We have worked with thousands of clients from all over the country. Not every one is a life insurance expert. From the first time purchaser to more experienced customers we have heard it all.
This is a list of our most frequently asked questions. Many of them weekly if not every single day.
Have a question of your own that is not listed? Need to dive deeper into one that is? We are standing by. Talk to you soon!
TermLifeInsuranceBrokers Most Frequently Asked Questions
What is life insurance?
Life insurance is a private contract between an insured (you) and a life insurance company. In exchange for your premium payment, the company agrees to pay the benefit when you die.
What type of life insurance is the best?
There are a lot of life insurance options out there. Many have debated this for decades. This one is impossible to give a generic answer. Term and Whole Life both have a place in the market. It depends entirely on what your needs are. If you have a temporary coverage need term is cheaper and often the better choice. If you need coverage for the rest of your life whole life or universal life is better suited to address that.
How much life insurance do I even need? 10X my salary?
This is a very common “rule of thumb” for life insurance coverage made popular by folks like Dave Ramsey or Suze Orman. Rather than getting into details, they throw out this blanket rule.
This can be a fine starting point for many, but for a more thorough calculation, many professionals use the D.I.M.E approach. It dives deeper into your situation to help make sure you are adequately covered. We are all unique and our financial needs are as well.
What is the best company to use?
Is there ever really a single “best” for everything? Nope, life insurance is no different.
The best company will be completely based on your needs and wants. Most of the time even husbands and wives will have separate companies even when applying at the same time.
Thing like health history and tobacco use can have a drastic effect on rates from one carrier to the next.
I have life insurance at work, why not just stick with that?
That is great that you have that option. We always walk through those options with our clients. When it is priced well and easy to get we usually recommend you get what you can there.
There are a few things to consider though using employer coverage as your only protection.
What type of insurance do they offer? Term, whole life, accidental death? It is important to know.
What underwriting do they require? Blood tests and exams? Or is it automatic?
Is there a limit to how much they will issue? Many plans allow you to get up to a multiple of your income. 4 as a max is pretty common. That is often not nearly enough.
What are your options if you leave or get terminated? That is probably the most important of all the things to look at. If you are laid off or leave your employer are you at risk of losing your coverage? This can be particularly dangerous as many companies will limit your options for applying for a new policy while you are unemployed. Yikes!
And can you keep it when you retire? Does the price stay the same? Often times it will skyrocket. I have even seen the cost quadruple while the policy amount is cut in half! Thanks for all your years of service.
How does my lifestyle change my rates?
That can be good or bad, lol. Depends on what you are up to.
Are you a health nut that is at the gym 5 times a week? That can have positive impact on rates. You are likely in great shape and have the blood pressure and cholesterol to prove it.
Do you do extreme sports? Skydive? Auto race? SCUBA? Rock climb? Those can all be a wild card. Each one is insurable but the details will be very important to disclose and discuss with your agent. It can be the difference between a great price or declined!
Have a dangerous job? Often times when someone asks about their occupation it is not a big deal, but if you are a S.W.A.T member or have other high risk we need to know.
Can I buy a policy for (insert relationship here)?
There are many times that you can get a policy on someone else. It is not uncommon for a parent to buy a policy for their children. Or even an adult child to insure an aging parent.
Buy Sell agreements are common in the business world where partners will buy a policy on each other to protect themselves.
The key here is that we cannot do anything shady. The other party has to both be aware of the purchase as well as participate in the approval process.
There will have to be an insurable interest and financial risk to you. You have no financial loss if the clerk at the store were to die. You would not be able to just get a random policy on them. Keep your risk in mind.
What is a rider?
Riders are ways that you can alter the base contract. It is kind of like customizing your policy to fit you.
Not every policy owner will want or need to cover children. A child rider can be added for an additional cost for those that do.
Common riders are waiver of premium, child rider, and accidental death. These are usually available at an increase to the premium.
What about FLO and her home and auto bundle?
This comes up all the time. Your home and auto agent starts planting the seed that you need some coverage, so you start to do some research.
Good for them for getting the wheels turning in your head, but lets talk about that bundle.
It is actually not legal to discount life insurance. So that bundle that you are getting is actually discounting the other lines. Who cares it is still a deal right? Well probably not. Most of the time the life insurance is going to cost more per thousand than using a broker. And guess what you can’t move later when your rates go up? That is right the life insurance. You would have to start all over again! Blood and urine? You are now older. What if you had a health scare? You might not even get approved somewhere else now.
We suggest you get the best policy for the best price outside the bundle for this reason. You won’t be stuck later if you decide you want to shop for better rates.
I have been declined before can I get a policy?
A lot of the time YES!
We have a lot of experience with high risk or previously declined clients.
Reach out to us to discuss the details. We have connections with the Underwriters to get you a solid offer even with ongoing issues.