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Another Six Secrets and Tips for Buying Life Insurance

Secret # 1: Don't forget about customer service.

Most people who buy insurance focus on the companies with the lowest price and the best financial score. Unfortunately, I know of some A + rated businesses with low rates that I wouldn't hit with a ten foot post just because it's easier to give birth to a porcupine upside down, so that's for get customer service from them.

Before I figured this out, I used a life insurance company that offered a customer a great rate, but 2 years later the customer called me and said, “I sent all my payments on time but I just received a notice that my policy has lapsed. It turned out that the company had made numerous back office mistakes and lost the premium payment!

We were able to fix it because we detected the issue so early. But if the client had died during the short time that the policy had expired, his family might have struggled to prove that the premium was paid on time and they might not have received the money from life insurance - a loss of hundreds of dollars. thousands of dollars in this case.

Secret # 2: Apply 3 to 6 months before you need the insurance, if possible.

Don't be in a rush to get a policy if you already have coverage in place. But don't hesitate and apply right away knowing that you might need several months to shop around if the first company doesn't give you a good rate. Even though the life insurance industry is increasingly automated, your application will often be put on hold for weeks or months while the insurance company waits for your doctor to mail them a copy of your medical records. .

If you're in a rush and buy a quick no-underwrite policy without going through the full health checks and underwriting that a traditional life insurance company requires, you'll end up paying 20% ​​to 50% more because the company insurance will do this automatically. charge you higher rates because they don't know if you are healthy or about to die the next day.

Secret # 3: Avoid purchasing extra life insurance through work if you are in good health.

I'm sure there are exceptions to this "trick" but I've rarely found one. By all means, keep the free life insurance offered by your employer. But if you're healthy and paying for supplemental life insurance through payroll deductions, you're almost certainly paying too much. What happens is that your "overpayments" end up subsidizing the unhealthy people in your business who buy life insurance through payroll deductions.
Usually the life insurance company has made a deal with your employer and will forgo the required health exam for all employees - instead, they just average the price for all employees and offer one or two tariffs for men or women at a given age. Life insurance companies know that they are going to take a lot of unhealthy clients this way, so they jack up the price on everyone so that healthy people end up paying too much for employees to pay too much. poor health get a cheaper policy. Plus, unlike the guaranteed life policies we recommend, most life insurance policies you buy at work will become more expensive as you get older.

Additionally, group life insurance is generally not transferable when you retire or change jobs, which means when you retire or change jobs, you may need to reapply. , although you will be older and probably not as healthy and risk being turned down for a policy. While the group plan allows for portability, it usually limits your conversion choices and requires you to commit to expensive cash value plans.

I remember helping someone assess their supplemental life insurance. He was sure it was a better deal than any policy I could find him. Didn't he know that the price of his group plan would increase every year? By the time he retired, his premium would have risen to over $ 10,000 per year. I found him a policy of about $ 1000 / year that would never increase. Plus, unlike his old group life insurance policy, he could take the individual policy with him when he changed jobs or retired.

Secret # 4: Make a trial application on a COD payment basis.

Only send money with the application if you need life insurance coverage immediately. Sending a check with the app is a traditional practice for agents - I think mostly because it allowed them to get their commissions faster. If you send money with an app you usually get temporary coverage right away, but if you already have enough coverage and are just trying to get better rates, ask your agent to request a trial. on a COD basis so you only pay once the policy is approved. . If you don't send money and die before you pay off the policy, there is no coverage.

Secret # 5: Wear your shoes when the nurse measures your height.

When the insurance company sends the nurse to do your checkup, try to be as tall as possible if you are overweight? In most states you are allowed to wear shoes and if you are a little overweight your taller height-to-weight ratio will be a little better for the underwriter who determines your health score and the price of your policy. Also do your exam early in the morning without food - this will improve your cholesterol levels and various health ratios.

Secret # 6: Be careful with the perks and extra jumpers.

Most policies have options such as accidental death benefit, children's riders, disability riders, return of premiums, etc. Life insurance companies are looking to make money and these endorsements are usually cost effective because they cover something that rarely happens or they are so strict that benefits are never paid. Keep it simple and focus primarily on getting a life insurance policy to cover your life without too many conditions. Again, a good agent can help you assess the benefits of additional jumpers. But beware of an agent trying to tack on all the extra jumpers possible.