika Clark "I went to the website to get a quote on life insurance on a Sunday night. The process was very simple and I got my quote in 5 minutes, sign my documents. Within 15 minutes, I received my policy paperwork in my email." While some applicants may need to schedule a medical exam before a final approval and rate can be determined, Haven Life works to make things as fast and easy as possible. Customer Review: Jonathan from Little Elm, Texas "The process was fairly easy. The online application was user friendly. The medical exam was easy. They came to my house. Performed the exam on both my wife and myself for both our applications. Once we had the exam we were approved within days." You can be confident in the policies sold through Haven Life Insurance Agency. It is backed by MassMutual, which has received high financial strength ratings. Haven Life Insurance Agency is also a top-ranked company in Best Company's life insurance category. Rankings are based on an algorithm that weights customer reviews. Haven Life Insurance Agency has also received a 4.8/5 star rating from its customer reviews. Get a Quote from Haven Life Insurance Agency You can count on getting reliable quotes online fast and a seamless transition to an online application when working with Haven Life. Get Quote
Buying life insurance is a traditionally slow process. Fortunately, many insurance agencies are using technology to make the process faster and easier. Here's a close look at Policygenius's quote process so you know what to expect. Policygenius Quote Process Life Insurance Quotes from Policygenius Use Policygenius's easy quote process to get accurate quotes from multiple insurers. Get Quote Policygenius's quote process starts online. After you provide your zip code, you'll be asked to provide information about why you're interested in a quote. Are you still assessing your life insurance needs, comparing options, or getting ready to submit an application? Then, you'll be asked for information about your life situation. For example, do you have a partner, are you employed, what are your dependents' needs, etc. After you complete these initial questions, you'll need to provide the following information before receiving quotes: Gender Birthdate U.S. citizen/permanent resident status Annual income Height and weight Tobacco use Health history Driving history Name Phone number and email address Once you submit your information to Policygenius, you'll be contacted with more information. Usually, you'll receive a call within minutes of sending your request. However, Policygenius doesn't have a set timeframe for contact. Policygenius's expert will walk you through the rest of the process, from finding a policy that meets your needs and fits your budget to applying and buying the policy. Anticipate completing a written application, phone interview, and medical exam before being accepted by an insurer and being able to purchase a life insurance policy. Life Insurance Quotes from Policygenius Benefit from comparing highly accurate quotes by working with Policygenius. Get Quote Instant Life Insurance Quotes from Policygenius Policygenius doesn't quite offer instant life insurance quotes. While you may be able to find faster online quotes elsewhere, choosing Policygenius offers several advantages, including realistic quotes, the ability to compare life insurance products from dependable insurers, personal assistance throughout the entire process, and the advantage of working with the top-rated company in Best Company's life insurance category. Accurate quoting makes it easier to assess your needs and find an affordable monthly premium from the beginning. A life insurance quote from Policygenius's is generally within $10 of the final rate. Customer Review: Paige Ellis Slade from Gilbert, Arizona "Policygenius is a little addicting. We actually have changed our life insurance three times because I kept on finding and qualifying for better deals." Comparison shopping is also easy since you can receive quotes from multiple insurers. Since Policygenius only works with financially strong insurance carriers, you can be confident when purchasing life insurance coverage. Rather than reaching out to individual insurers for life insurance rates and policy details, Policygenius is your one-stop shop for evaluating and comparing coverage options. Customer Review: Stacy P. Gordon from Fort Lauderdale, Florida "I had a great experience with your company. Everyone was friendly and they kept me updated about the application process. You offered the best rate out of all other companies I contacted. Would definitely recommend." A third advantage of choosing Policygenius is the personal assistance you'll receive throughout the entire process. Customer Review: Jon Monroe from Plymouth, Michigan "Policygenius process of getting term life insurance was easy and straightforward. They did a great job finding a competitive rate and shepherding me through the process." And, you'll have the advantage of working with Best Company's top-ranked company in life insurance. Rankings are determined with an algorithm that emphasizes customer reviews. Policygenius has also received an impressive 5/5 star rating from its customer reviews. Get a Quote from Policygenius You can count on top-notch customer service, helpful rate comparison, and realistic quotes with Policygenius. Get Quote
You may find yourself wondering: Is life insurance really worth it? Do I even need it? The answer to these questions depends on what your life looks like. As you assess your life insurance needs, here are six questions to consider: Are your funeral expenses taken care of? What would happen to your debt? Do you have dependents? Are you a dependent? Are you interested in an asset? Do you want to leave a legacy? 1. Are your funeral expenses taken care of? When was the last time you saw a GoFundMe fundraiser for a funeral? The National Funeral Directors Association reported that the median cost for funerals in 2019 were $9,135 for burials and $6,645 for cremations. Ask yourself the following questions: Are your funeral costs taken care of? (You can set aside your own savings, purchase things like burial plots in advance, or work with a funeral home to prepay your funeral.) Can your friends or family cover the funeral costs while waiting for your will to be processed fully? If you answered either of these questions "no," considering a life insurance policy can help your family pay their respects and focus on their grief rather than how they'll fund your funeral. Personal experience Randy VanderVaate president and owner of Funeral Funds, "I learned first-hand the importance of life insurance when my father died on May 10, 2017, without life insurance. When my father died without life insurance, our family had to figure out how to pay for his final expenses, which was emotionally stressful and financially burdensome. This experience reinforced my conviction that people need life insurance if they don't want their family or friends to struggle emotionally or financially after they're gone." Back to List 2. What would happen to your debt? Some debts are shared. Others are not. Review your debt to be sure you understand what debts would become the full responsibility of another or just be collected from your estate if you passed away. If any of your debt would become someone else's responsibility personally or professionally, be sure to have a life insurance policy in place to cover these debts. Personal experience: Business loans Matt Schmidt, Diabetes 365 Founder, "There are many reasons an individual may need life insurance coverage, but one popular example of why you may need a policy is to satisfy obligations for a SBA Loan. Every year, thousands of people will apply for a SBA loan. One little known fact that many are unaware of is that the lender will require a life insurance policy for collateral assignment. I personally went through this process about 10 years ago and got through to the very end before they stated to me that I needed a policy for a specific amount. While I was thrown a little bit off by this requirement, it obviously made perfect sense as to why the lender would require this type of collateral. Being able to find a very affordable life insurance policy was a relief, and ultimately the loan went through without a hitch. Obviously receiving the loan amount was of tremendous use." Learn more about entrepreneurs and life insurance. Back to List 3. Do you have dependents? Whether you work or not, a life insurance policy is especially important if you have dependents. Consider what your partner and dependents would need to replace the work you do. If you provide income for your family, make sure you buy enough life insurance coverage to replace your income. If you are a full-time parent, think about the costs of child care, food preparation, tutoring, cleaning, etc. when deciding how much coverage to buy. Personal experience: Growing family Kelan Kline, personal finance expert and cofounder of The Savvy Couple, "We recently got life insurance when we started to grow our family and felt the need to protect them better if something were to happen to my wife Brittany or myself. Since we run an online business, it's even more important to have all of our ducks in a row with our will and life insurance. We both got policies from Haven Life after shopping around for a bit. We ended up both getting a 30-year term life insurance policy covering us each for $500,000. We also recently set up our will so everything is in place and our family is protected." (Incidentally, Haven Life ranks first on Best Company's list of life insurance companies and agencies. Read customer reviews of Haven Life.) Personal experience: Special needs child Kari Lorz, Head Mama Money Nerd for MoneyfortheMamas.com, "My husband and I have a few different life insurance policies in place, although we didn't intend to do this. We have a very typical 25-year term insurance policy for each of us (different amounts); we did this when we purchased our first home. Term policies are great to bridge the gap until you have enough in savings to be self-insured. My husband is 20+ years military, so he has a smaller policy through an ARMY package as well. We have a 5-year-old daughter together, and she has Cerebral Palsy. We're unsure of her future ability to earn enough income to support her needs. As part of a larger dependant care plan (Revocable Living Trust for us, a Special Needs Trust for her, an ABLE account, etc.), we found we were $1.2 million short of having enough to cover her costs for her lifetime. Hearing that dollar amount was comically sobering (I even laughed out loud a bit when our planner told us our figure). To help bridge the gap, we took out a whole term policy to leave behind significantly more funding. Yet, it still (most likely) won't be enough. A special needs parent's greatest fear is what will happen to their child after they aren't there anymore. I never want her to have to worry about money, so we are doing everything possible to make sure we reach that $1.2 million!" Back to List 4. Are you dependent? If you depend on someone else's income for support, you can buy a life insurance policy to insure their life and name yourself as the beneficiary. If you receive alimony or child support, buying a life insurance policy on the person paying these costs can help you maintain your income and financial stability. Back to List 5. Are you interested in an asset? Permanent life insurance policies grow cash value. The cash value can be used as an asset as long as the policy remains in force. This asset can be useful in some circumstances. However, it should not be your primary reason for buying a life insurance policy, unless you have extra cash lying around. Personal experience Karen Condor, insurance expert for TheTruthAboutInsurance.com, "When my husband and I became engaged in our early twenties, my father-in-law advised us to get life insurance. We didn’t see the point of it given our age, not planning to have children, and not wanting an additional expense. But he kept urging it, so we acquiesced. And he was right, of course: Our life insurance helped 10 years later when we had the opportunity to move from Pennsylvania to California for job promotions. We needed money upfront for moving expenses, with our company reimbursing us after the move. But we were strapped for upfront money since both of us were wrapping up a decade of paying off our student loans, working second jobs to make ends meet. We also didn’t want to dip into what little savings we had, in case of any emergencies. But since whole life insurance builds cash value, we were able to “borrow” the money we needed and repay the account over time at favorable terms. Without having life insurance, I don’t know if we would have been able to accept those better jobs and experience a better life." Back to List 6. Do you want to leave a legacy or pass on wealth? Life insurance policies can be used to build generational wealth because the death benefit is not subject to income tax. If you have extra money and want to use it to buy a life insurance policy to leave your children, it can be a nice way to grow your family's wealth over time. Even if you don't have dependents, you can use a life insurance policy to leave a legacy. Maybe there's a non-profit you care about. You can name this organization as the beneficiary of your life insurance policy. If this is your only reason for buying a life insurance policy, then it's not necessarily a need. Life Insurance Policies and Companies If you need life insurance, check out our top life insurance companies and agencies based on customer reviews. View Top Companies
A life insurance policy reflects long-term commitment. It is a nice gift to give loved ones. Buying a life insurance policy on your life and naming your partner as the beneficiary is a valuable way to show your partner you care about them and their future. You can also consider purchasing a whole life insurance policy for your children. Once they are old enough, you can pass the policy on to them. Using the cash value of the policy can help them pay for school and other life goals. Before you decide to get a life insurance policy as a gift, you need to consider your financial needs and goals. Consider whether or not your family members need life insurance. Work with a trusted financial adviser to determine whether life insurance is a good financial move. Depending on your situation, life insurance may not be a good fit as a gift. For example, if you've only been dating for a week, a life insurance policy is at least overkill and at worst a red flag. (You most likely won't be able to show insurable interest anyway.) Farmers Agency Owner John Williams says life insurance can be worthwhile gift under certain circumstances: "It’s a great gift if it is to cover your loss of income, expenses, and debts for your loved ones. It’s a good gift if your other option is receiving nothing. And it’s a pretty smart gift to protect the future insurability of your children or grandchildren." If life insurance is a good fit for your family's situation, here are eight things to know as you look into buying life insurance as a gift: Start with a conversation. Gather necessary details. Research your options. Evalutate premium costs. Choose a good insurer. Consider insurtech. Know the application process. Ask about policy transfers. 1. Start with a conversation. If you're buying an insurance policy to insure someone else's life, you'll want to have a conversation with them before you start the process. The insured has to provide information for underwriting, and you don't want them to be surprised when they're contacted by the insurer. While this makes a life insurance policy not a surprise, it does show your thoughtfulness and planning. If you're buying a policy for a minor, you'll usually need to understand the applicable rules. Felix Malitsky, Fortis Lux Financial president, identifies a few: "Generally, insurance coverage will be limited to a maximum percentage of the coverage on a parent. All siblings must have an equivalent amount of coverage. The child must be at least 15 days old. Ages 15 and younger need parental sign-off even if the policy is owned by a grandparent." If you're a grandparent, you'll need to have a conversation with your grandchild's parents about buying a life insurance policy. You may be able to make your gift a surprise if you're buying a life insurance policy to insure your life and naming your partner as the beneficiary. Depending on family dynamics, a conversation can still be worthwhile, especially if the person you're buying the policy for will take responsibility for premium payments. Jacob Irving, Willamette Life Insurance Founder, recommends approaching these conversations focused on the value of the policy: "Explain why you are providing this gift. It could be to leave kids/grandkids an inheritance, charity donations, or to provide a lasting legacy. Build a value that you know they will be able to understand and see." Back to List 2. Gather necessary details. Before you apply for a policy, know whose life you're insuring, who the policyholder will be, and who you'll name as beneficiaries. As you choose the policyholder, insured, and beneficiaries, you'll want to avoid the Goodman triangle. If all three parties are different people (even if you name multiple beneficiaries and one is also the policyholder), the policyholder will be subject to gift taxes. To avoid these issues you can work with a tax professional to discuss using an irrevocable trust as the policy's beneficiary. More simply, you can have the policyholder and the beneficiary be the same person or the policyholder and the insured be the same person. (The insured person cannot also be the beneficiary for obvious reasons.) When you apply for a policy, you'll want to have basic information about the insured: name, gender, birthdate, and health history. These details are necessary to complete the application and underwriting. "When buying a life insurance policy as a gift you will also need to know the person you are insuring personal information such as a driver’s license and Social Security number. Finally, make sure you know the health of the person so you can answer the medical questions completely and accurately," advises Manny Lirio, Vantis Life AVP Consumer Direct Marketing. You will also have to provide insurable interest, which shows you have a reason to buy an insurance policy. For example, you can't just buy a policy on your favorite singer. You have to have a familial tie or strong financial connection. "It should be a direct relative, or perhaps even a business partner with a mutual business interest, but should always be discussed with the person who you are purchasing the policy beforehand as they may have to answer questions or have tests done to determine their eligibility," says Duncan France, State Farm Agent. Back to List 3. Research your options. There are many types of life insurance policies. You can find temporary and permanent policies. Some policies are fully underwritten, which means a longer and more thorough application process. Others require a less thorough application and review like guaranteed issue life insurance. Policies can be customized with riders that add benefits or protect your policy. "Some policies accumulate cash value, such as whole life, final expense, or universal life policies, where others, such as term policies, can maximize your dollar but are only in force for a set period of time. Cash value policies can be accessed by the owner of the policy at any time, so keep that in mind when gifting insurance," says France. All of these options can be daunting, so understand why you're buying life insurance and what your needs are. Working with a trusted life insurance agent or agency can also help you explore and narrow down your options to find a good fit. Back to List 4. Evaluate premium costs. "Gifting life insurance is a great idea, as long as you understand that most of the time it is not going to be a one-time gift. You will need to understand the type of policy and the premiums (cost) associated with the policy. There may be annual premiums that will need to be paid each and every year for a set period of time or forever," says Michael Foguth, Foguth Financial Group founder. The policyholder is responsible for covering monthly premiums. If you're the policyholder, know what your budget looks like and how much you can spend on premiums. If you plan to transfer ownership of the policy, be sure you have a sense of how much the new policyholder can afford in terms of the monthly premium. However you plan to handle your gift of life insurance, be sure that you or your gift recipient are prepared for the financial commitment. Back to List 5. Choose a good insurer. Be sure that you purchase a policy from a trusted insurer. A.M. Best rates insurers for their financial strength. The highest ratings are A-, A, A+, and A++. Insurers with these ratings are financially stable and will likely be able to make claims payments. Aside from choosing a financially strong insurer, you'll want to consider the customer experience, particularly when it comes to claims. Read trusted customer reviews and check government sites for formal complaints. If you decide to work with an insurance agent, you'll want to find someone trustworthy and with good experience. Customer reviews and referrals from friends or family can help you with this. It can also be worthwhile to double check that your agent has a license to sell insurance in your state. Top Life Insurance Companies Learn more about your life insurance options by looking at the top-rated companies and their offerings. Learn More Back to List 6. Consider insurtech. Insurtech companies are making applying for life insurance simpler, faster, and more convenient. You can apply for temporary and permanent life insurance policies online. In some cases, you'll need to complete medical underwriting either with a medical exam or with an at-home kit. Most insurtech companies offer policies from highly rated insurers. Before you work with an insurtech company, check the insurer that underwrites the policies for its financial strength ratings. If you're looking for a quick application process, purchasing life insurance through an insurtech company is a great option. Life Insurance InsurTech Companies Learn more about eight insurtech companies by looking at their offerings and customer review data. Learn More Back to List 7. Know the application process. You can apply for a policy by working with a life insurance agent, using an online platform, or working directly with an insurer. However you decide to apply, ask questions about the application process to make sure you understand what to expect. Most online applications are straightforward and user-friendly. However, you should understand how the platform uses your application. Does it stay with the insurer? Does the site allow you to compare policies from multiple insurers? Will your application be sent to multiple insurers or just to the insurer you selected? Does the company keep your information anonymous until you decide to buy a policy? If you're working with a life insurance agent or directly with the insurer, ask questions about how long the process will take and what to expect from underwriting. Back to List 8. Ask about policy transfers. You can change the ownership of a life insurance policy. Be sure you understand how to change the ownership of the policy. Review any tax ramifications associated with transferring policy ownership. This is particularly important if you're buying a whole life insurance for a child or grandchild and plan to transfer ownership to them. You may be required to pay gift taxes, so evaluate your options and plan the transfer with a tax adviser. "The Internal Revenue Service limits the amount that people can give tax free to a child in a particular year. For larger premium policies, a properly structured ownership arrangement allows you to take full advantage of those limits. The policy’s cash value grows on a tax-deferred basis and may eventually be worth far more than your original gift," says Malitsky. If you transfer ownership, you may also pass along responsibility for premium payments. If you want to avoid this situation and the potential of a policy lapsing, One Stop Life Insurance owner Zhaneta Gechev recommends buying a financed policy: "What we recommend is if you want to buy life insurance as a gift, make sure you pay off the policy before signing off to them. There are 10-Pay or 20-Pay policies. For a few extra dollars a month, you will have the opportunity to completely pay off the policy before signing it to the insured. In this case, you would gift them a life insurance policy, without the monthly bill. It will stick and they will appreciate it more."
Maybe 2020 was the first year you've ever considered buying life insurance. Life insurance offers valuable financial protection for your dependents. The death benefit can help your family finish paying off the mortgage and replace your income. How life insurance works, its terminology, and its policy variations can be difficult to navigate, especially if you're applying for it for the first time. Here are four things people wished they had known about life insurance: You've got options. You can layer term life insurance policies. You may not have to pay a life insurance premium for the rest of your life. You may find permanent life insurance beneficial. 1. You've got options. "What I wish I had known before purchasing life insurance, are all of the options. I purchased term life insurance because at the time it was most affordable, but with the intention of converting it to a permanent policy later on so that I would always have some coverage available. However now that I know of all the available options, it may have been more beneficial to start with a permanent policy." Nick Baldes, life insurance agent from Savewithcote.com. Exploring and evaluating life insurance policy options will help you find a policy that meets your needs. You'll find a wide variety of life insurance policies on the market. With such variety, you can find policies that fit your budget and meet your needs. "As for those that do not or have not yet purchased life insurance, the biggest "I wish I had known that" moment we always hear is that there is a policy for EVERYBODY. No matter what medical conditions one might have, there are life insurance options out there for people. There are policies where no medical exam is required, there are guaranteed issue policies you can have which will issue regardless of any underlying conditions," Baldes adds. Life insurance policies vary in underwriting, policy length, coverage levels, and features. While some of these aspects are easy to evaluate on your own, others are not. Underwriting is perhaps the most difficult to assess on your own. Insurers use underwriting to assess the risk of insuring someone. Certain policies require full underwriting. Others require minimal underwriting. The level of underwriting can affect your premium rate. Policies with less thorough underwriting (e.g. guaranteed issue policies) usually have higher premiums than those that have more thorough underwriting (e.g. fully underwritten policies). You'll also want to pay attention to how the insurer underwrites certain conditions. With life insurance, some insurers underwrite certain conditions more favorably than competitors. Working with a trusted life insurance agent or agency can help you find a good policy with the most favorable underwriting. For example, Quotacy's agents anonymously shop your policy with multiple insurers to find the best policy fit for your needs, including the most favorable underwriting. Back to List 2. You can layer term life insurance policies. "One thing I wish I had known before buying a life insurance policy is that you can layer fixed term policies, and this helps to keep your premiums low. Luckily, I found this out in good time." William Taylor, Career Development manager for VelvetJobs. Your coverage needs can also change over time. If you bought life insurance to cover your mortgage and provide for dependents, you may need less coverage as time passes. Making payments on your home lowers your debt. As your dependents grow up, they probably won't rely on you as much for financial support. You can also prepay funeral expenses, which again reduces the coverage you need. Although term life insurance is cheaper than permanent life insurance, saving on monthly premiums with layering frees up your monthly budget. Another option to layering term life insurance policies, is to look into insuretech companies that have developed adjustable policies or policies that automatically adjust coverage over the life of the policy. Ladder offers adjustable term life insurance policies. With one of these policies, you can decrease your life insurance coverage at any time, which lowers your monthly premium. If needed, you can also apply to increase your coverage. Increasing your coverage generally also increases your monthly premium. Everyday Life takes a different approach. It offers policies that automatically lower your coverage level over the course of your term policy. Your premium rate also adjusts as your coverage level changes. Back to List 3. You may not have to pay a life insurance premium for the rest of your life. "There are financed policies. They come with a higher cost but you only contribute for a few years." Jacob Naig, real estate agent and investor. Term life insurance policies only require premium payment for the term of the policy. However, permanent life insurance policies can require premiums for your lifetime. Luckily, you can find policies with customizable payment plans or pay for a policy with a single lump sum. Insurers offering these fully paid options for permanent life insurance include New York Life and State Farm. Back to List 4. You may find permanent life insurance beneficial. "I have had Term Life Insurance coverage since I was 27. I am literally 55 years old today…and what I wished I had known was how much 'cash value' I would have been able to accumulate by now had I invested more premium payments up front. I sincerely wish the two different agents who’d sold me the Term Life policies would have shown me the difference. I am grateful to have the coverage and I’ve essentially 'rented' the Term Life where I would have 'owned' a Universal Life or Whole Life Policy and this additional Asset for my family." John Stellar, Everyone's PR and Stellar Universe, Inc. The cash value offered by permanent life insurance policies can be accessed without making a claim. For example, you can borrow from it. Keep in mind that the death benefit will be reduced by the cash value amount you haven't paid back. You'll also want to pay attention to your policy's terms to ensure that you don't overborrow from the cash value and lose your policy. Depending on what your insurer offers, you may be able to add an over loan protection rider. Although permanent life insurance offers nice advantages, it may not be the best fit for every situation. Carefully assess your life insurance needs and budget as you choose between term and permanent life insurance policies. Working with a trusted life insurance agent or financial advisor can help you determine your needs and wants. Be aware that permanent life insurance policies are usually fully underwritten, so the application and approval process can take longer than other policies. However, if you're looking for an online, quick application process, Vantis Life offers online applications and approval for whole life insurance.
If you're just starting to shop and apply for life insurance, you've probably got a lot of questions. In this guide, we cover some of the most important questions about term life insurance: What is life insurance? What are my life insurance options? Why term life insurance? What riders should I consider? Do I need life insurance? How do I know if I've got a good life insurance company? What are the best life insurance companies? You'll also benefit from customer reviews and BestCompany.com company rankings. We verify each review before it's posted to our site to ensure that it comes from a real person. Our ranking system is based on an algorithm that heavily weights customer ratings and reviews. You can trust the customer reviews and ratings on BestCompany.com. Buyer's Guide: Term Life Insurance Use our guide to learn more about term life insurance, what to look for in a life insurance company, and BestCompany.com customer reviews and ratings. Download
Updated March 30, 2021. InsureTech companies use technology innovations to make the life insurance quote, application, approval, and purchase processes easier. These companies generally focus on term life insurance. However, a few companies also sell permanent life insurance. Below you'll find a list of 10 InsureTech companies, their product and service offerings, and an analysis of what customer reviews on Best Company had to say about the company. Best Company's customer reviews are trusted because of our guidelines and processes for catching fraudulent reviews through vetting all review submissions. InsureTech companies are making life insurance more approachable and even easier to buy. Use our analysis below to find the company that will best meet your needs. Policygenius Haven Life Bestow Sproutt Quotacy Fabric Ladder Everyday Life Ethos Vantis Life 1. Policygenius Best Company Rank — 1 Best Company User Star Rating — 5/5 (based on 27 reviews) Financial Strength — Policies from insurers with A- or higher A.M. Best financial strength rating. Coverage Levels — Unspecified Type of Policy — Term, whole, and universal Tech Innovation — Online quote, comparison, and application. Licensed agents available to assist with application process. Service information With Policygenius, you can compare quotes and policies from multiple insurers. If you see a policy and rate that you like, you can choose it and provide your contact information to Policygenius. You'll be contacted by one of Policygenius's licensed life insurance agents to complete your application. Policygenius offers realistic quotes based on information you provide. Most of its quotes are within $10 of the final approved rate, so you'll know what to expect once your application is complete. Policygenius's services are free because insurers pay the company when they sell its policies. Company insight Frank Kumpuris, senior vice president of life and disability insurance operations, Policygenius "One feature that sets Policygenius apart from other insurance marketplaces is our emphasis on education. We want people to feel empowered by their financial decisions, so our website houses an abundance of content — from informational guides to surveys to insurance company reviews — to help people get insurance right. We also have proprietary tools, like our life insurance calculator, to help people determine how much coverage they need when shopping for a policy. Policygenius also has a live chat feature — as opposed to only using a chatbot — so people can get their questions answered and have a personalized experience. Our goal is to give consumers a seamless digital experience while maintaining the human contact we all want when making big financial decisions. Policygenius helps you find and secure all of your insurance needs — whether for life, home, auto, disability, etc. — in one place: Online. We’ve partnered with more than forty different insurance companies in our digital marketplace, so people can compare multiple options at the same time and ultimately get the policy that best suits their needs." Customer reviews The most common praise for Policygenius is its customer service: 74 percent of reviews mentioned positive experiences with the company's team. Reviewers appreciated short wait times when calling and proactive communication throughout the application process. Roughly 56 percent of reviews included comments about how easy and smooth Policygenius's process was. Twenty-two percent also discussed how quickly the process went. An easy and fast process helps take the stress out of life insurance shopping. Thirty-three percent of reviews mentioned satisfaction with rates found through the company. This satisfaction is a good sign particularly since Policygenius makes it easy to comparison shop. Customer Review: Stacey P. Gordon from Fort Lauderdale, Florida "I had a great experience with your company. Everyone was friendly and they kept me updated about the application process. You offered the best rate out of all other companies I contacted. Would definitely recommend." Twenty-six percent of reviewers also said they'd recommend the Policygenius to others in their review. This occurence in reviews is worth noting since many reviewers focus on sharing their experience rather than making an explicit recommendation. Note: Analysis based on 27 customer reviews, the total number of Policygenius reviews on BestCompany.com as of March 12, 2021. Policygenius Life Insurance Learn more about Policygenius by reading our analysis and customer reviews. Learn More Back to List 2. Haven Life Best Company Rank — 2 Best Company User Star Rating — 4.8/5 (based on 21 user reviews) Financial Strength — Owned by MassMutual, which earned an A++ rating from A.M. Best. Coverage Levels — Up to $3,000,000 Type of Policy — Term Tech Innovation — View quotes and apply online. Schedule at-home medical exam. Product information Haven Life is one of the early InsureTech innovators. It makes applying for a fully medically underwritten term life policy simple. You can start by getting a quote without providing contact information while seeing what other people pay for a Haven Life policy. Of course, the information provided with these comparisons is anonymous. Haven Life is committed to realistic quotes. It bases its real rate quotes on the information you provide in the application. If you like the quote, you can complete an application online. Once submitted, Haven Life's software will gather underwriting information from pharmacy benefit managers and MIB, Inc. to determine if more medical information is needed before you can be approved for a policy. If more information is needed, you'll schedule an in-home medical exam and answer any additional questions. Haven Life offers an instant decision on eligibility along with a quick and simple way to get fully medically underwritten term life insurance issued by MassMutual. This underwriting process is the most thorough that life insurers use to assess the risk of providing insurance and determine the rate at which they will assume the risk. While it takes time, it typically results in lower monthly premiums. Company insight Adam Weinberg, brand director, Haven Life "Beyond offering a simple application experience, we’re committed to creating meaningful relationships with the families we have the privilege of financially protecting — this is why we offer services like Haven Life Plus. Haven Life Plus is an innovative rider (think: added feature) to the Haven Term policy that helps policyholders live healthier, fuller and more protected lives. In eligible states, customers can take advantage of the following services, which are included in the cost of the policy: Aaptiv — a leading in-home fitness app; policyholders have access to a yearly subscription at no cost ($99 value) Trust & Will — an online solution for creating a legal will at no cost (a $159 value) LifeSite — a secure, digital safe deposit box for organizing and sharing your family’s vital documents; policyholders receive a subscription for themselves and up to five family members ($80 per year) Timeshifter — a travel app that helps to eliminate the symptoms associated with jet lag; policyholders have access to a year of unlimited Timeshifter jet lag plans ($24.99 per year) MinuteClinic® — routine health services offered inside CVS Pharmacy and Target stores; policyholders receive a 15% off discount on any single service Offering innovative services like Plus is one of the main reasons why Haven Life receives such fabulous customer reviews." Customer reviews Roughly 67 percent of reviewers commented on how easy and clear Haven Life's application and approval process was. Twenty-four percent of reviewers commented on its convenience or liked that the initial application was online. Customer Review: Thomas Habib from Hawthorne, New York "As a first time buyer of life insurance, I found the process to be straightforward, thorough and pretty easy. I would highly recommend." Fifty-seven percent liked how quick Haven Life was. Given that Haven Life's process does include medical exams for some applicants, quick is a relative term. For a fully underwritten policy, Haven Life has made the process as fast as possible: Apply online, schedule a medical exam within two weeks, answer any follow-up questions, get approved and purchase. Reviewers also commented on how quick the turnaround was. One reviewer expressed difficulty with scheduling a medical exam and frustration that they wouldn't schedule more than two weeks out. Thirty-eight percent of reviewers mentioned needing to complete a medical exam. Medical exams are common when working with Haven Life. All the reviewers except one commented on the convenience of scheduling an at-home medical exam that took about 30 minutes. Fully underwritten policies usually result in lower premiums than simplified or guaranteed issue policies because the underwriting is much more detailed. Even though working with Haven Life may take longer than buying a policy instantly online, you may be able to save on premiums by taking additional time. Roughly 29 percent of reviewers were happy with Haven Life's rates. The most common adjective used to describe Haven Life rates was great. One reviewer said the rates were affordable. Another one said that the rates were pretty close to the cheapest. While life insurance rates are based on the underwriting process, it's good to know that many reviewers were happy with their policy's rate. Note: Analysis based on 21 customer reviews, the total number of Haven Life reviews on BestCompany.com as of March 12, 2021. Haven Life Insurance Agency Learn more about Haven Life by reading our analysis and customer reviews. Learn More Back to List 3. Bestow Best Company Rank — 3 Best Company User Star Rating — 4.7/5 (based on 13 user reviews) Financial Strength — Policies from North American Company for Life and Health Insurance®, which has earned A+ financial strength rating from A.M. Best indicating financial stability. Coverage Levels — $50,000 to $1,000,000 Type of Policy — Term Tech Innovation — Application and purchase process fully online Product information Bestow offers a simple online process that covers all points of the life insurance purchase process: choosing a policy, applying, underwriting, and buying a policy. The online process is also encrypted, so you can be confident in the security of the information you provide. These simplified processes, including underwriting, makes applying for a term life insurance policy quick and easy. Bestow's process is ideal for people in good health. Bestow's product offerings also reflect simplicity. It offers 10-year and 20-year term life insurance policies. Instead of being overwhelmed by options, you can make your decision based on the term length you want. Company insight Jessica Dolnick, Partnerships and Marketing, Bestow "Simply put, we are one of the fastest and easiest options for purchasing term life insurance! The application process only takes about five minutes and there is no waiting around for a decision or medical exam. We are also the only startup in the space that has our own foundation. We created the Bestow Foundation to help align with our mission: to create a world where every life is valued and protected. A portion of every sale is donated to the foundation. For other companies that offer life insurance, medical exams can be required. In our current environment, many people do not want to invite anyone into their home or go into a doctor’s office. The medical exam requires blood work, so if you are queasy around needles, you don’t have to worry about that with Bestow. One thing that’s really great for the user is that you can get an estimated quote without even putting down your contact information. If you don’t like the price, you don’t have to spend your time filling out additional questions or getting emails or texts for something you are no longer interested in. The application and approval process we offer is 100 percent online, but if you do need assistance, we have non-commissioned agents who can help you along the way." Customer reviews Sixty-nine percent of reviews mentioned how quick the online application and purchase process was. A few reviewers mentioned specific times from five to fifteen minutes. Roughly 54 percent of reviewers commented on how easy Bestow's process was or how easy the website was to use. Twenty-thee percent of reviewers also mentioned Bestow's lack of a medical exam requirement, which contributes to Bestow's easy process. However, the lack of a medical exam also means that some applicants will be denied coverage. Roughly 54 percent mentioned satisfaction with the coverage and rates. Reviewers said rates were affordable, competitive, good, low, or better than what another company offered. These are all great adjectives to hear regarding pricing. Keep in mind, however, that Bestow isn't a good solution for everyone. One reviewer mentioned that they got low prices because of their "excellent health." Another reviewer commented that Bestow was "made for healthy people." If you're in good health, Bestow is a great choice for buying quick, affordable coverage. If you have a tricky health history or a condition like diabetes, you may find better rates and coverage using another platform. Customer Review: Julie from Dallas, Texas "I’m a stay at home mom and this was perfect. Got my policy while the kids were sleeping and it only took a few minutes. Definitely provides peace of mind!" Note: Analysis based on 13 customer reviews, the total number of Bestow reviews on BestCompany.com as of March 12, 2020. Life Insurance Offered by Bestow Learn more about Bestow by reading our analysis and customer reviews. Learn More Back to List 4. Sproutt Best Company Rank — 5 Best Company User Star Rating — 4.6/5 (based on 13 user reviews) Financial Strength — Policies from financially strong insurers Coverage Levels — Unspecified Type of Policy — Term, no-exam term, and guaranteed life insurance Tech Innovation — Online quote, application, and approval (in some cases). Its algorithm uses a Quality of Life Index for underwritting. Product information Sproutt offers a Quality of Life Index. This index uses an algorithm called GAIA (Guided Artificial Intelligence Assessment) to make lifestyle and health recommendations based on medical research. The Quality of Life Index considers sleep, movement, balance, nutrition and emotional health. This index is also used as part of the underwriting process. In some cases, your online application can be quickly accepted and you can purchase a policy in one sitting. When working with Sproutt you can start by exploring your Quality of Life Index or start by getting a quote on life insurance policies. Sproutt offers an easy online quote and application process. Through this process, you'll see policy recommendations based on your responses and pulled from an algorithm that considers policies from many insurers. The matching process is another advantage of working with Sproutt. Rather than combing through many types of life insurance policies from multiple companies, you can view a shorter list of recommendations. Company insight Assaf Henkin, cofounder and president of Sproutt "Sproutt is a new kind of life insurance company that rewards people that take care of their lives with the best customer buying experience and highest value when it comes to available coverage and rates. Based on Sproutt's Quality of Life Index, that uses lifestyle data to better classify customers' health and lifestyle, qualifying customers can buy life insurance completely online and with no medical exams. The advantages with Sproutt include the following: Time and convenience — Qualifying customers can buy life insurance in under 15 minutes, completely online, and with no medical exam. Value — Sproutt assesses customers' health and lifestyle and based on this assessment provides an insurance policy that provides the needed value at a competitive rate. Amazing customer service — Sproutt operates two call centers, for maximal coverage, in New York and Kansas City with expert insurance professionals always on hand to provide the best advice and service." Customer reviews Seventy-seven percent of reviews praised Sproutt's customer service. Adjectives describing Sproutt insurance agents and customer service include "efficient", "helpful", and "attentive." These adjectives and regular praise demonstrate that Sproutt focuses on offering high-quality customer service. Another positive aspect of Sproutt mentioned by reviewers is satisfaction with rates and policy options. These comments appeared in 38 percent of reviews. Customer Review: Jason "Worked with me to find a no-exam term life option that was affordable." Roughly 15 percent of reviewers mentioned the quick process. These comments do not appear in many reviews and your experience may differ depending on your circumstances. However, these positive reviews show that applying through Sproutt can be fast and easy. Note: Analysis based on 13 customer reviews, the total number of Sproutt reviews on BestCompany.com as of March 12, 2021. Life Insurance Offered by Sproutt Learn more about Sproutt by reading our analysis and customer reviews. Learn More Back to List 5. Quotacy Best Company Rank — 13 Best Company User Star Rating — 4.8/5 (based on 33 user reviews) Financial Strength — Policies from multiple insurers that have earned top financial strength ratings from A.M. Best. Coverage Levels — Unspecified Type of Policy — Term and whole Tech Innovation — Online quote, comparison, and application for term life insurance. Licensed agents help complete the process and assist with whole life insurance inquiries and application. Service information Quotacy is a life insurance agency that works to match clients with the policy that best meets their needs. Its licensed agents are experienced and salaried, which means you don't have to worry about upselling or deciding too quickly on a purchase. You can view estimates and quotes for term life policies online from financially strong life insurers, which makes it easier to compare rates and policies across companies. Quotacy is also committed to showing visitors realistic quotes and estimates instead of the lowest possible rates. This level of transparency lowers discrepancies between the actual rate and the quote. You can view quotes online without providing contact information. If you see a policy you are interested in, you can quickly complete the online application process and give Quotacy your contact information. From there, a Quotacy agent will shop your policy to find the most favorable underwriting terms, coverage, and rates for your circumstances. Depending on how the insurer underwrites its policies, you may need to have a medical exam. Quotacy's process isn't instant, but you'll work with life insurance experts to find the best fit. Quotacy clients also benefit from a complimentary LegacyShield account that make it easy to store important financial information, your will, and memories. Having this information in one place makes it easy for your life insurance beneficiaries and dependents to take care of your wishes when you pass away. Quotacy also sells whole, final expense, and guaranteed universal life insurance policies. To compare these policies, you must reach out to Quotacy directly. Quotacy's services are free to you because the company earns money from life insurers for selling its policies. Company insight Abby Reddy, cofounder and CMO, Quotacy "Quotacy is the only online life insurance comparison site that shows quotes from the nation’s best life insurance carriers along with InsureTech companies new to the industry. This allows life insurance shoppers to see prices and compare policies from a robust selection of carriers all in one place and in real time. After applying, Quotacy double checks the market to make sure clients are matched with the carrier that will give them the best price possible and advocate on their behalf from start to finish. Our entire goal is to make sure families are protected with life insurance that fits within their budget. This means that we’re dedicated to helping design policies that fit the specific needs of each family, regardless of how big or small the premium is. Our caring, licensed agents offer unbiased advice, take care of the legwork, and keep customers informed and on track to make the buying experience as easy as possible." Customer reviews Roughly 82 percent of reviewers mentioned customer service. Their experiences were overwhelmingly positive and included satisfaction with communication throughout the application and approval process and praise for the knowledge and professionalism of staff. Only one reviewer was unsatisfied because they worked with an automated agent over the phone. Roughly 58 percent of reviewers were satisfied with Quotacy's process and mentioned it in their review. While the application and approval process is not instant, reviewers liked how convenient it was to work with Quotacy and the clear expectations of how its process works. Forty-two percent discussed the quotes and pricing. A few reviewers (9 percent) mentioned that the pricing after application was different from the initial quote offered by Quotacy. These discrepancies can happen because of how the completed underwriting process assesses risk. However, these discrepancies aren't the majority experience of Quotacy clients based on these reviews. Most reviewers (33 percent) used adjectives like good, fair, and affordable to describe the pricing. Thirty percent of reviews commented on Quotacy's products. To be clear, Quotacy life insurance agents offer services to match clients to the best life insurance policy for their situation. The products themselves are offered by financially strong insurers. Reviewers were satisfied with the selection and quality of the insurance policies and felt that they had found the best option for themselves. Customer Review: Kymberlee Yack from Orem, Utah "life insurance is so important to have incase anything happens to you. quotacy helped us get the perfect plan and perfect coverage so i know if anything happens to me i know my family will be taken care of" Note: Analysis based on 33 customer reviews, the total number of Quotacy reviews on BestCompany.com as of March 12, 2021. Quotacy Life Insurance Learn more about Quotacy by reading our analysis and customer reviews. Learn More Back to List 6. Fabric Best Company Rank — No rank Best Company User Star Rating — 5/5 (based on one review) Financial Strength — Policies from Vantis Life, which is owned by Penn Mutual. Penn Mutual has an A+ rating from A.M. Best. Coverage Levels — Unspecified Type of Policy — Term Tech Innovation — Apply online or through app. Product information Like many InsureTech companies, Fabric makes it easy to apply for a life insurance policy online. Its algorithm also allows applicants to quickly receive a decision on their application without the typical delay for underwriting. What makes Fabric stand out is its app. The app addresses some of the financial planning needs of parents. Through the app, you can apply for life insurance, set-up a 529 plan, create a rainy day fund, and write a will. The app also makes it easy to share policy details and coordinate wills with your spouse. Although the will writing software was developed with legal experts, you should work with an attorney for specific legal advice. Company insight Allison Kade, editorial director for Fabric "A big advantage of Fabric is the ability to offer life insurance without undergoing unnecessary health exams. Using proprietary technology, Fabric approves applicants using an algorithm to help assess their risk profiles. And if someone isn’t approved right away and immediately made an offer to buy life insurance, their application will be sent to human underwriters who will try to approve them without requiring an exam. Additionally, Fabric helps to alleviate the issue of unclaimed life insurance benefits, as that’s a tragedy if it happens even once. That’s why we empower our customers to grant their spouse beneficiaries access to their policy details online and share information with one another. That way, beneficiaries always have access to up-to-date coverage information and a direct way to access Fabric support. Similarly, if you create a last will and testament using Fabric’s free online willmaker, you can share key details of your will with important people such as your beneficiary, legal guardian and executor. We also offer 529 college savings and rainy day savings funds straight through our mobile app, helping families plan for their futures in the most convenient way possible. Now more than ever, it’s critical that parents have the online tools they need to protect their family’s future, without leaving their house (or their couch). Fabric wants to empower parents to build financial strength for their families." Life Insurance Offered by Fabric Learn more about Fabric by reading our analysis and customer reviews. Learn More Back to List 7. Ladder Best Company Rank — No rank Best Company User Star Rating — No rating Financial Strength — Policies from Fidelity Security Life Insurance Company® and Allianz Life Insurance Company of New York. Both companies have earned high ratings from A.M. Best.* Coverage Levels — $100,000 to $8,000,000 Type of Policy — Term with adjustible coverage levels Tech Innovation — Online application. Instant approval if qualified. Ability to adjust coverage level once you've purchased the policy. *Allianz Life Insurance Company of New York has been rated A+ (Superior) — affirmed September 2019 and Fidelity Security Life Insurance Company has been rated A (Excellent) based on an analysis of financial position and operating performance, by A.M. Best Company, an independent analyst of the insurance industry. For the latest rating, access www.ambest.com. Product information Like other InsureTech companies, Ladder offers term life coverage. It offers a quick online application and, if qualified, approval process. Some applicants won't qualify for coverage through Ladder. However, its process is convenient and quick for those who do. Ladder doesn't require contact information before it shows price quotes. You can also see how much different coverage amounts would cost you. This makes it easy to determine whether a life insurance policy through Ladder fits into your budget. If you're happy with your quote, it's easy to complete the application process to see if you're approved. Ladder stands out from other InsureTech companies because its policies are adjustable. You can decrease your coverage at any time, which will also lower your monthly premiums. This feature can help you save money as your coverage needs decrease over time. You can also apply to increase your life insurance coverage if the reverse happens. If you're approved, your monthly premiums will increase. Company insight Samantha Genevay, affiliate manager, Ladder "When consumers buy a life insurance policy, they're covering their needs as they stand today — a mortgage of $X, other loans, young kids, etc. As life happens, things change — you pay down your mortgage, maybe you get a stellar promotion at work, your kids become finally independent, etc. Or, the flip side, you decide to grow your family, you purchase a larger home with a bigger mortgage, you have aging parents to care for, you start a business and take out loans, etc. Whatever it may be, your needs are likely to change over time and yet most insurance policies are geared to be 'get it and forget it'. This leaves policyholders paying the same amount year after year regardless of how their situation evolves. Ladder makes it easy to adjust coverage, all online at any time in a matter of clicks." Life Insurance Offered by Ladder Learn more about Ladder by reading our analysis and customer reviews. Learn More Back to List 8. Everyday Life Best Company Rank — No rank Best Company User Star Rating — No rating Financial Strength — Polices from Legal & General America, whose life insurance companies Banner Life Insurance Company and William Penn Life Insurance Company have earned high financial strength ratings from A.M. Best. Coverage Levels — $100,000 to $2,000,000 Type of Policy — 10–year to 40–year term policies with automated coverage level changes Tech Innovation — Online application and approval; policy coverage levels change according to a formula over time Product information Everyday Life offers its clients personalized policy recommendations and quotes based on their needs. You can view quotes and policy options by using Everyday Life's proprietary Needs Assessment Tool. You can also complete the initial application online. Once you've completed the initial application, an underwriter will call you to complete the application. In some cases, you may need to complete a medical exam as part of this process. What makes Everyday Life's policies standout from other insuretech companies is that its Predictive Protection™ policies are pre-designed to change over time as your coverage needs lower. This preset coverage change means that you can save money on premiums and don't have to think about when you want your coverage level to change. Company insight Jake Tamarkin, cofounder and CEO, Everyday Life "Our personalized, adaptive coverage saves consumers money — from 30 to 80 percent off the total cost of insurance — while giving them confidence they have the right coverage to protect their loved ones. We are the only provider who does this. Our quick and easy needs assessment makes it possible for everyone to analyze their situation and get objective advice, quotes and explore different scenarios, all based on financial planning best practices — for free, in three minutes with no contact info required. Made possible by our breakthrough technology designed to always put the customer's needs first (we aren't hesitant to tell you if we think you don't need any life insurance). We offer simple, convenient, online application, with instant approval in many cases. It's easy on your phone to get from "Get Started" to "Congratulations to Here's Your New Policy!" in less than 20 minutes. People enjoy the simplicity of our self-service experience, with the option to connect with licensed experts (financial planning experts, not commissioned salespeople!) are available if you need us via chat, email, phone, text, but most people enjoy the self-service simplicity." Back to List 9. Ethos Best Company Rank — No rank Best Company User Star Rating — No rating Financial Strength — Polices from Legal & General America, whose life insurance company Banner Life Insurance Company has high financial strength ratings. Coverage Levels — Unspecified Type of Policy — Term Tech Innovation — Online quote, application, and approval. Product information Ethos offers a quick online quote and application process for term life insurance. It focuses on providing reliable quotes, which means that you can trust the pricing you see when you complete the quote process. Once you complete the online application, underwriters will review it and make a decision. Some applicants will need to complete a medical exam as part of this process. Ethos is a fast and simple way to apply for term life insurance. Ethos is not available in New York, so New York residents will need to find another company. Company insight Erica Kolari, communications manager, Ethos "Since its inception, Ethos has been dedicated to dismantling and redesigning life insurance from top to bottom. Ethos built its entire technical stack from scratch, which means that, unlike any other modern startup in the space, it has the benefit of using one advanced system to manage a seamless customer experience. In order to bring the end-to-end customer experience into the 21st century, the company built custom integrations to connect its predictive analytics-driven system to partner providers; in fact, the technical co-founder literally slept in a partner’s office to complete an integration (APIs don’t exist in this world). In turn, Ethos’ application and approval process is fast, easy, and inexpensive (minutes versus 10 weeks), a major innovation when you consider that many carriers still require customers to pay monthly with a paper check. Ethos also applies machine-learning that analyzes customer data to ensure customers are never paying more than necessary for coverage (a practice we call right-sizing), in combination with a customer service team who uses that data and their own knowledge to ensure customers are never paying more than they need to. Roughly 50 percent of the customers who have right-sized policies end up with a smaller monthly premium. This practice is in direct opposition to the traditional model of sales-incentivized methods that are solely focused on making as much money as possible off the individual." Back to List 10. Vantis Life Best Company Rank — No rank Best Company User Star Rating — No rating Financial Strength — A+ from A.M. Best Coverage Levels — Varies by policy. Term: $50,000 to $2,000,000. Whole: up to $1,000,000. Final Expense: $5,000 to $20,000 Type of Policy — Term, whole, and final expense Tech Innovation — Online application and approval Product information Whether you're looking for term, whole, or final expense life insurance, Vantis Life makes it easy to apply and buy a policy online. Most InsureTech companies focus on term life insurance, so the variety is a great benefit. Before you start an application, you must provide Vantis Life with your contact information. If you're still in the research phase, you may prefer to use other quote sites first. Vantis Life's policies do not require much underwriting, which makes the process easy and quick. Remember that the less underwriting an insurer completes, the higher your premiums will be because the insurer considers less information when assessing risk. One especially nice feature of Vantis Life's term and whole life insurance policies is the charitable giving rider automatically included. With this feature, the policyholder can choose an IRS 501(c) (3) nonprofit. When a claim is made, the full death benefit will be paid to the beneficiary and Vantis Life will make an additional donation to the specified nonprofit. The additional donation is one percent of the death benefit. The donation does not exceed $100,000. Company insight Manny Lirio, AVP consumer direct marketing, Vantis Life "There are quite a few advantages to choosing Vantis Life. One of the biggest advantages is our technology. Whether it’s via a desktop computer or a mobile phone, our award-winning quote and application online platform allows consumers to apply for ALL of our life insurance products online in minutes. Our technology also cuts down the time it takes to underwrite. If the consumer is both physically and financially fit, they could receive an offer for life insurance immediately, otherwise, they will receive their offer in only three to five days. Another advantage is the fact that we are the issuing company, not a third party. When customers apply for life insurance they are buying directly from Vantis Life. Unlike many carriers, we allow consumers to pay their initial and recurring payments via ACH or credit card at no additional cost, this way they are financially protecting their loved ones while earning their miles or points." Back to List
Life insurance purchases should be based on your needs. Before buying a life policy, you'll want to carefully evaluate your needs to make sure that life insurance is something you need. To ensure that you get the best advice as you make this decision, consult with a trusted financial advisor. "There are a lot of very smart sounding 'life only' agents or 'advisors' as they refer to themselves that have no fiduciary duty to make sure they put your interests ahead of their own. I would put a large amount of emphasis around finding yourself a fiduciary who is legally bound to do what's right for you without regard to how much commission they will receive if you buy a product through them. The two places you can look to find honest, trustworthy advice are going to be what are referred to 'fee based' financial or retirement advisors, and if you work with an Estate Planning attorney they will likely be able to get you going in the right direction. Both have fiduciary responsibilities to act on your behalf, but nothing is ever guaranteed so you'll still want to do your own homework," recommends Ian Grove, associate advisor for Robert Green & Company. While you set up your meeting, this article can help you start thinking through several aspects that are part of the life insurance decision and purchase process. I reached out to life insurance experts to learn more about what aging adults need to know as they're buying life insurance. If you're buying life insurance for a parent, grandparent, aunt, uncle, or other senior loved one, the expert advice below will help you understand how to evaluate policies to find the best fit for your needs. Do you really need it? How much do you need? What can you afford? What kind of policy should you get? How should you buy it? Do you really need it? report_problem Attention: Most aging adults won't need life insurance. While aging adults don't usually need life insurance, there are circumstances that can make it a good purchase. The questions in this section will help you determine whether or not you need it. Before you work with a life insurance agent or contact an insurer, you should consider whether or not you actually need life insurance or if you just think you need it. "As you get older and into your senior years, it can become less critical to have life insurance. For many people, they have paid off many debts at this stage and no longer have fully dependent children. However, that’s not the case for everyone, and there are still important reasons to at least consider if it’s necessary for your family. If your spouse or a child is still heavily dependent on you for financial support, that may be reason enough to have a policy. There may be a time where it simply no longer makes sense to have life insurance; however, it’s best to carefully consider this every step of the way and make the decision that best fits your life at each stage," says Brett Wilson, Ethos vice president. If you are considering life insurance, here are questions to think through before you buy it: Do you still have dependents? Would your spouse become responsible for paying your debts? Will you need to be in an assisted living or have long term care? How will your funeral be paid for? Are you trying to leave an inheritance? Do you have enough saved for retirement? Do you still have dependents? If you have dependents or a spouse, a life insurance policy may be right for you because it can provide money to pay tuition, living costs, etc. that you would pay for if you were living. Think about your current financial situation, retirement savings, and other assets before purchasing a policy. Charles Read, CPA, and former life insurance agent shares his experience: "I am now a widower and carry no life insurance. While my wife was alive, I carried no life insurance the last ten to fifteen years or so of her life. Why? No need. I have a retirement program that would have kept her in the lifestyle she was accustomed to for her entire life." If you don't have dependents, you may not need to buy life insurance. "When is life insurance desirable? When you have small children that need to be raised. So unless you are a senior raising a grandchild that will need to be brought up and educated if you are not there, why buy a poor investment?" adds Read. search Highlight: If you have dependents, you may want to consider life insurance. Consider your current financial situation and savings. If there wouldn't be enough to care for your dependents if you passed away, you may want to purchase a life policy. Back to "Do you really need it?" Would your spouse or someone else become responsible for paying your debts? In most cases, your outstanding debt will just be paid by whatever amount of cash or assets you leave behind, which will reduce or eliminate any inheritance. But, the bottom line: most of your debt, if it's solely in your name, won't be passed on to your dependents. "What if you have outstanding debt? So what. They can’t get money out of a dead person and your kids are not responsible," says Read. Before you get life insurance to cover outstanding debt, take stock of your debt and understand what would happen to your debt if you passed away. Your debt may not go to your kids, but your spouse or partner may become fully responsible if they're still living. Depending on what the rest of your financial situation looks like, you may want to purchase a life policy to alleviate those burdens. search Highlight: If someone else would take responsibility for your debt, you may want to get life insurance. Again, review your current financial situation and savings. If your debt would be passed to someone else or you wouldn't be able to leave enough for your dependents to live on, a life policy can be a wise purchase. Back to "Do you really need it?" Will you need to be in assisted living or have long term care? While you can't predict the future, you need to think about what health challenges you may face down the road. What are your options if you can no longer live on your own? Do you have children, nieces, or nephews that can help you? Will you need to live in an assisted living facility or pay an aide to help you at home? If you think you'll need assisted living or long term care, understand what your payment options are. You may be in a position to pay for that with savings. If you qualify for Medicaid, that coverage may help pay the costs. You can also look into long term care insurance, but these policies can be expensive and difficult to qualify for. Grove explains why: "The traditional LTC insurance underwriter will look to qualify you on what they call Mortality tables which basically means they are trying to make their very best estimate on how you are going to die or how sick or incapacitated they think you will get when you begin the process of 'moving on.' The later, Mortality table wants to know not how you die but instead when they think you will die. This makes it far easier to get past the underwriters with things like a bad hip or sleep apnea. Next, the cost. Traditional LTC insurance was one of the most expensive coverages you would ever purchase, primarily due to the likely need for a claim. If you make it to your sixties, it's more than a flip of a coin that you will need some type of long term care and the costs can be staggering. Where I live in Napa, California you can expect to pay upwards of 12,000 a month for a decent private room in a care facility." If long term care insurance is out of your budget and you don't have savings to pay for long term care, you may want to consider a life insurance policy with a long term care rider or even an accelerated death benefit rider. "Seniors need to know that more and more life insurance companies are offering life insurance with chronic illness or long term care benefits. A life insurance policy can serve a dual purpose to help provide their beneficiary with a cash payout if they die and/or to help pay for possible long term care or home health care someday. The living benefits mentioned above are available on both term and permanent life insurance," says Gordon Conwell, III, owner of Americanterm.com. search Highlight: Life insurance as a way to pay for long term care isn't a standalone reason to buy a policy. You don't know whether or not you'll need long term care and you may have other options like moving in with a younger family member. If you qualify for Medicaid, it may cover your long term care costs. If you're buying life insurance for another reason, consider a policy that offers an accelerated death benefit or long term care rider. Back to "Do you really need it?" How will your funeral be paid for? While you won't be around to foot the bill for your funeral, you may want to think through how those costs would affect your loved ones and what you can do now to alleviate costs for them. "I carry no life insurance now because why would I need it. My funeral expenses will be paid for. Cremation is less than $2,000, and the VA provides my burial plot and marker. The other reason is funeral expenses so as not to be a burden to your children. Save $5,000 and preplan. Buy the cheap casket that the funeral director would talk your children out of. Flowers, will you care? Give me a break! Here in Texas they can actually bury you in a cardboard box or nothing at all, cheap!" advises Read. While your situation and final wishes may be different from Read's, you should explore your options for covering funeral expenses so that your family doesn't have to worry about it. Before you prepay for your funeral, vet the funeral home carefully. You don't want the funeral home to fold before you pass away since prepaid funerals can't be passed to a different funeral home. Alternatively, a burial insurance or final expense insurance policy will make a cash payout that can be used as the beneficiaries see fit. Just remember that you'll need to make premium payments to keep your policy effective. search Highlight: Life insurance doesn't have to be part of your plan for paying funeral costs. Figure out how much your funeral will cost. Do you have a burial plot already? What do funeral prepay options look like? Would your lingering savings be able to cover expenses? Determine what matters to you, and make a plan to cover those costs. Back to "Do you really need it?" Are you trying to leave an inheritance? Some aging adults may approach buying life insurance as a way to leave an inheritance without paying income taxes. If this is something you're considering, meet with a financial adviser to discuss the best way to move forward. Depending on your situation, you may be better off investing on your own. "Life insurance is a terrible investment as well. Take the same money and put it into a diversified portfolio, you will do much better. Life insurance funds large salaries and big dividends to investors, you get a fraction of what you pay for. They have buildings full of actuaries to make sure. Do you want to leave an inheritance? Save the amount of the premium and invest it, in all probability you will leave more money than the life insurance will pay. The insurance company actuaries know this but won’t tell you. If they do, salaries at the insurance company will have to be cut, including that of the actuary and management," says Read. search Highlight: Meet with a financial adviser before buying life insurance to leave an inheritance. While one of the biggest advantages of life insurance payouts is that they are not subject to income tax, you'll want to talk to a finanical adviser about whether or not this is a good option for your financial situation. Life insurance payouts are subject to estate taxes, so they're not entirely tax-free. Back to "Do you really need it?" Do you have enough saved for retirement? Consider what your retirement accounts look like, how much you'll get from Social Security, and how much longer you plan to work. Do you have enough to cover your expenses? If you have a permanent life insurance policy that accrues cash value, you can use your policy to supplement your retirement income. Keep in mind that your beneficiaries may not end up with a death benefit payout if you use your policy's cash value. "One of the benefits to leveraging these permanent insurances is there is a savings component built into the policy. If designed properly, you can gain the protection the life insurance provides and at the same time have a savings account inside that policy you can access while you're still alive to help supplement your lifestyle in retirement. As attractive as that function is, it is not the main reason most seniors look to fund a life insurance policy," says Grove. Alternatively, you can invest or save what you would spend on monthly premiums to have additional retirement income. search Highlight: Life insurance can supplement your retirement income, but you can invest on your own instead. Supplementing retirement income isn't a good reason to buy a life insurance policy. Remember, whatever cash you receive while living is usually taken out of the death benefit. However, the ability to get income can be an additional benefit to consider if you have other reasons for needing life insurance. Back to "Do you really need it?" Back to Menu How much do you need? If you do need life insurance, you'll want to consider what you can afford and carefully calculate the amount you need. Reviewing the questions in the previous section will help you understand whether or not you need life insurance and why you're buying life insurance if you do need it. Understanding why you're buying a life policy will help you determine how much to buy. "Seniors, like all life insurance shoppers, need to evaluate what a policy will help protect. A thorough needs analysis should be performed to make sure they are not under or overinsured," says Michael Quinn, Life Insurance Blog owner and director of marketing. If you're young and overinsured, there isn't usually much of a difference in premium amounts. It will make a big difference if you're an aging adult. "For a 30-year-old man, the difference between $500,000 and $1,000,000 of 10-year term is less than $10 per month. For a 70-year-old man, the difference per month for the same policy could be $300 or more. By taking the time to correctly assess your coverage needs, you could save yourself thousands of dollars a year in premiums," notes Dennis Ho, cofounder and chief executive of Saturday Insurance. report_problem Attention: Save money by only buying the amount you need. If you don't have a trusted financial advisor, talk to a few life insurance agents to see how much they recommend buying. Getting recommendations from different agents will help prevent you from overbuying and help you find a policy that meets your needs. Back to Menu What can you afford? You also need to buy a life insurance policy that you can afford long-term. If you stop making premium payments, you'll lose your coverage. "Seniors should only buy life insurance they can afford from someone they trust," advises Ross Quade, Insurance Agent and Owner of Prime Mutual. Buying a policy from a trustworthy agent is also important because life insurance is a big financial commitment, and you don't want to be upsold or buy more than you need. As you work with your agent, be clear about budgetary restrictions and any health conditions that may affect your premium rates. Being clear will help them find a policy that fits your needs and budget. "It's also very important to be honest and forthcoming to their agent about their health and other qualifying information. Their agent will be researching which companies they can qualify with based on this information," says Quinn. Keep in mind that what you can afford may change depending on your age and health circumstances. "Seniors should understand that health and age are the biggest factors that play into life insurance. The healthier and younger one is, the cheaper the life insurance policy will be. Seniors should understand that acquiring health insurance before after being diagnosed with a condition will lower their chance of obtaining an affordable life insurance policy or obtaining one at all as most insurance policies require medical exams," says Jasmine Young, MBA, CPA, CFE, and Southern Tax Prep founder and CEO. Back to Menu What kind of policy should you get? There are many kinds of life insurance policies available, each with different features that make it advantageous for certain situations. While some insurers have ages at which they'll stop issuing policies. "The most important thing that seniors should understand about insurance is that options are available. Insurers are much more comfortable offering new coverage older ages today and insurance can be issued to folks as old as 80," says Ho. Term life insurance Key Takeaway: Term life insurance isn't always a good fit. If you're buying life insurance to cover debt, a term policy is a good option because your debt will decrease as you make payments over time. Otherwise, be careful with term life insurance. It may expire before a claim is made. If you renew the policy, you'll likely renew at a higher premium rate. Term life insurance only offers coverage for a set period of time. Term policies typically have lower premiums than permanent ones, which can make these policies attractive. "Term life insurance is the best option for seniors. Term life insurance guarantees payment of a stated death benefit during a specified term. Once the term expires, the policyholder can either renew it for another term, convert the policy to permanent coverage, or allow the policy to terminate. As seniors get older, they may have paid off all their debts or their children may become fully independent. In this case, they may not need or want life insurance anymore, and therefore would not want to be stuck with a whole life policy," suggests Wilson. A term policy may work for you if you're primarily buying coverage for debts. If you think you'll need coverage longer, term coverage may not be a good idea. "While it may be tempting to purchase a 10-year term policy to minimize costs, if there is a chance you need insurance longer, you might be better off getting a 20-year term or permanent insurance to be safe because extending your coverage in the future or purchasing another policy may be prohibitively expensive or even impossible if your health changes," cautions Ho. Quade agrees: "For many seniors, it's imperative that the coverage does not expire before they die, which is why term policies are often not the right fit." Whole life insurance Key Takeaway: Whole life insurance may be a good fit for some. If you're in good health, you can take advantage of a fully underwritten policy for lower premium rates on a permanent policy. Assess your insurance needs carefully and consult with a financial advisor to determine if a whole life policy is best for you. Whole life insurance is permanent life insurance coverage. As long as you make your premium payments, you'll maintain coverage with no premium increases. A whole life policy also accrues cash value that you can use while still living. The downside is that these policies are the most expensive type of life insurance. "Whole life insurance is the best life insurance option for seniors. Whole life insurance does not terminate at a specific age like term insurance is designed to do. Term life insurance for seniors often increases in price every five years and cancels after age 80. With whole life insurance, your coverage will last up to 121 years old. Whole life insurance is guaranteed to be there when you need it the most, as long as you keep paying the premiums on time," says Randy VanderVaate, Funeral Funds owner and president. If you're in good health, you may be able to find lower premium rates by buying a fully underwritten whole life policy than a guaranteed issue final expense policy. Before you buy a whole life insurance policy, remember why you're buying life insurance. Is it a permanent need like funeral costs and leaving an inheritance? Final expense insurance Key Takeaway: Final expense insurance is great if you're worried about passing underwriting. If you're buying life insurance to cover funeral costs, a final expense policy works nicely. You can find guaranteed issue policies that do not require underwriting. Remember, this means that you'll pay higher premiums. You'll only be able to buy a low amount of coverage. Final expense insurance is meant to cover funeral costs. "A more popular option for seniors is final expense insurance because they allow for elderly people to obtain an affordable policy without a medical exam. The benefit is smaller, often under $25,000, and can be approved within the same day," says Quade. If you're just looking for a policy to cover funeral expenses or have health issues that would affect underwriting, a final expense policy may be a good fit. These policies offer permanent coverage and level premiums. These policies are sometimes also referred to as burial insurance. "Most of the best burial insurance companies have lenient underwriting for the typical health problems that come with age, such as high blood pressure, high cholesterol, or diabetes are generally accepted for first-day coverage. These whole life insurance plans for seniors are designed to be easy to qualify for and be affordable for seniors on a fixed or limited income," says VanderVaate. As you consider final expense policies, you'll want to keep in mind that only lower amounts of coverage are available with these policies: "Final expense benefit amounts usually max out around $50,000 which will pay for their funeral and other final expenses. Most seniors aren't looking for big policies like when they were in their thirties and needed typical coverage for their mortgage and income replacement," says Quinn. You should also understand that your final expense policy may have a graded death benefit. "Some final expense policies don't pay the full death benefit right away. They can have what's called a graded benefit that might not pay the full amount for a year or two. These types of policies are offered to those with health issues — those who might not qualify for a non-graded plan. If the owner passes away early, then their beneficiaries will only receive the premiums paid into the policy, 10 percent on top for example, says Adam Hyers of Hyers and Associates. But, these policies may not be the best fit for you: "The biggest thing seniors need to know about life insurance is that they shouldn’t settle for the common final expense plans advertised everywhere. These plans are more expensive and have low coverage amounts since they are more accepting of high-risk clients. As a senior, you should go with traditional permanent coverage because you’ll save a ton of money. In addition to that, you won’t have any waiting periods and be able to get much more coverage. So keep the final expense plans as the last resort," advises Mack Dudayev, founder InsureChance Inc. Universal life insurance Key Takeaway: Universal life insurance may be a good fit for some. Universal life policies are typically cheaper than whole life policies. For approval with these policies, you'll go through underwriting. If you're not in good health, you may want to pursue another option. There are several kinds of universal life insurance. Work with your financial adviser to figure out which type is ideal for you. There are several types of universal life insurance. A few experts recommended a guaranteed universal or fixed indexed universal life insurance policy: Guaranteed universal life insurance "For the healthiest seniors, looking for coverage that is $30,000 or above, I would recommend looking into a Guaranteed Universal Life. It is a type of policy that ensures that they would not outlive their policy and when the time comes, they have a policy in place. These policies are considerably less expensive when compared to traditional final expense policies. However, they have more extensive underwriting. Oftentimes they require a medical exam. Again, this is a great option for people with average or above-average health," recommends Zhaneta Gechev, founder of One Stop Life Insurance. Fixed indexed universal life insurance "The best policy to purchase would be a FIUL or fixed indexed universal life policy. The cash value will grow tied to positive stock market index performance, but not fall when the index drops in value," recommends Mark Charnet, founder and CEO of American Prosperity Group. Policy riders Key Takeaway: Policy riders add value, but don't forget why you're buying life insurance. You may want to consider a policy with living benefits like cash value and an accelerated death benefit rider that can help you with challenges as you age. However, remember that the riders aren't the reason you're buying coverage. Focus on finding the best policy for your purpose and budget. Whatever type of policy you decide is best for you, pay attention to policy add-ons called riders. You'll also want to consider other features built into the policies you're considering. "Today, many policies have optional riders that can help you further customize your life insurance to your situation. For example, many insurers offer accelerated death benefit or long-term care riders that allow you to access a portion of your death benefit if you get a terminal illness or need long-term care. For seniors, riders such as these can greatly improve the value of their policy and are worth considering," suggests Ho. Don't get caught up in policy features and riders, though. Remember the core reason you're buying life insurance. Grove cautions: "I think the one biggest factor in all of this is to make absolute sure you've done your due diligence in understanding why you are going to look into the different types of life insurance policies and not get super distracted by one specific feature without weighing what you're sacrificing for that feature." Learn more about life insurance policy riders by reading "7 Common Life Insurance Policy Riders". Back to Menu How should you buy it? You've got several options when it comes to how you buy life insurance. You can work directly with the insurer, work with an independent broker, or buy online. Life insurers file their rates, so choosing one option over another won't find you a better rate from the same insurer. We'll go over each option briefly here. For an in-depth explanation of the pros and cons of each option, read "What's the Best Way to Buy Life Insurance?: What You Need to Know About Buying from an Insurer, Agency, and Online Retailer". If you buy directly from the insurer, you'll limit yourself to the policies and rider offered by that insurer. If you've looked around at a few insurers and have settled on one, then buying directly from an insurer isn't a bad option. However, if you have health issues, you may want to work with an independent life insurance agent or agency. They are familiar with how insurers underwrite certain conditions, which means they can help you find an insurer and policy that fit your needs. "Using an independent broker who offers multiple companies gives them the best chance at getting affordable coverage. This will avoid wasting time applying for companies or policies that may deny or rate them up at a much higher rate," says Quinn. Be careful when you're looking at policies online. Some websites generate leads for companies. If you give these sites your contact information, you'll end up with a bunch of sales calls. If a site won't show you a quote unless you share your contact information, find another site to use. Whatever purchase method you choose, be prepared to spot red flags in insurance companies and agencies. Choosing trustworthy and reliable companies will also help you make a good purchase. Truly understanding whether or not you need life insurance, your options, and what considerations to make will help you make a wise choice for yourself and loved ones.