Are You Really Buying Cheap Term Life Insurance?
You must have seen some promotions for term life insurance companies. They usually show a happy and smiling couple who just got a great deal on a new policy. The rates are usually very low. Are these real deals you can make for yourself, or should you look into this further? Consider a few questions that you should ask before you buy.
Some policies have a conversion feature. This means you can change your mind before the term ends and switch to whole life. You may not think you want that know, when you are younger, but it is hard to predict the future. After your policy expires, you will be older and, possibly, harder to cover. It may be prudent to keep your options open.
Some term policies have a handy option so you can convert them to permanent policies, like whole life, before the term expires without having to go through another medical exam or health questions. This option leaves your options open. You have left the door open so you can decide to buy permanent coverage before your term coverage expires.
So be sure and find out if the term policy that you are comparing comes with this feature.
Sometimes the premium that is advertised is only for the most select rate class that an insurer offers. It is valid to wonder if that is the quote that you will get. You need a very good health record, no bad health habits, a perfect weight and height match, etc. to get into this select class. Most people do not qualify, but have to pay a bit more.
These ads can be deceptive, and sometimes you may get quoted a higher figure by an agent. He or she is just being honest because he or she has your actual health history in hand. You cannot assume that the rates you see advertised for some perfect and fictional person on the TV will be the rates that you will have to pay.
Are the premium rates level for the whole time? Most of the time we assume that the price will stay the same for the whole period of the contract. But some policies are quoted with rates that are only guaranteed for 5 years! This means you could be surprised by a price increase in five years, and then another one in ten years!
Again, be sure and find out if the rates will be guaranteed for the whole term.
In addition, understand that the price will go up for longer terms. If you get quotes for 20 and 30 year policies, for example, the longer term will cost more! Make sure you are comparing the same term lengths in order to judge the price. It is probably obvious that insurers will charge more to take a longer risk.
These questions are just to help you become an informed consumer. Most of you can still find a great deal on a cheap term life insurance policy to provide security for your family! We just want to help you understand what you are buying so you can make the most of your premium dollars.
by: Carl Mason