Are you shopping for life insurance, but not sure what you need or what options are even available? Most of us shop for life insurance even less often than shopping for a new home. While life insurance is not complex, there are a lot of choices and making the wrong decision can be disastrous because you may not know it was the wrong decision until it’s too late to correct. In this article we show you how to shop for life insurance so that you can get the best value for your budget.
The first step in finding the right insurance coverage for you is to find a competent, experienced life insurance agent that has your best interest in mind. Life insurance products, and life insurance agents are strictly regulated by the state in which you live or the state in which you are purchasing life insurance. For example, if you are a New York resident but spend time in Florida then whichever state you are in physically when you sign your policy is the state that regulates that transaction. So, the insurance agent must be licensed in the state he or she is doing business. They should also be experienced enough to talk with you about how to shop for life insurance.
It’s also important to understand that all life insurance agents must represent the insurance company when offering a policy. In fact, the insurance agent, their professional opinion and observations are the first step in the insurance underwriting process. However, the right insurance agent will have your best interest in mind when they offer you a policy. The most important thing to know about your insurance agent is whether they are a captured agent or an independent.
Captured or Independent? What Does That Mean?
In general, life insurance agents will be either a captured agent or an independent agent. Many of the big name insurers that do a lot of advertising have a team of captured agents. These agents are employees of the insurance company and can only offer you the products of that company. Often, new insurance agents work as a captive agent early in their careers in order to get training and education. Some eventually move on to become an independent agent. It doesn’t matter if the captured agent knows that their policy is more expensive, if it has features you don’t need or is missing features you do need; the captured agent can only show and advise you on the policies of the company he or she works for. Period. Conversely, the independent agent is not tied to any particular insurance company. These agents can have the policies of dozens of the top insurers at their fingertip. Once they have an understanding of your needs, they can then match up the best policy at the best price for you. That is a big difference and it is important because the various insurance companies can charge wildly different prices for the exact same coverage.
A good independent insurance agent will also be transparent and discuss with you how to shop for life insurance. They should have no qualms about showing the prices offered by multiple insurers so that you can be confident you are getting the best value. One caveat; transparency is simple when referring to different types of term insurance. However, the variables involved in illustrations of permanent / cash value insurance can make complete transparency cumbersome.
For an example of what we at Shield Insurance Solutions show our clients when they request a quote on term insurance please click here: Sample Term Insurance Quotes. Note; in this sample of a 40-year old male, that for the exact same policy the price varies from $629 to $ 1,480 per year!
If you don’t seek the help of a qualified, experienced independent agent, you will need to do a lot of leg work on your own to be confident you find the right policy at the right price. Any insurance agent should be able to help you find out how much coverage you need (for more on that see our Blog post The Seven Most Common Mistakes Made When Calculating Life Insurance Needs). But, even that process can be confusing.
Independent Agent Does Not Mean All Alone
It may also be comforting to know that just because your life insurance agent is independent, does not mean they are all alone. Back in the 1980s and 1990s the independent insurance agent had to have developed their own network of experts they could lean on, and every insurance quote meant calling each different company they work with and requesting a faxed quote. Thankfully, in the last ten years the insurance industry has changed and your independent agent can have a team of advisors on contract, and getting multiple quotes at one time is simply a matter of software. An experianced independant agent will share the different benefits and drawbacks of the various types of insurance such as term insurance, whole life insurance, universal life insurance as well as fixed versus variable option. They will discuss with you how to shop for life insurance. Once you are comfortable with the right type or types of insurance that will fullfill your needs, the agent can search multiple insurers to be certain you get the best value and best life insurance rates. Shield Insurance Solutions is independent, but we have a team of over 40 professionals working with us. These professionals include attorneys and advisors with specialties in every aspect of the insurance industry.
The bottom line: shopping for the right life insurance can be a daunting task. If you are not aware of all the options available to you, how much you need and the pros and cons of term versus permanent coverage, or which insurance companies have living benefit life insurance options and which do not, then the odds are against your finding the right policy at the best price. A competent, experienced independent agent can do the shopping for you and provide you with the best alternatives and prices so you can make an informed decision.
Let us do the shopping for you. Shield Insurance Solutions is independent. Our goal is to find the best insurance company and policy for you. We specialize in living benefit life insurance and work with nearly 100 different insurance companies in order to find the right policy at the right value for you. We are transparent and have been in the financial services industry since 1984. Our life products include Whole Life, Universal Life and Term Insurance and mortgage protection insurance. As independent agents, we work hard to find the best life insurance company for you, with the best life insurance rates and value. We are based in Jupiter and Palm Beach Florida and licensed in almost every state. If you are shopping for a life insurance quote, we can show you what many of the top insurance companies will offer. The price differences will amaze you. Visit www.ShieldInsuranceSolutions.com to get a free life insurance quote comparison, or call us at (800) 847-9680.