Shopping for a life insurance policy is not something that anyone ever really looks forward to doing – but despite this, it is a necessary part of life for a variety of different reasons.
Life insurance protects your family and loved ones financially should something happen to you; and now it has become more uncomplicated and affordable than ever before.
Longer life expectancies have contributed to a decrease in life insurance premiums, making this vital product absolutely affordable to people of every income level.
Before you take out a life insurance policy, you should spend some time researching different companies and what they have to offer as well as the different types of policies that are available right now, since there are quite a variety of different types.
A February 20, 2007 article by The Insurance Information Institute, “I.I.I. offers tips to make shopping for life insurance simple and easy,” discusses some things that consumers should keep in mind when picking out a policy that best suits their individual needs.
One of the most important things to do when shopping is to find a company that is in good financial standing and has an overall favorable status in the community, or nationwide.
“Technology and a highly competitive marketplace have made it easier than ever for consumers to shop around for the right life insurance company, according to the Insurance Information Institute (I.I.I.).”
“‘The goal is to find a financially stable company with a solid reputation for consumer service,’ said Dr. Steven Weisbart, a vice president and economist at the I.I.I. ‘With hundreds of insurers offering policies, life insurance is a highly competitive business so consumers have a number of companies and policies to choose from.’”
Once you have narrowed down your search for the right company, to a few outstanding companies, you can begin to see which policy would work best.
The I.I.I. expects premiums on certain policies to drop 4 percent this year, so you probably couldn’t have picked a better time to be shopping for a policy.
“The I.I.I. estimates that, for example, the annual premium for a 40-year-old male nonsmoker buying a $500,000 20-year level term life insurance policy in 2007 will be $615 if he qualifies as a ‘standard’ risk and $340 if he meets the more stringent requirements of a ‘preferred’ risk. For groups such as women and younger people, premiums would be even lower still. And for people who buy sufficiently large amounts of insurance, the rate per $1000 of insurance will be lower. For example, buying twice as much coverage will increase the premium but by less than double.”
The I.I.I. says that there are a couple of criteria to keep in mind when shopping for a policy in order to ensure the most favorable situation for you and your loved ones. The criteria they recommend focusing on is: Price, personal budget, insurer stability and insurer customer service.
When you first begin talking to different companies you will get a good feel of the latter two criteria just by talking to a few agents.
If you already have an existing policy in place, be sure that you review it at least every year, since certain life changes can prompt some changes to be made in your policy that you may not initially realize. “‘Lifestyle changes such as marriage, divorce, the birth or adoption of a child and even starting a business may alter your life insurance needs. Let your insurance agent or company representative know about these changes and make sure that they are properly reflected in your life insurance coverage,’ Dr. Weisbart concluded.”
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