How to Compare Life Insurance Companies

You’ve finally decided that it’s time to get a life insurance plan. That’s the first step. Now it’s time to choose a company. You don’t have to settle for the first company that you receive a letter from, nor should you. There are many insurance companies that offer life insurance policies, and no two companies are the same. When taking out life insurance, it’s imperative that you get quotes from different insurance companies. Here’s how to compare the companies so you get the best policy to meet the needs of you and your family.

Financial Solidity

One of the biggest factors to consider when choosing a life insurance company is its financial stability. You want to make sure that any company you choose has financial strength and stability. The company should still be there to pay your beneficiary, no matter if you pass in 10 years or 30 years. You can easily look up information on financial strength, and find out how stable any given insurance company is. There are numerous independent rating companies such as A.M. Best, Fitch Ratings, and Standard and Poor’s Ratings Services. Each company has its own rating system, so make sure you pay attention to them.

It’s also important to keep in mind that the size of a company doesn’t necessarily correspond to its stability. Sure, there are many large, well-known, companies that have been around for over 100 years. There are also plenty of smaller companies that have been around for just as long, and are just stable.

Check the Company’s Track Record

You should learn about the company’s track record for taking care of its customers and how well it makes good on its promises. You can do this by checking with your state insurance department. These departments keep track of complaints and investigate them. In many cases, these departments will also publish reports on their websites, showing visitors how many complaints there are against different insurance companies in comparison to their total number of customers. You can also check with the National Association of Insurance Commissioners for financial information, complaints, and licensing.

The Products Offered

Your life insurance policy should meet your specific needs. Not everyone has the same needs, so a one-size-fits-all policy most likely won’t give you exactly what is right for your family. Make sure that the company provides a diverse line of products and features. This will allow you to tailor your policy to provide your family with the best protection possible.

Are Conversion Options Available?

Some insurance companies offer conversion options. This means that even if you start out with a term life insurance policy, which many people do, you have the option to convert that policy into a permanent policy, such as whole life or universal life, later on. A conversion option is important because it allows you to change your policy without having to take another medical exam or re-qualify for insurance.  

Use the Same Information for Each Quote

In order to get the most accurate quote from each insurance company, it’s important that you use the same information for each company. This includes your age, the amount of insurance coverage you need, and the type of policy and features you want. Premiums can vary widely from one insurance company to the next, so it’s important that the information you provide is consistent.

Life insurance is a long-term investment that you buy to provide protection for the ones you love most. You want to make sure you’re getting the best policy for the best price possible. Even after purchasing your plan, it’s important to remember that things will change over time. Your life insurance policy should always meet your needs. Reassess your policy every few years to make sure that your plan always works for you.

Adam Hansen

Adam is a part time journalist, entrepreneur, investor and father.