If You Want to Get the BEST Life Insurance Policy - I've Got Some Advice
If you want to get the BEST Life Insurance Policy possible, then I have a few words of advice for you.
The internet is a terrific source of information. Virtually anything you want to know is at your finger tips, which makes shopping much easier…in some ways.
But unfortunately there is a lot of inconsistency. Some articles are better than others and the amount of data available is staggering. So much so that Clients often get lost in it all and give up.
That’s why I started the Policy Architects blog, because I wanted to provide a one stop shop for user friendly advice that helps you save money, time and hassle. So I am sharing my top tips for you to get the BEST Life Insurance Policy…affordably.
What is a Life Insurance Policy?
Life insurance has a VERY long history. It was originally created in 100 BC in Rome to cover burial costs. Burial clubs were the brainchild of Caius Marius and were founded to help the widows and families take care of their end of life obligations.
Life insurance is a contract between the policyholder (the person who buys the coverage) and a life insurance company.
In a nutshell, you pay premiums (payments for coverage)to the life insurance company to cover you over a period of time (term). In return they payout your beneficiaries an agreed to sum (face value) should you die while the coverage is in force.
Now there are two types of life insurance. Term, which is temporary coverage for a period of financial vulnerability. There is no guarantee that your beneficiaries get a payout which makes this type of policy much more affordable. Typical terms are 10, 20 and 30 years.
The second type of coverage is permanent. This is coverage until the day you die and it typically has a cash value component. For obvious reasons this a much more expensive form of life insurance.
The beautiful thing about life insurance is that it provides options for your loved ones. It doesn’t even have to be a large policy to make a big difference in their lives.
After Selecting Your Coverage You Typically Answer Questions & Take a Medical Exam
Traditionally underwritten policies (both permanent and term) require a medical exam. What typically happens is a client comes to me and we go through their finances, goals and the products.
During this meeting I ask them a battery of questions to see what sort of coverage and company fits them best.
Then we set up an appointment for a medical exam.
The results of the tests are sent to the insurer’s underwriting department along with the information I gather. Based on this date, the underwriter issues a rating which determines how much the policyholder pays monthly, yearly or in a lump sum.
When all of this has been settled and you are ready to accept the company’s offer you receive the life insurance policy in the mail.
Please note: You can get no exam medical insurance. But please be aware that it will cost you more. Life insurance is all about assessing risk. The more an insurer knows about you the cheaper your premiums are.
5 Tips to Get the BEST Life Insurance Policy Today
Always Work With An Independent Life Insurance Agent
If you are looking for the best life insurance policy, always seek the services of a GREAT independent life insurance agent…
…and BEFORE you get started NO this is not a self serving piece of advice. Even if I wasn’t an independent life insurance agent I would tell my own family to do this.
Because we have access to the top life insurance companies in Canada AND know the ins and outs of the underwriting processes of each insurer.
This is important because not all life insurance companies are created equal. If you have someone in your corner that understands the niches, you save a lot of time, money and hassle.
If you go to a tied agent (someone who works only for the insurer that employs them) then you only get quotes for the products they sell. This is a costly misstep that can costs you thousands more over the course of your term.
Don't Get Lured Into No Medical Exam Life Insurance Unless You Are in Poor Health or Want a Final Expense Policy
Simply put, the more a life insurance company knows about you the better when it comes to your health. Life insurance is an industry based on risk assessment. The closer you are to death, the more it costs to insure you.
That said, if you skip the medical exam you’re thrown into a pool with high risk cases which means you will absolutely pay more….
….unless you have serious medical issues.
One other caveat, final expense insurance doesn’t require a medical exam and is very affordable. Especially for those in their elder years who are bound to have some health issues.
Buyer beware there are two different types of no medical coverage:
- Simplified Issue: You are asked a batter of questions that determine your premiums. This is the most affordable type of no medical coverage.
- Guaranteed Issue: This is coverage that anyone can get which means Ii’s also the most costly. Please note, there is a two year waiting period to get a pay out. Which means if you are gravely ill and die before that period is up your beneficiaries will only get your premiums back.
Smoking is deadly and underwriters KNOW this. That’s why you pay almost twice the amount a non-smoker does for life insurance coverage.
So cut it out! It’s simply not worth it.
If you are a smoker, do give up hope. You can embark on a smoking cessation program and reapply for non smoking rates once you’ve been smoke free for 12 months.
My best advice is to speak to your general physician and let them know you quit smoking so you have a solid source to bak you up when you reapply.
Don't Put Off Coverage
If you are looking for the best life insurance policy, get on it TODAY. Waiting doesn’t ever help people and in fact it usually turns into an endless cycle.
I have heard it all:
I’m applying when I lose 10 lbs, when I get more fit, when I quit smoking, maybe next year!
The fact remains, it’s never going to feel like the right time to get life insurance. There are 1 million excuses you can employ.
Sadly I have seen clients procrastinate themselves right into more expensive premiums OR no insurance at all.
Do it today! Most people are much healthier than they think.
Avoid Permanent Coverage UNLESS It's a Great Fit
Permanent life insurance is expensive AND it can be complicated. If you are looking for the best life insurance policy then you need to know that term coverage works for most people, most of the time.
That’s not to say that permanent coverage doesn’t have its place because it does. Here are situations where this type of insurance works a charm:
- You have a large estate and are worried about your kids having to foot a large tax bill
- Business interests are a big concern. You want to make sure the business continues after your demise and/or have employees or partners to consider.
- You have a child with special needs and require funds to make their lives run smoothly after you die.
- Final expenses. You want to make sure they are covered and your loved ones don’t have to worry about it.
- You have a cottage and you don’t want your family have to sell it to pay the taxes.
Anyway you get the picture. Permanent coverage is for people with expendable income. If you are simply looking for protection during your most vulnerable years then term is the most flexible and affordable option.
Don't Underinsure Yourself
No one wants to buy life insurance. It’s an expense that isn’t all that inspiring BUT honestly it’s one of the most loving things you can do for your family.
Loss of an income is serious and things unravel fast. Debts don’t go away but when a salary vanishes it often sends your loved ones into a financial tailspin they never recover from.
To keep that from happening you really need to crunch the numbers. We suggest 7 – 10 times your salary to keep you going. For example if you make $60K per year I would suggest $600K in life insurance. While this may sound like a lot of cash, it disappears quickly.
Pick the RIGHT Beneficiary & Update The Information Yearly
Selecting the right beneficiary is very important. So please do not pick out a minor without assigning a trustee to manage the cash.
If you do, your kids won’t have any access to the funds until they turn 18 which I am sure is not the intention.
It’s also important to remember to update the information. Circumstances change, people die and move. Trust me you don’t want to the insurance company to be responsible for tracking down your beneficiary. This results in delays and sometimes even a payout that is never made.
Get the BEST Life Insurance Policy NOW!
If you want to get the best life insurance policy then you need to call Policy Architects TODAY!
We have access to the top Canadian Life Insurance companies and want to help you find the perfect fit for your unique circumstances.
If you are reading my blog posts you know that not all insurers are created equal. To save money, time and frustration you need to speak to a knowledgable independent agent who gets all the ins and outs of this very complicated business.
A perfect fit may save you 10’s of thousands of dollars over your term. That’s some serious cash.
So why not speak to an agent that really cares and wants you to be a client for life. Call us NOW.