Topics:Life Insurance 101 buying life insurance final expense insurance tips and advice policy riders business life insurance life insurance facts research
Updated February 2021. Independent life insurance agencies or brokers are advantageous because they allow shoppers to find and compare life insurance premiums on similar policies from different companies. This feature simplifies the shopping process because clients do not have to work with multiple companies to learn about their coverage options. Policygenius and Quotacy both offer assistance comparing life insurance policies from multiple insurers. While the two companies are similar, here are a few differences: Customer ratings and reviews Scope of offerings Staff and client services Quote process Application process Skip to our recommendation Customer ratings and reviews search Highlight: Quotacy and Policygenius are highly rated by reviewers. Both companies have above average ratings for the industry in trust, customer service, quality, and value. Policygenius is ranked first on Best Company. Its average star rating is 5 stars based on 24 customer reviews. Customers praise Policygenius's easy and fast process (54 percent of reviews), customer service (50 percent of reviews), low rates (38 percent), and good communication (29 percent of reviews). Best Company reviewers rate a company's trust, customer service, quality, and value on a 5-star scale. In each of these categories, Policygenius's averages are above the industry averages. Policygenius scores a 4.9/5 in trust, customer service, and value compared to the industry average of 3.8 in each of these categories. Quality is Policygenius's best score with a perfect 5. The industry average for quality is 3.8. Reviewers are also very likely to recommend Policygenius. Its net promoter score is 9.6/10. Although these findings are based on 24 reviews, Policygenius's hard-to-beat ratings make it an attractive choice. Quotacy is ranked 13 with an average star rating of 4.8 stars based on 33 reviews. Customers have similar praise for Quotacy as Policygenius. Praise in Quotacy's reviews includes good customer service (82 percent), easy process (58 percent), fair rates (42 percent), and policies that met reviewers' needs (30 percent). Quotacy's average ratings are also above industry averages but are a tad lower than Policygenius's. Quotacy scores a 4.6/5 for quality and value compared to the industry average 3.8 for both categories. In trust, Quotacy receives a 4.5 compared to the industry average of 3.8. Customer service is Quotacy's highest score, with a 4.9 compared to the industry average of 3.8. Reviewers are also likely to recommend Quotacy. Its net promoter score is 8.9/10. Although this is lower than Policygenius's score, it is higher than the average score for the industry: 6.8/10. While these findings are based on 33 reviews, they show that Quotacy is a competitive option when buying life insurance. Data as of Feb 9, 2021. Quotacy reviews are primarily from 2018. However, there are a few from 2019 and 2020. Policygenius reviews are from 2020 and 2021. Back to Menu Scope of offerings search Highlight: Policygenius offers assistance with many types of insurance while Quotacy focuses on life insurance. You can use Policygenius's platform to buy disability insurance, renters insurance, pet insurance, auto insurance, home insurance, and more. Quotacy offers a complimentary LegacyShield account to its life insurance clients. You can also work with Quotacy to find disability insurance. Policygenius offers term and whole life insurance policies. Beyond life insurance, it offers disability, renters, pet, auto, homeowners, health, vision, long-term care, jewelry, identity theft, and travel insurance. Individuals can also compare prescription discount cards through Policygenius. This scope of insurance offerings is advantageous for individuals looking for a one-stop shop for all their insurance needs. Business owners can also use Policygenius to find insurance policies to offer their employees. While specific details about how businesses can use Policygenius are difficult to find online, business owners can benefit from the Policygenius platform to find quality insurance products and good rates to offer their employees. Quotacy was founded by life insurance experts with industry knowledge and experience. Through Quotacy, individuals can purchase term life insurance, whole life insurance, and disability insurance. While the scope of insurance offerings isn’t as large as those from Policygenius, Quotacy has a high level of industry-specific expertise. Quotacy also offers its clients a complimentary LegacyShield account with a life insurance purchase. The LegacyShield account can be used to securely store legal and financial documents, like a life insurance policy, will, 401(k), bank account, and social media logins. The account also allows you to record life stories for family and friends or record your wishes for funeral or life celebration arrangements. Access to a LegacyShield account is a nice perk of working with Quotacy. Both Quotacy and Policygenius work with trusted life insurance companies with high financial stability rankings. This ensures that the products customers purchase through their company are high quality and reliable. Policygenius is a good option for people looking for a one-stop shop for their insurance needs. It’s also a great resource for business owners looking to find good insurance deals for their employee benefits package. Quotacy brings a lot of life insurance industry experience and expertise. If you’re only looking for a life insurance or disability insurance policy, Quotacy is an excellent choice. Back to Menu Staff and client services search Highlight: You can benefit from personal assistance from insurance agents with both companies. Quotacy agents continue to be available for assistance once you're a policyholder. As you're looking for life insurance policies, you'll benefit from assistance through the process whether you work with Quotacy or Policygenius. Quotacy remains the point of contact after you've purchased a policy if you want to make any changes. Both Quotacy and Policygenius have licensed life insurance agents available to answer your questions and help you through the quote and application process. Assistance is available through live chat, email, and phone. Quotacy will also communicate via text if that’s what a client prefers. Quotacy does not upsell its clients to a different kind of life insurance policy. Instead, the Quotacy team focuses on finding the best company match for the client's desired coverage while considering the underwriting process. Once you purchase a life insurance policy through Quotacy, its team is still available to help you. If you want to make changes or have questions, you don’t have to reach out directly to your life insurance carrier. Quotacy will do that for you. The assistance available to clients throughout the quote and application process is high at Quotacy and Policygenius. Quotacy goes further and offers complete service to its clients. Its services don’t end once you purchase a life insurance policy. This level of service makes it convenient for clients to make changes and ask questions without having to find a new contact with their insurance carrier. Back to Menu Quote process search Highlight: While taking different approaches, both companies focus on offering realistic quotes. Policygenius prioritizes getting accurate pricing information from its partnered insurers. When the final price comes, it's typically within $10 of the initial quote. Quotacy also focuses on offering realistic quotes and works with insurers to help you find the best fit. Before Policygenius offers a life insurance quote, it completes some underwriting. The underwriting process is how life insurance companies determine the insurability of an applicant and determines the monthly premium. Underwriting typically includes a medical questionnaire and can include a medical exam in some cases. Policygenius requires some health information and contact information before you can receive policy and pricing details. After you submit your information, a Policygenius expert will contact you with more information about quotes, policies, and applying. Policygenius also works closely with life insurance companies to ensure that the life insurance rates listed on its website are up-to-date. This approach helps ensure that quotes are accurate. Around 80 percent of policies purchased through Policygenius are within $10 of the online quote. The high level of accuracy is especially nice for life insurance shoppers because the value and the cost of the life insurance policy are clear early in the process. Working through Quotacy, website visitors can get a quick premium estimate for term life insurance policies by providing information about their zip code, age, and gender. After this number is shown, visitors have the option to fill out additional health information to get a more accurate and personalized quote. It’s convenient to see the estimate sooner, rather than filling out a health history form. If you’re interested in whole life insurance or disability insurance, the process requires a phone conversation. These policies can be more complex, so this difference is understandable. If you’re just interested in looking at quotes online and don’t have a specific kind of life insurance policy in mind, Quotacy is a good resource. However, both companies offer personal assistance with comparing policies and completing the application process. Back to Menu Application process search Highlight: Both companies keep their clients' information confidential. Once you apply for a life insurance policy through Quotacy or Policygenius, your information is protected. With either company, you'll only receive communication from them, not another insurer. Policygenius does not sell its clients information as leads to life insurance companies. This is nice for consumers because no one enjoys getting sales phone calls that they didn’t sign up for. Policygenius representatives follow up directly with people who submitted an application on their site. Quotacy’s online quote processes naturally lead into an application. You do not have to fill out the same forms twice. Once you see the available policies and the quotes, you can pick one and apply through the company. After applying, Quotacy’s life insurance underwriters will look at your application and work with life insurance companies directly to find the best fit for what you want and your situation. Throughout this process, Quotacy agents keep your information anonymous from companies until you decide to buy life insurance. Everyone has different health circumstances and life needs. Some companies are better in some situations than others. For example, diabetes affects life insurance premium rates. Some life insurance carriers have better rates for diabetic people. Quotacy’s holistic approach of finding the best fit for the client without upselling another policy means that clients are better able to find good value in their life insurance policy, not just a good deal. After clients purchase a policy, Quotacy agents still help clients make changes to their policy and answer questions. Both companies take care of their clients information. Policygenius and Quotacy work with their clients directly after the application is submitted instead of selling the information to other companies as leads. Back to Menu Our recommendation Both Policygenius and Quotacy have high ratings from reviewers on BestCompany.com. Although the review count for both companies makes it difficult to draw firm conclusions, these high ratings are promising. Beyond reviews, these companies respect their clients information and do not sell it to life insurance companies for lead generation. Whether you use Quotacy or Policygenius, you can trust that you'll only receive calls from Quotacy or Policygenius. Policygenius ranks first on BestCompany.com, and offers its clients a lot of convenience. It’s a great resource for comparing insurance quotes from multiple companies for many different kinds of insurance. If you're also looking for other insurance quotes, like health, jewelry, or long-term care insurance, Policygenius offers quotes on more than life insurance coverage. Policygenius is also a great tool for business owners to use. Its quotes are highly accurate as well. Life Insurance from Policygenius Learn more about Policygenius by reading customer reviews. Read Policygenius Reviews Quotacy’s sole focus is life insurance. Clients can receive estimates and quotes for term life insurance online without providing contact information. You can also contact Quotacy for assistance purchasing whole life insurance. Quotacy agents can also find long-term disability insurance quotes. It keeps its clients' information anonymous as it works with life insurance carriers to find the best fit and best rate for a client’s situation. Quotacy agents also continue to offer customer support to clients after they have purchased a life policy. If a client wants to make changes or has questions, Quotacy agents will answer questions and help make changes. Quotacy also offers its clients a free LegacyShield account that they can use to store legal and financial documents so that they are easy for their beneficiaries, family members, and friends to locate. While both companies are great options for buying life insurance, Quotacy brings a higher level of industry knowledge and the convenience of online quotes. The insurance agency also takes good care of its clients by offering a LegacyShield account and helping clients even after they have purchased a policy. Life Insurance from Quotacy Learn more about Quotacy by reading customer reviews. Read Quotacy Reviews
Guest Post by Colin Simmonds Why life insurance? In simple terms, life insurance provides financial protection for your loved ones if you are no longer around to look after them. As we enter adulthood and our responsibilities grow, the need for life insurance tends to increase. Theses key milestones in life often trigger us into taking out a life insurance policy: Purchasing our first home Having our first child Getting married Losing a loved one As we age, the cost of life insurance premiums rises. This is because as we get older, statistically we pose more of a risk to the insurer. As a result, the best time to take out a policy is often when we think we least need it, (before all of the above scenarios). Some key figures to emphasise the importance of life cover: United Kingdom £121,687 - Average mortgage debt £231,713 - Average cost of raising a child to 21 years  £223.36 - Average cost of fulltime childcare per week £9,204 - Average cost of dying, (funeral service and all associated costs) United States $201,811 - Average mortgage debt $233,610 - Average cost of raising a child to 17 years $211 day-care center, $195 family care center, $580 a nanny - Average cost of full-time childcare per week $7,360 - Average cost of a funeral with viewing and burial $52,458 - Average adult debt These figures are not intended to scare you, but merely to show how financially vulnerable many of us are. What you may not know is that the cost of premiums can differ significantly between insurers because providers employ different underwriting processes. It is imperative that you compare multiple quotes in order to secure the most cost-effective policy. Here are three of the best ways to compare quotes: Research online yourself Use a life insurance broker Use a comparison website Doing the research yourself online and running through quotes from the various insurers is not a bad option, especially if you understand the pros and cons of the different policy types and exactly what it is you want to protect and for how long. However, this method can be very time-consuming and somewhat frustrating. In this article we will be focusing on the choice between using a broker or using a comparison website. Life insurance brokers A broker works on your behalf, identifying the best available quotes based on the information you provide. They can also help answer any questions you may have so you are well equipped to make an informed decision. Pros Brokers can explain insurance jargon One major advantage of using brokers, especially if you are new to life insurance, is that they can impart their industry knowledge to you. Understanding insurance jargon is important if you are to choose the policy that best suits your unique needs. Brokers have experience in the industry A credible broker will be able to utilize their experience to ensure all aspects of your life are protected. For example, you may think you know exactly how much cover you require. However, having spoked to an agent they may have opened your eyes to other aspects of your life which may need to be covered, which you had not factored in. This may also impact the term length of your policy too. Brokers offer customer support services As well as ensuring you take out the most suitable policy, some brokers offer additional customer services not provided by a comparison website. For example, they may be able to help your loved ones through the claims process or help you write your policy in trust. If you are not a standard applicant (perhaps you have a pre-existing medical condition), a broker can source quotes from smaller, specialist insurers. Again, a comparison website will not be able to offer this added value. If you are happy to proceed with the application, a broker can fill in the documentation on your behalf, saving you time. You can choose between an advised or non-advised brokerage Depending on your preference, you can choose between an advised or a non-advised brokerage. An advised broker will listen to your individual circumstances; age, number of dependants, budget, level of debt, etc. and personally advise you on a particular policy. A non-advised broker will not personally advise you. They will simply take the information you provide and make suggestions as to viable options. You can still utilize their knowledge to answer any questions. You have a wider panel of insurers to choose from Some comparison websites do not use a wide panel of insurers in their results. Certain providers simply do not want to used by comparison sites. A broker, generally speaking, will have access to a wider range of insurers, meaning you have greater choice. Cons Brokers usually charge a fee Some brokers, usually advised brokers, will charge a relatively small fee for their services, while a comparison website is free to use. Brokers are only available during business hours You will only be able to speak with brokers and compare quotes during their working hours, unlike a comparison site which is available 24/7. What’s more, if you work standard hours, speaking on the phone with a broker may not be convenient. Comparison websites A comparison website allows you to input your sum assured, term length, age, smoking status, etc. and will give results based on this criteria. You can then easily compare the different quotes and make a judgement on the right policy for you. Pros Comparison websites are convenient In 2019, the vast majority of us have access to the internet, be it from our mobile, tablet of desktop device. As a result, comparison websites are highly convenient. You can compare life insurance quotes 24 hours a day, 7 days a week. Websites are free of charge Whilst some brokers charge a small fee for their services, comparison sites are free to use. No need to talk to anyone While some people enjoy discussing their requirements with an agent, others would rather not. Comparison sites enable you to compare multiple quotes at any time of day or night without the need to talk to anyone. Websites may offer a free gift incentive Some comparison websites offer a free gift incentive for taking out cover through them, usually in the form of a gift voucher for Amazon or other well-known retailers. While this is a nice gesture, the most important thing is always to ensure that you secure the right policy type, for the right cover amount, over the right term. Over the course of the entire policy term, a $50 voucher is insignificant. The bottom line The right answer will depend on you and your needs. If you are not 100 percent sure about the type of life insurance you need to protect the financial future of your loved ones, then a broker may be more suitable. However, the single most important thing, especially if you have children and/or a mortgage, is to ensure that you have life insurance in place. Because life insurance is not compulsory, many people put it off for another day. Unfortunately, you never know when your loved ones may require the funds generated from a policy. Whichever comparison method you chose, why not seize the day, safeguard the future and get on with enjoying life — safe in the knowledge your family is secure. Notes  https://themoneycharity.org.uk/money-statistics/51592/  https://themoneycharity.org.uk/money-statistics/september-2017/  https://www.moneyadviceservice.org.uk/en/articles/childcare-costs  https://www.sunlife.co.uk/siteassets/documents/cost-of-dying/cost-of-dying-report-2018.pdf  https://www.experian.com/blogs/ask-experian/how-much-americans-owe-on-their-mortgages-in-every-state/  https://www.thestreet.com/personal-finance/cost-to-raise-child-14814957  https://www.care.com/c/stories/2423/how-much-does-child-care-cost/  http://www.nfda.org/news/statistics  https://www.gobankingrates.com/net-worth/debt/how-much-debt-does-the-average-american-have/ Colin Simmonds is the Marketing Director at Reassured Ltd, the UK's largest FCA registered life insurance broker. He has worked within the insurance sector for 12 years, fulfilling a range of marketing roles. Today, he is considered one of the country’s leading figures in digital lead generation. As a dedicated husband and father, he understands the importance of life insurance protection to secure the future of his family.
Updated April 1, 2020. Many people create GoFundMe accounts to help cover unanticipated expenses, like high medical bills or funeral expenses. "Most people have no concept of the cost of funerals, which is why you see GoFundMe's to pay for funeral expenses," says Elizabeth Kent, a former cemetery director.To be prepared for leaving life, it's important to know funeral costs and associated expenses, as well as payment options. Understanding the costs associated with death will help you and your family be financial prepared. The cost of a funeral The National Funeral Directors Association (NFDA) reports the median burial and cremation costs in 2019: The median cost of a burial with a viewing was $7,640. With a vault, the cost was $9,135. The median cremation cost was $5,150. With a cremation casket and urn, the cost rose to $6,645.“If you ever walk into a funeral home and you ask for a General Price list, the funeral home is required by the Federal Trade Commission (FTC) to give you a General Price List, a Vault Price List, and a Casket Price List. All of those things may be in one price list, but look for all three to make sure they are upfront. If the funeral home fails to comply, I would leave immediately and not work with them,” says Kent.Tyler Yamasaki, CEO of funeral home comparison website Parting.com, and former cemetery director Elizabeth Kent identified the following services and fees that are associated with funerals: Funeral home basic services fee Death certificate “Bring the body into care” fee Embalming Viewing Funeral Building rental Graveside service Casket Hearse and transportation fees Plot purchase Opening and closing grave fees Vault or concrete liner fee Grave marker or headstone Cremation Funeral homes are obligated to be upfront and transparent about the cost of their services.Yamasaki shared some insight into 2019's market: Funeral home basic services: $1000-$3000 Casket: $1500+ Vault or concrete liner (required by most cemeteries): $1000+ Headstone or marker: $1000+ The expenses associated with funerals are pretty steep. However, Kent says, “The industry trend is that the cost of a funeral doubles every 10 years. That trend has been accurate for as long as the funeral industry has been around.” Paying for a funeral Cremation is cheaper than a traditional funeral with embalming services, large burial plots, and caskets.“By going the cremation route, a family can potentially save on all cemetery costs, embalming, and even the basic services. What has become increasingly popular is the Direct Cremation. A direct cremation is a stand alone service that just transports the deceased from the place of death, files the paperwork, cremates the body, and returns the cremated remains to the family. This can be done, in some areas, for as little as $600. The family then can decide on their own disposition options,” says Yamasaki.All funeral costs are due at the time of service. Life insurance, final expense insurance, or burial insurance can help cover these large fees with the death benefit payment. Even if you have enough savings to pay for your funeral, your family members and friends may not be able to access the funds in your bank account immediately. The death benefit payout from a life insurance policy can greatly help your family as they pay for your funeral and their living expenses.Another option is to pay for your funeral before you die. When people pre-pay for funerals, payment plans are available.“A prepayment plan is called a Pre-Need and is usually done through an insurance company that the funeral home is associated with. It is actually a really, really, really, smart idea to do a Pre-Need, because it locks the costs into place. If you die 30 years after you make it, the costs are guaranteed and the funeral home has to agree to the agreement. The only time a funeral home does not have to abide by the agreement is if you got the agreement from a different funeral home than the one providing the funeral services,” says Kent. Life Insurance and Protecting Your Family Consider a life insurance policy as a way to protect your family financially. View top life insurance companies and the policies they offer. Read what clients have to say in reviews. Learn More Other expenses Matt Schmidt, CEO of Burial Insurance Pro, says, "When planning a funeral, many people tend to forget about the additional final expenses that come at the end of one’s life. Such expenses include medical bills, installment debt, cell phone bills, cable bills, and other monthly expenses. If wanting to address all of the final expenses a person will face, you definitely want to account for those. Unfortunately there are more expenses then the basic funeral and burial costs."Take some time to think about what would happen to your family’s finances and make a plan. How much debt do you have? Whose name is it under? How dependent is your family on your income? Would your family have to pay for full-time childcare? Purchasing a life insurance policy, buying final expense or burial insurance, pre-paying for the funeral, and knowing your options are all things that can help you and your family be financially prepared for an emergency and avoid funeral-expense related debt.
Guest Post by John Holloway Life insurance should be an essential part of your financial plan. It serves as a safety net for your family in your absence and allows your loved ones to take care of their short-term as well as long-term financial needs. If you have family members who are financially dependent on you, it is vital for you to insure yourself as soon as possible. Let’s take a detailed look at the steps involved in purchasing a life insurance policy. Choosing the right type of policy First, you should decide if you need a term life policy or a permanent life policy. A term life policy is designed to cover you for a specific time period (anywhere from 1 to 30 years). It offers a death benefit, which is paid out to your designated beneficiary in the event of your death. It is very cheap and can easily fit into your budget. A permanent life policy is designed to cover you until your death. In addition to a death benefit, it also offers living benefits in the form of cash value account and dividends, depending on the type of policy you choose. It is typically more expensive than a term life policy. You can choose the type of policy that accommodates your budget and financial needs. Determining your life insurance needs The next step deals with determining your life insurance needs. You can calculate the amount of death benefit you need based on a number of factors including your age, income level, number of financial dependents, amount of debts you have, and your family’s short-term and long-term financial goals. Getting quotes from multiple companies This is perhaps the most important step in purchasing a life insurance policy. A surprisingly large number of people overspend on life insurance simply because they fail to shop around and choose an insurance provider randomly. It’s crucial to get quotes from multiple insurance providers. Getting a free, personalized quote is very easy. You can do it online or over the phone, depending on your convenience. You have to provide certain details like your age, gender, occupation, location, and basic medical history. You can then get a quote which includes the coverage amount you are likely to receive and the premium amount you have to pay. You can get quotes from multiple companies in two ways. You can talk to insurance agents who represent different companies and get a quote from each of them. Or, you can contact an online platform like noexam.com and get quotes from multiple insurance companies at the same time. Once you have the quotes, you can compare them with each other and choose one that fits your needs. Choosing an insurance company There are hundreds of life insurance companies in the United States, so choosing one can be a difficult task unless you know what you should look for. You should consider these three key factors while choosing an insurance provider: Financial ratingsSeveral independent rating agencies evaluate the financial strength of insurance companies and rate them accordingly. The most important among these are Moody’s, Standard & Poor’s, A.M. Best, and Fitch. If a company has an A rating or above from all four of these agencies, you can have confidence in its financial stability and its ability to honor its commitments. Track recordDoes the insurance company have a track record of settling claims quickly and efficiently? Does it have a support team which addresses the needs of customers and responds to their queries in a timely manner? Are there too many complaints filed against the company with the National Association of Insurance Commissioners? Based on the answers to these questions, you can easily decide if the company is the right choice for you. Policies offeredNot all companies offer the same kind of policies. Since each company has its own underwriting policy, the amount of coverage offered, the amount of premium charged, and the kind of benefits provided differ from one company to another. You should take a good look at the policies offered by different companies and choose a company whose product range adequately meets your needs. Applying for the policy Once you have chosen the insurance company and the right policy for you, the next step is the application process. A life insurance application form requires you to submit a wide range of information including the following: Age Occupation Hobbies, especially dangerous hobbies like scuba diving, bungee jumping, and paragliding Your designated beneficiary Premium payment frequency (monthly, quarterly, semi-annually, annually, or a lump sum payment) Pre-existing health problems, if there are any Prescription drug record Smoking and drinking habits Use of illicit drugs Driving record Credit history, especially if you have filed for bankruptcy in the past Your travel record (places you visited in the past one year and the places you intend to visit in the next one year) Apart from this, you also have to share the medical history of your parents and siblings, so the insurance company can determine if you are at risk for any genetic disorders. In some cases, the application process might also involve a phone interview. The medical exam Once you submit the application, you will be contacted by the insurance company to schedule a medical exam. A trained nurse will review your medical history, ask you several questions, measure your height and weight, check your blood pressure, and collect your urine and blood samples. Medical exam is a requirement for most policies. There are, however, policies that you can apply for without undergoing a medical exam. If you are old or have preexisting conditions that could prevent you from qualifying for a regular policy, you can select a no-exam policy. The underwriting process This step determines the premium amount you will pay. Based on the details you provided during the application process, the underwriter will determine your mortality risk, give you a health rating, and set the premium amount you have to pay. Accepting the policy Once the underwriting process is over, you will be issued a policy in two to three weeks. All you have to do is sign the policy, mail it back to the company, and keep a copy of the policy with you. Once you make the first payment, the policy comes into effect and stays in force as long as you keep making the payments or until the expiration date. John Holloway is a co-founder of NoExam.com, a digital life insurance brokerage focused on helping consumers make the best choice when buying insurance.
Updated May 2021. Life insurance is an investment. Choosing a strong, well-regarded, reliable company is important when purchasing life insurance. There are many life insurance providers. However, only a few deal specifically with the needs of military service members and their families, like USAA, Navy Federal Credit Union, and Navy Mutual Aid Association. Over the years, USAA has earned high financial strength ratings and developed a good reputation of service. Its life insurance product offerings are designed with military needs in mind. With these factors, it’s no surprise that USAA makes our top ten list. However, Navy Mutual and Navy Federal have their own strengths. Navy Federal offers its life insurance products through subsidiaries and other companies, which means that it has more policy options. Navy Mutual has great life insurance options — three term policies and whole life. The only difference between Navy Mutual and USAA’s policy offerings are that USAA includes a severe injury benefit in its military term policy and offers universal life insurance in addition to whole life insurance. What follows is a comparison of these three companies. You’ll see how they compare on the following criteria: Insurer financial strength Time in business Term policy options Permanent policy options Eligibility Because USAA, Navy Mutual, and Navy Federal are financial institutions, their other services like banking may be included in your consideration. We've added a bonus section to cover these additional services. You can also view side-by-side comparisons at the end of the article or by clicking the links below: USAA vs Navy Federal USAA vs Navy Mutual USAA vs Geico Life insurance basics Life insurance helps secure your family’s financial stability by providing a death benefit. The amount of the death benefit depends on how much life insurance is purchased. Permanent life insurance policies have the ability to build cash value in addition to the death benefit. This money is not subject to income taxes and can be used to pay off debt, pay for funeral expenses, the beneficiaries’ living expenses, a dependent’s college education, etc. Life insurance costs The monthly premium varies depending on several factors: Kind of policy purchased Amount of life insurance purchased Payment plan selected (applies to permanent policies) Lifestyle and career Health Age Gender Life insurance companies often have online life insurance calculators to help you determine how much life insurance you should purchase. Consumers can receive quotes on life insurance when they supply information about their health, age, gender, etc. online or when working with an insurance agent. Some plans do not require a medical exam, which means that health is not a criteria when determining the monthly premium rate. These rates are often higher. Financial strength ratings Before you start paying for a life insurance policy, you’ll want to be confident in the company’s ability to meet its claims obligations. Looking at financial strength ratings will help you understand if a life insurance company will be able to pay the large lump sum death benefit to your beneficiaries. There are four common Insurer Financial Strength rating companies. Each rating service has its own rating system that it applies when auditing an insurance company’s finances. Not every life insurance company is rated by these agencies. A.M. Best has 16 possible ratings. The Financial Strength Rating scale is Superior (A+ and A++), Excellent (A and A-), Good (B+ and B++), Fair (B and B-), Marginal (C+ and C++), Weak (C and C-), Poor (D). More pluses indicates a higher level in the category. A minus indicates a lower level within the category. A.M. Best also has non-rating designations. Moody’s Investors Service has 21 possible ratings. Aaa is the highest rating on Moody’s Global Long-Term Rating Scale. Standard and Poor’s also has has 21 possible ratings. A rating of AA+ from Standard and Poor’s is just below its highest rating category of AAA. Fitch Ratings is another common ratings services company. It’s rating criteria for insurance companies is trickier to pin down. However, an A+ rating denotes stability and a good level of financial strength. Ratings at a glance USAA A.M. Best: A++ (2021) Moody’s Investors Service: Aaa (2019) Standard and Poor’s: AA+ (2019) Fitch: Not Rated Navy Federal A.M. Best: Not Rated Moody’s Investors Service: Not Rated Standard and Poor’s: Not Rated Fitch: Not Rated Navy Mutual A.M. Best: Not Rated Moody’s Investors Service: Not Rated Standard and Poor’s: Not Rated Fitch: A+ (2020) USAA’s financial strength ratings USAA’s life insurance companies have some of the highest ratings in the industry. A.M. Best: A++ Moody’s Investors Service: Aaa Standard and Poor’s: AA+ Fitch: Not Rated These high ratings show that USAA is prepared to meet its claims obligations, which makes it a good company to trust when purchasing life insurance. Navy Federal’s financial strength ratings Navy Federal Credit Union does not have Insurer Financial Ratings listed on its website. A.M. Best: Not Rated Moody’s Investors Service: Not Rated Standard and Poor’s: Not Rated Fitch: Not Rated Navy Federal is also not responsible for meeting life insurance claims. Customers considering a life insurance policy through Navy Federal should understand who is responsible for paying claims and what the claims process is. Navy Federal Credit Union offers life insurance policies through its subsidiary Navy Federal Financial Group that works through COVR Financial Technologies, LLC. It also partners with Navy Mutual Aid Association to offer additional life insurance policies tailored for military needs. Navy Federal offers supplemental accidental death life insurance policies through TruStage. Navy Mutual’s financial strength ratings Navy Mutual has earned one of Fitch’s high financial strength ratings for consecutive years. It does not list ratings from other agencies. A.M. Best: Not Rated Moody’s Investors Service: Not Rated Standard and Poor’s: Not Rated Fitch: A+ Back to Menu Time in business The longer a company is in business, the more experience it has. It is also likely to continue its existence in the long-term. Both experience and longevity matter when choosing a life insurance company. You want to buy life insurance from a stable company with a good reputation that will still be around when your beneficiaries file claims. USAA was founded in 1922 to provide life insurance to military members. With nearly a century’s worth of experience, USAA is a reliable, trustworthy company. Navy Federal Credit Union was founded in 1933. It has almost as much experience in the financial industry as USAA does, though it does not specialize in life insurance. Of the three companies, Navy Mutual Aid Association has the most experience. It was founded in 1879. It is another trustworthy and reliable company. Back to Menu Life insurance products Make sure you know what kind of a life insurance policy you want before you purchase one. Life insurance policies fall into two broad categories: Term life insurance Permanent life insurance There are several kinds of permanent life insurance policies on the market. Term policies also vary in length. The specifics of each policy vary company to company, so it’s important to understand what you want and what a company offers. Term life insurance basics Term life insurance offers a death benefit for a certain period of time or until a certain age. If the insured passes away within the specified time frame, the insurance company pays beneficiaries a death benefit. The death benefit can be used to pay for lingering debt, medical bills, funeral arrangements, or some of the beneficiary’s living expenses. Life insurance can be invaluable to dependent beneficiaries as they adjust to their new financial situation. Life insurance is also beneficial for non-dependent beneficiaries because they can use the money for funeral expenses, which are often high. This helps them avoid debt. Term policies at a glance USAA Term length 10-30 years Ages Eligible 18-35 years Types of policies Term Premium Rate Consistent throughout term Renewable? Undisclosed Severe Injury Benefit $25,000 Death Benefit Value Varies Medical Exam? Yes Continued Coverage after Military? Yes Riders Term conversion, child benefit Able to add coverage? Yes Navy Federal Term length N/A Ages Eligible 18-64 years Types of policies Term policies offered through other insurers Premium Rate N/A Renewable? N/A Severe Injury Benefit N/A Death Benefit Value N/A Medical Exam? N/A Continued Coverage after Military? N/A Riders N/A Able to add coverage? N/A Navy Mutual Term length Varies Ages Eligible 18-75 years Types of policies Flex Term, Level II Plus Premium Rate Consistent throughout term Renewable? Undisclosed Severe Injury Benefit None Death Benefit Value $50,000-$1,000,000 Medical Exam? Undisclosed Continued Coverage after Military? Yes Riders Guaranteed term conversion, child benefit, accelerated death benefit, extended guaranteed conversion Able to add coverage? Undisclosed USAA’s term policy options USAA offers term life insurance in 10, 15, 20, 25, and 30 year term lengths. The monthly premium rate remains consistent throughout the length of the policy. Individuals ages 18-35 are able to purchase a term policy with USAA. USAA’s term life insurance policies come with the following benefits: Term conversion. Term life insurance policyholders can change their term policy into a permanent life insurance policy. According to the terms of the policy, there may be a set time limit for this conversion to occur. Add coverage. Policyholders can purchase up to $100,000 of coverage if they experience a life change, like marriage, birth, or home purchase. Policyholders can also add their children to their policy for about $8 per month. When the insured child reaches adulthood, the term policy can be changed into a permanent policy depending on state laws and regulations. USAA also offers a policy with benefits around military member needs like coverage during war and the below features: $25,000 for expenses caused by severe injury Guaranteed coverage after leaving military Can replace some or all of Servicemember Group Life Insurance (SGLI) lost from military separation or retirement Customer Review: April Jones from Tremonton, Utah "USAA has been able to give us the best price on term life insurance! And we were even able to get a rider on the kids. And their customer service is amazing!" Navy Federal’s term policy options Navy Federal does not issue life insurance policies. However, you can view insurance policy options and quotes online by clicking a link from its website. If you're not a military member, you can compare policies from multiple insurers after providing some personal details. If you are a military member, you'll be redirected to Navy Mutual to view options. Navy Mutual’s term policy options Navy Mutual offers three kinds of term policies: Flex Term Level II Plus The Flex Term policy offers life insurance coverage geared for military members ages 18 to 45 with a death benefit of $50,000-$1,000,000 with a consistent monthly premium rate. This policy is available to nicotine users ages 18 to 35. It includes an accelerated death benefit rider to receive the death benefit early in the event of a terminal diagnosis, and guaranteed convertability to change the policy into a permanent one. The conversion must occur before your 48th birthday, or 38th birthday for nicotine users. Policyholders may also add coverage for unmarried, dependent children under age 26 for an additional monthly charge. Applications must be received before the child's 21st birthday. The Flex Term policy includes: No restrictions for military service Coverage after leaving the military Level premiums The Level II Plus policy is sold in $10,000 increments with a range of $50,000-$1,500,000. The minimum term length is 10 years. The Level II Plus policy is also convertible to a whole life policy without a physical. To convert your policy, you must have at least five years left on the term and be under 71 years old. Consumers can add the following riders to their policy: Extended guaranteed convertibility Accelerated death benefit Child benefit Term Life Insurance Learn more about insurers offering term life insurance by looking at the top-rated companies and their offerings. Learn More Back to Menu Permanent life insurance basics Permanent life insurance is life insurance coverage that lasts a lifetime. Permanent policies often have higher premiums. Unlike term policies, permanent policies accrue cash value through investments. The cash value can be accessed at anytime by the policyholder. For this reason, permanent policies are sometimes considered to be part of a retirement plan. USAA’s permanent policy options USAA offers two kinds of permanent life insurance: whole and universal. Permanent policyholders can pay an upfront fee to have premiums waived if they become disabled. Policyholders can also pay higher premiums to add coverage for their children or grandchildren. Whole life insurance With whole life insurance, the premiums remain consistent across the payment plan, the policy accrues cash value, and the policy does not expire. The cash value is additional money separate from the death benefit. A whole life insurance policy grows cash value as it is invested. The growth is tax-deferred. Policyholders can access the cash value while still living. As long as what the policyholder accesses is less than or the same as what has been paid in, it is tax-free. You can also purchase a guaranteed life insurance policy underwritten by Mutual of Omaha. This policy offers lower coverage levels and no underwriting is required to issue the policy. You must be between ages 45 and 85 (50 and 75 in New York) to be eligible for the policy. Universal life insurance USAA’s universal life insurance also has cash value that builds over time. With a universal life insurance policy, policyholders have much more control over how high premium rates are and setting a payment schedule. Because of this, the premium rates may change year to year or month to month. USAA guarantees interest rates for its universal life insurance policies based on the cash value. The more valuable a policy is, the higher the interest rate. The guaranteed minimum is 2 percent, but can be as high as 4.35 percent if the face amount is over $100,000. Navy Federal’s permanent policy options Navy Federal does not issue life insurance policies. If you're interested in a whole life insurance policy, you can view policy options from multiple insurers. Again, you'll need to indicate if you're a military member or not. If you're not a military member, you'll provide some basic information and be able to view policy options and pricing from multiple insurers. If you're a military member, you'll be directed to Navy Mutual. Navy Mutual’s permanent policy options Navy Mutual only offers whole life insurance. Its policy is called Flagship Whole Life. $10,000 is the minimum amount of coverage available, but consumers can purchase up to $1,500,000. The cash value of the policy grows in safe, tax-deferred investments. You'll need to have a medical exam as part of the underwriting process. If you'd rather not have a medical exam, you may be able to get a guaranteed issue policy. To be elilgible, you need to be within 120 days of separation from the military and have been covered by SGLI during your military service. A Flagship Whole Life policy also includes accelerated death benefit and paid-up additions features. You'll need to decide which accelerated death benefit option you want to include on your policy. Chronic illness accelerated death benefit. Insured individuals over 60 who have been diagnosed with a chronic illness can receive the death benefit early to help pay for medical expenses. The money is disbursed over the course of 48-60 months. Terminal illness accelerated death benefit. Insured individuals can receive the lump sum death benefit payment early if they have less than 2 years to live. The policy has to have existed for at 5 years before this payout can be made. Paid-up additions. This rider can be used to increase the death benefit and cash value. The lifetime maximum is $500,000. For an additional cost, policyholders can add coverage for their children and grandchildren until they turn 26. Policyholders can also borrow up to 75 percent of their policy's cash value. Customer Review: Andrea Fredericks from Edmond, Oklahoma "If you are eligible for coverage from Navy Mutual sign up as soon as possible. It is a great company and offers military families life insurance policies at the lowest rate on the market. I have gotten quotes from the top 5 insurance companies on the market and no one even came close to Navy Mutual. I have yet to find a whole life policy that will return all your premiums if you choose to leave the company but Navy Mutual does. I have signed up my entire family including my grandkids for their whole life policies." Permanent Life Insurance Learn more about insurers offering permanent life insurance by looking at the top-rated companies and their offerings. Learn More Back to Menu Eligibility USAA, Navy Federal, and Navy Mutual have eligibility requirements that must be met before becoming a member. USAA members must meet be one of the following: Active military Former military (Honorable discharge) Family (widows, widowers, un-remarried former spouses of USAA members, children and step-children of USAA members) Cadets Midshipmen Navy Federal has similar eligibility requirements as USAA. Eligible groups include the following: Veterans Armed Forces Personnel Department of Defense National Guard Immediate family member who has a Navy Federal membership To be eligible for a Navy Mutual membership, one of the following must apply: Active duty military Retired military In the reserves or guard Separated within 120 days of the US Military, USPHS, or NOAA Honorably discharged Veterans (Rhode Island, Connecticut, Maryland, Virginia, North Carolina, South Carolina, Hawaii, Arizona, Oregon, Florida, Texas only) Back to Menu Additional services USAA offers many financial products in the following categories: insurance, banking, investing, real estate, and retirement. It also offers a car buying service. USAA makes online banking easy and convenient. Members can do direct deposit from their phones. You can open a checking account, savings account, and a credit card through USAA. It's also a lender, so home, auto, and personal loans are also available. Navy Federal offers many of the same financial services that USAA does, including checking and savings accounts, credit cards, and several types of loans. It even offers student loans. However, Navy Federal does not issue insurance. USAA is a bank. Navy Federal is a credit union. The biggest difference between banks and credit unions is that banks are for-profit while credit unions are not. This difference may affect the interest rates available through each institution. In contrast, Navy Mutual specializes in life insurance, annuities, and financial planning. If you're looking for a credit union or a bank to keep your money, Navy Federal or USAA are good options. Back to Menu USAA vs Navy Federal USAA has strong financial strength ratings. It is also known for its excellent customer service. It can be difficult for military members to be approved for a life insurance policy. It’s even rarer to see life insurance policies designed with military needs in mind. On the other hand, Navy Federal offers life insurance policies through other carriers, which means that it is not responsible for fulfilling claims. USAA Navy Federal Founded 1922 1933 Financial Strength Ratings A.M. Best Moody's Standard & Poor's Fitch A++ Aaa AA+ Not Rated Not Rated Not Rated Not Rated Not Rated Term Policies Term Length Ages Eligible Military Term Severe Injury Benefit Medical Exam Term Conversion Rider Child Benefit Rider Accelerated Dealth Beneift Rider 10-30 Years 18-35 Years Old Yes $25,000 Yes Yes Yes Undisclosed Undisclosed Undisclosed Through Navy Mutual No No Yes Undisclosed Undisclosed Permanent Policies Whole Life Medical Exam Premium Payment Terms Children's Whole Life Universal Life Ability to Add Children to Universal Policy Yes Undisclosed Can Pay Over 20 Years, Until Age 65, or Duration of Policy Can add children to policy Yes Yes Yes, through other insurers Undisclosed Undisclosed No No Not Applicable (Updated for 2021) Back to Menu USAA vs Navy Mutual Navy Mutual Aid Association’s life insurance options are the most similar to USAA’s offerings because it has life insurance policies designed specifically with miliary needs in mind. There are no restrictions or limitations in its policies regarding military activities in its term life insurance policies. The advantage of choosing USAA is that its military term life insurance policy includes a $25,000 serious injury benefit. Policyholders aren’t just paying for financial protection in the event of their death, they’re also paying for financial security if they become seriously injured. USAA Navy Mutual Founded 1922 1879 Financial Strength Ratings A.M. Best Moody's Standard & Poor's Fitch A++ Aaa AA+ Not Rated Not Rated Not Rated Not Rated A+ Term Policies Term Length Ages Eligible Military Term Severe Injury Benefit Medical Exam Term Conversion Rider Child Benefit Rider Accelerated Dealth Beneift Rider 10-30 Years 18-35 Years Old Yes $25,000 Yes Yes Yes Undisclosed Undisclosed 18-75 Years Old Yes No Undisclosed Yes Yes Yes Permanent Policies Whole Life Medical Exam Premium Payment Terms Accelerated Death Benefit Rider Paid-up Additions Rider Universal Life Ability to Add Children to Universal Policy Yes Undisclosed Can Pay Over 20 Years, Until Age 65, or Duration of Policy Undisclosed Undisclosed Yes Yes Yes Undisclosed Undisclosed Yes Yes No Not Applicable (Updated for 2021) Back to Menu USAA vs Geico Unlike USAA, Geico offers quotes for policies from multiple life insurance companies. After entering information on its website, customers can view quotes and policy options from various companies. These are the companies that are responsible for paying the claims. Geico can be a great research tool for civilians looking for good deals on life insurance policies. However, USAA has better options and services for military service members. BestCompany.com recommends USAA because of its quality services and life insurance products for military members and their families. Back to Menu Research Life Insurance Options Learn more about insurers and their offerings by looking at the top-rated companies and their reviews. Learn More
Before you finalize your life insurance policy, you should consider life insurance riders. These policy riders can provide additional insurance protection and give you more flexibility and options in the future."When considering various types of insurance riders, make sure you understand the cost and the terms under which you'll be able to make a claim. Conduct a bit of independent research to find out how likely you are to be eligible to make a claim, as well," says Lingke Wang, co-founder of Ethos.Below are life insurance experts’ thoughts on useful and common life insurance riders. 1. Disability waiver of premium rider Insurance and savings is how many people prepare for emergencies and unpredictable what-ifs. Life insurance premiums can be very affordable depending on your age, the amount of insurance purchased, and your budget. Experiencing a long- or short-term disability can affect your ability to work and what your budget looks like. Fortunately, there are two ways to handle this situation: add a disability premium waiver or buy disability insurance.Mike Raines, an independent life insurance agent, agrees: “The waiver of premium rider is probably the most valuable, especially if the premium on the life policy is significant. This rider added to the policy will typically waive the premium if the insured is disabled and unable to work. Often times the waiver of premium option will drop off a policy at an older age such as 55.”This rider may be more important to add depending on what you do for a living.Chelsie Ball, a licensed life insurance agent with TermLife2Go.com, says, “As with all life insurance the riders you add to a policy depend on your individual situation. Waiver of premium rider can be a great rider to add if you work in more high risk industries. This might be good to invest in if your job puts you at a higher risk of being injured.”While this is a handy rider to include with your insurance policy, it is limited.“Often times the waiver of premium option will drop off a policy at an older age such as 55,” Raines adds.However, considering the limitations of a disability rider, purchasing disability insurance may be a better idea in the long run. Wang explains, “If a waiver of premium rider looks tempting, keep in mind that it's usually more cost-effective to buy adequate disability insurance. 30 percent of workers experience disability at some point, so buying this type of insurance may be a better option for you.” 2. Guaranteed insurability rider Some people buy the amount of life insurance they can afford and plan to buy additional coverage later.David Duford, from Buy Life Insurance for Burial, says, “Normally, to add coverage, an applicant must apply for a new life insurance policy and is subject to underwriting their current state of health, even if the applicant already owns life insurance with the same company.”If you plan to add additional health insurance coverage later, a guaranteed insurability rider on your policy is a good idea.Ball advises “A guaranteed insurability rider is a life insurance rider that allows the owner of a life insurance policy to buy additional life insurance with no underwriting. This can be highly beneficial if after your original purchases your finances grow and your health also decreases. Generally, health conditions can either increase your rate or sometimes your coverage request can be declined.” 3. Long-term care rider No one really knows what the future holds. When it comes to health conditions, aging is tough and you may need to have someone available to take care of you around the clock.Dina Golub, Director of Operations for AIA Direct, says, “Another rider that is also valuable, but less common, is a long-term care rider. This type of coverage offers benefits if the policyholder is moved to long-term care, such as a nursing home.”Of course, this rider is probably only worth it if you are purchasing a permanent life insurance policy. 4. Accelerated death benefit rider John Holloway, Co-founder and Agent at NoExam.com, says, “Another common rider is the accelerated death benefit rider. If the insured is diagnosed with a terminal illness, it allows them to receive some of their death benefit to cover medical expenses.”Medical care can be quite expensive, so this rider helps defray the costs of hospice care. It is important to note, that the total sum of the death benefit does not change. An accelerated death benefit just allows for part of the death benefit to be disbursed early. 5. Child term life rider If you plan on having a family, adding a child term life rider is a good option.Holloway advises, “One rider I recommend often is the child term life rider. It provides coverage for children, without having to apply for a separate policy. This is a better option than buying some of the whole life policies on the market that are marketed as children's life insurance.” 6. Accidental death rider Duford says, “An accidental death rider pays an additional death benefit, typically two- or three-times the coverage amount, if the insured dies by means of an accident. The rider is very affordable, and provides a way to maximize quantity of coverage, especially if the insured cannot afford full natural death coverage.”Wang adds, “Accidental death and dismemberment insurance is almost never a good deal. It's a better bet to buy additional term life insurance coverage. The changes of an accidental death and dismemberment rider increasing the actual death benefit are very low since most people don't die in an accident or ever experience dismemberment.” 7. Return on premium rider Life insurance, especially term life insurance, can seem like a good way to throw away money. The younger you are, the less likely you are to die. However, some insurance companies offer a return on premium rider with their term life insurance policies.Ball offers this advice: “If you are looking to invest in a term policy to cover some of your expenses you may want to consider a return of premium rider. This rider allows paid premiums to be returned if the insured outlives the term of the policy. The exact details of this rider can vary based on the carrier.” With a return on premium rider, you’re purchasing insurance protection for your family and friends and also setting aside future savings for yourself.
Updated January 20, 2020. You're in the market for a life insurance policy because you want to protect your loved ones or even yourself financially. Life insurance policies are a significant investment, so it's important to understand what your life insurance policy options are, where you can go wrong, and how to distinguish between a good life insurance company and a bad one. We'll cover some of the worst life insurance advice people have received and some red flags to look for in companies. Worst advice Company red flags Worst advice Life insurance advice varies based on your situation. Things like age, health, family size, and financial situation affect how much and the kind of life insurance you’ll want to buy. Below are some of the worst life insurance advice people have received: Employer life insurance is sufficient. Start with term insurance. Whole life insurance is always better than a term life policy. Worry about life insurance cost, not about coverage. You’re too old for life insurance. 1. Employer life insurance is sufficient Many employers offer a group term life insurance policy as part of their benefits package. It’s a great idea to opt into this benefit, but don’t put all of your eggs in one basket.Lingke Wang, co-founder of Ethos, says “Some of the worst life insurance advice people routinely get is that their employer-provided life insurance policy is enough. Life insurance as part of a benefits package is not enough to replace lost future income. Getting a term life insurance policy separate from an employer is quick, inexpensive, and can be accomplished online in just a few minutes. When you change jobs or if you get let go, your life insurance isn't portable. Getting a term policy on your own is a smart financial move.” 2. Start with term insurance While a term life insurance policy can be a great option to start with if you are on a tight budget, locking in a low premium for a permanent life insurance policy may be a better option for long-term planning.Sam Price, Independent Agent and owner of Assurance Financial Solutions, says “I married at the age of 31 when I was the healthiest I've ever been. My adviser at the time recommended I start my life insurance with ten years of term coverage rather than locking in an amount for an extended period of time to take advantage of my youth and good health. That was to reconsider when my wife and I wanted to start our family. The problem though is that many people begin to see their first health issues in their mid to late 30s. By the time we started our family some six years later, I had been diagnosed with asthma and could no longer qualify for preferred rates. My life insurance now costs me about 50 percent more than I could have been paying.”Another reason term insurance may not be the best choice is because it’s temporary.Anthony Martin, owner and CEO of Choice Mutual, says “There are various reasons to want or need life insurance. Some of these needs are permanent, such as the final expense coverage. It makes no sense to buy a term policy to cover this permanent need. The term policy will statistically be long gone when death occurs, thus not accomplishing the objective.” 3. Whole life insurance is always better than a term life policy Some people think of permanent life insurance as an investment that is an asset to their retirement plan. Permanent life insurance can accrue cash value from investments over time, which can make higher premiums worthwhile.David Bakke, insurance expert at Money Crashers, says “One of the worst pieces of advice I've ever been given is that a whole life insurance policy is better than a term life policy, because in most cases, the numbers don't add up.” James Heidebrecht, owner of Policy Architects, agrees. He says, “Although there are instances where whole life is a fantastic tool for high net worth individuals to preserve wealth, these are few and far between. Approximately 30 percent of people let their whole life policy lapse in the first three years because they can’t afford it. As a result, they lose all the money they’ve invested and are left uninsured.Buying term and investing the difference in an index fund is probably a better option for most people considering whole life.”Martin disagrees. He says, “It's good situational advice but horrible general advice. What should be said is “If you are disciplined saver and investor, and you have a temporary need or liability to cover, then buy term and invest the difference." The truth is: almost nobody is a good saver, so nobody actually saves the difference.” 4. Worry about life insurance cost, not about coverage It’s easy to focus on the monthly cost of a life insurance policy and overlook the coverage being purchased.Bakke says, “Some say the amount of coverage doesn't really matter, as long as it is big. Truth be told, you need to dig down into the numbers and determine an amount that is enough, but not too much, so you protect yourself and don't overpay.” Another way to keep from overpaying is to look at several insurance companies and policies. You can then compare the life insurance quotes, coverage offered, and insurance policy features.“Coverages, limits, and deductibles do matter, and they do fluctuate amongst providers. Folks wanting insurance should be sure to check around,” Bakke says. 5. You’re too old for life insurance While it is true that you can lock in lower premiums at younger ages, the fact that you are older than you once were should not necessarily deter you from considering and purchasing life insurance.Ketan Kapoor, CEO and co-founder of Mettl, says “Once I was told to think about life insurance well before a certain age. The person elaborated on how you can’t have life insurance past an age limit. But, in my opinion, age shouldn’t be the reason you don't invest in yourself. If a risk can present itself anytime without looking at the age, an insurance policy must be bought for cushioning irrespective of age. Also, everyone succeeds at different times in their life to be able to have enough for life insurance, so age must not act as a barrier.”Now that you're armed against the bad advice, you can read some good advice or continue reading to learn about what characteristics signal a bad life insurance company. Compare Life Insurance Companies Learn more about life insurance by looking at the top-rated companies, their offerings, and customer reviews. Learn More Back to Menu Company red flags Buying life insurance can be a tricky process to navigate. As you determine the best way to approach life insurance for yourself and your loved ones, you’ll want to make sure that you work with trustworthy and dependable companies and avoide the worst life insurance companies. Here are five things to watch out for: Low or unpublished financial strength ratings Limited time in business or poor company history Unfavorable company structure Bad reviews Poor client treatment 1. Low or unpublished financial strength ratings Financial strength ratings companies evaluate insurers’ finances and score their strength based on the evaluation. These ratings indicate a company’s financial stability, which is very important when you’re buying life insurance. Depending on how much life insurance you buy, death benefit claims can result in large cash payouts. You don’t want to worry about your life insurer folding or declaring bankruptcy. The most common ratings agencies are A.M. Best, Moody’s Investors Service, and Standard and Poor’s (S&P). Each company has its own ratings scale. Not all insurers are rated by each agency, so be aware of the ratings scale differences. The top ratings from A.M. Best are A++, A+, A, and A−. The top ratings from Moody's are Aaa, Aa, and A. The top ratings from S&P are AAA, AA, and A. Most insurance companies share their current ratings on their websites. If you’re having trouble finding that information online, you can ask a company representative to share that information. If you’re working with an independent life insurance agent or agency, learn more about which companies they work with before you buy to make sure that you’re considering reliable companies. 2. Limited time in business or poor company history If you’re considering purchasing life insurance from a new company, you need to find out why buying a policy from them is a financially wise choice because it has had less time to demonstrate its longevity and commitment to policyholders. Does the insurer have insurance on all of its life insurance policies? How would your policy be affected if the company folded or closed? If the insurance company does not have good answers to these questions, take your business elsewhere. Someone else can be their guinea pig. Many life insurers have been in business for over half a century. Longevity as an insurance company demonstrates good financial planning and reliability. Look into a life insurer’s history to learn more about how it has weathered financial crises and changes in the economy. Pay attention to how the insurer prioritized policyholder claims with its business interests. Information on a life insurance company’s history is available on the company’s website. And, while information provided must be true and accurate, it can be difficult to find negative information directly from the insurer. Doing some digging on other sites and checking news sources will help you uncover any lawsuits. Understanding the issues in the lawsuits will help you know what to look out for when working with a specific insurance provider. Some lawsuits are more significant than others, so use good judgement as you evaluate the company. If you’re working with a life insurance agent or agency, you can still look into the history of the companies you’re considering. To get a better sense of how trustworthy the agent or agency is, you can look at customer reviews or gauge trustworthiness based on agency structure and your impression of your agent. 3. Unfavorable company structure Some life insurance companies are mutually owned. This means the company doesn’t have to consider shareholder interests when making decisions. The shareholders are the policyholders. Insurers that are mutual companies are really only concerned with what is best for policyholders. When mutual companies do well, they pay dividends to policyholders. There are some advantages to choosing a mutually owned insurance company. However, if a company is privately owned, it’s not necessarily a red flag. It just means that the company operates differently. This information is important to understand because it can help you decide how you want to proceed with an insurance company. If you’re working with a life insurance agency or quote service, you need to understand how they operate. Do they sell client information to all their clients or do they keep your information confidential? You should also understand how life insurance agents are paid. Are they salaried or commissioned? If they’re paid commission, you may be upsold on an insurance policy or not be told all of your coverage options. Again, these things aren’t necessarily red flags if they’re the only negative aspect of an agency that you can find. Rather, realize that you may need to proceed with caution while working with this company. If you’re finding some unsuitable aspects of the company structure alongside other red flags, choose a different company or agency to work with. 4. Bad reviews Customer reviews give you excellent insight into the customer experience. If a company has several bad reviews, pay attention to what they say. Are the issues raised common to the insurance industry or specific to each reviewer? Has the company or agency responded to poor reviews? Life insurance isn’t just about the purchasing process; it’s about how a company handles client policies in the long term. If clients complain about customer care, misinformation, difficulty filing claims, or insurance companies failing to pay claims, that’s a signal that a company isn’t trustworthy. If there is an overwhelming number of bad reviews and a very low customer rating, you know that the insurance company or agency do not offer good customer satisfaction. Look for another company or agency to work with. As useful as reviews are, there are some pitfalls to understand. Some review sites suppress bad reviews. Others may only publish bad reviews to get a company to work with them. Companies will occasionally pay for people to leave reviews, and sometimes they’ll also pay people to leave fake reviews. You’ll want to make sure that you’re getting the best information possible on the customer experience, so check to see how review sites handle reviews: Does the company have a verification process to catch fake reviews? Does the company publish reviews based on its own interests? Best Company has a review verification and moderation process to ensure that reviews on our site come from real people and reflect the true customer experience. 5. Poor client treatment Ultimately, it comes down to your own experience and feelings about the insurance company. Once you decide to meet with a company or agency, notice how the insurance agent or company representative treats you. Are they knowledgeable? Do they answer your questions well? Do they take time to understand your needs and concerns? Do you feel pressured to buy from them? Is this someone you can trust? Answering these questions when you start working with a company will confirm your earlier research or help you realize that you need to find a different insurance company to work with. Thinking through your situation, determining your life insurance needs, and knowing how to spot red flags in agencies and companies will help you successfully navigate the purchasing process and make a wise, longer-term decision for yourself or your loved ones. Top Life Insurance Companies You know how to identify a bad life insurer, but what about the best life insurers? We've done the work for you. Learn more about what top companies offer and what customers say about them. View Best Life Insurance Companies Back to Menu
Life insurance can provide peace of mind for your loved ones' financial security should you pass away unexpectedly. Below are some of the best tips and advice that people have received about purchasing life insurance: 1. Buy life insurance young Purchasing a life insurance policy at a young age, even if you don’t think it’s necessary, can save you money in the long-run.Matt Schmidt, CEO of Diabetes Life Solutions, says “As a 23 year old, my father who was a financial advisor told me to lock in a term life insurance policy, as it'll never be cheaper. I kind of laughed but ultimately did do just that.Six years later, I got married and got additional coverage. By this point, I had developed diabetes, and my rates on new policy were much higher. The lesson I learned was you don't know what the future holds. Never did I think that I would develop diabetes or any other chronic illness.Young people, lock in policies while you are young and healthy.” 2. Consider ALL your options There is a lot to consider when buying a life insurance policy. Should you get a temporary (term) policy or permanent policy? What kind of permanent policy — whole life, universal life, or variable life?Additionally, you’ll need to choose a life insurance company. Anthony Martin, owner and CEO of Choice Mutual, says “With life insurance, there is no one company that is best for everyone. To get the best plan for you, it’s critical that you compare offers from multiple companies. If your short list is comprised of only well-known companies, you hamstring yourself in a big way.”Cast a wide net when looking at life insurance companies, but make sure you choose reliable companies. Martin says, “A consumer needs to be open to any life insurance company that has been in business for at least 30 years and has an A rating with A.M. Best (which like 90%+ do).” 3. Talk to an independent agent Working with an independent insurance agent can help you investigate and consider all of your options at different companies. You won’t have to worry about the insurance agent needing to make a sale for a specific company or a specific policy.Martin says “Work with an independent agent that represents 20 or more insurance companies. No one company can be best for everyone. That is because they all underwrite in their own way. Furthermore, everyone's situation is different, which is why it's critical that their agent can simply pivot to whichever carrier views their health most favorably.” 4. Understand the terms and conditions Life insurance is an investment. With monthly payments over time, individuals can spend considerable money on life insurance.If you understand the terms of your policy, you’ll know exactly what you are going to be paying for. This knowledge can help you be confident in your purchase and investment.Ketan Kapoor, CEO and co-founder of Mettl, says “Terms and conditions are such miniscule-written content that it’s a normal practice to ignore them. Ask as many questions as it takes to understand the jargon from different people or insurance agents. It's better to read and understand everything in entirety at length at your own leisure rather than repenting later in time.”To be confident in your decision, make sure that you’ll have enough time to consider the policy. David Bakke, insurance expert at Money Crashers, says “Be sure to choose a policy that allows a certain waiting period before you choose to buy. That gives you a last recourse to decide whether the policy is right for you based on coverage and other aspects, geared toward your personal needs.” 5. Look into policy riders Life insurance companies offer all kinds of riders, like an accelerated death benefit, accidental death benefit, long-term care insurance, disability insurance, and more.Bakke says “One great piece of advice I received is that riders to your policy are mostly needed, especially if you have special circumstances. You need to be specific as far as what you need in order to get the coverage you want.”One rider that individuals should consider is term conversion. This allows a term life insurance policy to become a permanent life insurance policy.Sam Price, Independent Agent and Owner of Assurance Financial Solutions, says “The best life insurance advice I've ever been given is to consider using a company with good conversion options. Most people start their life insurance with term life insurance which is a great way to get a good deal of coverage for less money at a time in you life when you need more but perhaps can't afford a large premium. But for many people who develop health issues later in life, that first term policy may be the only life insurance they'll ever have.”Permanent life insurance policies are more expensive than term life insurance policies. If you can’t afford to invest in a permanent life insurance policy now a term conversion rider can help you have a lower monthly premium payment.Price says “Legally, life insurance companies have to offer at least one option for conversions, even if it's a bad option. If you find yourself being that person who can no longer qualify for life insurance, having multiple conversion options is the best way to fit your budget and life insurance needs and is something everyone should consider in the buying process.”
Life insurance is one of those subjects that is difficult for many to talk about. In short, you and your loved ones are much better off having life insurance and not needing it, than needing life insurance and not having it. Thankfully for most of us, life insurance is not only accessible but also affordable. Unfortunately, the same cannot be said for many of the characters portrayed in film, literature, and television these days. But which characters are the least insurable? Well, we've identified the top five - and some of the characters on this list might surprise you. Factors Affecting Life Insurance Rates SKIP THIS PART! TAKE ME TO THE CHARACTERS! Before we can get into just how uninsurable these characters are, it's important to go over a couple of ground rules first. There are a number of factors that can affect a life insurance company's ability to insure you. We've identified the top seven: Age If you are younger, chances are you will be paying insurance for much longer. Consequently, you'll likely be paying lower life insurance premiums overall; however, the older you get, the more that window begins to close. Gender Gender can also greatly influence pricing. The logic behind this gender bias is based on statistics. On average, women tend to live about five years longer than men, meaning they'll likely be paying insurance for longer, and will therefore enjoy lower rates. Occupation What you do for a living can also affect what you pay for insurance. For example, if you happen to be a race car driver, a firefighter, or a chemist dealing strictly with deadly chemical compounds, you will be paying more for health insurance. Some jobs can even cause insurers to deny you coverage! On the other hand, if you work as a marshmallow tester or something like that, you'll probably get to pay lower rates. Current Health Your current health status is extremely important when it comes to life insurance. Most often, you will have to undergo a medical examination before some insurance companies will offer you coverage. This exam checks for health factors like high blood pressure and disabilities. When companies see that you're in good health, they're more likely to trust you with a policy. Lifestyle Lifestyle factors including drinking, smoking, and engaging in dangerous or otherwise risky behavior will definitely count against you; however, if you quit smoking or drinking, you'll be able to enjoy lower rates over time. Family Medical History Insurers are also interested in your family's medical history. Does anyone in your family suffer from a chronic disease such as heart disease or cancer? If so, these conditions will most likely weigh into your rates. Driving Record Believe it or not, your driving record will also go under the microscope. Even if no violations are found on your current record, life insurance companies can consult with the Department of Motor Vehicles for your full history. But if your record has been clean for the last three to five years, you'll likely be in the clear. That being said, you won't be terribly surprised to find that the following characters might have a hard time getting adequate life insurance coverage: James Bond James Bond, international man of mystery has been eluding death, seducing beautiful women, and drinking scores of martinis for well over 50 years. And while I'm sure MI-6 likely has a great policy in place for their double-0 agents, Bond will likely have difficulty finding someone who will insure him should he lose his government job. Then again, for someone like James Bond - an orphan who somehow manages to avoid commitment as easily as he avoids bullets - passing on benefits from life insurance may not even be an issue. But for the sake of this analysis, let's run the numbers anyway: Name Bond. James Bond Age Unknown Gender Male Occupation Spy, Assassin Current Health Surprisingly Good Lifestyle Gets Shot At/Tortured Smokes Drinks Heavily Frequently Engages in Risky Behavior with Several Mysterious Women Family Medical History Unknown Driving Record Poor. Very Poor. According to the facts, things don't look so good for 007. First, he is a male, meaning his life insurance premiums are already heightened. He also has a history of destroying expensive sports cars, promiscuity, and getting repeated shot/shot at. And if that were not enough, he drinks - all the time. The only things Bond has going for him are his excellent (and unexplainable) health, the fact that little is known about his parents' medical conditions. Harry Potter This list would not be complete without Harry Potter. Lay aside the fact that he's been under constant threat of death since he was a 1-year-old, Potter's entire lifestyle and demographic is just asking for impossible life insurance rates: Name Harry Potter The Boy Who Lived The Chosen One Age 17 Gender Male Occupation Student/Wizard Prospective Dark Wizard Hunter Current Health Questionable Lifestyle Quidditch Seeker Has Almost Died Every Year of His Adolescent Life Has Died Practices Magic Regularly Family Medical History Parents Died Prematurely Father Spent Time with a Werewolf Driving Record Also Poor Harry Potter is a risk assessor's worst nightmare. And while Potter doesn't smoke or drink like James Bond (there are few who do), he engages in plenty other risky behavior that have repeatedly landed him in the Hogwarts hospital wing. And that's just from being a seeker on his quidditch team. The one time Potter has driven a car, the car ended up in a tree bewitched to destroy anything that comes near it. Of course, we can't forget his frequent encounters dealing with a certain dark wizard who has employed increasingly creative means - including a giant snake and reanimated corpses - to specifically kill Harry Potter. In fact, that dark wizard even once succeeded in killing Harry Potter (spoiler alert), though, whichever life insurance company enough to give him a policy will be relieved to know that they won't have to pay out that policy after all. Katniss Everdeen When it comes to life insurance, Katniss Everdeen from The Hunger Games franchise is a difficult one to figure out. On the one hand, death is constantly knocking at her door, but on the other hand, she might not be as huge an insurance risk as you would think. Name Katniss Everdeen The Girl on Fire Age 16 Gender Female Occupation Hunter Tribute Revolutionary Current Health Questionable Lifestyle Under Constant Threat of Danger Engages in Regular Combat Family Medical History Father Died in Coal Mine Accident History of Malnutrition Driving Record None There are a number of reasons why Katniss Everdeen would be difficult to insure. First of all, unless you happen to live in the capital, I'm pretty sure life insurance isn't an option for most of the citizens of Panem. So access is a big deal. Secondly, she lives in a coal mining community, which means an increased risk of respiratory disease and even lung cancer. What more, before she won the Hunger Games, she would often go days without eating, which can greatly deteriorate one's health, and chances at good insurance rates. Conversely, after she won the Hunger Games, she was eating a lot better, but her mental health began to decline, which might also be considered an insurance risk. And, oh yeah, everyone keeps trying to kill her. Did I mention that? On the other hand, Katniss might not be as difficult to insure as everyone else on this list. Females tend to have lower rates than males do when it comes to life insurance. And when you think about it, save for the constant threat of gladiator-style executions, she actually tries to live a healthy lifestyle. When she can eat, she only eats organic, and she seems to avoid the coal mines her district is known for, meaning better respiratory health. She stays fairly active, and the best way to avoid a poor driving history is to simply never drive a car. Everyone on Game of Thrones In the five seasons Game of Thrones has been on the air, roughly 60 major and minor characters have died in one way or another. And if you follow the show, it's no secret that nearly every character on the show has an increasingly shortening shelf life as the seasons progress. What makes insuring Game of Thrones characters so difficult is the fact that death seems to come upon everyone - regardless of health, occupation, age, or gender. Quite frankly, the show throws all the life insurance rules out the door! And since it's so difficult to assess the risk of future characters, we need to go with what information we do have (to skip this list and see the highlights, click here). To see just how randomly and ridiculously death manifests itself in this show, just read the fourth column in succession - out loud: Name Role Time of Death Means of Death Will Ranger of the Night's Watch S1ep1 Beheaded Jon Arryn Hand to the King S1ep1 Poisoned Jory Cassel Captain of the Guards S1ep5 Stabbed through Eye Viserys Targaryen Exiled Head of House Targaryen S1ep6 Molten Gold Poured on Head Benjen Stark First Ranger of the Night's Watch S1ep7 Unknown Robert Baratheon Lord of the Seven Kingdoms S1ep7 Killed by Boar Syrio Forel Sword Fighting Instructor S1ep8 Killed in Sword Fight Eddard Stark Hard of the King Lord of the North S1ep9 Beheaded Drogo Chieftain of the Dothraki S1ep10 Smothered to Death Rhaego Son of Khal Drogo S1ep10 Stillborn because of Blood Magic Mirri Maz Duur Enslaved Godswife S1ep10 Burned Alive Rakharo Dothraki Bodyguard S2ep2 Beheaded Yoren Recruiter for the Night's Watch S2ep3 Killed in Sword Fight Renly Baratheon Master of Laws S2ep5 Killed by Shadow Rodrik Cassel Master-at-Arms S2ep6 Beheaded Irri Dothraki Handmaiden S2ep7 Murdered Master Luwin Maseter of Winterfell S2ep10 Stabbed with Spear Qhorin Ranger of the Night's Watch S2ep10 Asked to Be Killed Pyat Pree Warlock from Qarth S2ep10 Burned Alive Doreah Handmaiden S2ep10 Locked in Stone Vault Xaro Xhoan Daxos Merchant in Qarth S2ep10 Locked in Stone Vault Hoster Tully Lord of Reverrun S3ep3 Illness Jeor Mormont Lord Commander of the Night's Watch S3ep4 Stabbed to Death Craster Wildling S3ep4 Killed by Night's Watchman Krazyns Salve-Trader S3ep4 Burned Alive Bernic Dondarrion Leader of Brotherhood without Banners S3ep5 Killed in Combat Ros Prostitute Sepe6 Shot with Crossbow Talisa Stark Wife S3Ep9 Stabbed in Stomach Robb Stark King of the North S3Ep9 Shot with Crossbow, then Stabbed through Heart Catelyn Stark Wife of Eddard Stark S3ep9 Throat Slit Polliver Man-at-Arms S4ep1 Stabbed in Throat Tansy Servant S4ep2 Eaten by Dogs Joffrey Baratheon Lord of the Seven Kingdoms S4ep2 Poisoned Karl Tanner Brother of the Night's Watch S4ep5 Impaled Locke Man-at-Arms S4ep5 Neck Snapped Rast Ranger of the Night's Watch S4ep5 Ripped Apart Lysa Arryn Lady Regent of the Vale S4ep7 Fell to Her Death Oberyn Martell Prince S4ep8 Skull Crushed The Mountain Knight S4ep8 Poisoned by Spear Grenn Ranger of the Night's Watch S4ep9 Killed in Combat Mag the Mighty Giant S4ep9 Killed by Night's Watchman Pyp Brother of the Night's Watch S4ep9 Shot by Arrow Styr Thenn S4ep9 Bludgeoned in Head by Hammer Ygritte Soldier S4ep9 Shot by Arrow Jojen Reed Warg S4ep10 Stabbed Multiple Times, Burned by Fireball The Hound Member of House Clegane S4ep10 Died from Wounds Shae Prostitute S4ep10 Strangled Tywin Lannister Head of House S4ep10 Shot with Crossbow while on Toilet Mance RAyder Leader of the Free Folk S5ep1 Shot by Arrow Janos Slynt Former Commander S5ep3 Beheaded Barristan Selmy Former Kingsguard Member S5ep4 Killed in Combat Maester Aemon Maester at Castle Black S5ep7 Dies of Old Age Karsi Chieftainess S5ep8 Mauled to Death Shireen Baratheon Daughter S5ep9 Burned Alive Hizdahr zo Loraq Scion S5ep9 Stabbed to Death Sleyse baratheon Wife S5ep10 Hangs Herself Stannis Baratheon Lord of Dragonstone S5ep10 Executed Myranda Servant S5ep10 Pushed off Ledge Meryn Trant Knight S5ep10 Blinded, Stabbed, Throat Slit Myrcella Baratheon Daughter S5ep10 Poisoned Highlights from This List What becomes clear of this list is that while some deaths are more predictable than others, most of them could not have been foreseen. For example, it's understandable that Syrio Forell, a sword fighting instructor was killed, of all the ways, in a sword fight. The nature of his occupation puts him at high risk, and he would not likely have qualified for insurance anyway. On the other hand, Tywin Lannister, head of his own house, was shot by a crossbow while on the toilet! Risk Assessment for Game of Thrones Characters Let's say for a moment you were a Game of Thrones character. You saw everything that was going on around you, and you wanted life insurance. Here are a few questions your insurance rep might ask you: Do you have, or have you ever had, one of the following: A Neck A Heart A Skull Are you generally well-liked on the show? Are you in a position of either authority or servitude? Have you been featured on the show for at least one episode? If you answer yes to any of these questions, then your risk is quite high. And Apparently, Any Character Played by Sean Bean Whether he's asked for it or not, actor Sean Bean has made a career out of letting people watch him die. And while not all of his characters have experienced on-screen deaths like that of Game of Thrones's Eddard Stark, the trend is significant enough to pay attention to (again, the fourth column is the only interesting column here): Character Movie/Television Show Year of Movie Release/Air Date Means of Death Ranuccio Caravaggio 1986 Throat Slit German Soldier War REquiem 1989 Impaled Tadgh McCabe The Field 1990 Falls off Cliff Carver Doone Lorna Doone 1990 Drowned Gabriel Lewis Screen One 1991 Stabs Himself Robert Lovelace Clarissa 1991 Stabbed Sean Miller Patriot Games 1992 Beaten, Impaled, Blown Up Lord Fenton Scarlett 1994 Stabbed Alec Trevelyan GoldenEye 1996 Crushed to Death Dave Toombs Airborne 1998 Shot Jason Locke Essex Boys 2000 Shot Boromir The Lord of the Rings: Fellowship of the Ring 2001 Shot by Arrows Patrick Koster Don't Say a Word 2001 Buried Alive Cleric Errol Partdrige Equilibrium 2002 Shot Robert Aske Henry VIII 2003 Hung Dr. Bernard Merrick The Island 2005 Hung Loki Far North 2007 Frozen to Death Danny Bryant Outlaw 2007 Shot John Ryder The Hitcher 2007 Shot John Dawson Red Riding: The Year of Our Lord, 1973 2008 Shot Pyke Kubic Ca$h 2010 Shot Markus Kane Death Race 2 2010 Shot Ulrich Black Death 2010 Quartered Major Jack Jones Age of Heroes 2011 Shot Lord Eddard Stark Game of Thrones 2011 Beheaded Of course, these statistics will only really matter to you if you end up having a movie made about your life and Sean Bean is a potential candidate to portray you. Chances are, it won't even matter if you're still alive when the movie is released - the cinematic powers that be will somehow work a death scene into your life story. And while having Sean Bean portray you in a movie won't necessarily increase your risk or make it harder for you and your loved ones to enjoy the benefits of life insurance, not signing up for life insurance definitely will.
Life insurance protects your loved ones’ financial stability by paying out a lump sum benefit if you pass away. This cash can be used to pay for funeral expenses, finish paying a mortgage, and cover remaining debt obligations. Life insurance benefits are not considered income. They are only taxed as part of estate taxes, not income taxes, which is another reason that life insurance is a great investment in your family’s financial future. There are lots of options when it comes to life insurance. Many employers offer life insurance as part of their benefits packages for employees. Keep in mind that while these group rates tend to be incredibly cheap, the coverage will stop when your employment ends — whether that’s taking a job elsewhere, retiring, or losing your job. "Employer offered life insurance is great if you have it, but must realize there is no flexibility. If your employment situation changes, you'll have either a temporary or permanent lapse in coverage and getting coverage later in life is usually much more expensive than if you opted to get private term life insurance when you were younger and generally healthier," says Mark Cluett, Director of Content and Digital Assets. Key Takeaway: If you purchase your own life insurance independent of your employer, you’ve got several options. Term Life Insurance Whole Life Insurance Universal Life Insurance (variable or indexed) Final Expense Insurance (Funeral Insurance) “The options for life insurance are vast — from whole life insurance to universal life insurance to many variations and permutations of the above, some with market participation and investment exposure and others with a dizzying array of riders and features that will make your head spin. Be very wary about purchasing something that you don't fully understand,” advises Joel Ohman, MBA, MDiv, CFP ®, and Insurance Providers CEO. Understanding your options is the one of the first steps in finding and buying a life insurance policy. This article focuses on the basics of each kind of life insurance available. For more information on common riders, see “7 Common Life Insurance Policy Riders.” Jump ahead to: What kind of life insurance should I buy? What is Term Life insurance? Key Takeaway: Term life insurance is advantageous if you have a temporary coverage need. These policies typically have the lowest premium rates. Coverage only lasts a set number of years. Simplified underwriting may be available depending on your health and the insurer. If you have dependents to care for, debt that would be passed to a family member, or are taking on a small business loan, a term policy is a good fit. When you sign up for term life insurance, you agree to give your insurer monthly payments for a limited period of time for a fixed coverage amount. Term Life insurance is usually the cheapest form of life insurance because it only lasts a certain length of time. With most term life policies, the monthly premium is set for the length of the term. This is convenient because medical conditions can develop. Some medical conditions, like diabetes, increase monthly premiums. It’s convenient to lock in costs early. However, if you renew your policy, you’ll likely have higher rates. Most insurers that offer term life policies have several term length options. These options tend to start at 5 years and can be up to 30 years. These options allow clients to choose the length that best fits their needs. Some life insurers also offer a term conversion rider with their term life insurance policies. This rider allows policyholders to convert the term life insurance policy into a permanent one during a set period of time. This rider is great because it allows policyholders to purchase a very affordable term life insurance policy with the ability to convert it to a permanent policy later. Another common rider available for term life insurance policies is guaranteed renewability. This feature allows policyholders to renew their policy within a certain time frame. While the premium rates may be different when the policy is renewed, the life insurer will renew the same coverage. Some life insurance carriers offer a return of premium with their term life insurance policies. This means that if the company does not pay out a death benefit, the total of the premiums is returned when the policy expires. What do experts say about term life insurance? Jeff Root from Rootfin Insurance Blog “A simple rule of thumb is if you're in your prime income earning years (30–65), buy enough term life insurance to replace your income until your estimated retirement date. Don't worry about permanent life insurance until you reach a high income level.” Richard Best, personal finance expert at Don’tPayFull “The most practical use of term insurance is for situations where you can be certain that the need for life insurance will not exist after a specific period of time. For example, if you need life insurance coverage to ensure the needs of your children are met through the time they graduate from college and are out on their own, your term coverage might only need to last until they complete college. The problem with term coverage is that, if you determine that your need for coverage will last beyond your intended time frame, you would need to renew the term coverage or purchase a new policy at substantially higher premium costs. And, if you develop any health conditions, you could be denied coverage.” Joel Ohman, MBA, MDiv, CFP ®, InsuranceProviders CEO “It's very rare that you need any type of fancy life insurance policy other than a plain vanilla term life policy. Term life is simple, straightforward, and likely much cheaper than you think.” Buyer's Guide: Term Life Insurance Download our free guide to learn more about term life insurance, how to decide if you need it, tips for choosing a life insurance company, and customer reviews. Download Guide Back to List What is Whole Life insurance? Key Takeaway: Whole life insurance offers stability for those with a permanent coverage need. These policies come with high, but level premiums. Your policy builds cash value at a guaranteed rate. You can use the cash value while living, but it will lower the death benefit payout. A fully underwritten policy can get you the best premium rate. Whole life insurance is a form of permanent life insurance, which makes it more of an investment than term life insurance. Whole life insurance policies have a death benefit and the ability to accrue cash value through investments. The fixed monthly payments that you contribute to go into a tax-deferred account that accumulates interest over time. Whole life insurance policies accrue cash value at specified minimum rates and are not subject to the high level of fluctuation in the market. However, if the life insurance company does well, the cash value can grow more. This stability is a nice feature of a whole life insurance policy. The cash value of the policy contributes to the death benefit as it grows. Whole life cash value acts like a savings account. As the cash value accrues, policyholders can use it as an asset when applying for loans or even borrow from their cash value. If the insured passes away before paying back the borrowed cash value, the death benefit will be reduced by the outstanding balance. Because a whole life insurance policy does not expire and requires more overhead management for the cash value accrual, monthly premiums are much higher than term life insurance premiums. Part of the monthly premium goes toward the death benefit, part of it goes to overhead, and another part goes to the policy’s cash value. When you sign up for whole life insurance, your payments are guaranteed to stay the same throughout maturity. Whole life insurance also guarantees that your beneficiaries will get the face value of the policy at a minimum. Purchasing a permanent life insurance policy early is wise because it allows you to lock in lower rates. What do experts say about whole life insurance? Richard Best, personal finance expert at Don’tPayFull “The oldest and most basic form of permanent life insurance, whole life insurance is a fixed, guaranteed product, meaning the face amount, premium and cash value growth are determined at issue and guaranteed for the life of the contract. Some insurers pay dividends which can be applied towards the premium payment or used to buy paid-up additions which can increase cash value growth and the face amount.” Travis Price, IFixMedicare.com Licensed Insurance Agent “On the downside, Whole Life insurance tends to be the most expensive insurance type out there. If you're buying a policy in whole life, I tend to tell people that it should be enough to get you into the ground. That's a relatively low amount, from $10,000–$15,000, and keeps your premiums lower. Some people simply can't qualify for insurance because of their health issues. In this case, whole life offers a guaranteed issue policy. The upside is that you get coverage, but the first two years you don't get the full face amount. Instead, the insurance company simply refunds the premiums that were paid plus 10 percent.” Kurt Hemry, Ironwood Wealth Consultants President “Whole life insurance may earn guaranteed cash value increase as well as an annual dividend. These are often considered the most conservative of policies regarding cash value growth. An upside to this type of policy is the protection of your cash in that you never lose money because of Wall Street losses.” Back to List What is Universal Life insurance? Key Takeaway: Universal life insurance offers flexibility to people with permanent coverage needs. These policies are typically cheaper than whole life insurance. Monthly premium rates can change over time. Policyholders choose how to invest the cash value and assume more investment risks. The cash value can be used as an asset while still living but using it affects the death benefit payout. Universal life insurance has many of the same features as a whole life insurance policy. It is permanent and has cash value. The monthly premiums go three places: death benefit payment, overhead management, and cash value building. The cash value grows interest from investments tax-deferred and can be borrowed while the policyholder is still living. The premium rates for universal life insurance policies are more expensive than term policies and also tend to be less expensive than whole life policies. Unlike whole life insurance, universal life insurance gives policyholders the flexibility to adjust premiums and coverage levels according to their needs and investment goals. What is Variable Universal Life Insurance? Variable universal life insurance allows policyholders to invest the cash value of their life insurance in separate accounts, sort of like mutual funds, with different stock and bond options. What makes this type of insurance still universal is that the policy owner can make flexible monthly payments. If you are interested in variable universal life insurance, make sure to pay attention to the management fees and any penalties that come with changing your coverage amount. What do experts say about variable universal life insurance? Richard Best, personal finance expert at Don’tPayFull “Variable life insurance allows the policy owner to allocate funds among different investment options, such as various types of stock and bond accounts. Although the separate investment accounts are subject to market fluctuations, the death benefit is guaranteed. Some variable life policies offer minimum return guarantees as options.” Daniel Ray, National Independent Life Insurance Agent and Owner of PinnacleQuote Life Insurance Specialists “PROS: A permanent policy with an investment component that can accelerate cash value. CONS: You are at risk of market fluctuations which can affect your premiums and face amount.” Kurt Hemry, Ironwood Wealth Consultants President “With variable life insurance, you select from a number of mutual funds that you want your money to be invested. This provides you with the opportunity to earn as Wall Street goes up. However, when Wall Street goes down, so does your policy value.” What is Indexed Universal Life Insurance? Indexed Universal life insurance has lower investment risks. The investments can only grow. If there is a year when the investments lose money, the cash value stays the same. Loans from an indexed universal life insurance policy are tax-free. These policies can also be used as retirement income and withdrawals are also tax-free. What do experts say about indexed universal life insurance? Daniel Ray, National Independent Life Insurance Agent and Owner of PinnacleQuote Life Insurance Specialists “PROS: A permanent policy that is tied into an index like the S&P. CONS: If the policy is underperforming in your later years, rates can double or more which can result in seniors losing insurance that they can't afford when they need it the most.” Gordon E. Conwell, III of Americanterm.com “Variable Universal Life and Indexed Universal Life are both investment type of life insurance policies, primarily for people that are looking for both life insurance and/or an investment. Many people over-fund these policies to potentially gain a larger investment from the tax deferred benefits of these policies, so it's not easy to show rates for this type of coverage as most people will purchase the smallest amount of insurance for the amount of the premium they want to pay for this coverage to maximize their investment potential.” Back to List What is Final Expense insurance? Key Takeaway: Final expense insurance is designed to cover funeral and burial costs. Final expense insurance is permanent life insurance. You'll buy a smaller amount of coverage because insurers set limits. Some policies are guaranteed issue, which means they require minimal underwriting. Final expense insurance is ideal for covering seniors. Final expense insurance is a kind of permanent life insurance. It is also called funeral insurance, cremation insurance, or burial insurance. Final expense insurance is especially good for seniors and offers more limited coverage levels designed to cover funeral and final expenses. Because of the lower levels of coverage available, final expense insurance premiums tend to be fairly low. It’s a great option for those who do not have another permanent life insurance policy and are not interested in term life insurance. What do experts say about final expense insurance? Travis Price, IFixMedicare.com Licensed Insurance Agent “For seniors, I suggest they only purchase the fixed amount that they would need to handle their final expenses if they don't have resources to handle it (like savings or 401k).” Jeff Root from Rootfin Insurance Blog “If you're nearing retirement and getting close to living on a fixed income, you no longer need that much term coverage and you should decide if permanent life insurance (whole life, indexed universal, guaranteed universal life, final expense) is needed. Will you need life insurance to cover any final expenses? Will you need life insurance for estate planning purposes? Then go from there.” Daniel Ray, National Independent Life Insurance Agent and Owner of PinnacleQuote Life Insurance Specialists “PROS: Small and affordable whole life policy to cover final expenses. CONS: Usually policies are between $2,000–$40,000, and are geared for seniors. But are limited to the coverage amount.” Back to List What kind of life insurance should I buy? Key Takeaway: Consider these questions to help you buy a policy that meets your needs. Why are you buying life insurance? How much money would your family need to replace the work you do? What can you afford to spend on monthly premiums? In what ways will your life insurance needs change over time? “More important than what kind of life insurance you should get, is how much insurance you should have. I’ve never heard a widow ask me what type of life insurance her husband had; her concern is always how much did he have,” says Hemry. Fortunately, many life insurance needs calculators are available online, which makes determining your coverage needs easy. “If you find yourself getting bogged down with all of the various calculators and different formulas used then take a step back and just ask yourself this question, "What is the absolute minimum amount of money that my loved ones would need if I passed away to not have to worry about money, not have to change their lifestyle or dreams, and not have to get a new job?" Now double it,” says Ohman. Once you’ve gotten a number, think about the pros and cons of each policy type and what your specific needs are. “For every type of insurance product available, it is the right thing for some people and wrong for others. I suggest you think about it this way: Use term insurance for short term needs and more permanent insurance for long term needs. For example, term insurance fits well to cover debt that you do not want to leave to your family such as a mortgage. Purchase term insurance that ends when the mortgage ends. Use more permanent insurance for expenses that will not go away, such as funeral expenses, other final expenses and income needed for the people you leave behind,” says Nancy D. Butler, CFP ® , CDFA ™, CLTC, and owner of Above All Else, Success in Life and Business ®. Remember that while term life insurance policies have an expiration date, some can last as long as 30 years. If the policy includes a guaranteed renewability or term conversion rider, you can extend the coverage longer. “Term life insurance is the best choice for most people, especially those in their younger years looking for a pure protection product. Permanent life insurance and other products with an investment vehicle attached rarely payout the same dividends someone could achieve by opting for term insurance and making some modest investments with the money they save,” says Cluett. Permanent life insurance policies can be advantageous because they accrue cash value that it not subject to income taxes and can be accessed while the insured is still living. “Permanent policies are used when the need for protection or capital will extend into well into the future.It’s often used in wealth transfer strategies, business planning situations, and where the need for income replacement extends beyond the dependency years of the children,” advises Best. However, permanent life insurance policies are more complex and some are affected by the stock market, which can make them harder to understand. “Within each of these sub-categories of permanent life insurance are a multitude of variations of each. The universe of different types of life insurance products is vast, and should be explored with your specific circumstances in mind along with the guidance of a qualified, and preferably, independent life insurance professional,” adds Best. What questions should I ask? Daniel Ray, National Independent Life Insurance Agent and Owner of PinnacleQuote Life Insurance Specialists “The questions you should ask when purchasing life insurance are What do I need to protect and for how long (Term Life)? Is it safer to overfund a permanent life policy rather than be limited with contributions to an IRA/401k? (Whole Life/Variable/IUL) Will my savings cover my funeral? Will my family have a financial burden when I pass? (Burial Policy/Final Expense)” Nancy D. Butler, CFP ® , CDFA ™, CLTC, and owner of Above All Else, Success in Life and Business ® “How much do I need? What type(s) are appropriate? With Universal and Variable Life you need to know what interest rate the agent used when running the illustration to determine what the premium will be. If they use a rate that is too high, you run the risk of losing the policy in later years unless you substantially increase the premiums. I recommend a reasonable rate of return to use in an illustration today is 6 percent or less. High returns going forward are of course, not guaranteed regardless of past performance.” Taking these questions and expert tips into consideration will help you make a smart life insurance decision for yourself and your family and friends. Your decision will offer peace of mind and financial security for your beneficiaries. Looking for more tips? Check out some good advice and bad advice that people have received. Ready to start looking at companies? Check out Best Company’s top-ranked life insurers.