How to Buy Life Insurance
Before you buy a policy, compare rates, choose a trustworthy agent, and more.
When choosing a life insurance policy, it pays to learn about the different types of insurance available, shop for the best rate, choose an agent wisely, and check the reliability of your insurance company.
Learn About Different Types of Insurance Policies
The first step is to learn about the basic types of life insurance policies -- term life insurance versus whole life insurance, for example. For a discussion of the different kinds of life insurance, see Life Insurance Options.
Getting the Best Rate
The cost of the same coverage can vary considerably from company to company. Often, relatively small mutual companies charge lower rates than some of the giants of TV advertising, and some brokers charge lower, "discount" commissions.
To compare rates, start by visiting one of the following free life insurance rate shopping services online:
These websites don't cover every major insurance company, but they're a good place to start. Also, a website may offer quotes for only one type of insurance product. Generally, you should look at various types in order to make an informed decision.
Choosing an Insurance Salesperson
Once you've picked out a policy, you can buy it directly from the company or through an insurance salesperson or broker. The cost will be the same, but it may be helpful to get some information from a local agent.
Salesperson v. broker. Normally, a salesperson sells for one company only, while a broker can place your policy with one of several. In theory, this would seem to be a reason to prefer a broker, but in practice, the integrity of the person you are dealing with is far more important than is the legal relationship to an insurance company or companies. Look for a person who will function as an ally, offering additional information and proposing alternatives -- not forcing you to buy a product. If you get too much quick-sell pressure, contact someone else.
|
